Climate Change Mitigation and Adaptation
Climate Change Mitigation and Adaptation
In the face of global warming, extreme climate, growing awareness of environmental protection and energy saving, safety and health, and conservation, Century Iron & Steel has also incorporated climate change into the topic of corporate sustainable development, and closely monitors global climate change trends and international response directions. In response to the current and future potential risks and opportunities of climate change to the enterprise, it conducts statistics on greenhouse gas emissions, water consumption, and waste, and formulates policies for greenhouse gas reduction or other waste management as response measures for climate-related issues, so as to reduce and prevent the impacts brought about by climate change, continuously carry out analysis and control, and commit to greenhouse gas adaptation and mitigation work.
Risk and Opportunity Management Process
n Short-term: 1 to 3 years; Mid-term: 3 to 7 years; Long-term: over 7 years
(I) Climate Risk
Risk Prioritization | Risk Type | Risk Content | Risk Scope | Timing | Likelihood of Occurrence | Degree of Financial Impact |
1 | Regulatory Risk | Greenhouse Gas Regulatory Control and Carbon Pricing Policy | The Company | Mid-term | Medium | Increased operating costs (how to regulate costs) |
2 | Actual Risks | Extreme climate events such as typhoons and floods have increased in frequency, increasing the likelihood of flooding at the plant sites | The Company | Short-term | Medium | Increased operating costs (higher infrastructure damage costs) |
(II) Climate Opportunities
Opportunity Prioritization | Opportunity Type | Opportunity Content | Opportunity Scope | Timing | Likelihood of Occurrence | Degree of Financial Impact |
1 | Resource Efficiency | Adopt high efficiency manufacturing processes and transportation methods | The Company | Mid-term | High | Reduce Expenditures |
2 | Market Opportunities | Increased demand for low-carbon energy across various industries | The Company | Mid- to long-term | High | Increase income |
Scenario Analysis of Climate Risk and Opportunity Issues
n Use scenario analysis to evaluate climate change risks
Scenario Description | Description of Potential Financial Impacts | |
Extreme Climate | 1. Extreme weather events such as typhoons and floods 2. Changes in rainfall patterns and extreme variations in climate patterns 3. Sea level rise | 1. Capacity reduction or disruption (such as production stoppages, transportation difficulties, or supply chain interruptions) 2. Impact on labor management and planning 3. Write-off and early retirement of existing assets 4. Increased operating costs 5. Increased infrastructure costs (such as facility damage) 6. Higher insurance premiums and difficulty insuring assets located in “high risk” areas |
Transformation Actions | 1. Supportive energy incentives 2. Participate in carbon trading markets 3. Energy security and the transformation to decentralization | 1. Reduce operating costs 2. Reduce the risk of future energy price increases 3. Reduce GHG emission risks, thereby reducing sensitivity to carbon trading price fluctuations. 4. Increase in available capital (more investors favor low-emission manufacturers) 5. Increase in corporate reputation |
n Scenario Analysis 1:
In the context of the SSP5‑8.5 scenario in the IPCC’s 6th Assessment Report (AR6), climate change will bring a series of acute and chronic physical risks due to high emissions and rapid economic growth.
Types of Risks and Opportunities | Scenario for Evaluating Strategies | Financial Impact Assessment |
Actual Risks Immediate | Frequent and intense extreme weather events (hurricanes, tropical storms, storms, high waves, etc.) | Increased wind speeds may cause product damage, while infrastructure damage will lead to higher costs If a strong typhoon causes damage to plant roofs and flooding in plant areas that damages equipment, losses of NTD 432,000 thousand may occur, seriously impacting the Company's finances. |
Actual Risks Long term | Rising seawater temperatures and acidification accelerate corrosion of underwater structural foundations, requiring the use of materials resistant to high temperatures and corrosion | Using different materials can affect quality and requires re‑evaluation of inspections to ensure compliance with high temperature and corrosion resistance standards. Multiple inspections will extend the construction schedule and increase costs, and employees’ learning curves must also be evaluated, which may result in the company incurring losses of NTD 43,151 thousand. |
n Scenario Analysis 2:
The RCP2.6 scenario represents a global low carbon transition, with the goal of limiting global warming to within 2°C. In this scenario, the Company will face a series of transition risks arising from the impacts of policy, technological innovation, and social and market changes.
Types of Risks and Opportunities | Scenario for Evaluating Strategies | Financial Impact Assessment |
Transition Risk Policy and Regulatory Risks | Strengthen carbon pricing and emission restrictions (carbon tax, carbon trading system) | The government will impose a carbon tax in 2025 at a general rate of NTD 300 per ton. Although the Company is not yet within the scope of the carbon tax, after future policy adjustments it is highly likely that it will need to pay the tax. In the worst case scenario, it may have to pay taxes exceeding NTD 1,000,000. |
Opportunities Energy Sources | The government’s strong support for renewable energy (such as subsidies, tax incentives, and green finance support) will accelerate the construction of wind power projects and thereby increase demand for underwater foundation equipment. | If production capacity allows, it may secure a large number of orders and, due to future policy factors, may receive assistance from various parties and obtain government subsidies. |
Opportunities Market | Emerging markets (such as Southeast Asia) are experiencing rapid growth in demand for renewable energy, and underwater foundation equipment manufacturers can seize this market opportunity to expand their global market share. | As climate change is a global phenomenon, other countries are projected to face energy-related challenges as well. Early-stage investment positioning in countries with high potential may enhance the Company's financial performance. |
Climate Change Reduction Targets, Strategies and Specific Action Plans
Target strategy | With the goal of the 2050 net-zero policy, and in line with the nationally determined contribution targets set by the Taiwan government, the Company has, for the purpose of planning greenhouse gas reduction strategies, adopted 2024 as the base year. Its Scope 1 and Scope 2 emissions were 1,523.7909 tonnes CO2e and 3,255.4389 tonnes CO2e, respectively. Its medium- and long-term targets are to achieve a 1935% reduction by 2030 compared with the base year, with a linear reduction rate of 4% before 2030, so as to achieve a 1961% carbon reduction by 2037.
Due to the characteristics of various ongoing projects, new wind power projects commenced production in 2025, and the second quarter saw steel structure and wind power projects manufacturing different components, resulting in increased carbon emissions. Additionally, reduction plans and renewable energy measures were insufficient to meet the targets required, and the annual target was accordingly not achieved. Notwithstanding the increase in carbon emissions, the Company continues to implement process optimization, energy management, and energy conservation and carbon reduction measures. |
Specific Action Plan | 1. The Company has integrated carbon management into its operational strategy. Through the energy management system, the Company conducts a comprehensive review of current energy conditions, pursues strategically planned energy conservation initiatives, and achieves continuous improvement in energy performance. Comprehensive monitoring is applied across multiple greenhouse gas reduction programs, including improving energy efficiency, procuring energy-efficient equipment, considering the purchase of green electricity, and evaluating the installation of solar power generation systems, all of which serve as references for carbon reduction management and planning. 2. In recent years, the Company has continued to implement the ISO 50001 Energy Management System and has put forward energy conservation improvement plans, including the phased replacement of water-cooled packaged air conditioning units in the administration building — prioritizing the procurement of new energy-efficient water-cooled packaged units bearing the Energy Efficiency Label (Grade 1) — replacement of cooling tower motors in the air conditioning system to reduce energy consumption, and pressure reduction on the 200HP air compressor system to lower electricity consumption. Regular advocacy programs on energy conservation and carbon reduction are conducted for employees to reduce energy consumption and achieve the target average annual electricity savings rate of 1%, thereby improving energy efficiency and ensuring the effective implementation of conservation measures. 3. For major energy-consuming equipment on-site (such as air compressors, fixed cranes, and plate rolling machines), regular inspections of pipeline air leakage conditions are conducted to improve system operating efficiency and reduce unnecessary energy consumption. 4. Employees are encouraged to participate in energy management-related seminars and conferences to exchange knowledge with industry peers and enhance professional competency.
Through the above programs, the average annual electricity savings rate from 2015 to 2024 was 1.6%. The Company continues to implement carbon reduction in alignment with national policy through iterative adjustments to related policies and programs, including forward-looking carbon reduction technologies such as process improvements, in an active effort to reduce the impact of carbon emissions and strengthen operational competitiveness. |
GHG Management
To respond to global warming and effectively mitigate the impacts caused by climate change, the Company actively promotes environmental protection aspects such as energy saving and carbon reduction, and provides full support and dedication. Century Iron & Steel adopted the ISO 14064-1:2018 standard to conduct its greenhouse gas emissions inventory, with the organizational boundary including Century Iron & Steel’s Taoyuan Plant, Yunlin Plant, and Taipei Port. The Company’s greenhouse gas emissions can be divided into direct emissions (Scope 1), energy indirect emissions from purchased electricity (Scope 2), and other indirect greenhouse gas emissions (Scope 3), so as to fully grasp greenhouse gas use and emissions status and provide more accurate disclosed emissions data, and this is continuously implemented every year.
Since 2021, an impartial third-party verification body has been engaged each year to verify the greenhouse gas inventory results, and ISO 14064-1:2018 verification certificates have been obtained to ensure data quality and credibility.
To ensure the effective operation of the greenhouse gas inventory, the General Manager serves as convener and organizes the GHG Inventory Implementation Committee to conduct GHG inventory and management. The Plant Manager serves as the management representative, and department heads assist in establishing the working group.
GHG Emissions
Total greenhouse gas emissions amounted to 21,579.141 tonnes CO2e. The plant’s Category 1 greenhouse gas emission sources mainly came from process emissions, and total direct greenhouse gas emissions amounted to 1,523.7909 tonnes CO2e. Among them, CO2 greenhouse gas emissions accounted for the largest share at 97.77%, followed by CH4 at 1.71%. Among the 5 emission sources, process emission sources accounted for the highest proportion, with emissions of 1,228.0743 tonnes CO2e, accounting for 80.5934% of direct greenhouse gas emissions. The main emission source type was CO2.
n Greenhouse Gas Inventory Emissions
Unit: Metric tons of CO2e | ||||
Scope | GHG Emissions | 2023 | 2024 | 2025 |
Direct GHG Emissions | 1,364.5560 | 1,358.9664 | 1,523.7909 | |
Scope 2 | Energy Indirect Emissions | 4,576.8971 | 3,096.6031 | 3,255.4389 |
Total Emissions | 5,941.4531 | 4,455.5695 | 4,779.2298 | |
Other indirect emissions (Scope 3) in 2025: 16,799.9114 tonnes CO2e (Category 3: 412.4143 tonnes CO2e, Category 4: 16,387.4971 tonnes CO2e) Note: 1. Scope 1 does not use biogenic carbon dioxide, and Scope 2 uses the location-based method. 2. The organizational boundary changed in 2024, therefore 2024 was selected as the base year | ||||
Unit: Metric tons of CO2e/Per NTD million of revenue | ||||
Scope | GHG Emissions and Intensity | 2023 | 2024 | 2025 |
Scope 1 | Direct GHG Emissions | 0.1685 | 0.2618 | 0.5160 |
Scope 2 | Energy Indirect Emissions | 0.5652 | 0.5965 | 1.1024 |
Total Emissions Intensity | 0.7338 | 0.8583 | 1.6184 | |
