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Green ideas for green manufacturing

In this interview by Singapore’s Energy Market Authority, Panasonic Asia Pacific managing director Yorihisa Shiokawa reveals how manufacturers can contribute to an energy efficient society through innovation, collaboration and careful management.

Energy Market Authority: Panasonic’s ambition is to be the leading “Green Innovation Company” in the electronics sector. What steps is Panasonic undertaking to achieve this target? What impact will this have on consumers and the environment?

Yorihisa Shiokawa: We want to become the number one Green Innovation Company in the electronics sector by 2018. Through our ‘eco ideas’ strategy, we create innovative businesses, products and services that are energy-efficient or have smart energy features, and therefore are more environmentally-friendly. But they also help consumers save money. We are on track to achieving 80 per cent of our total sales in Asia Pacific from these eco products.

Panasonic Group is also focused on developing Total Energy Solutions that involve energy creation, storage, savings and management. We set up the Panasonic Energy Solutions Development Centre Singapore in July this year to develop total energy solutions not only for the region, but also to commercialise them globally. Panasonic is working closely with the local authorities in Singapore to test-bed some of our urban solutions at the Punggol Eco-Town project.

We have a Panasonic Eco Learning Programme, which will help 200,000 students across Asia Pacific to develop environmental awareness and an understanding of how virtually zero CO2 emissions can be achieved through technology. We will continue to spread the word so that more will come together to create a positive impact on the environment.

Panasonic applies the ‘eco ideas’ strategy to our own business. We aim to reduce the environmental impact of our business operations by making the best use of resources and energy through green innovation. We have set a goal of a 600,000-tonne CO2 reduction in our operations versus a “business-as-usual” level (based on our fiscal year ending March 2005).

We are also developing three more ‘eco ideas’ factories by March 2013, which will demonstrate our sustainability solutions and capabilities. These factories adopt green solutions and exemplify how reductions in CO2 emissions, managing waste generation and chemical substance releases and maintaining energy efficiency can be achieved in manufacturing facilities.

EMA: In difficult economic times, some consumers may not be inclined to pay for green-certified appliances. What role can global manufacturers play in raising the awareness of the importance of such appliances?

YS: Global manufacturers can take the lead to help imbue eco-consciousness among consumers though championing environmental awareness programmes and education initiatives. Industry players must work with governments worldwide to ensure their products are compliant with the energy regulations of each country. In Singapore, Panasonic’s air conditioners and refrigerators meet the standards which are required for The Energy Label, mandated by the National Environment Agency (NEA).

Asia Pacific also has many environmental challenges in emerging and rapidly growing markets. Economic growth can create environmental pressures - especially in creating and providing a stable supply of energy and meeting the demand for improved living standards. Product customisation for particular markets is important. In India, for example, the CUBE air-conditioner takes into account specific Indian climatic conditions and space limitations. This kind of product customisation will encourage customers to purchase green-certified appliances.

EMA: Businesses, especially manufacturing companies, are some of the biggest consumers of energy. How do you think businesses can and should conserve energy through their own business practices?

YS: Business growth must be achieved with an eye on conserving the planet for future generations. We are committed to promoting environmental sustainability and reducing the impact of our business operations. There are two ways to achieve this:

First, look at reducing CO2 emission. Panasonic has been using meters and gauges to manage energy consumption during production, as well as replacing fluorescent lights with energy-efficient Light-Emitting Diode (LED) lights in our factories. By doing so, we have been able to reduce CO2 emissions by 560,000 tonnes in our Asia-Pacific operations as of the end March this year.

Second, companies should set assessment criteria on the environmental impact of their products. This needs to be done right from the planning and design stage. Improved environmental performance can be based on criteria such as energy savings, resource savings and chemicals management.

EMA: There is much being said about public-private partnerships in developing solutions that lower energy consumption. How have Japanese companies, for instance, collaborated with the Japanese government to help meet nationwide energy intensity goals?

YS: In Japan, such collaborations are increasingly important for a nation that is dependent on imports of virtually all fossil fuels. For decades, Japanese energy policy has focused on efficiency, diversity and development of indigenous energy sources.

One such recent project is Fujisawa City in Kanagawa Prefecture, situated about 50km west of Tokyo. This collaboration sees nine companies coming together with the government to build an innovative smart town deploying services and energy systems based on Panasonic’s ‘eco ideas’ for green lifestyles. The companies include developers, manufacturers and service providers and will see an eventual actual operation of the town with about 1,000 households. The smart town is to be built on the vacant lot of Panasonic’s former factory site and is targeted to open in the fiscal year ending in March 2014.

Apart from these large-scale collaborations, there are other ways to contribute to the nation, especially in times of crisis. At the end of March 2011, Panasonic donated a Life Innovation Container to the Miyagi Prefecture, which suffered widespread devastation in the Great East Japan Earthquake. The container is a standalone power system equipped with solar panels and rechargeable batteries to deliver electricity to areas without access to electricity.

But such collaborations are picking up in other parts of Asia as well. For example in Singapore, we are partnering with the Housing Development Board (HDB), Energy Market Authority (EMA) and Economic Development Board (EDB) to test-bed total energy solutions on an existing public residential building in Punggol Eco-Town. This project aims to achieve zero CO2 emissions for common areas of public housing in Singapore, and provide residents with a complete total energy solutions package that helps monitor and better manage their energy consumption.

EMA: Do you think companies can combine making contributions to the environment with business growth? Do you think legislation, such as those enacted in Japan and soon to be enacted in Singapore, will push companies to be more energy-efficient?

YS: Our belief is that we must integrate environmental conservation with business growth.  As such, we strive to achieve the highest achievement levels in reducing CO2 emissions, recycling resources, the size of our energy systems business and the sales ratio of environmentally-friendly products. These are our “Green Indexes” and they are just as important as our Global Excellence Indexes, which look at sales, operating profit and return of equity.

Legislation also has a role to play in driving mindset changes in energy consumption and the nation’s energy mix.  In July 2012, the Japanese government rolled out feed-in tariffs (FiTs) for renewable energy. The Japanese FiTs are significantly higher than those offered in both Germany and China. Such clean energy investments shift Japan’s reliance on nuclear energy. Government subsidies benefit solar panel makers such as Panasonic, spurring them to manufacture even more energy-efficient products and services.

We also applaud the Singapore government for introducing the Energy Conservation Act, which comes into effect in 2013, to improve energy efficiency across different sectors. It will also drive energy efficiency in business. The legislation requires factories that consume more than 15GWh of energy a year to implement minimum energy management standards, such as the appointment of an energy manager, reporting of energy use and submission of energy efficiency improvement plans.

This is likely to help households make more informed choices about purchasing energy-efficient appliances since the legislation stipulates the minimum energy performance standards and energy labelling scheme for common household appliances such as air-conditioners and refrigerators.

Yorihisa Shiokawa is Managing Executive Officer, Regional Head for the Asia Pacific, Middle East & Africa of Panasonic Corporation, as well as Managing Director of Panasonic Asia Pacific. He assumed his role from April 2011, after three decades of building the brand name Panasonic in markets such as Europe, notably its digital audio-visual product and home appliance businesses.

This article was originally published on the Singapore International Energy Week 2012 website, and has been republished with permission.

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