environment performance

The 'greening of processes' aims to improve the Company's resource efficiency via the development of clean production technologies, material reduction and recycling, reducing factory emissions to land, air and water and maximizing energy efficiency. A key focus area is the Company's plans to reduce direct and indirect GHG emissions in order to respond to the challenges posed by climate change

• Climate Change policy
• GHG emissions, energy & resource consumption
• process improvement activities

Climate Change policy

The 1992 Rio Declaration on Environment and Development highlighted the need to regulate greenhouse gas (GHG) emissions which have a direct impact on climate change. Under the ground-breaking Kyoto Protocol, signatory countries are required to reduce their combined GHG emissions by 5.2% from 1990 levels between 2008 and 2012.

Samsung Electronics recognizes that it is not only countries but also companies that have a responsibility to address the global challenges posed by climate change. To date, the company has focused on its direct impacts; reducing CO₂ emissions during manufacturing processes via a range of energy-saving initiatives and improving the energy efficiency of products during use. Future plans will expand Samsung Electronics' GHG emission reduction efforts to cover additional direct impact areas such as logistics and indirect sources where possible.

Samsung Electronics has participated in several voluntary government-led initiatives on climate change in Korea where 60% of our workforce and the majority of our operations are based. These include:

• Mock CO₂ emissions trading supported by the Korea Energy Management Corp (KEMCO);
• National Korean Greenhouse Gas Register (trial project)
• Voluntary agreements to reduce energy consumption in all Samsung Electronics workplaces in Korea via the Catch CO₂ Project with a target reduction of 30% on 2001 levels by 2010.

Voluntary agreement to reduce green house gases

In 2000, SAMSUNG Electronics became signatory to the government-initiated Voluntary Agreement on reducing green house gases in Korea. Each Samsung Electronics factory in Korea has joined the voluntary Agreement and implemented a plan to save energies annually and reduce CO₂ emissions.

* The Voluntary Agreement
The purpose is to save energy and curb greenhouse gas emissions between the government and a business entity that consumes more than 2,000 TOE (Ton Oil Equivalent) of energy annually. The business entity sets energy saving targets for a period of 3~5 years starting from the agreement year. In return, the government provides incentives such as tax benefits and technology support.

Catch CO₂ Project

Catch CO₂ is the slogan for activities carried out at SEC business sites in Korea to lower the emission of greenhouse gases (GHG). Between 2002 and 2005, reduction targets were set on per revenue basis. But due to distortion caused by fluctuations in the selling price of products, we switched to a target scheme based on unit production from 2006.
Reduction targets

Previous: Reduce GHG by 30% from 2001 levels by 2010 (per unit revenue basis)
Revised: Reduce GHG by 45% from 2001 levels by 2010 (per unit production basis)

Table 1. CO₂ Emission Trend (Basic Unit)

Category	2004	2005	2006
Basic Unit	66	62	58

* SEC has a diverse product line-up including semiconductors, LCD, mobile handsets and home appliances.
  For this reason, the basic unit of production was calculated taking into account the proportion of GHG
  emissions of each business unit. We set 2001 as the base year (2001=100).

We are taking various steps to lower polyfluorocarbon (PFC) emissions from our semiconductor fabrication facilities, including the adoption of treatment systems, use of alternative gases and process optimization. Since 2003, PFC treatment facilities have been built into fabrication lines which decreased PFC emission by 63%. As of 2006, emission was down by more than 90%. For existing lines, we are using alternative gases and expanding PFC treatment capacity.

Under voluntary agreement on energy conservation with the government, we are recovering and reusing waste heat, installing high-efficiency coolers and low-power pumps, and seeking ways to reduce waste factors. A taskforce team has been set up to lower energy consumption (use of low-power pumps, chillers, etc.) in fab lines to be constructed in the future.