• Energy Saving Measures

To enhance energy efficiency, King Yuan Group set 2020 as the baseline year. Besides establishing an internal goal to achieve 1% energy savings every year, the Company implemented internal energy planning guidelines and energy management standards to prioritize the replacement of energy-consuming equipment based on performance in energy-saving plans, aiming to replace outdated equipment and improve department energy efficiency. The short-term goal is to achieve 37.5 million kWh of accumulative energy savings by 2025. As of the reporting year, we have saved 48.42 million kWh, achieving the short-term goal. In 2023, the Company launched 29 energy-saving projects, which can collectively save 43,319.86 GJ. The main energy-saving strategies included replacing high-energy-consuming equipment with energy-efficient ones and improving the energy efficiency of existing equipment.

King Yuan Group Energy Saving Projects by Plant

• Renewable Energy

The Company actively expands its use of renewable energy. In August 2022, the King Long (KLT) plant and in January 2024, the Tongluo plant completed installing and operating solar power systems. The Zhunan plant will also complete the installation of solar photovoltaic facilities in 2024. In addition, KYEC, through the procurement of renewable energy, has achieved a renewable energy usage rate of 2.5% of the total energy consumption in 2024. The goal is to reach 10% of total energy consumption by 2025, 20% by 2030, and 100% by 2050. The Company views continuous improvement in green production performance as a critical action.

2 、Greenhouse Gas Emission and Management

• Greenhouse Gas Inventory and Analysis 

Greenhouse Gas Emissions Analysis (Unit: tCO2e)

Note 1: Greenhouse gas emissions in 2021 only covered plants in Taiwan and China. Starting in 2022, the scope covers all parent and subsidiary companies included in King Yuan Group's consolidated financial statements.

Note 2: From 2021 to 2022, the disclosure scope for KLT & ZKT included Scopes 1 to 3, while KYEC included Scopes 1 to 4. In 2023, the disclosure scope for the entire King Yuan Group covers Scopes 1 to 4 and has been verified by a third party.

Note 3: We use the emission coefficient method for calculations. The emission coefficient for KYEC comes from the latest version (6.0.4) of the "Greenhouse Gas Emission Coefficient Management Table" announced by the Environmental Protection Administration, Executive Yuan. The emission coefficient for KLT & ZKT comes from the 2018 IPCC National Greenhouse Gas Inventory Guidelines, with GWP values from the IPCC Sixth Assessment Report. The sources of activity data include engineering calculations, mass balance, and other supporting documents.

Note 4: The Company has no emissions from biomass combustion or Scope 1 perfluorinated gases (PFCs).

• Greenhouse Gas Reduction 

King Yuan Group completed its first group-level greenhouse gas inventory in 2022, thus setting 2022 as the new baseline year, aiming to reduce emissions by 15% compared to the baseline year by 2030. We have adopted the following measures and regularly track performance results:

Reduction Action A: Purchase renewable energy and carbon credits

Reduction Action B: Implement various energy-saving projects within plants, such as using eco-friendly refrigerants

Reduction Action C: Install additional solar power systems

Reduction Action D: Change the waste disposal method from incineration to recycling, such as reusing empty barrels

Reduction Action E: Continue implementing green transportation initiatives to reduce Scope 3 transportation emissions

We used the energy-saving action plan of the energy management system to calculate the measured electricity consumption before and after improvements. By multiplying the total electricity savings in 2023 (in kWh) by 0.495 (the carbon emission coefficient for electricity announced by the Energy Administration in 2022), we estimated that King Yuan Group reduced approximately 5,956.48 tCO2e of greenhouse gas emissions through carbon reduction actions. The main type of emissions reduced is Scope 2.

3 、Water Resource Management

• Water Resources Data Overview

In 2023, the total water consumption of the King Yuan Group was 3,425.93 million liters, of which 33.7% was recycled process wastewater or recycled water repeatedly used by water treatment systems, totaling 1,155.022 million liters. The total water withdrawal was 2,270.908 million liters, which was all freshwater, primarily sourced from third parties. The total annual discharge was 509.119 million liters, and the total water consumption was 1,761.789 million liters. Due to the continued introduction of recycling systems in plants, water consumption is decreasing each year.

• Water Resource Overview (Unit: million liters or thousand cubic meters)

 Note 1: Recycled water = recycling system, rainwater harvesting, pure water reuse
 Note 2: Errors in water discharge and water consumption for 2022 have been corrected.

• Water Conservation Goals

Regarding water conservation goals, the Zhunan plant's process water usage in 2023 decreased by 58% compared to August 2020, meeting the set goal of a 5% reduction. KLT and ZKT recycled 788,000 tons of water, exceeding the 2023 target of 483,000 tons.
In 2023, the Company will continue to plan and implement water-saving projects targeting major water-consuming plants, including the Zhunan plant and its subsidiaries KLT and ZKT, to set water usage reduction goals. By adding recycling systems, the Company will invest 20 million NTD in the Zhunan Plant for recycling and reusing process water, with a payback period of roughly 2.5 years. KLT and ZKT will continue to improve processes to achieve water conservation and waste reduction goals. 

4 、Climate Change

In 2023, KYEC implemented the TCFD risk management framework to determine the financial risks and potential opportunities related to climate change for the Company through the TCFD framework. 

• Financial Impact Analysis of Climate Risks and Opportunities

KYEC conducts financial impact analysis on three selected climate risks and opportunities by analyzing future financial impacts and customer priorities. The details are as follows:

5 、Waste Management

• Waste Management Strategy and Objectives

The Company records the types and quantities of waste and tracks waste flows through the Industrial Waste Reporting and Management Information System of the Ministry of Environment. It also summarizes annual waste generation using triplicate forms and weighing methods. All plant waste is cleared and disposed of by external qualified waste disposal contractors. The Company established a waste management system to regularly audit, track, and review waste reduction performance in the plant. The Company also formulated an audit plan for waste clearance and disposal and regularly performs unannounced audits to ensure that outsourced waste disposal operations comply with regulations. The Company also mandates its contractors to complete a 2-hour EHS training before commencing in-plant operations to enhance their environmental protection work management capabilities during on-site operations.

King Yuan Group Waste Management Strategy and Goals

• Overview of waste generation and disposal methods

In 2023, the total waste generated by the Company was 3,558.51 tons, of which 328.87 tons (9.2%) were hazardous industrial waste and 3,229.64 tons (90.8%) were non-hazardous industrial waste. 

Summary of Industrial Waste Generation, Transfer during Disposal, and Direct Disposal (Unit: tons)

Note: The classification of hazardous and non-hazardous waste is based on local regulations at each site.