GHG Management

All FENC production sites must comply with ISO 14064-1 or local regulatory standards on the quantification and reporting of GHG emissions.

GHG Management Guidelines and Measures

Note: Environmental Protection Administration of Executive Yuan issued a notice on October 21, 2021 on the upcoming amendment to Greenhouse Gas Reduction and Management Act and the renaming of the act to Climate Change Response Act.

Direct and Energy Indirect GHG Emissions per Unit of Production

Unit: tCO₂e / metric ton of product

Note: The Textile Business does not include FEAZ, FEAV and FENV.

GHG Emissions in 2021

In 2021, direct and indirect (categories 1 and 2) GHG emissions increased by 2%. The increase is mainly attributed to the increase in production. However, GHG emission per unit production dropped by 5% compared to the previous year, which is a testimony to the Company’s dedication in GHG reduction implementations.

Direct and Energy Indirect GHG Emissions

Unit: ktCO₂e

		Direct Emissions Category 1	Energy Indirect Emissions Category 2	Category 1 and 2 Total
Petrochemical	2019	391	203	594
	2020	364	195	559
	2021	389	151	540
Polyester	2019	470	570	1,040
	2020	771	655	1,426
	2021	785	620	1,405
Textile	2019	45	288	333
	2020	137	310	447
	2021	167	374	541
Total	2019	906	1,061	1,967
	2020	1,272	1,160	2,432
	2021	1,341	1,145	2,486

Note：
1. GHGs include CO2, CH4, N2O, HFCs, PFCs, SF6 and NF3. ISO 14064-1:2018 categorizes emission sources into direct (category 1, emission source from directly owned or controlled by the organization) and indirect (category 2, indirect GHG emissions from imported energy such as electricity, heat and steam).
2. The scope of data collection for 2019 includes 15 production sites in Taiwan, Mainland China and Vietnam. Starting in 2020, 6 additional production sites are incorporated into the scope of data collection. Totaling 21 production sites.
3. In 2019 and 2020, OPTC, Hsinpu Chemical Fiber Plant, Kuanyin Chemical Fiber Plant, OPSC and FEIS completed GHG inventory in accordance with ISO 14064-1. GHG inventory from other production sites have passed internal audits.
4. In 2021, 100% of the GHG emission data passed the internal audit. Once the Company obtains third-party verification, which is scheduled to be completed by the 3rd quarter of 2022, the data will be disclosed in 2022 Sustainability Report.
5. In 2021, direct and indirect (category 1 and 2) GHG emissions from the 4 FENC production sites in Taiwan amount to 793 ktCO₂e.

Other Indirect GHG Emissions in 2021 (Category 3 to 6)

Unit：ktCO₂e

	Petrochemical	Polyester	Textile	Total
Purchased Goods and Services (Category 4)	2,206	4,137	804	7,147
Capital Goods (Category 4)	4	41	10	55
Fuel and Energyrelated Activities (Category 4)	131	411	204	746
Upstream Transportation and Distribution (Category 3)	17	53	10	80
Waste Generated in Operations (Category 4)	6	13	17	36
Business Travel (Category 3)	0.03	0.45	0.36	0.84
Employee Commuting (Category 3)	0.22	3	3	6.22
Upstream Leased Assets (Category 4)	2	0.48	2	4.48
Downstream Transportation and Distribution (Category 3)	20	65	50	135
Downstream Leased Assets (Category 5)	0.10	0.10	0.10	0.30
Franchises (Category 5)	0	0	0	0
Investments (Category 5)	0	0	0	0
Total	2,386	4,724	1,101	8.211

Note:

1. The classification is based on GHG protocol.
2. FENC focuses on the production of polyester and raw materials with an array of terminal applications. The GHG emission generated from the processing, use and end-of-life treatment of sold products must be calculated based on specific scenarios. Due to the lack of objectivity and reference value, the data is excluded.
3. Category 3 to 6 account for 95% of the production sites within the scope of this report. FEAZ, which is in the process of relocating and excluded from the scope of disclosure, did not conduct the GHG inventory.

System Establishment and Management

All FENC production sites must comply with ISO 14064-1 standards as well as local regulations on GHG inventory and quantification. In addition, third-party verifications must be conducted once every 3 years. In 2020, FENC launched comprehensive GHG inventory initiatives covering 20 production sites in Taiwan, Mainland China, Vietnam, Japan and the U.S. The inventory is conducted following the 6 categories of emission sources from the latest ISO 14064-1:2018 and categories 3 to 6 (scope 3) in GHG Protocol issued by World Council for Sustainable Development (WBCSD). The scope of the inventory covers the entire organization, including all departments and supply chain, taking into account direct emission sources as well as 15 indirect GHG emission sources such as imported energy, transportation and products used. In 2022, the 20 production sites are scheduled to complete external verification in accordance with ISO 14064-1:2018.
To implement company-wide GHG inventory, FENC held the kickoff meeting at the end of 2020. In 2021, 3 stages of trainings were conducted, including 24 sessions with 672 employees in attendance. Among them, 332 have been qualified as ISO 14064-1:2018 internal auditors.
The inventory helps the Company identify carbon emission hotspots. The information serves to support FENC’s 5 major carbon reduction strategies. With regular monitoring and testing as well as timely adjustments, FENC is on track to achieve its GHG emission reduction targets.

Avid Support for Governmental Policies

The enactment of Trial Procedures of Shanghai Municipality on Carbon Emission Administration in 2013 puts a cap on carbon emission for OPSC and FEIS. The two subsidiaries ensure regulatory compliance by formulating various carbon reduction and monitoring measures, and establishing energy conservation and carbon reduction goals at each year end for the coming year. The progress is reviewed monthly during energy conservation meetings, where improvement measures are also proposed with designated lead agency for action. Each day, staff track the fluctuation of carbon pricing and report the observation during monthly meetings.
The Chinese government mandates corporate efforts in carbon reduction through Carbon Emission Trading System. The carbon quota allocated in the system has been decreasing by the year. With increasing production scheduling at FEIS in 2021, its carbon emission exceeded the cap by a slight margin. Therefore, FEIS must replenish the quota with unused carbon emission balance. FEIS also installed the solar power generator and hybrid power station using cogeneration technology to reduce carbon emission. OPSC installed the rooftop solar power station and will optimize boiler operation with AI to reduce the use of natural gas as boiler fuel. The measures will cap the carbon emission under the decreasing carbon quota.

Carbon Quotas and Emissions of OPSC and FEIS

Unit：ktCO₂e

		2019	2020	2021
OPSC	Quota	166	161	139
OPSC	Actual Emissions	161	150	145
FEIS	Quota	324	328	319
FEIS	Actual Emissions	325	309	334

Note: The Quota in 2021 were estimated emissions; the actual quota is yet to be verified by the government. The Quota in 2020 were revised to actual number, which approved by government

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