Strategic Energy Management For Resilience
1
Energy efficiency measures in an
evolving landscape of regulations (Why it is important and how we approached it)
Dr. Stefan Schmitt
CEO (Asia Pacific)
Singapore, 6th October 2015
TK: Large Diversified Industrial Group
2
ThyssenKrupp Groupfigures as per 30.09.2014
Industrial Solutions
Components Technology
Materials Services
Steel Americas
Elevator Technology
Steel Europe
Sales 66 bn SGD
EBIT 2 bn SGD
Employees 160,745
“Ingenieurkunst” – Engineering,
Ability to Connect Competencies
3
4
Engineering to Advance Our Customers
Material
Plant
Automotive
High-strength
steel reduces
weight by up to
30%
Energy
Non-oriented
electrical steel
reduces energy
transmission
losses
Construction
Optimized
corrosion
protection through
zinc-magnesium
coating
Packaging
Ultra-thin
packaging steel
improves resource
efficiency by 23%
Mechanical
Energy
Slewing bearings
and rings for wind
turbines
Construction
Up to 66% greater
energy efficiency
in elevators
Automotive
Valve control
enables 4.1 t less
CO2 per vehicle
over lifetime
Mining
Fully mobile
crushers enable
up to 350,000 t
less CO2 per year
Construction
Up to 40%
reduction in CO2
emissions in
cement plants
Automotive
Development of
production lines
for lithium-ion
battery cells
Chemicals
EnviNOx®: Up to
99% reduction in
N2O/NOx in
fertilizer plants
Chemicals
Technology for
polylactides: New
plastics based on
biomass
Product and service examples in our application areas
5
Naturally, with an Interface on a Broad
Range of Energy and Environment Topics
974 mn m³
Fresh water
1.8 mn t
Waste for
disposal
91 mn m²
site area
32 mn t CO2
10,800 t Dust
Industrial sites
at natural
habitats
REACHRegulations
Environmental costs
in the Group
Ø FY 09/10 - 13/14
~880 mn SGD OPEX
~240 mn SGD CAPEX
Water and
waste
water
Emissions
and ambient
air
Hazardous
substances
and
chemicals
Biodiversity
Permitting
Soil
Waste
and
circular
economy
CO2
Source: CO/TIS, ThyssenKrupp global data for 2013/14
17,200 t NOx
33,400 t SO2
NOx, SO2
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Energy Consumption Dominated by Steel
OperationsTotal net energy consumption ThyssenKrupp Fiscal Year 2013/2014: 98.4 TWh
Steel Europe
Steel Americas
Materials Services
Components Technology
Elevator Technology
Industrial Solutions
Corporate
Total
approx. 2/3
98.4
ThyssenKrupp operations uses all kinds of external energy carriers – including coal, gases, electricity – and generates energy from residual and process waste streams
7
Meanwhile, Regulations Becoming More
Complex and Stringent …Example: Complex Machinery of German Energiewende, DE
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… and Management Equally Complex
Finanzielle
Belastung ETS+
Zertifikate-
zukauf-
kosten
Strompreis-
kompensation
Berücksichtigte
Strommenge
Diverse Faktoren
(nat. CO2-Intensität,
Benchmark, Zeit,
usw.)
Zertifikatspreise
auf Forward-Basis
Mitgliedsstaats-
entscheidung über
Gewährung (jährlich)
[0-100%]
Zertifikatspreis
bei Erwerb
Zukaufsbedarf
x
x
x
x
-
Tatsächliche
Emissionen
Kostenfreie
Zuteilung
„Rücklagen“
aus 2.
Handelsperiode
-
Tatsächliche
Produktion
Tatsächliche
spezifische Emission
x
Historische
Produktionsmenge
„Benchmark“
(spezifischer
Emissionswert)
Korrekturfaktor und
linearer
Reduktionsfaktor
x
x
Carbon Leakage
Status
x
Direkte CO2-Kosten
Indirekte CO2-Kosten
CO2-bedingte
Strommehrkosten
bei zugekauftem
Strom (eher Null)
-
Wirkungsweise Belastungen aus EU ETS in 3. Handelsperiode im Stahl
Gewinne Finanz-
geschäfte (SWAPs,
etc.)
Kürzungsfaktor
wegen Absenkung
Produktionsmenge
(bis 100%!)
x
-
Nettoeffekt
Strompreis-
kompensation
Emissionen für
Stromerzeugung aus
Kuppelgasen
(erdgasäquivalent)
Strompreis-
kompensation
auf Basis
Verbrauch
(unabhängig
von Zukauf
oder Eigen-
erzeugung)
Hans-Jörn Weddige
CO/TIS-SEE
12.02.2015
Ausgleichs-
zahlungen Kunden
für CO2-
Mehrkosten
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Strong Focus on Energy & Environment
‘Hard-wired’ into our Strategy
Climate change
Urbanization
Globalization
Leading
engineering
expertise
in
Material
Mechanical
Plant
More consumer and capital goods
More resource and energy use
More infrastructure and buildings
ReducedCO2 emissions,
renewable energies
Efficient resource and
energy use,alternative
energies
Efficient infrastructure
and processes
Demand (“more”)
Drivers
Demography
Finite resources
Political framework
Business opportunities RestrictionsDemand (“better”)
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Sustainability a Top Priority Area, Integral
to Our Strategy
Our ‘Strategic Way Forward’ defines an integrated approach to sustainable business for TK
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Multi-Stakeholder Perspective Required
to Address Challenges (Opportunity)
360°
Business
Society Environment
Products
Processes
Supply Chain
FCF
Pro
fit
Debt
Co
mp
liance
Customer satisfaction
Resources
Energy Efficiency
Diversity
Health & Safety
ma
rke
ts
Ma
rgin
Water
CO2
Human Rights
Urbanization
Co
rpo
rate
C
itiz
ensh
ip
Ta
xe
s
BiodiversityWaste
Re
ne
wa
ble
sEmployeeParticipation
Fre
edo
m o
f a
ssocia
tion
TrainingPollution
Effluents
Quality Innovations
Growth
Re
cyclin
g
Go
ve
rna
nce
Recruiting
Conflict Minerals
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Four Elements Need to be Thought
Through and Planned For in Detail
Impactful Goals and Objectives
Leveraging Supply Chain for Efficiency
Internal Measures for Sustained Impact
Enabling Customers for Superior Performance
I
II
III
IV
3.5
100
100
2.5 %
1003.8
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WE have Set Ambitious Targets for us to
Realize Across Our Business
TWh
energy efficiency gains
until FY 19/20
sustainability
audits of suppliers p.a.
% of relevant activities
covered by Energy Management
according to ISO 50001
until FY 19/20
Keep adjusted R&D intensity continuouslyat around
% of relevant activities
covered by Environmental
Management according to ISO
14001 until FY 19/20
Reduce accident frequency
rate per Mio. working hours
until FY 14/15 to
I
Coverage of ThyssenKrupp energy use
by Energy Management Systems (EnMS)
14
Extensive Audits Helped Secure Superior
Performance Through Supply Chain
II
EnMS in
implementation
or planned
certified EnMS
other approaches
Suppliers & Partners
Regulatory requirements:e.g. approx. 50 Audits for operations in EU
Internal requirements: Group-wide and globally through GEEP
General Sustainability Audits
Based on
binding
Supplier Code
of Conduct
Target:
Minimum
100 audits/year
Cooperation and technical exchange as needed at local levels
~ 70%
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WE have Adopted a Comprehensive
Approach
Process excellence
Meaningful
Targets
3.5GEEP
Comprehensive
ApproachTangible results
(since Oct 2013)
Target 2020
3.5
Till Date
2.0
III
TWh
o Efficient furnaces
o Utilization of waste heat and gases
o Efficiency of reduction agents
o Steam generation from other energy
sources
o Reduction of stand-by times
o Replacement of old equipment
o Advanced lighting concepts
o Efficient fleet management and services
o Efficiency benchmarks
o 2/3 of energy consumption covered by
certified Energy Management Systems
o Best-practice sharing
o Energy Audits
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GEEP: Full Follow Through From
Concept to Group Wide Realization
3.5 TWh energy
efficiency gains until FY 19/20
% of relevant activities covered by
Energy Management according to ISO 50001
until FY 19/20
100“Indirect Financial Targets”
III
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Examples of Internal Energy Efficiency
Success Across the Board
III
Improved
isolation of
production
buildings
Potential:
10 kWh / m²
Efficiency
increase: >50%
Modern lighting
systems
Air drying at
elevator
production
Saving:
~1.5 GWh/a
Revisit major
energy uses
(steel making)
>500 GWh at
main site
Rising Complexity of Measures
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Consistent Engineering Led Efforts for
Higher Performance for our Customers
IV
Example of our product development for ET customers
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…Including 2nd and 3rd Order Effects of
Efficient Mobility on Buildings and Cities
IV
MULTI – New Elevator Technology ACCEL - Metro Feeder/for Airports
Enabling greater floor space – reducing per capita energy footprint of buildings
Enabling seamless integration of energy efficient mobility systems
Example of our product development for ET customers
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Supporting Our Clients with Innovative
Energy Solutions Across all our Businesses
IV
Cement Plants Steel
Reduction of energy use by >40%Innovative steels allow significant
weight reductions
21
Supporting Our Clients with Innovative
Energy Solutions Across all our Businesses
IV
Automotive Renewables
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Over 40 innovations for weight and fuel savings
Key components for wind energy
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Our Efforts are Being Recognized – Our
Goal is to Progress Further
CDP1 ratings 2008-2014
for ThyssenKrupp
95
2008 2009 2010 2011 2012 2013 2014
B
Benchmark 2014:
Max: 100 A
Ø DAX: 90 B
Ø Germany, Austria, Switzerland: 73 C
Disclosure Score
Performance Band
Member of the Leadership Index
since 2012 (Top-10% in
disclosure)
Global Energy Efficiency Program
with targets & quantified
reductions (GEEP)
Formal risk management
Solutions to improve the carbon
efficiency of our customers
1. The CDP rates the transparency and performance of climate change management of companies to provide guidance for investors, customers and stakeholders
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o Make energy and environment a strategic priority
o Prepare in advance for legislation – it will come, be
ready for it
o Consider the view of all stakeholders – avoid a narrow
business only view
o Mobilize the organization, be rigorous – it requires
every one to be involved
o Set ambitious targets/goals and follow through to make
it happen
o Think across the value chain – collaborate with
suppliers and customers
Reap the benefits of a better world!
Key Learnings from Our Experience
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