11

“Embraco’s contributions to energy efficiency”Ernesto HeinzelmannErnesto Heinzelmann

Sep, 2008International Policy Leaders Dialogue, Washington D.C. International Policy Leaders Dialogue, Washington D.C.

22

Energy consumption is a global concern... Energy consumption is a global concern...

To reduce energy consumption by 20% To reduce energy consumption by 20% until 2020until 2020

To save 177 billion KWh (3,4%) per year To save 177 billion KWh (3,4%) per year in 2030 in 2030

To reduce energy consumption by 20% To reduce energy consumption by 20% until 2020until 2020

To reduce energy consumption by 20% To reduce energy consumption by 20% between 2006 and 2010between 2006 and 2010

To raise energy efficiency in 20% until To raise energy efficiency in 20% until 20202020

22

Ambitious global goals have been set Ambitious global goals have been set

Sources: Council of the Federation (Canada); CNIS (China); European Energy Commission; American Council For a Energy Efficient Economy; Ministry of National Infrastructures (Israel)

33

...and the refrigeration segment plays a key role in this scenario

Refrigeration accounts for Refrigeration accounts for 15%15%

of the global electricity consumptionof the global electricity consumption

33

44

Energy efficiency in Household RefrigerationEnergy efficiency in Household Refrigeration

• Combined efforts of refrigerators and compressors Combined efforts of refrigerators and compressors manufacturers have reduced energy consumption 5 times in manufacturers have reduced energy consumption 5 times in the last 30 years the last 30 years

5x less energy consumption

in the last 30 yearsRefrigeration

system Compressor

Crossover Technologies

Cooling Components

Cooling Mechanisms

Cooling Cycles

Source: Embraco 44

55

Energy consumption reductionEnergy consumption reductionThe outcome of 100 million new systems per year in the worldThe outcome of 100 million new systems per year in the world

2 years

US$ 26 bi

2.5 years

155 million tons

Household refrigerators’ Household refrigerators’ consumption in the U.S.consumption in the U.S.

End user savingsEnd user savings

Largest worldwide Largest worldwide Hydroelectric power Hydroelectric power

productionproduction

ReductionReductionof COof CO22 emission emission

55Source: Refrigeration system consumption: 2,900 KWh per year - internal analysis based on DOE 2006 data

66

Energy RegulationsEnergy Regulations

• Minimum Energy Performance Minimum Energy Performance Standards (MEPS)Standards (MEPS)– Government sets the appliances Government sets the appliances

maximum consumptionmaximum consumption

• LabelingLabeling– Raise end users’ awareness on Raise end users’ awareness on

energy efficiencyenergy efficiency

Source: Collaborative Labeling and Appliance Standards Program - USA, Embraco Market Intelligence

• Tax IncentivesTax Incentives– Facilitate the purchase, installation or manufacturing Facilitate the purchase, installation or manufacturing

of energy–efficient productsof energy–efficient products

66

77

Compressor is a key componentCompressor is a key component

88

EmbracoEmbraco37 years of activities37 years of activities

Global Leader in the Hermetic Compressors SegmentGlobal Leader in the Hermetic Compressors Segment

22% Global Market 22% Global Market ShareShare

VCC’s Market Share:VCC’s Market Share:100% North America 100% North America

90% Europe90% Europe

28 Million 28 Million Compressors / Year Compressors / Year

+ 380 Million + 380 Million Manufactured Manufactured

ProductsProducts

Global Network Global Network of Selling and of Selling and DistributionDistribution

99* August, 2008

EmbracoEmbracoFacilities and PeopleFacilities and People

Italy - 708

Sales office + Warehouse – 76USA & Mexico

Slovakia – 2,250

China – 1,356

Brazil – 5,5049.894*9.894*

1010

EmbracoEmbracoEnergy savings initiativesEnergy savings initiatives

19831983

Consumption of 700 BTU/h, single-speed compressor

180 W180 WLaunch of new compressors highly Launch of new compressors highly

focused on energy efficiencyfocused on energy efficiency

20062006110 W110 W

Embraco VCCEmbraco VCC100 W100 W

1111

EmbracoEnergy savings initiatives

• Compressor efficiency improvement over the years has...

– Avoided the emission of

32 millions of tons of CO2

in the atmosphere

– Saved the energy consumption of all refrigerators sold in the U.S. for 6 years

1212

Top Embraco high efficiency compressorsTop Embraco high efficiency compressors

• Embraco VCCEmbraco VCC– Most efficient variable capacity Most efficient variable capacity

compressor of the marketcompressor of the market

• EMCEMC– The most efficient single-speed The most efficient single-speed

compressor in the world (produced in compressor in the world (produced in our China plant)our China plant)

• EM2EM2– Replaced a bigger compressor, providing Replaced a bigger compressor, providing

high efficiency while reducing the high efficiency while reducing the amount of raw materials usedamount of raw materials used

• EGXEGX– Featured in a significant number of Featured in a significant number of

Energy Star products in the USEnergy Star products in the US

1212

1313

Technology innovationOur R&D structure

R&D Centers in 3 continentsR&D Centers in 3 continents(including 40 labs)(including 40 labs)

Dedicated teams in each locationDedicated teams in each location(Brazil, Slovakia, Italy, China and USA)(Brazil, Slovakia, Italy, China and USA)

400 highly specialized people400 highly specialized people (PhDs, Masters and Engineers)(PhDs, Masters and Engineers)

1414

Technology innovationTechnology innovationStrongly supported by a global knowledge networkStrongly supported by a global knowledge network

More than 600 researchers in institutions like Univ. Illinois (US), Fraunhofer (GER), Univ. Glasgow (UK), POLO (BR), Univ. Timisoara (Romania), Univ. Shanghai (CH), Univ. ITL (PT), etc.

1515

Around 65% of revenues generated

from products launched in the last

4 years

2nd Brazilian company in patents’ placement in USA

770 patents granted in the

world

29% market share in the Commercial

segment

Environmentally friendly

products

Technology innovationTechnology innovationOutstanding resultsOutstanding results

1515

1616

SustainabilitySustainabilityThe Triple Bottom Line ApproachThe Triple Bottom Line Approach

Sustainability Sustainability is in our DNAis in our DNA

Economic Economic DevelopmentDevelopment

Environmental Environmental DevelopmentDevelopment

Social Social DevelopmentDevelopment

Technology Technology LeadershipLeadership

Diversity ProgramDiversity Program

Environmental Environmental Management SystemManagement System

Recycling Program for Recycling Program for end-of-life compressorsend-of-life compressors

Ethics and ValuesEthics and Values

Energy EfficiencyEnergy Efficiency

Environmental Education ProgramEnvironmental Education Program

Lean Concept Lean Concept

Volunteer ProgramVolunteer Program

1717

SustainabilitySustainabilityEnvironmentally friendly refrigerantsEnvironmentally friendly refrigerants

We are constantly taking the lead in the We are constantly taking the lead in the development of compressors that use development of compressors that use environmentally friendly refrigerantsenvironmentally friendly refrigerants

1992

1994

2005

Year

Evolution in alternative refrigerants

R 290R 290 R 600aR 600a

R 744 (COR 744 (CO22))

1930

1987

1995

R 134aR 134a R 404aR 404a

R 407cR 407c

MontrealMontrealProtocolProtocol

Initial use of CFCInitial use of CFCin refrigerationin refrigeration

1818

Reducing the size of compressors is one of our Reducing the size of compressors is one of our ways to promote sustainabilityways to promote sustainability

SustainabilitySustainabilityContributing to savings in the environmentContributing to savings in the environment

• When Chinese industry replaces old EC compressors by new EMB, we will save around 18,000 tons/year of:

Steel

15,000 cars

Copper wire

1.5 times the driving distance between Washington, DC and Los Angeles

Aluminum

2 boeings 777-300 aircrafts

Iron

85 thousand car engine crankcases

1818

1919

Miniaturized cooling Miniaturized cooling device presented at Intel device presented at Intel

Developer ForumDeveloper Forum

““VCC Technology is among VCC Technology is among the 10 biggest Brazilian the 10 biggest Brazilian innovations in the last innovations in the last

decade”decade”

O B R A S I L Q U E I N O V A

Liebherr domestic Liebherr domestic appliances won the appliances won the

“Kitchen “Kitchen Innovation of the Innovation of the

Year 2007” award Year 2007” award in Germany. The in Germany. The

VEMZ 9C is applied VEMZ 9C is applied in this systemin this system

““Embraco, Synonym for Embraco, Synonym for Global Leadership and Global Leadership and

Quality in Cooling Solutions Quality in Cooling Solutions for the Refrigeration for the Refrigeration

Market.”Market.”

EMBRACO – WINNER OF THE 2008 EMBRACO – WINNER OF THE 2008 “INTERNATIONAL STAR AWARD” OF “INTERNATIONAL STAR AWARD” OF

THE ALLIANCE TO SAVE ENERGYTHE ALLIANCE TO SAVE ENERGY

Embraco’s initiatives have been well recognizedEmbraco’s initiatives have been well recognized

2020

Embraco’s client portfolio

2020

2121

Embraco has beenEmbraco has been participating in the participating in the United Nations Global CompactUnited Nations Global Compact

Since 2004

2222

Ernesto HeinzelmannErnesto HeinzelmannPresidentPresident

ceo@embraco.com.brceo@embraco.com.br

www.embraco.com

Responsible technology for a better quality of lifeResponsible technology for a better quality of life