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Energy and Greenhouse Gas Management

Having been successively awarded the ISO 14001 Environmental Management Systems, ISO 45001 Occupational Health and Safety Management Systems, and ISO 50001 Energy Management Systems certifications since 1997, we continue to make improvements to our manufacturing processes, implement pollution control measures, reduce energy consumption, eliminate hazards, and minimize occupation accidents using the PDCA approach. Moreover, we control our impact on the environment using knowledge tools and technologies to achieve a balance between the environment, society, and the economy, as well as implement green and sustainable development to meet stakeholders’ expectations. CSCC’s management and implementation of environmental, safety, and energy systems are detailed as follows:

Every week Factory affairs meetings The heads of manufacturing departments discuss environmental, safety, health, and energy issues and the progress of improvements made with the heads of various departments and first-line workers
Every week Business management meetings The President discusses environmental, safety, health, and energy issues with the heads of various departments and first-line workers, reviews the implementation outcomes, and adjusts the relevant approaches in a timely manner
Every quarter Occupational Safety and Health Committee
Every year Environment, safety and health management system review meetings
Every month Carbon reduction meeting The President discusses energy-saving plans, reviews carbon reduction achievements with the heads of various departments and first-line workers, adjusts the relevant approaches in a timely manner

SDG

Performance highlights in 2025

  • Completed 25 energy-saving projects, reducing CO2e by a total of 1,820 tons.
  • The average energy-saving rate for the entire company is 1.73%

Significance to CSCC

We implement energy management, collect information on financial impact that can assist in decision-making and is forward-looking, and help stakeholders understand the risks and opportunities involved in our move towards energy conservation and carbon reduction and the transition to a low-carbon economy.

Goals

Short-term goals
(2026)		 Medium-term goals
(2027～2030)		 Long-term goals
(2031 and beyond)
  • Reduce greenhouse gas emissions by 2% annually, based on the 2022 base year for Category 1 and Category 2 carbon emissions
  • Greenhouse gas emissions have been inventoried in accordance with the ISO 14064-1:2018 standard
  • Complete carbon footprint verification for major products based on customer needs
  • Provide guidance to Changzhou China Steel for completing the greenhouse gas inventory and verification
  • Install solar photovoltaic systems at the Carbon Chemical Manufacturing Department in line with expansion projects
  • Application for voluntary carbon reduction programs in line with policy guidance, including the planning and implementation of carbon reduction measures to obtain preferential carbon fee rates or carbon reduction credits
  • Reduce greenhouse gas emissions by 3% annually, based on the 2018 base year for Category 1 and 2 carbon emissions
  • Conduct annual GHG inventories in accordance with Ministry of Environment guidelines and Financial Supervisory Commission requirements, using the GHG Protocol
  • Complete carbon footprint verification for major products based on customer needs
  • Provide guidance to Changzhou Zhongtan for independently completing its GHG inventory
  • Procurement of green electricity as needed to offset carbon reduction gaps
  • Install solar photovoltaic systems at the Carbon Chemical Manufacturing Department in line with expansion projects
  • Implementation of voluntary carbon reduction programs to continually execute carbon reduction measures, ensuring compliance with program objectives
  • Reduce Category 1 and Category 2 greenhouse gas emissions from the 2022 base year by 3.5% annually in 2031-2032 and by 4% annually from 2033 onward, gradually progressing toward carbon neutrality by 2050
  • Purchase green electricity and carbon credits as needed to reduce carbon emissions, thereby addressing the carbon reduction gap and aligning with national reduction targets.
  • Install so lar photovoltaic systems at the Carbon Chemical Manufacturing Department in line with expansion projects
  • Completion of voluntary carbon reduction programs, followed by implementation of subsequent carbon reduction projects in accordance with policy directives

Management strategies

Continue to reference the best available technologies adopted by international peers to refine energy-saving programs at the production plants. With reference to the IFRS S2 framework, disclose information on governance, strategy, risk management, metrics, and targets related to climate-related risks and opportunities

Resources invested and implementation outcomes

Kindly refer to Annual ESG Plan and Implementation Outcomes in this Report for more details.

Energy Consumption

In the wake of climate change, coping with climate disasters has become a critical issue for business operations in recent years. After formulating our short-, medium-, and long-term ESG goals in 2021, we have not only established our greenhouse gas inventory plan and annual reduction targets and schedule in response to climate change and carbon neutrality, but also completed a carbon footprint inventory of our major products. The implementation progress is reported to the Board of Directors on a regular basis for tracking and evaluation.

In 2025, with reference to the IFRS S2 framework, the Company disclosed information on governance, strategy, risk management, metrics, and targets related to climate-related risks and opportunities. The Company established a voluntary climate-related financial disclosure system to collect information on financial impact that can assist in decision-making and is forward-looking, so that our stakeholders can understand the risks and opportunities involved in our move towards energy conservation and carbon reduction and the transition to a low-carbon economy. We also completed a risk matrix assessment and introduced a climate governance system.

Our Coal Chemical Manufacturing Department and Carbon Chemical Manufacturing Department conduct an inventory of Categories 1 and 2 greenhouse gas emissions for the previous year on their own each year. Furthermore, Category 3 greenhouse gas emissions have been included in the scope of the inventory according to the ISO 14064:2018 greenhouse gas emissions standards since 2021. A third-party verification body is commissioned to carry out verification of these inventories. CSCC (Operations Headquarters, Coal Chemical Manufacturing Department, and Carbon Chemical Manufacturing Department)'s energy consumption situation for the last three years is detailed as follows:

CSCC's energy consumption situation for the last three years

Item 2023 2024 2025
CSCC Headquarters Electricity (MWh) 203 198 174
Energy consumption (GJ) 730 712 627
Coal Chemical Manufacturing Department Electricity (MWh) 51,578 52,108 41,852
Steam (metric tons) 161,542 158,227 136,941
Coke oven gas (kilostere) 289 0 0
Natural gas (kilostere) 8,024 8,579 7,087
Diesel oil (kL) 340 320 330
Energy consumption (GJ) 998,545 1,005,528 808,075
Production volume (metric tons) 498,167 455,842 434,875
Energy intensity (GJ per ton of products) 2.00 2.21 1.86
Total Total energy consumption (GJ) 1,141,183 1,137,852 909,489
Total amount of products (ton) 500,578 457,730 436,377
Total energy intensity (GJ/metric ton of product) 2.28 2.49 2.17
Purchased electricity ratio (%) 99.23 98.94 98.70
Renewable energy ratio (%) 0.77 1.02 1.28
Total self-generated and self-consumed energy 0 0 0
Note:
The heating values used in the calculation of the items above are listed as follows: 1 kWh of electricity = 860 Mcal; 1 metric ton of steam = 674Mcal; 1 kilostere of coke oven gas = 4,200 Mcal; 1 kilostere of natural gas = 8,728 Mcal; 1 kL of diesel oil = 8,636 Mcal; and 1 kilogram of liquefied petroleum gas = 10.97Mcal. The energy usage is based on the calculation data provided by the external procurement unit

CSCC's production volume by product category in 2025 is as follows:(Unit: ton)

We have established the Greenhouse Gas Inventory Management Procedures, which are intended for our greenhouse gas inventory system, in compliance with international greenhouse gas standards such as ISO 14064-1:2006 and domestic rules and regulations related to greenhouse gases such as the Guidelines for Greenhouse Gas Inventory and Registration promulgated by the Environmental Protection Administration, Executive Yuan. We complete our own greenhouse gas inventory on a regular basis each year and register the results on the GHG Emissions Information Platform. With the introduction of the 2018 edition of ISO 14064-1 and the inclusion of other sources of indirect emissions such as employee commuting and transportation in the scope of inventory, CSCC has conducted inventory and verification on a regular basis according to the latest edition of the standards since 2021. The third-party unit, DNV Business Assurance Co., Ltd., is also commissioned to provide third-party verification at a reasonable assurance level, ensuring data validity. The categories of greenhouse gases inventoried based on the Company's (including the Operations Headquarters, Coal Chemical Manufacturing Department, and Carbon Chemical Manufacturing Department) activities, products, and services, as well as their scope of operations are listed as follows:

Category Corresponding activity/ Type of equipment Source of emissions
Category 1 Stationary combustion sources (i.e., stationary combustion of fuels at a facility) Emergency power generators Diesel
Gas boilers Natural gas
Other reheating furnaces Natural gas
Process emission sources (owned or controlled by the organization) QA laboratory Acetylene
Mobile combustion sources (i.e., combustion of fuels in transportation modes owned and controlled by the organization, such as automobiles, trucks, trains, planes, and ships) Engine-powered vehicles (company vehicles) Gasoline and diesel
Fugitive greenhouse gas emission sources (intentional and unintentional emissions) Fugitive emissions from air conditioning systems (use, maintenance, and filling) R410a/R404a/R134a/R22/R32
Company vehicles (use, maintenance, and filling) R134a
Biogas from septic tanks (employee use) CH4
Maintenance and repair WD-40
Fire suppression systems (i.e., fire extinguishers and firefighting equipment) Dry powder (phosphate excluded); CO2
Volatile organic compounds CO2
Category 2 Indirect emissions from input energy sources Power supply from Taiwan Power Company (Taipower) Electricity purchased from Taipower
Steam supply Steam purchased from China Steel Corporation
Category 3 Indirect emissions from transportation Emissions from the transportation of raw materials Fuels
Emissions from the transportation and distribution of the organization's products Fuels
Emissions from employee commuting Fuels
Emissions from business travel Fuels

The Coal Chemical Manufacturing Department uses 2022 as the base year for its GHG inventory. The emission factor for purchased electricity was calculated using the latest electricity emission factor of 0.466 kg CO2e/kWh announced by the Energy Administration, Ministry of Economic Affairs. Emission factors for other energy sources were calculated using energy consumption data and the latest factors announced by the Environmental Protection Administration. In the 2025 GHG inventory, direct GHG emissions (Category 1) and indirect GHG emissions (Category 2) accounted for 31% and 69% of total emissions, respectively. GHG emissions by category over the past three years are as follows:

Year Category 1 Category 2 Total emissions Reference
2023 26,074 metric tons 57,647 metric tons 83,720 metric tons IPCC 2013 Greenhouse Gas Inventory Report
2024 23,323 metric tons 56,756 metric tons 80,079 metric tons IPCC 2013 Greenhouse Gas Inventory Report
2025 16,379 metric tons 36,435 metric tons 52,814 metric tons IPCC 2013 Greenhouse Gas Inventory Report

For the Carbon Chemical Manufacturing Department, the base year for greenhouse gas inventory is 2018, i.e., the year when the first greenhouse gas inventory was conducted, using the year 2022 as the baseline year for the greenhouse gas inventory. The primary type of energy source used in manufacturing processes is electricity, as most of the processes involve the use of non-combustion equipment, with only a few using liquefied petroleum gas as an energy source. In 2025, direct emissions (Category 1) and indirect emissions (Category 2) accounted for 3% and 97% of the total emissions, respectively. Greenhouse gas emissions from each category of emission source at the Carbon Chemical Manufacturing Department for the last three years are detailed as follows:

Year Category 1 Category 2 Total emissions Reference
2023 430 metric tons 18,957 metric tons 19,387 metric tons IPCC 2023 Greenhouse Gas Inventory Report
2024 565 metric tons 16,679 metric tons 17,244 metric tons IPCC 2023 Greenhouse Gas Inventory Report
2025 458 metric tons 12,465 metric tons 12,923 metric tons IPCC 2023 Greenhouse Gas Inventory Report

The Company's subsidiary, Changzhou China Steel New Materials Technology Co., Ltd., is located in Wujin Economic Development Zone, Changzhou, Jiangsu Province. It conducted its first GHG inventory in 2023. All energy consumed in its production processes is electricity. GHG emissions by category over the past three years are as follows:

Year Category 1 Category 2 Total emissions Verification Agency
2023 8.89 metric tons 168.60 metric tons 177.49 metric tons Centre Testing International Group Co., Ltd.
2024 13.49 metric tons 169.97 metric tons 183.46 metric tons Shanghai Zedui Certification Co., Ltd.
2025 11.06 metric tons 134.69 metric tons 145.75 metric tons Shanghai Zedui Certification Co., Ltd.

The Company's GHG emissions intensity over the past three years (Operations Headquarters, Coal Chemical Manufacturing Department, and Carbon Chemical Manufacturing Department) is as follows:

Year Parent company-only revenue Category 1 Category 2 Total emissions Total Emissions/Revenue
2023 NT$8,091,691,000 25,510 tons 76,704 tons 103,214 tons 0.0128
2024 NT$7,489,924 23,895 tons 73,529 tons 97,424 tons 0.0130
2025 NT$5,764,234 16,842 tons 48,981 tons 65,823 tons 0.0114

Item Manufacturing Department Energy conservation action plan Estimated benefit from energy conservation Carbon reduction after improvement (metric tons CO2e/year)
1 Coal Chemical Manufacturing Department Gas Holder Flue Gas Heat Recovery System (MGGH) Reduce steam consumption by 5,249 tons each year 650.88
2 BW2 IE4 Motor Replacement at the C/B Plant Reduce electricity consumption by 1.4 MWh each year 0.65
3 Modification of the MPS01 8 kg Medium-Pressure Steam System Reduce steam consumption by 460 tons each year 57.04
4 Replacement of the Fine Coke Plant Air Compressor with a Variable-Frequency Screw Air Compressor Reduce electricity consumption by 42 MWh each year 17.57
5 Control of Steam Consumption for the V101A1 Steam Jacket Reduce steam consumption by 408 tons each year 50.59
6 Energy Conservation Plan for Fume Hoods in Laboratory No.2 Reduce electricity consumption by 4 MWh each year 1.86
7 Replacement of Old Refrigerators in Laboratory No. 1 Reduce electricity consumption by 0.2 MWh each year 0.09
8 #3 Replacement of MCC Packaged Air Conditioner Reduce electricity consumption by 22 MWh each year 10.25
9 E127A Light Oil Preheating Project Reduce steam consumption by 173 tons each year 21.45
10 Conversion of MA661A to a Permanent-Magnet Direct-Drive Motor Reduce electricity consumption by 9.6 MWh each year 4.47
11 Localization of P111A/B for Energy Conservation and Carbon Reduction Reduce electricity consumption by 303 MWh each year 141.20
12 Hydraulic Analysis and Optimization of the T/P Cooling Tower System Reduce electricity consumption by 703 MWh each year 327.60
13 #1 Replacement of Control Room Packaged Air Conditioner Reduce electricity consumption by 29 MWh each year 13.51
14 #2 Replacement of MCC Packaged Air Conditioner Reduce electricity consumption by 51 MWh each year 23.77
15 G1/G2 and G7/G8 MPS Tracing Pipe Energy-Saving Project Reduce steam consumption by 2,097 tons each year 260.03
16 Energy-Saving Project for Cleaning Analytical Equipment and Crucibles in Laboratory No. 2 Reduce electricity consumption by 0.5 MWh each year 0.23
17 Qi Analysis Filter Aid Sintering Energy-Saving Project Reduce electricity consumption by 0.6 MWh each year 0.28
18 Carbon Chemical Manufacturing Department Reduction of Electricity Consumption per Graphitization Furnace Cycle for Graphite Blocks Reduce electricity consumption by 101 MWh each year 47.07
19 Electricity-saving improvement for MGP total power supply Reduce electricity consumption by 244 MWh each year 113.70
20 Reduction in Water Rinsing Frequency for the ACS Plant Cleaning Unit Reduce electricity consumption by 36 MWh each year 16.78
21 Electricity-Saving Management for the Automated Storage and Retrieval System Reduce electricity consumption by 123 MWh each year 57.32
22 Improvement of Electric Heating Power Efficiency for the Carbonization Furnace Reduce electricity consumption by 0.6 MWh each year 0.28
23 Energy-Saving Plan for Air Cooling of Aluminum Busbars in the Graphitization Plant Reduce electricity consumption by 0.5 MWh each year 0.23
24 Energy Conservation Plan for Laboratory Dehumidifier Operation Reduce electricity consumption by 7 MWh each year 3.26
25 D83 Laboratory Instrument Computer Monitor Energy-Saving Project Reduce electricity consumption by 0.5 MWh each year 0.23
Total 1,820

The Company continues to reference best available technologies adopted by international peers to refine energy-saving programs at its production plants. In 2025, completed carbon reduction projects reduced CO2 emissions by a total of 1,820 metric tons. Selected improvement results and performance of energy conservation management programs over the past three years are presented below:

Item 2023 2024 2025
Coal Chemical Manufacturing Department Number of energy conservation action plans 35 13 17
Amount of electricity saved (MWh) 1,400 1,546 1,166
Amount of steam saved (ton) 2,367 5,750 8,387
Natural Gas Saved (Nm3) 236,600 29,842 -
Amount of diesel oil saved (kL) 62 - -
Total amount of energy saved (GJ) 23,513 23,815 27,867
Cumulative electricity saving rate (%) 1.55 1.61 1.65
Total energy saving rate (%) 2.08 2.06 1.48
Reduction in greenhouse gas emissions (metric tons of CO2e) 1,794 1,774 1,581
Carbon Chemical Manufacturing Department Number of energy conservation action plans 6 4 8
Amount of electricity saved (MWh) 263 937 513
Total amount of energy saved (GJ) 946 3,372 1,847
Cumulative electricity saving rate (%) 1.49 1.74 1.76
Total energy saving rate (%) 0.15 0.54 0.22
Reduction in greenhouse gas emissions (metric tons of CO2e) 130 462 239

Greenhouse Gas Control

According to the 2015 Paris Climate Agreement, each country must review their own contributions to carbon reduction with the goal of limiting global warming to well below 2 degrees Celsius by the end of the century. In 2018, the Intergovernmental Panel on Climate Change (IPCC) recommended that global warming should be controlled further to within 1.5 degrees Celsius while emphasizing the need to achieve a 45% reduction in carbon emissions by 2030 and realize net zero emissions (and carbon neutrality) by 2050.

To align with the aforementioned policy targets and implement GHG controls, the Company established a decarbonization pathway based on a reduce-first, remove-later approach toward carbon neutrality by 2050. In 2023, the Company completed carbon footprint inventories and external verification for ten key products, including mesophase pitch carbon microspheres and mesophase graphite carbon microspheres. In addition, the Company conducts annual company-wide GHG inventories and external verification in accordance with ISO 14064-1:2018 as the basis for emissions reductions. For the medium- and long-term period after 2025, the Company has set a target to reduce GHG emissions by at least 2% annually. Annual reduction targets have been achieved to date through energy conservation and process improvement measures. Using 2022 as the base year, the Company aims to reduce carbon emissions by 20% by 2030 through measures including AI-enabled technologies, equipment replacement to improve energy efficiency, and green electricity procurement. The Company's 2025 inventory showed combined Category 1 and Category 2 GHG emissions of 65,823 metric tons, down 38% from the base year. Since the base year, the Company has developed annual reduction plans for each category and expects to continue effectively reducing GHG emissions.

Since beginning construction of the Carbon Chemical Manufacturing Department in 2016, the Company has placed significant emphasis on the plant's ecological environment. As the plant is located on industrial land within an industrial park, the Company carried out new afforestation, enabling young trees to absorb carbon dioxide and release oxygen, increasing carbon sequestration, purifying the air, regulating the microclimate, mitigating environmental impacts from air pollution and global warming, and enhancing biodiversity within the plant area. Before the plant commenced operations in March 2018, more than 770 native Taiwanese trees had been planted around the facility, serving both ecological conservation and aesthetic purposes. This initiative aligns with the policy direction of "Forest 1-1: Conduct new afforestation on national, public, and private land to increase forest cover and carbon sinks" under Taiwan's 2050 Net-Zero Transition Key Strategic Action Plan for Natural Carbon Sinks. The Company also applied to register the "CSCC

Afforestation Carbon Sink Voluntary Reduction Project" with the Ministry of Environment. The project is expected to remove 129 metric tons of CO2e over its 30-year duration. In 2025, the Company continued tending the trees at the plant and measured diameter at breast height and tree height once annually within the project area. Based on growth model estimates, removals in 2025 were 4 metric tons of CO2e, supporting both increased carbon sinks and sustainability.

The Company's 2025 GHG Emissions (Operations Headquarters, Coal Chemical Manufacturing Department, and Carbon Chemical Manufacturing Department)

Emission Category Emissions Percentage
Scope 1: direct greenhouse gas emissions 16,842 metric tons 1.67%
Scope 2: indirect greenhouse gas emissions from input energy sources 48,981 metric tons 4.85%
Scope 3: greenhouse gas emissions from transportation 4,835 metric tons 0.48%
Category 4: Indirect emissions from products used by organization 938,705 metric tons 93.00%
Category 5: Indirect GHG emissions associated with the use of products from the organization Not material -
Category 6: Indirect GHG emissions from other sources Not material -