"REDUCING GREENHOUSE GAS EMISSIONS 60% by 2010" (Seiko Epson)

JFS Newsletter No.23 (July 2004)
"TOWARD A SUSTAINABLE JAPAN - CORPORATIONS AT WORK" ARTICLE SERIES Article No. 16
http://global.epson.com/

The World's First "CFC-Free Factory"

Seiko Epson Corporation was founded as a watch maker in 1942 in Suwa City, Nagano Prefecture of Japan. After 1964, when its Printing Timer was adopted as the official timer of the Tokyo Olympic Games, the company went on to develop the world's first mini-printer (EP-101) and quartz watch (35SQ), and has been expanding its areas of business ever since. Currently, Seiko Epson is a global company manufacturing information technology devices such as printers and projectors, electronic devices and precision instruments. It has 110 subsidiaries in and out of Japan and 85,000 employees, of whom 22,000 are in Japan. Its consolidated sales in fiscal 2003 were 1.4132 trillion yen (about U.S.$12.97 billion), of which over 60 percent were overseas.

The environmental initiatives of Seiko Epson started in earnest in 1988, when the company announced its "CFC-free policy. "Many people in the industry stated that the total elimination of ozone layer -destroying chlorofluorocarbons (CFCs) was extremely difficult. However, then-President Tsuneya Nakamura was determined to achieve the total elimination of CFCs. The company solved many problems and finally succeeded with this goal in just four years. Mr. Yoshihiro Ono, the director of the CSR (Corporate Social Responsibility) and Global Environment Department of Seiko Epson, says, "One of the reasons of this success was the distance of Suwa City from Tokyo. It takes two hours by express train to get here. We were able to focus on the elimination of CFCs without being distracted by the views of the national government and others."

After eliminating CFC use, Seiko Epson found that it had succeeded in not only reducing its environmental burden but also in increasing profits by eight billion yen ($73.4 million) by 1995. This is the estimated amount that the company would have spent if it had continued to use CFCs from 1988 to 1995. The success of CFC elimination was significant to Seiko Epson in terms of the promotion of environmental activities. The fact that Seiko Epson was the first in the industry to achieve the total elimination of CFCs gave the company confidence in its environmental activities and assurance that they could even be profitable.

Since then, Seiko Epson has worked on diverse environmental activities, making the full use of its original technologies. Its efforts to prevent global warming are especially remarkable.

A Vision to Prevent Global Warming and Measures to Reduce CO2 Emissions

Seiko Epson has a vision to reduce the total amount of greenhouse gases emitted from all its plants throughout the world by 60 percent from the 1997 level by 2010. While many companies set their goals of cutting carbon dioxide (CO2) emissions per unit of production or sales, Seiko Epson aims to reduce the total amount of the heat-trapping gases, including CO2, emitted from its worldwide facilities to less than half of the fiscal 1997 level. Considering the company's growing sales, the target is a challenging one.

http://www.epson.jp/ecology/factory/method.htm (Japanese)

The company is taking two approaches to prevent global warming: reduction in CO2 emissions through energy savings, and reduction in the emission of greenhouse gases other than CO2. To reduce CO2 emissions, energy conservation is essential, since a large amount of CO2 is emitted due to energy consumption.

Seiko Epson began to conduct a thorough analysis of its manufacturing process to find what it should focus on to achieve the target. According to an analysis of energy usage at its facilities worldwide, the total amount of power used at its domestic manufacturing plants was the largest of all its facilities throughout the world, accounting for about 70 percent of the total. By categories of the plants, energy used at plants for electronic devices, such as semiconductors and liquid crystal displays, stood at 67 percent of the total power consumption of all its plants in Japan.

Usually, the manufacture of electronic devices requires a clean room to keep the work area free of dust, and highly pure water to clean the devices. In addition, precise adjustments of temperature, humidity and pressure are needed to maintain the quality of the devices. Unexpectedly, the analysis proved that the amount of electricity used at the device production facilities was only one third of the company-wide energy consumption. Instead, a large amount of energy was used at the "support" facilities that supply pure water, compress air, and discharge liquids and gases.

The power capability needed for support facilities is connected with that needed for production facilities. To minimize energy for support facilities, Seiko Epson adopted 88 technologies at a new plant built in 2001, such as technologies for improving the manufacturing process, reducing the use of pure water and compressed air, and downsizing facilities. As a result, the energy efficiency of the new plant is now double that of plants built earlier.

But although these efforts helped to prevent an increase in CO2 emissions, they were not enough to actually reduce them. Seiko Epson realized that it is essential to reform its manufacturing processes thoroughly in order to cut energy used for the support facilities. Innovative Production Technology to Save Energy

Seiko Epson has been challenging itself to achieve a breakthrough in its production processes. It has two core production technologies. One it calls "scaleable minimum fab" ("fab" for "fabrication facility"). Each conventional electronic device plant was equipped with its own support facilities, such as a large clean room. And all the basic facilities had to operate at full capacity, even when the operating rate of the production facilities was low. This created problems in terms of energy use. In the scaleable minimum fabs, each production line is installed with its own set of the smallest required equipment, such as a downsized, standard clean room. Then, each production line can be operated flexibly depending on production volume, using small clean rooms with low energy consumption.

Another core technology involved revolutionizing the production processes. A good example is a film forming technology using inkjet technology. The conventional electronic device production involves many processes such as cleaning, film forming, photolithography, etching, and photo-resist removal. This production method wastes most of the materials supplied during the processes because they are washed away in the processes. The inkjet technology, however, allows just the necessary amount of material to be applied only to the areas required, so that the processes can be less wasteful. The combination of this and various other technologies can reduce the number of semiconductor manufacturing processes from about 300 to about 80, and the company envisions that by doing this it is possible to cut the energy consumption in the processes by 84 percent. When all the innovative technologies are put into practical use, the company will be within striking distance of its goal of a 60 percent reduction of greenhouse gases by 2010 from the 1997 baseline.

Investing in such complex technologies involves high costs in the short run. But once those technologies are put into practical use, a dramatic improvement of productivity and low-cost production can be possible, thus improving the company's competitiveness. "The efforts to reduce the energy use by only 10 to 20 percent would rather increase costs and would not be economical because we will only use the existing energy saving technologies. Once we set a target of a 50-percent reduction, ideas of eliminating processes and devices come into play, and they will lead to real cost reductions," says Mr. Ono. He stresses that he wants many corporations to understand the fact that environmentally friendly activities will actually bring them profits.

Emissions Reduction in Greenhouse Gases Other Than CO2

The Kyoto Protocol has specified CO2 and the following five substances as greenhouse gases: nitrous oxide (N2O), methane (CH4), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulphur hexafluoride (SF6). These five gases also have a significant impact on global warming; for example, hexafluoroethane (C2F6), a type of PFC, has 9,200 times, and SF6 23,900 times, the heat-trapping effects of CO2. Seiko Epson thus began to strive to reduce emissions not only of CO2 but also of the other greenhouse gases, as it has been using PFC and SF6 gases as cleaning and etching agents in the manufacturing process of electronic devices.

The company's specific measures to reduce greenhouse gases are to decompose these gases and to minimize their usage. In the past, amounts of PFCs gases were difficult to measure, but without analysis of their emissions and reduction, a company could not monitor the progress of its effort. To solve this problem, Seiko Epson devised a simple measuring method it calls the Epson Method to gauge quantities of PFCs, and consequently optimized its manufacturing conditions. As a result, the company succeeded in cutting PFC emissions by 49.5 percent in fiscal 2003 from the fiscal 1997 level. The Epson Method is introduced on the company website at: http://www.epson.jp/ecology/factory/method.htm(Japanese)
http://global.epson.com/SR/environment/method.html (English),
Seiko Epson hopes that the information will help other companies curtail their own PFC use, and welcomes information and suggestions to further improve the technologies.
http://global.epson.com/newsroom/

To Coexist with Nature and Be Trusted by People

The headquarters of Seiko Epson are still located at Lake Suwa, facing the Northern Japan Alps. The founder's determination not to contaminate Lake Suwa and not to cause any trouble to neighbors is still respected by employees around the world, who often do volunteer work for their local communities. The company's efforts to promote its environmental activities are driven by its corporate culture to respect nature and challenging spirit to develop unique technologies to achieve high aims.

See details of Epson "zero emission" activities in JFS newsletter #016, issued December 2003. (English)