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 2024

Based on a 2% reduction from the baseline year (1,724 tons), the Company had completed 17 energy-saving projects. The total reduction of 2,236.7 tons represented a 129.7% achievement rate, equivalent to a 2.60% reduction from the baseline year.

The average energy-saving rate for the entire company is 1.68%.

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 (2025)	Medium-term goals (2026～2029)	Long-term goals (2030 and beyond)
Reduce greenhouse gas emissions by 2% annually, based on the 2018 base year for Scope 1 and Scope 2 carbon emissions Greenhouse gas emissions have been inventoried in accordance with the ISO 14064-1:2018 standard The carbon footprint data of key products was revalidated based on customer requirements Provided guidance to Changzhou China Steel for completing the greenhouse gas inventory and verification Solar photovoltaic systems were installed at the Pingnan Plant as part of its expansion project 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	From 2025 to 2026, reduce greenhouse gas emissions by 2% annually, based on the 2018 base year for Scope 1 and Scope 2 carbon emissions; From 2027 to 2028, increase the annual reduction to 5%. Greenhouse gas emissions have been inventoried in accordance with the ISO 14064-1:2018 standard in each year The carbon footprint data of key products was revalidated based on customer requirements Provided guidance to Changzhou China Steel for completing the carbon footprint inventory and verification Procurement of green electricity as needed to offset carbon reduction gaps Solar photovoltaic systems were installed at the Hsiaogang Plant/Pingnan Plant as part of its expansion project Implementation of voluntary carbon reduction programs to continually execute carbon reduction measures, ensuring compliance with program objectives	From 2029 to 2030, reduce greenhouse gas emissions by 5% annually, based on the 2018 base year for Scope 1 and Scope 2 carbon emissions, to progressively achieve the carbon neutrality target 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. Solar photovoltaic systems were installed at the Hsiaogang Plant/Pingnan Plant as part of its expansion project. Completion of voluntary carbon reduction programs, followed by implementation of subsequent carbon reduction projects in accordance with policy directives

Management strategies

Continue to refine energy conservation plans for our manufacturing departments by referencing the best available technologies from our international peers, complete the TCFD risk matrix, and introduce a climate governance system

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 2021, we rolled out the TCFD initiative and 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 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's energy consumption situation for the last three years is detailed as follows:

CSCC's energy consumption situation for the last three years

	Item	2022	2023	2024
CSCC Headquarters	Electricity (MWh)	73	203	204
Coal Chemical Manufacturing Department	Electricity (MWh)	50,919	51,578	52,108
	Steam (ton)	172,244	161,542	158,227
	Coke oven gas (kilostere)	0	289	0
	Natural gas (kilostere)	8,522	8,024	8,579
	Diesel oil (kL)	438	340	320
	Total energy consumption (GJ)	1,042,010	995,332	1,011,218
	Total amount of products (ton)	647,324	580,040	551,544
	Energy intensity (GJ per ton of products)	1.61	1.72	1.73
Carbon Chemical Manufacturing Department	Electricity (MWh)	32,771	38,375	36,103
	Diesel oil (kL)	9.20	9.40	12.60
	Liquefied petroleum gas (kg)	26,500	19,450	25,250
	Total energy consumption (GJ)	119,580	139,234	138,082
	Total amount of products (ton)	2,108	2,292	2,292
	Energy intensity (GJ per ton of products)	56.73	60.75	60.25
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 = 710Mcal; 1 kilostere of coke oven gas = 4,197 Mcal; 1 kilostere of natural gas = 9,307 Mcal; 1 kL of diesel oil = 8,330 Mcal; and 1 kilogram of liquefied petroleum gas = 12Mcal. The energy usage is based on the calculation data provided by the external; procurement unit.

CSCC's production volume by product category in 2024 is as follows:(Unit: ton)

In 2024, we purchase 100% of its electricity, use 0% of renewable energy, and use 0% of self generated energy.

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. 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. A third-party unit is also commissioned to carry out verification to ensure the validity of related data. The categories of greenhouse gases inventoried based on our activities, products, and services, as well as their scope of operations are listed as follows:

Category		Corresponding activity/ Type of equipment	Source of emissions
Scope 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
Scope 2	Indirect emissions from input energy sources	Power supply from Taiwan Power Company (Taipower)	Electricity purchased from Taipower
Scope 2	Indirect emissions from input energy sources	Steam supply	Steam purchased from China Steel Corporation
Scope 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 production plant uses the 2022 reporting year as the base year for greenhouse gas inventory. The carbon emission factor for purchased electricity is calculated using the most recent emission factor of 0.474kg CO₂e per kWh, as announced by the Bureau of Energy, Ministry of Economic Affairs (updated on April 14, 2025). Carbon emission factors for other energy sources are calculated using the latest factors published by the Environmental Protection Administration. The scope of the 2024 greenhouse gas inventory includes the coal chemical production plant and the operational headquarters. Direct greenhouse gases (Scope 1) and indirect greenhouse gases (Scope 2) account for 28% and 72% of the total emissions, respectively. The emission quantities for each greenhouse gas scope for the base year and the past three years (the 2024 inventory data is currently in progress and has not yet been verified) are as follows:

Year	Category 1	Category 2	Total emissions	Reference
2022	32,656 tons	59,906 tons	92,562 tons	IPCC 2013 Greenhouse Gas Inventory Report
2023	27,054 tons	57,450 tons	84,504 tons	IPCC 2013 Greenhouse Gas Inventory Report
2024	22,460 tons	56,387 tons	78,847 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 2024, direct emissions (Scope 1) and indirect emissions (Scope 2) accounted for 3% and 97% of the total emissions, respectively. Greenhouse gas emissions from each scope 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
2022	203 tons	16,741 tons	16,944 tons	IPCC 2013 Greenhouse Gas Inventory Report
2023	121 tons	18,995 tons	19,116 tons	IPCC 2013 Greenhouse Gas Inventory Report
2024	460 tons	16,678 tons	17,138 tons	IPCC 2013 Greenhouse Gas Inventory Report

CSCC's GHG emissions intensity for the last three years are listed as follows:

Year	Parent company-only revenue	Category 1	Category 2	Total emissions	Total emissions/ Revenue
2022	NT$10,442,949	32,859 tons	76,647 tons	109,506 tons	0.0105
2023	NT$8,091,691,000	27,186 tons	76,481 tons	103,667 tons	0.0128
2024	NT$7,489,924	22,927 tons	73,159 tons	96,086 tons	0.0128

According to the carbon reduction projects completed in 2024, CSCC reduced CO₂ emissions by 2,236.7 tons. The related projects and the results are as follows:

項次	節能行動方案	改善後減碳量(MT CO₂e/年)
1	Replacement of ash high-temperature furnaces with rapid furnaces	2.67
2	Improvement of waste heat recovery system in solvent recovery units	203.30
3	Pipeline tracking in the west plant changed from MPS to LPS	60.32
4	Deployment of P951D high-efficiency pump with 3D impeller	33.79
5	X931/X933 permanent magnet variable-frequency chillers	370.61
6	TVR steam recovery system	359.37
7	Optimization of steam efficiency for E4302	326.70
8	Installation of variable-frequency controllers for MF951ABC to regulate speed	60.34
9	Electricity-saving improvements for T663A electric boilers	146.72
10	Energy-saving plan for laboratory computers	1.45
11	Energy-saving improvements for laboratory high-temperature furnaces	1.43
12	AI algorithm for optimal electricity-saving settings in T663A	146.72
13	Energy-saving improvement plan for C615B	61.00
14	Replacement of air source for R2515 upper cover movement	13.70
15	Electricity-saving improvement for MG11 total power supply	273.66
16	Electricity-saving improvement for MGP total power supply	161.26
17	Energy Savings for DC2111/2/7 Dust Collector Cartridge Reverse-Blowing with IA	13.68
合計		2,236.72

We continue to refine the energy conservation plans for our manufacturing departments in accordance with the best available technologies from our international peers. Our performance in the implementation of relevant improvements for 2024 and energy conservation management plans for the last three years is detailed as follows:

	Energy conservation action plan	Estimated benefit from energy conservation
Coal Chemical Manufacturing Department	Improvement of waste heat recovery system in solvent recovery units	Reduce steam consumption by 1,980 tons each year
	X931/X933 permanent magnet variable-frequency chillers	Reduce electricity consumption by 750 MWh each year
	TVR steam recovery system	Reduce steam consumption by 1,815 tons each year
	Optimization of steam efficiency for E4302	Reduce steam consumption by 1,650 tons each year
	Installation of variable-frequency controllers for MF951ABC to regulate speed	Reduce electricity consumption by 122 MWh each year
	Electricity-saving improvements for T663A electric boilers	Reduce electricity consumption by 297 MWh each year
	AI algorithm for optimal electricity-saving settings in T663A	Reduce electricity consumption by 297 MWh each year
	Energy-saving improvement plan for C615B	Reduce natural has consumption by 29.842 kilostere each year
	Deployment of P951D high-efficiency pump with 3D impeller	Reduce electricity consumption by 68 MWh each year
Carbon Chemical Manufacturing Department	Replacement of air source for R2515 upper cover movement	Reduce electricity consumption by 28.85 MWh each year
	Electricity-saving improvement for MG11 total power supply	Reduce electricity consumption by 553.96 MWh each year
	Electricity-saving improvement for MGP total power supply	Reduce electricity consumption by 326.44 MWh each year
	Energy Savings for DC2111/2/7 Dust Collector Cartridge Reverse-Blowing with IA	Reduce electricity consumption by 27.70 MWh each year

	Project	2022	2023	2024
Coal Chemical Manufacturing Department	Number of energy conservation action plans	9	35	13
	Amount of electricity saved (MWh)	156	1,400	1,546
	Amount of steam saved (ton)	7,935	2,367	5,750
	Natural Gas Saved (Nm3)	59,202	236,600	29,842
	Amount of diesel oil saved (kL)	76	62	-
	Total amount of energy saved (GJ)	29,094	23,453	20,116
	Cumulative electricity saving rate (%)	1.51	1.55	1.61
	Total energy saving rate (%)	2.79	2.36	2.23
	Reduction in greenhouse gas emissions (ton of CO₂e)	2,907	1,794	1,774
	Carbon Chemical Manufacturing Department	Number of energy conservation action plans	3	6	4
Amount of electricity saved (MWh)		357	263	937
Total amount of energy saved (GJ)		1,286	946	3,368
Annual electricity saving rate (%)		0.80	0.70
Cumulative electricity saving rate (%)		1.81	1.49	1.74
Total energy saving rate (%)		1.81	1.49	1.41
Reduction in greenhouse gas emissions (ton of CO₂e)		177	130	462

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 goals and implement greenhouse gas control, the Company completed a carbon footprint assessment and external verification for ten key products, including mesophase pitch carbon microspheres and mesophase graphite carbon microspheres, in 2023. Additionally, the Company conducts an annual ISO 14064-1:2018 standard greenhouse gas inventory and external verification to establish reduction benchmarks. Through various energy-saving and process improvement measures, the mid- to long-term goal post-2024 is to reduce greenhouse gas emissions by 2% or more annually, and to purchase green electricity to lower carbon emissions. Following the 2024 inventory (currently unverified), the total greenhouse gas emissions across categories were 106,643 tons. Starting in 2024, the Company will implement annual reduction plans for each category of emissions, aiming to sustain and effectively reduce greenhouse gas emissions.

Greenhouse gas emissions at CSCC in 2024

Scope	Gas emissions	Ratio
direct greenhouse gas emissions	22,927 tons	21.5%
indirect greenhouse gas emissions from input energy sources	73,157 tons	68.6%
greenhouse gas emissions from transportation	10,557 tons	9.9%