NIPPON YAKIN KOGYO CO., LTD

We are well aware of the importance of environmental protection. We promote environmentally friendly business complying with environmental treaties, laws, regulations, etc. In addition, we are proactively implementing environmental initiatives, including effective use of resources, saving energy and facilitating green procurement.

We have the Environmental Committee, chaired by a director appointed by the president to smoothly progress with environmental management by Nippon Yakin Kogyo and the Nippon Yakin Kogyo Group.

The Committee deliberates on and reports the environmental management plans implemented at our two plants and the issues related to energy conservation.

Kawasaki and Oheyama Plants have standardized ISO 14001/JIS Q 14001 environmental management systems.

Environmental management system

We have implemented measures for our plants to achieve the environmental policies and environmental management planned by the Environmental Promotion Committee of the plants.

The steel industry is an energy-intensive industry. At Nippon Yakin Kogyo, we believe that addressing climate change is a management issue of ours as a member of the steel industry, and are proactively working for carbon neutrality to fulfill this social responsibility.

In December 2021, we set a CO₂ emissions reduction target of 46% for FY2031 (Scope 1 + 2, compared to FY2014), and aim to achieve net zero emissions by FY2051. In our recently announced Medium-Term Management Plan 2024, we have established a plan to achieve our 46% reduction target in FY2026, ahead of FY2031. We are also promoting initiatives to achieve carbon neutrality throughout the entire Nippon Yakin Kogyo Group.

CO₂ emissions reduction targets(Scopes 1 + 2)

Nippon Yakin Kogyo formulated a roadmap to achieve carbon neutrality by FY2051.

We aim to facilitate the usage of recycled materials at Oheyama Plant to establish a carbonless operation technology targeting Scope 1 emissions. We will strengthen the shift to LNG and other energy along with working on installation of a new synthetic methane/hydrogen combustion system.

As for Scope 2 emissions, the new electric arc furnace contributes to energy conservation.

We will consider introducing green power in the near future during the renewal of equipment, one of which is being equipped with an inverter controller. We will consider conducting carbon offset activities for CO₂ emissions in order for us to implement all possible countermeasures for energy saving and emissions (from purchased products and services) accounting for 75% of the total.

Roadmap to carbon neutrality

Nippon Yakin Kogyo has been thoroughly implementing energy saving countermeasures in all the business activities. We use the devices equipped with inverters and LED lamps at Kawasaki Plant. We also began operating an efficiently energy saving electric arc furnace (“E furnace”) in the plant in January 2022.

Moreover, we began operating a system responding to demand enabling flexible operation according to changes in the electricity supply demand balance. In addition, since FY2023, we have been operating an internal carbon pricing (ICP) system to set carbon prices and virtually convert our CO₂ emissions into monetary costs for capital investment to reduce our CO₂ emissions.

We announced that we would embrace the challenge of carbonless nickel smelting at Oheyama Plant producing ferronickel alloys as the major material for stainless steels. We extended the use of materials recycled from “urban mines” to decrease per unit of fuel to suppress the CO₂ emissions to meet this challenge.

The total amount of CO₂ emissions for FY2022 from Nippon Yakin Kogyo on a non consolidated basis came to 390,000 ton CO₂ including emissions from Kawasaki and Oheyama Plants. The amount of emissions from the entire Nippon Yakin Kogyo Group totaled 423,000 ton CO₂. It is generally recognized that the amount of CO₂ emissions significantly depends on the amount of production. However, we are aiming at achieving our reduction targets by steadily decreasing per unit emissions.

In order to grasp the amount of CO₂ emissions generated across the entire supply chain that supports our business activities, we are estimating our Scope 3 emissions (non consolidated) based on the basic guidelines (Ver. 2.5) for the estimation of greenhouse gas emissions across the supply chain published by the Ministry of the Environment and the Ministry of Economy, Trade and Industry.

For the creation of a decarbonized society, each country has announced their respective greenhouse gas emissions reduction targets. We likewise regard the risks and opportunities posed by climate change as important issues for our own sustainability. Accordingly, we have analyzed the risks and opportunities in line with the recommendations made by the Task Force on Climate Related Financial Disclosures (TCFD).

The Sustainability Strategy Promotion Committee chaired by the president leads the execution of a plan do check act (PDCA) cycle for the risks and opportunities posed by climate change, fosters relevant measures for the entire company, and reports the details as necessary to the Board of Directors.

We conducted scenario analysis for the 4℃ scenario (the projected outcome if no measures against climate change are taken) and the 1.5℃ scenario (the outcome if the average temperature increase in this century is limited to 1.5℃). We predicted the worldwide situation in 2030 based on each of the scenarios and identified the risks and opportunities, and then divided the identified risks into transition risks and physical risks.

For transition risks we referred to the IEA World Energy Outlook for future energy supply and demand and carbon pricing and for physical risks we referred to the hazard maps created by local governments. By using these materials, we quantified the impact of the risks on our business to make impact assessments. Also, each of our departments discussed countermeasures against the risks. The following table shows the results.

Against this backdrop, in September 2022, Nippon Yakin Kogyo announced the support for the TCFD’s recommendations. Going forward, we will conduct more detailed examinations for the scenario analysis and continuously enhance our climate change countermeasures while disclosing the related information to the public.

We regularly monitor the air emissions discharged from our plants according to the related laws to manage and improve them. At Oheyama Plant, we combined a wet type precipitator and an electrostatic precipitator to decrease particulate matter, and are appropriately managing this equipment. At Kawasaki Plant, we have taken measures such as applying a burner with low NOx for a furnace and trying to reduce emissions of nitrogen oxides.

Release of nitrogen oxides into the air

Water used in our production processes is released out of the plant after being treated at our wastewater treatment facilities so as to meet all the regulatory standards relevant to prevention of water pollution. Water at Kawasaki Plant is constantly monitored for contaminants (nitrogen, phosphorus, COD).

COD of water released into the environment

We quantify the amounts of pollutants released and transferred into the environment (air and public waters) from our sites according to the pollutant release and transfer register (PRTR) system*. We annually submit a report on the released amount to the national government continuously ensuring the most appropriate control of chemical substances. We stock PCB waste in an appropriate manner coinciding with the plan to complete the management by the deadline indicated by the national government based on the Act on Special Measures concerning Promotion of Proper Treatment of PCB Waste.

Release and transfer of substances regulated under the PRTR system

We utilize the ferronickel slag and stainless steel making slag, by-products from Oheyama Plant and Kawasaki Plant, respectively, as substitutes for concrete aggregate in roadbed materials. The effective use of slag also significantly contributes to the conservation of natural resources.

NASSAND is the ferronickel slag generated at Oheyama Plant and it is certified as concrete aggregate material under JIS-A-5011 (Slag aggregate for concrete – Part 2: Slag aggregate for ferronickel alloys slag).

NASFINESAND is produced from the ferronickel slag generated in the unique nickel ore smelting process at Oheyama Plant. The slag is granulated into fine particles (with diameters of 75μm or smaller) which composes 90% of NASFINESAND. This material can be widely applied for embankment, backfilling, land development, foundation for drainage and the use of heavy machinery. The material produced by our unique method has already been patented and registered with the New Technology Information System (NETIS) of the Ministry of Land, Infrastructure, Transport and Tourism.

Stainless steel slag generated from Kawasaki Plant, called “NASFILLER,” is certified as a product made in Kawasaki, contributing to reduction of CO₂ emissions throughout the life cycle under the Low CO₂ Kawasaki Brand Certification System and the Kawasaki Mechanism Certification System.

(Low CO₂ Kawasaki Brand ： https://www.k-CO2brand.com/ )

Nippon Yakin Kogyo has been suppressing the generation of industrial waste and promoting the recycling of such waste to reduce the final disposal amount.

Final disposal amount of industrial waste generated

Stainless steel is 100% recyclable and collectible as scrap for recycling. We apply the raw materials reclaimed from “urban mines” to minimize the impact on climate change and the environment while supporting the prosperity of society.

We have to choose recycled materials suitable for the processes of Kawasaki and Oheyama Plants. Therefore, we develop technologies allowing us to more effectively use them to increase the usage ratio of recycled materials. Accordingly, we developed a technology resulting in the nickel amount extracted from recycled materials to be 60-70% of the net amount of nickel used at Kawasaki Plant. This amount of nickel includes ferronickel alloys supplied by Oheyama Plant. We indeed need to further develop technologies responding to the probable changes depending on the coming eras that may alter the compositions, grades and the shapes of recycled materials. We will definitely carry on developing our technologies to address the probable changes.

Usage rate of recycled materials (in terms of the net amount of nickel)

As an important resource we recycle water in our production processes. The recycling rate attained is more than 70% and more than 90% at Oheyama and Kawasaki Plants, respectively.

In the stainless steel process, byproducts are generated including dust from the electric arc furnace and sludge from the pickling process of wastewater treatment. They contain valuable metals including iron, chromium, nickel, molybdenum and others. We mix these with water and knead them into briquettes, which are then melted in an electric arc furnace to extract the valuable metals by separating slag. The extracted metal is collected as valuable metal to help produce stainless steels.

We installed a new briquetting machine in 2012 with equipment to add binder to strengthen the briquette. This investment also contributed to the recovery rate of valuable metals. We applied the subsidy provided by the national government for companies using rare earths for the installation. This equipment allowed us to operate the submerged arc furnace at higher temperatures to increase the recovery ratio.

We mainly use the recycled materials in our processes effectively contributing to the creation of a recycling-oriented society. We are proactive in use of materials extracted from stainless steel scrap widely available in society together with materials from so-called “urban mines.” We are also making an effort to improve our technology through capital investment allowing us to offer more value to society. We have developed our own in-house recycling process efficiently using the byproducts generated in our production processes. We are also considering new applications for the byproducts. For example, we are working on the recycling of slag into a roadbed material for sale outside the company.