Theme 8
SDGs and Sumitomo: Decarbonizing Society

Beautiful islands conjure up images of balmy sea breezes and bountiful nature. But every paradise has a serpent: diesel power generation is a commonplace on remote islands, churning out CO₂ emissions. Since island power grids are isolated from the mainland grid, it would be impracticable to rely exclusively on renewables because of the fluctuations in output depending on the weather.

Satsumasendai City of Kagoshima Prefecture took up the challenge to resolve this issue. With its nuclear power station and major photovoltaic and wind power facilities, Satsumasendai is positioned as the power source of southern Kyushu. With the aim of turning the Koshikishima islands, which form part of Satsumasendai City for administrative purposes, into “eco islands” by introducing next-generation energy, Satsumasendai City, Kyushu Electric Power, and Sumitomo Corporation launched a demonstration project, the Koshikishima Reuse Storage Battery Project, in 2015.

Back in 2010, Sumitomo Corporation established 4R ENERGY, a joint venture with Nissan Motor, to reuse electric vehicle (EV) batteries. In 2013, on the manmade island of Yumeshima, Osaka, the partners began the world’s first demonstration experiment involving reuse of recovered batteries. Although batteries mounted on EVs are no longer fit for powering vehicles after a certain number of years of use for that purpose, they can still do a good job as storage batteries. There are already over seven million EVs in service worldwide. In aggregate, their batteries have enough storage capacity to handle the daily output of ten nuclear reactors. And since the world’s population of EVs is destined to soar, there will be more and more used batteries looking for a useful post-vehicle role. Sumitomo Corporation expects reuse of batteries will contribute to load balancing and protection of the global environment.

Following completion of a technological examination on Yumeshima, the new project on Koshikishima started. Using batteries from 36 EVs, a power management center was set up on Koshikishima. By directly connecting the power management center to the island’s power grid, infrastructure is now in place for load balancing and introduction of solar and wind power, whose intermittency would be a problem if the power management center were not part of the grid. With an eye to the needs of remote islands and in pursuit of regional vitalization, Sumitomo Corporation is promoting greater use of renewable energy in combination with power storage stations, which are positioned as the third element of an integrated grid, along with power stations and substations.

In April 2017, 40 EVs were introduced on Koshikishima by Nissan Motor. Clean electricity from the renewable energy source drives EVs, contributing to low carbonization of the island. When the batteries on the EVs are no longer fit for purpose, they will be used at the power management center, thus boosting use of renewables. Thus, society will be sustained by a circular energy system. Looking ahead, the idea is to establish a municipal model for renewables use and then promote it nationwide.

Since glass making involves the combustion of natural gas and heavy oil to melt raw materials, the resulting CO₂ emissions are considerable. Accordingly, the glass industry has long been seeking ways of reducing its CO₂ emissions. For its part, Nippon Sheet Glass (NSG) positions climate change countermeasures as management’s top priority among its sustainability initiatives.

Glass for architectural and automotive applications account for 90% of the NSG Group’s sales, with architectural applications accounting for 62% of the Group’s CO₂ emissions and automotive applications for 33%. NSG’s drive to reduce CO₂ emissions has two aspects: contributions to CO₂ emissions reduction by products and through the revision manufacturing processes. In terms of products, online transparent conductive oxide (TCO)-coated glass for solar panels facilitates power generation and insulated window glass contributes to energy saving. Glass with solar control performance for automotive applications reduces the air-conditioning burden and improves the fuel efficiency of gasoline vehicles, while for electric vehicles, it reduces the burden on batteries, thus extending cruising range.

Regarding initiatives to reduce CO₂ emissions from manufacturing processes, a look at the big picture reveals that over the past 100 years NSG has switched the fuel for glass melting from coal to heavy oil and then from heavy oil to natural gas. Taking the opportunity of the adoption of the Paris Agreement in 2015, NSG’s Sustainability Committee set a CO₂ emissions reduction target for the entire Group. The Group pursued a 1% year-on-year reduction in CO₂ emissions per tonne of equivalent product for the period from 2015 to 2020. In 2019, the NSG Group announced a long-term target: a 21% reduction by 2030, compared to the 2018 level, in absolute greenhouse gas emissions (total of Scope 1 and Scope 2) attributable to the use of fuel and consumption of purchased electricity and other energy sources in business operations. This target has been verified by the Science Based Targets initiative (SBTi*). Furthermore, the Group set a medium-term target: a 2% year-on-year reduction in CO₂ emissions per tonne of equivalent product for the period from 2021 to 2024.

*A partnership between CDP (former Carbon Disclosure Project), UN Global Compact, WRI (World Resources Institute) and WWF (World Wildlife Fund). SBTi helps companies set science-based goals for reducing greenhouse gas emissions to mitigate the impact of climate change.

*A partnership between CDP (former Carbon Disclosure Project), UN Global Compact, WRI (World Resources Institute) and WWF (World Wildlife Fund). SBTi helps companies set science-based goals for reducing greenhouse gas emissions to mitigate the impact of climate change.

The NSG Group has made solid progress with its initiatives, having achieved in excess of a 1% year-on-year reduction in CO₂ emissions per tonne of equivalent product through 2019. Regarding measures for Scope 2 (indirect emissions attributable to consumption of energy sources), the Group is expanding the use of renewable energy. Of NSG’s direct CO₂ emissions, 70% are from the furnace for melting glass ingredients. Notwithstanding continuous concerted efforts to develop furnaces with superior combustion efficiency, a great reduction in CO₂ emissions would likely be unattainable unless the use of energy derived from fossil fuels for melting ceased. Seeking a solution to this impasse, NSG has been focusing on hydrogen as a possible fuel.

Natural gas is the mainstay fuel for glass furnaces. If hydrogen were mixing with natural gas for combustion, CO₂ emissions throughout the melting process could be dramatically reduced. NSG estimates that if all of the natural gas were replaced with hydrogen, CO₂ emissions would be slashed by 80%.

From March to April 2021 the world’s first demonstration of glass manufacturing using hydrogen will take place at the NSG Group’s Greengate Works in Northern England. The objective is to investigate productivity and quality while increasing the hydrogen ratio. The initiative is part of a project managed by HyNet, a consortium of industries in North West England, to reduce carbon emissions. The work is supported by funding from the UK government, which is promoting a fuel-switching scheme for industry.

Hydrogen, the subject of this test, is certainly a promising candidate fuel, but it is one of several R&D themes being pursued in a multifaceted effort with a view to eventually achieving zero carbon emissions from glass manufacturing processes. In parallel with the demonstration of the use of hydrogen, NSG is also developing technology for the use of electricity derived from renewables in glass melting. As in the case of hydrogen, a collaborative effort integrating various parties’ expertise is the key to efficient development of innovative technology. Such an approach is the fast track to realizing zero CO₂ emissions for the benefit of our planet and all its inhabitants. Going forward, NSG is convinced that promotion of partnerships across industry and society will be a major theme.

Media report that greenhouse gas emissions decreased as the global economy slowed during the COVID-19 pandemic. Although emissions may fluctuate during the eventual economic recovery, the global trend toward carbon neutrality is expected to gain momentum with every passing year. Moreover, in view of the growing commitment to the Sustainable Development Goals (SDGs) and the environmental, social and governance (ESG) approach to corporate investment, companies’ decarbonization initiatives are indispensable.

Sumitomo Seika Chemicals, whose mainstay business of super-absorbent polymers is complemented by a functional chemicals business as well as a gases & engineering unit, has placed the SDGs at the heart of its management since 2018. The company established “Sumitomo Seika Group’s Mission for CSR” to guide and unify the Group’s commitment toward CSR activities and set up the CSR Committee, a cross-functional organization spearheading the Group-wide initiatives.

In Sumitomo Seika Chemicals’ initiatives, contributing to carbon neutrality is positioned as a central task. The company’s medium-term targets include a 7% reduction by fiscal 2021 and an 11% reduction by fiscal 2022 in CO₂ emissions as compared to fiscal 2013. This is in keeping with the Japan Chemical Industry Association’s low-carbon society action plan, which seeks to reduce fiscal 2030 CO₂ emissions by 10.7% compared to fiscal 2013 amounts. With an eye to the longer term, Sumitomo Seika Chemicals is promoting further efforts toward the Paris Accord’s target of reducing CO₂ emissions in fiscal 2030 by 26% compared to fiscal 2013 amounts.

As an experienced contender in the chemicals industry with a wealth of expertise, the company is able to offer a continually renewed range of diverse innovative products and pioneer new applications. Although people may not be aware of Sumitomo Seika Chemicals in their everyday lives, the company’s gases & engineering business, which handles over 40 kinds of gases, certainly has a direct impact on decarbonization. Chipmaking, chemicals, transportation, medicine, and food processing are just some of the sectors in which these gases are used.

For example, the company’s gases include specialty gases used as analytical standards in environmental monitoring, gases used for semiconductor fabrication processes, chemical gases for medical and industrial applications and food additives. The company’s ultra-high-purity ammonia gases are supporting development of high-performance blue and white LEDs.

The company’s principal products for the semiconductor industry are high-purity special gases, such as carbon monoxide, nitric oxide, and propane (C₃H₈), which are used for deposition and etching processes in the manufacture of memories, logic ICs, SiC power semiconductors, etc. SiC power semiconductors are already being applied for air conditioners, photovoltaic power conditioners, electric vehicles, server power supplies, and trains.

As well as ensuring safe and stable supply of standard gases required for traceability-based certification (gases that serve as the criteria for measuring gas concentration) and industrial gases in Japan and overseas, Sumitomo Seika Chemicals is supporting the manufacture of diverse products used in daily life and the development of new products. Furthermore, besides gases, the company also handles pressure swing adsorption (PSA) gas generators that separate and purify gases and, for resource circulation, gas recovery and purification systems. Thus, the company’s products are by no means limited to actual gases, but include equipment with wide-ranging applications in diverse industrial fields. Capitalizing on its expertise in chemicals, Sumitomo Seika Chemicals intends to contribute to the development of a sustainable society through gases.

As well as requiring the development of breakthrough technologies, solid progress in decarbonizing society is equally dependent on the ability to execute complex practical solutions incorporating diverse technologies, which is Sumitomo Densetsu’s forte. The company contributes to the realization of decarbonizing society through diverse projects, including electrical facilities, power system interconnection lines, and substations, in the renewable energy field such as solar photovoltaic (PV) power generation plants and wind farms. As envisaged in its medium-term management plan VISION 24 covering five years from fiscal 2020, the company is also energetically promoting the “new energy” business.

Sumitomo Densetsu has a long history of been engaging in the renewable energy field, having started the construction of PV power generation systems some 30 years ago. The introduction of the feed-in tariff (FIT) scheme in 2012 was a turning point, with demand for facilities construction on an upward trajectory ever since. However, reflecting the annual decrease in the fixed purchase price for solar power, the trend has changed in recent years. Rather than selling all the electricity generated by their PV systems, most companies nowadays opt to install a power generation system with capacity sufficient for their in-house needs in the context of their ongoing efforts to improve their environmental performance, reduce energy costs, and implement business continuity planning (BCP) measures. Responding to this change, Sumitomo Densetsu is emphasizing proposals of on-site PV power systems whose output is for in-house consumption.

Sumitomo Densetsu’s prowess in the construction of PV systems owes much to the capabilities of two specialist units: one devoted to ultra-high-voltage electrical systems for power utilities and the other to grid interconnection. Deploying expertise covering virtually every aspect of the power system, and benefiting from an open corporate culture conducive to flexible inter-departmental collaboration, Sumitomo Densetsu can independently execute large-scale projects. In addition to high-caliber technical capabilities, the company has several decades of accumulated experience and knowhow, including proposal-making capabilities honed through relationships with diverse partners and projects encompassing a wide range of facilities. Hence, the company’s solid track record of projects successfully accomplished nationwide, including Oita Solar Power in Oita City whose 82MW capacity made it Japan’s largest PV power plant operated by an individual company at a single location when it began commercial operation in 2014.

In recent years, the number of new wind power projects has been on the rise. For big wind farms transmitting ultra-high-voltage electricity, Sumitomo Densetsu’s technological capabilities and inter-departmental collaboration are highly advantageous, just as they are for PV power plants. A major project was construction of Wind Farm Tsugaru in Tsugaru City, Aomori Prefecture, Japan’s largest with a capacity of 120,000kW. For this project involving 38 wind turbines and 32km of power transmission lines, Sumitomo Densetsu was responsible for the installation of power transmission lines (underground) and current collection lines (underground and overhead), construction of a substation, communications work, and electrical work inside the wind turbines. Inter-departmental collaboration and technological ingenuity enabled the company to successfully execute this ambitious large-scale project with outstanding environmental credentials.

Demand is expected to increase for installation of both onshore and offshore wind power facilities and the number of biomass power generation projects is also starting to rise. Going forward, Sumitomo Densetsu will step up its contribution to the achievement of carbon neutrality by leveraging its comprehensive strengths.