Reducing CO₂ Emissions from Our Business Activity

Basic stance

As a global business entity, the Nidec Group has been engaging in CO₂ emissions reduction during business activities (Scopes 1 and 2) since FY2004. At present, with a FY2025 sales target of 4 trillion yen, we need to reduce our CO₂ emissions while expanding our business. If our renewable energy introduction – Nidec’s major CO₂ emissions reduction effort – fails to go as planned, costs may increase as a result of the introduction of a carbon tax. Further,if we fail to respond to our customers’ and investors’ demands for climate change actions and information disclosure, we may be subject to business suspension and a decline in reputation.

Target

In July 2021, Nidec announced Vision 2025, which aims to achieve: a net-zero status in CO₂ emissions in Scopes 1 and 2 by FY2040; and the renewable energy introduction ratio of 40% in FY 2025, and 80% in FY2030. Then, in March 2024, we set a new mid-term plan on CO₂ emissions reduction. Nidec aims to reduce, by FY2030, its CO₂ emissions based on Scopes 1 and 2 by 42% from the level of FY2022.
In August 2024, these aforementioned reduction targets were recognized as science-based targets to achieve the Paris Agreement’s 1.5ºC target, and given an SBT certificate by the SBTi (Science Based Targets initiative), an international climate change initiative.

To achieve this goal, our seventh medium-term environmental conservation plan sets Scope 1 and 2 reduction targets as part of our efforts to reduce the environmental impact of our business operations. One particularly important goal is to increase the ratio of renewable energy use to 40% on a consolidated basis by fiscal year 2025, which we have set as one of our materiality KPIs; we are continually working to reduce CO₂ emissions.

The seventh mid-term environmental conservation plan

Materiality: Contribute to environmental sustainability

Achievements

For fiscal year 2023, Scope 1 and 2 CO₂ were 1,060,000 t-CO₂, which represents a 2% reduction from the fiscal year 2022. This decrease is attributed to energy-saving initiatives achieved through the optimization of operating conditions for production equipment and air conditioning systems, as well as an increase in the adoption of renewable energy sources and new implementations at 9 sites. These initiatives contributed to an increase in the renewable energy introduction ratio from 7.8% from the fiscal year 2022 to 12.5%.

Actions

To reduce CO₂ emissions as part of its climate change measures, Nidec implements actions to improve its businesses’ energy efficiency and those to introduce renewable energies. With more than 300 business bases around the world, we accumulate information on our various actions, and share the information globally to contribute to mitigating climate change.

Improving our internal energy efficiency

To reduce electricity consumption, we are promoting energy conservation activities through the following steps:

• ・Visualizing individual facilities’ electricity usage
• ・Conducting energy-saving diagnoses
• ・Optimization of equipment usage conditions

Energy saving diagnosis

We visualize the power consumption of each piece of equipment, narrow down the issues, and then conduct an energy conservation diagnosis. Energy conservation experts from the Nidec Group visit the sites and carry out site-specific activities.

Optimization of equipment usage conditions

Nidec Vietnam Corporation places heat-insulating covers over its injection molding machines to reduce their overall electricity usage by 15 – 20%. In addition, heat insulation at equipment’s thermal sources, guiding heat for discharging, transferring cool air from air-conditioning units, and an efficient discharge of warm air staying above enable a 20% reduction of air-conditioning units’ electricity usage. These measures will likely help us reduce CO₂ emissions by approximately 800t per year. These initiatives will be rolled out gradually across the NIDEC Group.

Introducing renewable energies

In another activity, Nidec is replacing conventional energies with renewable ones to reduce its electricity usage and CO₂ emissions. In particular, Nidec is active in:

• ・Installing photovoltaic facilities
• ・Revising the contents of its electricity contracts to procure renewable energies

Installing photovoltaic facilities

Nidec Precision Components (Zhejiang) Co., Ltd. utilized an onsite PPA to introduce a 1621kW photovoltaic electricity generation system. This action will enable Nidec Precision Components (Zhejiang) to reduce its annual CO₂ emissions by 830 tons. We will introduce such an action to other business bases to contribute to further reduction of CO₂ emissions.

Revising the contents of electricity contracts to procure renewable energies

The following seven factories executed renewable energy-based electricity contracts, generating electricity entirely with renewable energies.