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KKR ESG & Citizenship Report

Eco-Efficiency: Panasonic Healthcare

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Improving Energy Efficiency in Production Facilities

Key Environmental Performance Area:

  • Greenhouse Gas Emissions (Facilities)

Replaced current equipment with high-efficiency equipment in Japanese facilities in 2016.

Avoided almost 6,200 metric tons of greenhouse gas emissions due to efficiency improvements since 2012.

Avoided approximately $1.75 million in costs due to efficiency improvements since 2012.

All data and information in this case study are as of December 31, 2016, unless otherwise noted.

Challenge

The industrial sector consumes over half of the world's total delivered energy and produces approximately 1.3 billion metric tons of greenhouse gas emissions (GHG) annually.i,ii Manufacturers can help manage their energy consumption and associated greenhouse gas emissions and costs by improving the efficiency of both their facilities and production processes.

Panasonic Healthcare is a leading provider of diabetes monitoring systems, specialized laboratory equipment, and clinical healthcare IT systems in Japan and worldwide. Panasonic Healthcare is focused on improving the energy efficiency of its facilities and has been tracking the results of these efforts.

Response

In 2016, Panasonic Healthcare continued measuring and managing energy consumption in its Japanese facilities against a 2012 performance baseline. To improve energy efficiency, the company:

  • Reduced power loss by concentrating its uninterruptible power supply units.
  • Continued replacing power-receiving equipment with more energy efficient options.
  • Replaced fluorescent lamps with LED lighting.
  • Replaced a mounter, a type of production machine, with a high-efficiency option.

Resultsiii

In absolute terms, greenhouse gas (GHG) emissions from facilities decreased approximately 15 percent compared to a 2012 baseline, while efficiency has improved approximately 14 percent (GHG/revenue) during the same period. This efficiency improvement has helped Panasonic Healthcare to avoid more than $1.75 million in costs, or more than JPY 200 million, and almost 6,200 metric tons of GHG emissions since 2012.

GHG Efficiency (2011 Baseline)
Estimated Results 2013 2014 2015 2016 Total
Avoided GHGs (metric tons) 840 250 2,500 2,600 6,200
Avoided costs $296,000 $83,000 $674,000 $700,000 $1,750,000

Panasonic Healthcare has participated in KKR’s green program since 2014. In 2017, Panasonic Healthcare announced a partnership with the United States Environmental Protection Agency ENERGY STAR program for its biomedical refrigerators and freezers. For more on Panasonic Healthcare’s environmental program, visit http://www.panasonic-healthcare.com/global/corporate/environment/csr.

i U.S. Energy Information Administration. International Energy Outlook 2016. May 2016.

ii U.S. Environmental Protection Agency. Sources of Greenhouse Gas Emissions. Web. 1 August 2017.

iii Reported results are based upon data provided by the portfolio company, and have not been reviewed or independently verified by KKR or KKR Capstone. KKR may calculate the figures presented in an effort to ensure calculation methodologies are consistently applied across companies in the Eco-Efficiency category. For more information regarding KKR’s calculations, please see the methodology section. There is no guarantee that any GSP-related avoided costs or added efficiencies will positively impact the portfolio company’s valuation or performance.

Unless otherwise noted, portfolio company data represents 2016 results, published in October 2017. These case studies may contain forward looking statements including descriptions of planned projects and projected results and savings. These statements are subject to the risk that the projects will not develop as planned or at all or that projected results and savings are not realized.