Materials and Energy

Resources and energy input for producing one tonne of crude steel (tCS) in 2022 are as follows.

Raw Materials Management

Corresponding UN SDGs

Taiwan's SDGs (T-SDGs) :
Core Objective 8(8.4)、12(12.2)

Benefit Highlights in 2022

  • 8 new sources for coal, iron ore and flux were developed in 2022.
  • To avoid the risk of Russia being sanctioned due to the Russo-Ukrainian War, metallurgical coal was sourced from alternative sources in other countries instead of the long-term contract with Russia.
  • A total of 999,075 tonnes of scraps was recycled in 2022, of which 940,362 tonnes was used with the percentage reused reaching 94.1%.

Target

  • Short-term goals (2023) Mid-term goals (2025) Long-term goals (2030)
    Number of suppliers accepting the Supplier Code of Conduct ≥ 2,550 Number of suppliers accepting the Supplier Code of Conduct ≥ 3,000 Number of suppliers accepting the Supplier Code of Conduct ≥ 3,500

Policy or Commitment

CSC is the largest upstream steel production plant in Taiwan. The main products are steel plates, steel bars, wire rods, electromagnetic steel coils, galvanized steel coils and others. The main raw materials used are coal, iron ore and flux; the majority of the raw materials are imported. In recent years, the raw materials market has changed from a buyer's market to a seller's market; therefore, the management of raw materials is one of the important determining factors for the steel plant to produce and make profit.

Besides, adjusting raw material stock according to domestic and international situations during weekly meetings on material purchase, transportation, and storage, CSC should also actively develop new materials and new sources. CSC also actively develops new sources for raw materials and recycles steel scrap in order to reduce costs, diversify sources, and avoid material shortages and monopoly by suppliers.

Action Plan

  • Development of New Material Sources
    CSC actively seeks new supply sources that satisfy the CSC's quality requirement. By closely tracking and reviewing the progress to diversify the risk, 4 new sources for coal, iron ore and flux were developed in 2022.
    CSC also requires suppliers to comply with the relevant ESG clauses in procurement contracts signed with coal and iron ore suppliers. Furthermore, the CSC Supplier Code of Conduct was established in accordance with international regulations and standards, including code of ethics, labor and human rights, health and safety, environmental standards, and management system. Special clauses are added to contracts where necessary, in hopes that suppliers can adopt the same code of conduct. Please refer to Supply Chain Management and Sustainability Accounting Standards Board (SASB) Steel Industry Indicators for more information on purchasing requirements.
  • Steel Scrap Recycling
    Scraps recycled by CSC are divided into two categories, scraps and residual liquid steel, in which scraps include crude steel with non-conforming quality, the head and tail cut when crude steel is produced, coils with non-conforming quality, head and tail cut from plates, and scraps. Residual liquid steel includes basic oxygen furnace, ladle, and dispenser residual liquid steel. The strategy used to increase scrap use by the Steelmaking Department is thermal balance and mass balance in furnace, torpedo car low weight production model, and adding a cover.
    In response to resources recycling, CSC has already added steel scrap into the raw materials -mixed and steelmaking process. The amount of steel scrap used will adjusted based on the quality requirements of the steel products, the blast furnace condition and the annual maintenance conditions. Steel scrap is mainly for self-production and self-use at CSC, and the excess will be sold to subsidiaries to achieve the principle of the circular economy.
  • Implementation Status Results
    CSC is a consistent steel production plant. During the manufacturing process, more than 90% of the raw materials are flux, coal and iron ore, and a small portion of steel scrap which accounted for 4.11% of materials used in 2022. The procurement of raw materials is mainly focused on non-renewable raw materials, including the flux, coal and iron ore. Any surplus waste steel produced internally is sold to Dragon Steel Corporation, thus adhering to the principles of a circular economy.
    Category Raw materials 2022 Usage
    (Unit: 10,000 tonnes)
    Non-recyclable Coal 604.9
    Iron Ore 1,333.4
    Flux 253.3
    Recyclable Steel Scrap 94.0

    A total of 2.57 million tonnes (Mt) of the flux, 6.96 Mt of coal and 13.90 Mt of iron ore were purchased in 2022. Among them, about 82% of the flux was imported from abroad and serpentine and limestone from Hualien area accounted for about 18%. Coal and iron also need to be purchased from abroad.

Use of Raw Material and Percentage of Purchasing by Country from 2020 to 2022

Flux
Coal
Iron Ore
Event 2020 2021 2022
Purchase amount (10,000t) 251 322 257
Country % Japan 44.22 44.79 52.03
Taiwan 20.32 17.02 17.92
Vietnam 13.94 8.46 8.87
Philippines 12.01 17.49 10.91
Others 9.51 12.24 10.27
Event 2020 2021 2022
Purchase amount (10,000t) 733 798 696
Country % Australia 76.81 78.03 80.41
Canada 16.78 15.83 16.04
Indonesia 2.59 4.17 1.54
Others 3.82 1.97 2.01
Event 2020 110年 111年
Purchase amount (10,000t) 1,324 1,694 1,390
Country % Australia 83.01 73.79 78.42
Brazil 9.67 16.34 14.19
Canada 7.32 9.87 7.39
Others - - -

 

Energy

Corresponding UN SDGs

Taiwan's SDGs (T-SDGs) : Core Objective 7, 8,11,12

Benefit Highlights in 2022

  • According to regulatory requirements, energy users are required to save at least 1% of electricity on average between 2015 and 2024. CSC has currently saved up to 1.89% of electricity on average from 2015 to 2022, which is higher than required by law.
  • The installed capacity of CSC's solar power system reached 62.0 MW; CSC installed 4 solar PV charging stations with a total of 30 kW for electric scooters in CSC's plants in 2019. In 2022, 24,795 kWh was generated for self-use in the plants, and CSC obtained 25 renewable energy certificates.
  • With the continuous promotion of District Energy Integration in Linhai Industrial Park, CSC sold 1.480 million tonnes of steam produced from district energy integration in 2022, which can reduce approximately 355,000 tonnes of CO2e in greenhouse gas emissions.
  • The energy target in 2022 was 23.12 GJ/tCS (5,522 Mcal/tCS), and the actual performance was 22.96 GJ/tCS (5,485 Mcal/tCS), achieving the annual target.
  • The fourth Energy Saving Action Plan (2021 to 2025) has a target of saving 2.64 million GJ. From 2021 to 2022, CSC has saved up to 2.175 million GJ of energy, which accounted for 82% of the aforesaid target, thereby achieving its target for the year. The amount of energy saved was equivalent to a reduction of 174,700 tonnes of CO2e in carbon emissions.

Policy or Commitment

CSC mainly implements energy management through the Energy Conservation Committee and control of the energy management system (ISO 50001) to achieve the goals of energy conservation, carbon reduction and continual improvement. The Committee was formed and chaired by VP of Production Division. The Committee has three teams be responsible for energy saving and emission reduction in CSC's plants. The Committee also regularly holds meetings to review the achievement of current targets, share information on energy conservation projects, communicate relevant important topics, bring up appeals or consultations, propose interim motions, and publicize the records of the meeting. The energy policies are approved by the Chairman of the Board and updated when necessary. The latest version of the Energy Policy is committed to continuous improvement, compliance with regulations, performance management, energy conservation, carbon reduction, and knowledge advancement.

Energy Policy

Continual Improvement Improve energy performance, support energy-saving designs and green procurement, and commit to sustainable operations.
Legal Compliance Implement legal identification, comply with energy regulations, and fulfill corporate social responsibility.
Performance Management Perform energy reviews, fully provide resources and information to achieve goals/targets, and eliminate potential energy waste.
Energy Saving and Carbon Reduction Become an environmentally friendly steel company dedicated to improving energy efficiency, promoting district energy integration, developing green energy, and using clean energy.
Knowledge Advancement Capture the latest energy technical opportunities, reach communication consensus and achieve widespread application.

The Energy Conservation Committee

In order to improve energy efficiency and achieve continuous improvement, CSC sets the energy intensity target (Mcal/tCS) according to the annual production plan and energy saving goals every year, as the energy performance indicator. The energy intensity target for 2023 is≦5,436 Mcal/tCS (22.76 GJ/tCS ).

Item 2020 2021 2022 2023
Energy Intensity Target
(Mcal/tCS)		 ≦5,614 ≦5,390 ≦5,522(I) ≦5,436
Energy Intensity Target
(GJ/tCS)		 ≦23.50 ≦22.57 ≦23.12 ≦22.76
Actual Energy Intensity
(Mcal/tCS)		 5,549 5,315 5,485 -
Actual Energy Intensity
(GJ/tCS)		 23.23 22.25 22.96 -
Accomplishment Yes Yes Yes -

Note: The target of Energy Intensity is set based on production capacity and equipment maintenance that year. The steel market was still in poor condition in the second half of 2022, production of the blast furnace was adjusted accordingly, and the energy baseline has deviated from the original basis used for goal programming. Hence, the target value for Energy Intensity in 2022 was adjusted for management and to make the target feasible.

Action Plan

ISO formally announced ISO 50001 in June 2011. In order to improve the performance of energy conservation, CSC introduced ISO 50001 in February 2011 along with consultation from Industrial Technology Research Institute (ITRI), and received the certificate of ISO 50001 from BSI on December 1st of the same year. CSC is the first steel company to implement ISO 50001 in Taiwan, and obtained ISO 50001:2018 certification in 2019. CSC continues to pass verifications by third party institutions each year, and achieves energy conservation, carbon reduction, and continuous improvement goals through its management system and the Energy Conservation Committee.

Five-year Energy Saving Action Plan and Targets

In order to achieve energy conservation and carbon reduction and respond to mandatory Greenhouse Gas (GHG) reductions in advance, CSC started the “Five-year Energy Saving Action Plan” in 2005, and has successively promoted three phases and every phase has reached the targets of the action plan. 553 energy-saving projects were completed in 2021-2022, contributing to 82% of the “Energy Saving Action Plan -Phase IV” target (the fourth phase is from 2021 to 2025), which is equivalent to a reduction in carbon emissions of 174,700 tonnes CO2e (I). At the same time, CSC adheres to the government's energy saving targets and regulations “The average annual power-saving rate of energy user shall reach 1% or more from 2015 to 2024”. Currently, CSC has achieved a power-saving rate of 1.89% from 2015 to 2022.

Note: I. The calculation coefficients are partially quoted from the CO2 emission factors of the GHG inventory in the previous year, and the rest are calculated based on CSC's energy equipment efficiency coefficient in 2014 x previous year's electricity emission coefficient from the Bureau of Energy.

Phase I
Energy Saving Action Plan		 II
Energy Saving Action Plan		 III
Energy Saving Action Plan(I)		 IV
Energy Saving Action Plan
Schedule 2005 - 2010 2011 - 2015 2016 - 2020 2021 - 2025
Energy-saving Target (GJ) 8,666,676 9,043,488 3,784,624 2,637,684
Number of Projects 372 658 662 553
Performances (GJ) 8,930,444 12,623,202 6,253,473 2,174,657
Achieving Rate 103% 139% 165% 82%

Note I: Due to the diminishing energy-saving potential, the targets of Phase III and IV Energy Saving Action Plans are less than previous years. The number of projects, energy-saving performances and achieving rate are calculated until 2021.

 

 

 

On-plant Energy Saving

▪ Set up Utilities Dispatching Center (UDC) CSC established the UDC since factory completed and put into production. The UDC centrally monitors all energy sources, such as gas, electricity, steam, O2, N2, Ar, H2, plant air, compressed air, etc., and also production plans. Then with the assistant of the integrated-Energy Management System (iEMS), UDC can execute dynamic dispatching in order to keep energy balancing in CSC and to minimize by-product gas emissions. UDC also manages the electricity load in CSC to avoid violating the contract with Taiwan Power Corp. (Taipower), and actively participates in the Taipower Demand Bidding Program. Furthermore, it compares the power generation cost of different fuels with Taipower tariff to adjust the self-generation amount to minimize the usage of high-priced fuels, such as low-sulfur oil and natural gas.

▪ Best Available Techniques (BAT) In order to improve energy-saving performance, CSC has intensively contacted with steel-making companies in Japan, South Korea and China in recent years. We had collected BAT for energy-saving from other companies and completed the “Best Available Technical Manual for Energy Saving and Emission Reduction of Steel Plants” in July 2011.
The main technologies that have been applied in CSC are Coke Dry Quenching (CDQ), sinter waste heat recovery, Top Gas Pressure Recovery Turbine (TRT), Blast furnace hot stove waste gas heat recovery, Blast Furnace Pulverized-coal Injection, Converter Off-Gas Boiler, Gas recovery system for top hopper release, Hot Charging, Regenerative Combustion, etc.

▪ Guidelines of Energy Conservation Energy-saving begins with design. CSC adds the “Guidelines of Energy Conservation” section to CSC Design Standard and indicates energy efficiency requirements of air conditioning, lighting, shifting mechanisms, water supply systems, etc. New plants should follow the design standard to choose equipment that is high efficiency, energy saving with long-term benefits. To promote energy conservation design standards, energy conservation examples are periodically shared during energy and environment meetings of the Energy Conservation Committee and CSC Group, in hopes of further improving energy conservation results.

Off-plant Energy Saving

▪ Energy-Saving Technology Counseling Team Through vertical integration and horizontal contact, CSC takes the lead in promoting the energy-saving technical service work to CSC's subsidiaries and mid- and downstream customers. With consultation on thermal, electricity, and energy management, the team hopes to discover more opportunities in energy-saving improvement, which further improves energy efficiency, reduces energy costs, and increases competitiveness. As a result, CO2 emissions are reduced, contributing to the voluntary reduction of greenhouse gas emissions in steel-related industries.
From 2007 to 2022, the team served a total of 69 manufacturers. The service target has been extended to mid- and downstream customers and their associates in the steel industry. CSC has fulfilled its corporate social responsibilities in order to improve industrial competitiveness and promote a friendly environment. In 2021, CSC provided energy saving and carbon reduction-related technical consulting services to two companies, namely Kaohsiung Monomer Co., Ltd. and Hanshin Department Store, in collaboration with the Kaohsiung City Energy Saving and Carbon Reduction Technical Consulting Team.

▪ Group Energy Saving Promotion To promote energy-saving measures and sharing case studies within the CSC Group, an energy-saving technology exchange platform, and share energy conservation examples during periodic group energy and environment meetings, in order to maximize the benefits from the group's energy conservation.

Capacity of Renewable Energy Installations

“Renewable Energy Development Act” have been passed in May 2019. National cumulative installation amount is projected to reach 27 GW in 2025, and large power consumers are required to set up a certain percentage of renewable energy power generation equipment. CSC Solar Corp. installed 92.4 MW solar photovoltaic equipment within the CSC Group from 2017 to 2022 to achieve energy saving, carbon reduction and fulfill corporate social responsibility. As of the end of 2022, the cumulative power generation reached 435 million kWh, and all the power generation was sold to Taipower. As the electricity emission coefficient of Taipower in 2021 was 0.509 kg/kWh, the carbon reduction generated by CSC's solar energy reached 221,000 tonnes, equivalent to the CO2 absorption of 569 Daan Forest Parks.
Following the installation of solar power systems in line with government policies since 2011, CSC's solar power installed capacity has reached 62.0 MW (including self-built and provided places) in 2022. Subsequent to the installation of four solar power charging stations for electric scooters with a total capacity of 30kW at CSC plants, these charging stations generated 24,795 kWh of electricity in 2022, with the electricity generated by these charging stations used at CSC plants. At the same time, CSC successfully obtained a total of 25 renewable energy certificates at the end of 2022. On the other hand, CSC has planned to use at least 30 million kWh of electricity generated from renewable energy each year starting in 2023 for the purpose of complying with the “Regulations for the Management of Setting up Renewable Energy Power Generation Equipment of Power Users above a Certain Contract Capacity.”


Solar power bike charging stations at the east side of W6/Y6 Dept. building

2020 2021 2022
CSC Accumulated Solar Power Capacity (MW)
( Including self-built and provided places) 		61.1 62.0 62.0

Implementation Result

The coking coal in the steelmaking process transforms into by-product gases which can be used as fuel in steelmaking and in cogeneration power plants to generate steam and power. Oil and natural gas can also be used in power plants while the excess power demand is met by purchased electricity from Taipower.

Category(I) Item 2020 Usage (GJ) 2021 Usage (GJ) 2022 Usage (GJ)(II)
Primary Energy Coal(III) 207,815,234 219,340,668 191,854,995
NG 3,082,331 5,107,395 9,556,139
Diesel Oil 103,292 111,916 104,733
Gasoline 5,953 5,368 4,997
Low-sulfur Oil 68,615 79,477 373,631
Secondary Energy Purchased Electricity 8,918,640 9,600,438 9,991,953
Self-Produced secondary energy Steam 11,692,499 10,755,248 10,791,457
Coke Oven Gas (COG) 35,070,654 36,497,632 36,300,085
Blast Furnace Gas (BFG) 40,424,444 47,792,494 40,306,703
Linz-Donawitz Converter Gas (LDG) 6,982,838 8,129,416 6,816,953
Cold Blast Air 7,793,058 8,765,847 7,765,506
Oxygen 942,972 1,129,754 1,049,466
Nitrogen 713,866 764,360 769,522
Argon 95,064 100,735 90,431

Note I: Primary Energy consumption and Secondary Energy consumption were verified by DNV in CSC's annual GHG inventory. Energy consumption for each type of energy source each year is determined by calculating the product of annual consumption and average heating value in CSC's annual test each year.

Note II: Consumptions of natural gas, low-sulfur oil, and purchased electricity were higher in 2022 and 2021 than in 2020 due chiefly to the cessation of coal combustion in boilers at CSC's power houses in August 2021, which eventually led to higher consumption of purchased electricity within the company and increased use of natural gas and low-sulfur oil at the company's power houses.

Note III: Coal in 2020 and 2021 includes metallurgical coal and steam coal; coal in 2022 only includes metallurgical coal.

Performance of Energy Saving and Carbon Reduction

In 2022, CSC completed a total of 234 energy saving projects, which saved a total of 1.317 million GJ, reduced carbon emissions by 86,000 tonnes CO2e, and saved energy cost by 417 million TWD, main projects include Rolling Mill Department II- Hot Rolled Products "changing reheating furnace No.3 of the first hot roller to regenerative," "improving fuel control of reheating furnace No. 2 of the first hot roller," and Rolling Mill Department I - Plate, Bar & Rod "optimizing combustion air emission valve of reheating furnace in Billet Mill to improve the energy consumption of the reheating furnace."

Energy Saving Category 2020 2021 2022
Items Items (GJ) Items Items (GJ) Items Items (GJ)
Electricity 111 298,099 106 223,820 169 486,750
Fuel Gas 13 569,392 8 172,350 17 664,063
Industrial Gas 4 25,364 7 47,292 2 3,865
Steam 5 146,544 5 108,472 6 107,150
Water Systems 11 9,244 170 13,190 25 2,162
Others 12 13,882 23 285,941 15 52,853
Total 156 1,062,525 319 851,065 234 1,316,843