24 September, 2008

Narito ShibaikeMatsushita Electric Industrial Co., Ltd.

Activities on Tools and Indicators for Sustainable Manufacturing

in Japanese Electronics IndustryPanasonic Group's 'eco ideas' StrategyActivities of Japanese Industry on Environmental Indicators for Products

International Conference on Sustainable Manufacturing

'eco ideas' Strategy

Accelerate Environmental Sustainability Management

Steady Growth with

Profitability

Deconstruction and Creation

Matsushita in 2007

Matsushita in 2009

Global ExcellenceBecoming a Challenger to Achieve Global Excellence

GP3 Plan Reduce environmental impact in all business

activitiesRapidly implement measures to prevent global warming.Globally promote environmental sustainability management.

Key issues

Reduce CO2 Emission in Production Activities

FY2010 Target

Reduce total emission while increasing production

Achieving the level for FY2000(approx. 3.6 million tons)

Reduce global CO2 emission by 300,000 tons in three years

- Pursue energy-efficient product development

- Promote the use of environmentally-conscious materials and product recycling

- Reduce CO2 emission by improving productivity

- Enhance resource conservation and waste reduction

- Expand ecology with the international community

- Strengthen activities across national borders

Three Key Initiatives of 'eco ideas'

'eco ideas' for Products

'eco ideas' for Manufacturing

'eco ideas' for Everybody,

Everywhere

Korea

Japan

China

Hong Kong

EU

U.S.

Brazil

India

Energy-saving Performance Label Expandedaround the World (typical examples)

Australia

Canada

The concept of the program is: Standards are set exactly the same as or higher than the best performance value of each product item currently on sale in the market.

Japan Standard: Top Runner Program (since 1999)

1: Heavy vehicles weighing over 3.5ton (buses, trucks) were added for the target products in April 2006.

2: LCDs and plasma display TVs were added for the target products in April 2006.

Target products 21 products

Passenger vehicles

Freight vehicles

Air-conditioners

TV sets

Video-cassette recorders

Fluorescent lights

Copiers

Computers

Magnetic disc units

Electric refrigerators

Electric freezers

Space heaters

Gas cooking appliances

Gas water heaters

Oil water heaters

Electric toilet seats

Vending machines

Transformers

Electric rice cookers

Microwaves

DVD recorders

Fuel Efficiency(km/L)

At the time of standard setting

Target Fiscal Year

19km/L

18km/L

17km/L

15km/L15km/L

14km/L

13km/L

12km/L

16

Weighted average per product category is used to judge achievement of the standard

Standard setting of Top Runner Program

Thorough Pursuit of Energy-efficient ProductsIncrease the number of products featuring the No.1 energy-efficient performance and phase out low energy-efficient products

2007 2009

No. 1 16%

High-ranked 36%

Low-ranked 13%

Mid-ranked 35%

No. 1 30%

High-ranked40%

Mid-ranked 30%

100%

Fade out

Double

Dis

trib

utio

n of

ene

rgy-

effic

ient

mod

els

'eco ideas' for Products

Productplanning

Design

Procure-ment

Manufac-turing

Logistics

Sales

Service

Recycling

Manufacturing Process

Reduce CO2 emissionby Improving Productivity

IT innovations

e-Work

Green logistics

Modal shifts

Energy-conserving equipment

Electronic component mounting machines

Recycling

3R design

Inventoryreduction

Qualityimprovement

Factory integration

Energy conservation

at offices

'eco ideas' forManufacturing

Reduce CO2 emission to FY2000 Level

350

-120,000tons

-300,000tons

'06

300

400

0 '05'04 09

368

'03

410 400 398404

'07 '08

388 378360

'10'00

361

To FY'00level

GP3 Plan

Reduce global CO2 emission to 3,680,000 tons in FY2009- 294 manufacturing sites -

CO

2em

issi

on (1

0,00

0 t-C

O2)

FFYY

'eco ideas' forManufacturing

CO2 Emission Serve as Key Management Indicators

Environmental performance system

Report monthly global CO2 emission figures to management

Manufacturing business units

294

294 sites around

the world

Environmental performance data

Head OfficeCO2

emission

with 23 items

Submit data via the Web

Feedback of analysis results

Monthly reporting of tatement of

Environmental

Various data analyses, etc.

Key management indicators

SalesOperating profitInventoryCCM

CO2emission+

Modular type

Manufacturing technology innovations

Increased the number of PDP panels produced from a single substrate

Finer semiconductor processing on larger diameter wafers

One panel Six panels

Energy saving

Line width: 130 nm(Diameter: 203 mm)

CO2: -80%/chip

Energy saving CO2: -50%/PDP

Introduction of energy-conserving production equipment

Molding machines

Energy saving

Spacesaving

Hydraulic type Motorized type

CO2: -50%/unit

CO2: -60%/unit

Electronic component mounting machines

Rotary type Modular type

Energy saving

Spacesaving

Line width: 45 nm(Diameter: 300 mm)

Molding

Reducing CO2 Emissions byIncreasing Productivity in Direct Manufacturing

Site integration

Spacesaving

Mikuni Nara

Kusatsu

Fujisawa Kofu

Spacesaving

"eco-idea" Factory Biwako

Transportationvolume reduced

Four factories and one shipping site

Reduce the number of sites to three

Shipping site

Factory FactoryShipping site

Factory integration (PanaHome's main factory)

Site integration (Matsushita Home Appliances Group)

Integration into Kusatsu Site

Green logistics

Tokyo

Shanghai

Tokyo

Transportationdistances reduced

Direct transportation near to the market

Modal shifts (railroad transportation)

ShanghaiOsaka

Direct transportation

CO2: -50%

CO2: -80%

Reducing CO2 Emissions by Increasing Productivity in Entire Process

CO2: -15%

CO2: -20%

Energy Conserving at Offices

Energy-conserving lighting equipment

Conventional fluorescent lamps

(Starter type) Hf fluorescent lamps (High frequency type)

3 lamps 2 lamps

Energy saving CO2: -30%

Energy-conserving air conditioning systems

Optimum control of compressor operations

Energy saving CO2: -15%

IT utilizationWeb conferences (EPOCH System)

Telecommuting (e-Work)

Commuting became unnecessary

Paperless conferences become possible

Business trips become unnecessary

CO2: -300 kg per capita/year

CO2: -400 kg per capita

CO2: -30 kg per capita

(Osaka-Beijing round trip)(Osaka-Tokyo round trip)

Reducing CO2 Emissions by Increasing Productivity in Every Operation

Love the Earth

(LE Campaign)

Global promotion

Expand Eco-conscious Activities with the Collective Wisdom

From communities to the world

Establishment of factories that achieve living in harmony

with local communities

'eco ideas' Factory

Acceleration of environmental

contributions in China

China Eco Project

'eco ideas'for Everybody,

Everywhere

'eco ideas' Declaration as the Tool of Panasonic

Panasonic will Lead the Way for the World with 'eco ideas'

3- -

1. We will produce energy-efficient products.

2. We will reduce CO2 emission across all our manufacturing sites.

3. We will encourage the spread of environmental activities throughout the world.

Publicly announced on October 5, 2007

Enhance energy-conserving performance

Spread energy-conserving products

Reduce CO2 emission to FY2000 level

Incorporate into the core management system

Globally expand the LE activities

Promote the China Eco Project

Activities of Japanese Industryon Environmental Indicators

for Products

Market Transformation

Manufacturer

Government

Consumer

Retailer

- Energy Efficiency Standard- Labeling System- National Campaign- Consumers Education- Information Delivery

to Consumers- Incentives and Subsidies- Government Procurement

MarketPull

Technology

Push

Requirements to Transform Market

Policies must be developed by considering two aspects;

Pulling the market by indicatorsTo inform consumers on the importance of considering eco-efficiency of products in purchasing is very important.

If consumers can know the progress of products by the indicator, they will buy better ones.

Pushing the technology by indicatorsConsumers are increasingly demanding information on the products that they are using.

If manufacturers can measure the position of products with the indicator, they will develop better ones.

Indicators for Environmentally Conscious Products

A product strategy must be responding to market needs such as higher quality and environmental friendliness.

For standardization, it is desirable to be simple, easy to understand and clearly transparent.

As the environmental impact, GHG (Greenhouse Gas) emissions or energy consumption of a product in its entire life is most familiar, scientifically established and important to all the consumers.

Eco-Efficiency

Factor-X

Factor-X

Eco-Efficiency of the Evaluated

Product or Service

Eco-Efficiency of Reference Product

or Service

Eco-Efficiency

Product or

Candidate Indicators

=

Environmental Impact

=

Movement on Indicators in Japanese Industry

8 electronics companies in Japan have agreed to - -

efficiency evaluation to provide meaningful indicators to the markets, with creating new relationships between manufacturers and consumers.

Why?Eco-Efficiency can consider two important aspects of products; their functional performance and environmental impact. Factor-X is a specialized indicator which can show the

environmental friendliness at the same time. Compatibility of economics and ecologyFlexible and diverse approachesRaise of effectiveness towards the sustainable development

Therefore, Eco-Efficiency and the Factor-X may be ideal candidates for world-wide indicators.

Assessed Products1st Step: Air-Conditioners

Refrigerators Lamps (Bulbs, CFLs, etc.)Lighting Apparatus (Incl. Lamps)

60% of Electricity Consumption

2nd Step: TVs

Personal Computers

Washing Machines

-

Definition of Indicators for First Four Products- Next products will be with the same definition

CommonFactor-X

Fundamental Function ×× Utility Duration

Eco-Efficiency of Assessed Product

Eco-Efficiency of the Same and Past Product (in 2000 FY)

Eco-Efficiencyof Product

Sum of GHG Emissions through Entire Life Cycle of Product

-

=

Eco-Efficiencyof 4 Products

=

Environmental Impact through Entire Life Cycle of Product

=

Fundamental Function Utility Duration

Air-ConditionersSum of Heat Quantity of

Cooling and Heating per Year[kWh]

10 years

RefrigeratorsAdjusted Internal Volume

[l (Liter)]10 years

Lamps(Bulbs, CFLs, etc.)

All Luminous Flux[lm (Lumen)]

Product Lifetime

Lighting Apparatus(Incl. Lamps)

All Luminous Flux[lm (Lumen)]

10 years

The most important characteristic in this approach is having a voluntary framework by private companies, not a compulsory by the government.

An evaluating methodology about 4 products such as air conditioners, refrigerators, lamps, and lighting apparatus was made with designating the GHG emissions as their environmental impact.

A couple of candidate products such as TVs, personal computers, washing machines, etc. are being discussed in the same companies.

The demands imposed on the development of environmentally conscious products are to maximize the product value and to minimize the impact of the product on the global environment.

Eco-Efficiency is an indicator that specifies this concept.

Factor-X will therefore reach its full potential after advances are made in Eco-Efficiency.

Standardization of Indicators for Eco-Efficiency

ex) Subsidy, tax incentive, award, etc.to buy a new energy efficient product

Consumers

Old P

roduct

NewP

roduct

CO2Reduction

Manufactures

Governmentor

Municipalities

CO2Emissionfor years

Change

Retailers

Expectations of National Tools for Eco-Innovation & Market Transformation

Subsidies and incentives have effects in two aspects;

Certification

Policy

Policy

Policy

Thank you very much!

The Panasonic Group proposes one-step-ahead eco ideas

in every activity.