Climate Change Response Strategies

Science-Based Targets initiative (SBTi)

 

 

Simplo signed the “SBTi Commitment” in 2021 and submitted the carbon reduction target in 2022. Simplo sets emissions reduction targets in line with a 1.5°C future, and Group’s near-term emissions reduction targets are approved by the SBTi in May 2023 (note1). Simplo is the first company in the global battery module manufacturing industry to pass the review. Simplo Technology commits to reduce absolute scope1 and 2 GHG emissions 51% by 2030 from a 2020 base year. Simplo Technology also commits to reduce absolute scope3 GHG emissions from purchased goods and services 25% within the same timeframe.
In the future, Simplo will actively take carbon reduction actions, including: introducing the ISO 50001 management system, installing solar PV systems, signing renewable energy power purchase agreements, designing green products, using recycled materials, etc. At the same time, key suppliers will be included in the emission inventory and emission reduction actions, implement carbon reduction goals, and built a sustainable partner co-prosperity ecosystem.

 

 

SMP Carbon 2030


Note:1.The data coverage of Simplo Technology Group includes the headquarters and subsidiaries of the consolidated financial statements.
2.*Purchasing goods and services classified according to the GHG protocol.
3.This near term target follows 1.5ºC path and has been certified by SBTi.
 
 

Internal Carbon Pricing (ICP) Strategy

Facing the generation of low-carbon emission or zero-carbon emission, the international community has promoted carbon fees and Carbon Border Adjustment Mechanism (CBAM), which will increase the carbon cost burden of the industry. Carbon risk management has become an important topic for companies, and companies are also aware of the profound impact of carbon risks on operations, thus launching the ICP mechanism.
Simplo is committed to implementing the sustainable strategy blueprint, moving towards the goal of low carbon emissions or even net zero carbon emissions. In order to accelerate the group's carbon reduction actions, Simplo actively develops an ICP mechanism and tracks the international carbon trading market as reference for internalize external costs. Valuation of carbon emissions promotes the reduction of carbon emissions in the group's internal activities. In addition to developing low-carbon processes in the manufacturing process, it can also encourage employees to implement energy conservation and carbon reduction in their work, and strengthen the company's low-carbon culture.

 

Carbon Disclosure Project (CDP)

In 2022, Simplo was be awarded a “B” score” by CDP. According to the CDP guidelines, a B score indicates that a company is showing some evidence of managing its environmental impact. At the same time, CDP announced the results of the 2022 Supplier Engagement Rating (SER), and Simplo was rated "A-", which shows that Simplo's carbon reduction management efforts and action results are both affirmed by international evaluations.
 

Task Force on Climate-related Financial Disclosures (TCFD)

Simplo became a TCFD supporter in December 2022. The Company discloses information such as climate governance, strategies, risk management and indicator targets by referring to the core elements of TCFD to assess climate-related risks and opportunities to the corporate operations. Meanwhile, a section of corporate risk identification is incorporated as a reference for formulating climate strategies to improve the transparency of organizational behavior, strategies and climate-related financial disclosure.

Aspect Description
Governance For the identification and management of climate change-related risks and opportunities, the board of directors was authorized to establish the Sustainability Office as the dedicated unit for the promotion and implementation of corporate sustainability, as well as the unit in charge of climate management strategy assessment and management. In 2023, the Sustainability Office identifies climate change-related risk and opportunity topics by following the TCFD standards, and report on the performance of ESG and climate change-related issues, impact assessment and progress of sustainability target achievements annually to the board of directors, so that the board can understand and monitor the risks faced by the Company.
Strategy The financial impact of the risks and opportunities related to climate change are identified, with response strategies formulated according to the items, while seeking opportunities for transformation or various investments of enterprises under climate change in the process.
Risk management Pursuant to the framework recommended by the TCFD, the influence of climate change-related impacts and opportunities are identified, and response strategies are formulated to continuously promote climate mitigation programs.
Indicators and targets Response plans and targets have been established for implementation, including:
1. Since 2020, Simplo Group has carried out ISO 14064-1 carbon inventory and verification for the organization every year
2. Passed the SBTi carbon reduction target (1.5 °C near-term) in May 2023
3. In 2022, a carbon reduction management model for the supply chain was formulated, and management programs will continuously be implemented in 2023

 

Identify Climate Change-related Risks and Opportunities

 

 

 

Climate-related Risk Matrix

Climate-related Opportunity Matrix


Greenhouse Gas Inventory

Based on the environmental concept of sustainable development and fulfilling corporate obligations, Simplo is actively committed to the inventory and control of greenhouse gas emissions, thereby slowing down global warming. We expect to maintain the sustainable development of the global environment through management and conservation of energy resources.
Simplo is currently not subject to the mandatory declaration of greenhouse gas emissions. In order to comply with international trends and customer requirements, Simplo passed the SBTi carbon reduction target compliance review in May 2023, actively demonstrating its determination to help the world control global temperature rise within 1.5°C.
Since 2021, Simplo has introduced the ISO 14064-1:2018 greenhouse gas inventory system. Every year, we conduct an inventory of the previous year's greenhouse gas emissions to monitor the carbon emissions of the group's important operating bases, and it has been verified by a third-party.

Direct emissions and energy indirect emissions (Scope 1 and Scope 2)

Item Unit 2020(Base year) 2021 2022
Direct emissions (Scope 1) ton CO2e 2,221 1,810 1,753
Energy indirect emissions (Scope 2) ton CO2e 106,769 75,448 10,031
Total emissions (Scope 1&2) ton CO2e 108,990 77,258 11,783
% change in total GHG emissions % NA -29% -85%
Emission intensity ton CO2e / NTD million in revenue 1.28 0.81 0.12
% change in emission intensity % NA -37% -85%

Note:

1. The data includes Simplo (Taiwan), Simplo (Chongqing), Simplo (Changshu), and Huapu.
2. The inventory is done with the operation control. The figures of the GHG inventory are certificated by third-party.
 


 

 

Other indirect emissions (Scope 3)

Simplo has established a GHG inventory and assesses the significance of the items in the C1-C15 categories by GHG protocol. Based on the significance of the analysis results, seven categories were included in the inventory items, and verified by a third party in accordance with ISO 14064-1. The item with the highest emissions is the purchased goods and services in 2022, accounting for 90.36%, which is a key item for the subsequent reduction.

Unit: ton CO2e

Category 2020
(Base Year)
2021 2022 % in 2022
(C1) Purchased Goods and Services 220,658.87 297,589.65 236,875.62 90.36%
(C3) Fuel- and Energy-Related Activities
(Not Included in Scope 1 or Scope 2)
14,352.55 15,144.80 5,879.91 2.24%
(C4) Upstream Transportation and Distribution 8,730.17 13,817.44 5,869.32 2.24%
(C5) Waste Generated in Operations 119.38 186.28 188.98 0.07%
(C6) Business Travel 116.84 102.25 218.01 0.08%
(C7) Employee Commuting 1,006.04 833.98 878.27 0.34%
(C9) Downstream Transportation and Distribution 33,158.53 15,086.75 12,235.70 4.67%
(C11) Use of Sold Products 1,626.22 Non-significant Non-significant NA

Note:

1. The data includes Simplo (Taiwan), Simplo (Chongqing), Simplo (Changshu), and Huapu.
2. The inventory is done with the operation control. The data industry has been verified by a third party in accordance with ISO 14064-1.