Fighting Climate Change

Basic Approach to Addressing Climate Change

Considering the vast amount of energy used in its business activities, Air Water Group believes that making efforts to reduce greenhouse gas emissions is indispensable for the Group to drive sustainable business practices. Therefore, we have defined reducing CO2 emissions as a key environmental issue for the Group.
Moreover, we participate in the Keidanren’s commitment to a low carbon society through the Japan Chemical Industry Association. We also advocate “clean energy solutions” as one of our efforts to contribute to solving social issues through our businesses. By expanding our woody biomass power generation and LNG/LPG businesses, we will contribute to reducing greenhouse gas emissions from our customers.

CO2 Emission Reduction Targets

Here at the Air Water Group, we use vast amounts of energy and emit large volumes of carbon dioxide in our business activities such as producing oxygen and nitrogen at industrial gas plants. We are always striving to reduce carbon dioxide emissions, for instance through efficient plant operations and by using the latest high-efficiency equipment. In FY2018, emissions by those group companies classified as Specified Business Operators under the Act on the Rational Use of Energy* were 1,594,000 t-CO2, approximately 3.2 percent below FY2013 levels. Moving forward, we are enhancing our emission reduction initiatives with the aim of reducing total carbon dioxide emissions even further: six percent below FY2013 levels by FY2021, and 15 percent by FY2030.

CO2 emission reduction targets

Mid-to-Long-Term CO2 Emission Plan

As part of the group’s efforts to reduce greenhouse gas emissions over the mid-to-long term, those energy-hungry group companies classified as Specified Business Operators under the Act on the Rational Use of Energy have enacted a mid-to-long-term plan, which sets forth actions such as capital investment and improved operations. Under the plan, those companies are indeed working aggressively to cut emissions. Key initiatives stipulated in the plan are shown in the table below.

Target plants Initiative Reduction
Target year
Air Water Inc.
Kashima Plant
  • Build new high-efficiency oxygen plant
9,598 FY2021
Kinki Air Water Inc.
Mie Gas Center
  • Upgrade equipment for reuse of nitrogen plant waste gas
4,904 FY2021
Air Water Inc.
Utsunomiya Plant
  • Build new composite
    storage tank
2,401 FY2019
Gold-Pak Co., Ltd.
Eniwa Plant
  • Improve energy-efficiency
    overall through upgrading of PET line no. 1
927 FY2019

Initiatives to Cut CO2 Emissions at Industrial Gas Plants

Using air to make oxygen, nitrogen, argon, and other industrial gases at our industrial gas plants takes vast amounts of electricity. The power supplied by utility companies is generated at thermal power plants, and in that way, we indirectly emit carbon dioxide—a serious challenge to our mission to cut emissions.
The Air Water Utsunomiya Plant replaced its old plant in 2017 with a VSUA plant (high-efficiency, compact, liquefied oxygen, liquefied nitrogen, and argon production plant) in an effort to achieve more efficient manufacturing. In fiscal 2017, the plant’s carbon dioxide emissions were down 7.7 percent year-on-year, and 13 percent the following year. The Utsunomiya Plant is scheduled to upgrade its old storage tanks in fiscal 2019 to new models that reduce loss, thereby further cutting greenhouse gas emissions.

Calculating Greenhouse Gas Emissions

Calculating Greenhouse Gas Emissions through Supply Chain (Scope 3)

Air Water Group calculates greenhouse gas emissions from fuel use (Scope 1 – direct emissions) and greenhouse gas emissions from electricity use (Scope 2 – indirect emissions). In 2019, we also started calculating greenhouse gas emissions from a supply chain (Scope 3), such as those from our suppliers and customers.

Third-party Verification of Greenhouse Gas Emissions

The Air Water Group discloses greenhouse gas emissions in the Air Water Report and on its website. To ensure that the data we provide are highly transparent and verified from an independent, objective perspective, we have received third-party verification for our greenhouse gas emissions since fiscal 2017.
We will continue working to provide even more reliable data to outside stakeholders through third-party verification of our greenhouse gas emissions.

Energy Management Structure

As a Specified Business Operator under the Energy Saving Act, Air Water has established an environmental management structure with the Compliance Center General Manager acting as the Energy Management Control Officer.
This has included establishing the Energy Conservation Committee (Subcommittee 1), which is made up of the Energy Management Control Officer, Energy Management Planning Promoter, and Energy Management Person in charge of designated energy management factory, and Energy Conservation Committee (Subcommittee 2), which is made up of plants and business sites with relatively low levels of energy consumption. Each subcommittee holds meetings on a regular basis.
At Group companies, the Compliance Center checks their energy management structures and provides guidance through environmental audits.

Information Liaison Conference of Energy Management Staff

Since 2015, Air Water has held the Information Liaison Conference of Energy Management Staff for Group companies designated as Specified Business Operators under the Energy Saving Act. There are talks by outside instructors, as well as discussions on energy conservation at the Group based on information provided by the Environmental Management Promotion Department of the Compliance Center and presentations of energy-saving practices.

Reduction of Greenhouse Gas Emissions by Decreasing Energy Consumption Intensity

All 23 companies of the Air Water Group that have been designated as Specified Business Operators under the Act on the Rational Use of Energy are working to reduce greenhouse gas emissions by decreasing energy consumption intensity.
The energy consumption intensity for the entire Group in fiscal 2018 has decreased by about 11.4% compared to fiscal 2013 and 2.4% compared to the previous year. We will continue to work to reduce greenhouse gas emissions through various measures, such as establishment of high-efficiency plants and thorough energy saving activities, to decrease energy consumption intensity.

Changes in energy consumption intensity

*Energy consumption intensity with sales as the denominator. The reference value, which is the value of fiscal 2013, was set to 100.

Greenhouse gas emissions

Efforts in Transportation Field

As a freight consigner, the Air Water Group promotes energy conservation and reduction of greenhouse gas emissions in collaboration with transportation companies.

<Mid-to long-term of Transportation Field>

The figure increased by 0.6% in comparison with the target of reducing unit energy consumption by an average rate of at least 1% per year over the mid-to long-term (over the past five fiscal years). The figure increased by 1.7% from the previous fiscal year.
The main causes of the increase were an increase in the long-distance transportation of backup gases required for periodic repairs of the plants installed at customers’ factories and an increase in transportation by trucks following the stagnation of transportation by ships due to heavy rain.

Greenhouse gas emissions and energy consumption intensity index in the transportation sector

Adaptation to Climate Change (continuation of supply of medical and industrial gases)

In recent years, large-scale natural disasters that are affected by climate change, such as recurring typhoons and record heavy rainfalls, have become more frequent. We are working to reduce the risks of natural disasters, such as suspended equipment and disconnected gas supply routes by installing VSUs (compact liquefied oxygen/nitrogen production plant) in various locations so that we can ensure a continuous supply of medical and industrial gases even in the case of a catastrophic natural disaster.

CDP* Climate Change Assessment

Air Water Group responded to the “CDP Climate Change” questionnaire aimed at disclosing information on greenhouse gas emissions and climate change at the request of investors. In addition to the CDP Climate Change questionnaire, we also responded to the “CDP Water Security” questionnaire concerning depletion of water resources and other related issues. In fiscal 2019, we received an “A-” for the climate change and a “B-” for the water security questionnaires.

*CDP is a global non-for-profit organization founded in 2000 and headquartered in London. Aiming to promote low-carbon efforts of businesses, CDP collects, analyzes and assesses information on climate change from the world’s largest companies from the perspective of management risks related to climate change and discloses the results to institutional investors. The organization was formerly called the “Carbon Disclosure Project” when founded but changed its name to “CDP” in 2013 following the expansion of its activities to other fields, such as water resources, in addition to climate change.