NSG Group's initiatives to decarbonize and reduce environmental impact

As an energy-intensive and carbon-intensive manufacturing company, tackling climate change is essential for the Group.

Contributing to a decarbonized society through our products and services will help us fulfil our mission to “Changing our surroundings, improving our world”. We are actively working towards social issues such as climate change, contributing to a sustainable society and increasing our corporate value. The Group continues to endorse the TCFD, with actions including increasing the intensity and scope (to include all three emission scopes) of SBTi verified decarbonization targets in May 2022 (original verification in 2019). It has also committed to achieving carbon neutrality by 2050. The implementation of the roadmap to achieve this will lead to a reduction in CO₂ emissions and, in turn, to the continued development of Sustainability and products and the expansion of opportunities related to our business.

^*1 SBTi is a partnership between CDP (former Carbon Disclosure Project), UN Global Compact, WRI (World Resources Institute) and WWF (World Wildlife Fund), which helps companies set the science-based goals for reducing GHG emissions to prevent the impact of climate change.

^*2 Scope 1: Direct emissions by business operators (Use of fuel in manufacturing processes, etc.)

^*3 Scope 2 Location: Indirect emissions by consumption of energy sources (Purchased electricity used in manufacturing processes, etc.)

^*4 Scope 3: Value chain emissions including both upstream and downstream of the organization's activities. Because >99.9% of our GHG emissions are CO₂, thereafter we only mention CO₂

Initiatives to reduce Scope 1 (own emissions)

We are considering a range of technical options to reduce Scope 1 emissions, including:

1. Use of alternative fuels: we are actively engaged in technological development initiatives, such as the world's first successful production of float glass using hydrogen energy in September 2021, as well as the successful production of glass using 100% biofuels in February 2022. From 2025, the Group is planning to begin construction of a green hydrogen production plant^*5 at its UK Green Gate facility with funding support from the UK government and will expand production of low-carbon glass from 2027. As a result, the Group expects the plant to reduce CO₂ emissions by 15,000 tonnes per year. Procuring fuels on a larger scale at competitive prices is particularly important for hydrogen and biofuels. Long-term contracts with suppliers, as well as securing production sites and stable supplies of fuels in the vicinity of the sites, are some of the initiatives being promoted by the purchasing team to support reductions in Scope 1.
2. Electric melting of glass: efforts are being made to increase the amount of renewable electricity used as a substitute to fossil fuel in the glass production process. This includes a plan that from 2025, a project increasing to the highest level ever achieved within the Group for electric melting will be implemented with the support of the German Government. We are planning to gradually introduce this system to other offices by 2030, and we are drawing up a roadmap at a global level.
3. Substitution of glassmaking raw materials: during the glass melting process, large amounts of carbon dioxide are emitted due to decomposition of CO₂ containing raw materials in the furnace and it accounts for about 20% of our Scope 1 and Scope 2 emissions. In order to reduce the carbon dioxide emissions from these raw materials, attempts are being made to replace the carbonates in the material with various oxides: in 2022, glass production using “Dolime” (CaOMgO) was successfully achieved in a float furnace in Chile; Previous research has shown that, in addition to the CO₂ reduction effect derived from the raw materials, there is also an energy reduction effect from using Dolime. The handling of the powder is an issue for the future. Studies will continue in 2024
4. Carbon capture: the process for capturing CO₂ emissions from glass melting furnaces is not compatible with typical CO₂ capture processes, so we are working with a process development partner that is likely to be compatible with our needs. In March 2024, we began the first demonstration experiment for carbon capture in the flat glass industry in Europe at our float furnace in the UK.^*6 One of C-Capture’s carbon capture solvent compatibility units (CCSCUs) has now been deployed at Pilkington UK’s float furnace at the Greengate glass manufacturing site in St Helens, part of NSG Group.

Initiatives to reduce Scope 2 (own emissions)

The Group has set a target of 50% renewable electricity by the end of 2024. In response to the new medium-term plan announced in 2024, the Group set a new sustainability target of increasing the ratio of renewable electricity. To support this target, the Group continues to invest in on-site power generation including installing on-site solar power at the Lathom Research Institute in the UK and the Rossford plant in Ohio, USA. Many other solar projects are underway across the Group. We are also actively introducing power source certification and Power Purchase Agreements (PPA agreements) on a global basis. In March 2024, our Maizuru Plant became the first of our Group's domestic plants to sign a PPA contract for renewable electricity generated by solar panels installed on the plant grounds, and installation work began^*1. Against a backdrop of global CO₂ reduction efforts, there is an increasing demand for green power in the market, and with the risk of rising electricity prices, we are continuing our efforts to find the most economically rational procurement method from among various options on a global level, aiming for stable procurement of renewable energy in the medium to long term.

Initiatives to reduce Scope 3

In 2022, the Group launched a Sustainable Supply Chain Committee to examine sustainable supply chains with regard to all factors, including environmental and social aspects. In the course of its activities, it is also working on reducing Scope 3 emissions. In 2024, we held a cross-departmental Scope 3 workshop with the participation of various key members of the Group. We have drawn up a group-wide roadmap for achieving our Scope 3 reduction targets for 2030, and in order to achieve this, we recognized the importance of improving our internal data collection system and continuing dialog with key suppliers. We are working with actual suppliers to obtain emissions data and share best practice alongside various other initiatives.