Our Net-Zero Energy Journey IEMA Webinar, 8 th February, 2017 Mark Harris Building Technology Director KIP.

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1 Our Net-Zero Energy Journey IEMA Webinar, 8 th February, 2017 Mark Harris Building Technology Director KIP.

2 Agenda Who are we? What? Why? How? Progress to date What are the benefits Future progress 2

3 Who we are A world leader in building systems and solutions including, high performance insulated envelope systems, insulation and integrated renewable technologies. Market leading positions in Insulated Panels Insulation UK, Europe, North America and Australia. Focus on delivering energy High Performance Insulated Building Envelope Systems, Rooftop Solar PV, Steel Building Solutions and Structural Products Insulation Boards for Roofs, Walls & Floors, Pipe & Ductwork Insulation and Engineered Timber Systems efficient, low carbon building solutions for the global construction and property industry. Kingspan s proven sustainability credentials are a key element for delivering affordable Energy Saving Buildings. Access Floors Raised Access Floors and Data Centre Airflow Management Solutions Light + Air Daylighting Systems, LED Lighting, Ventilation, Smoke & Heat Vents, Building Automation and Industrial Electronics Environmental Energy Storage Solutions, Water Management, Renewable Technologies and Monitoring & Service 3

4 What? Kingspan Group manufacturing facilities will be Net-Zero Energy in 2020 on aggregated basis. Interim target of 50% to be achieved in Net-Zero Energy, as defined for our own purposes, is that our manufacturing sites, over a year, will consume 100% renewable energy on a net aggregated basis across the Kingspan estate. 4

5 Why NZE? Energy Performance of Buildings Directive - Recast 2010 Nearly Zero Energy buildings in Europe in 2020 Demonstrating the business case around our own products and solutions Establishing Kingspan as leader and innovator in our sector Reducing the environmental footprint of our products Putting our own house in order (Saving money and adding to profitability) 5

6 The Scale of the Challenge Overall we supply products to more than 80 countries across the globe 90+ Manufacturing Sites 20 Countries 6

7 Our Process Save More Generate More Hierarchy 1. Save More 2. Generate More 3. Buy more. Buy More Meeting the needs of every application through choice of specifications and guarantees. 7 7

8 Save More We believe that it is crucial to minimise energy use as a first step in the process and have invested in energy efficiency projects on many sites. ISO is being introduced across the Group. 6 Major UK sites currently certified. 8

9 Save More Every site is different and needs to be targeted in a unique way. The optimum energy saving solution is often a combination of: Employee awareness Energy metering Building management systems Lighting upgrades with Kingspan Smart-Lite LED Improved Insulation Motor replacements Compressed air system upgrades Process heat control Fan optimisation measures Process heat recovery equipment 9

10 Save More using our own products and solutions. LED/Daylighting Optimising lighting across our manufacturing facilities with a combination of Kingspan Day-Lite polycarbonate lighting solutions and Kingspan Smart-Lite LED solutions. Kingspan Day-Lite Trapezoidal Insulated Roof Panel System Refurbishing roofs of our manufacturing facilities for long-term energy savings. 10

11 Generate More using our own products and solutions as far as possible. Rolling out our Rooftop Solar solutions across the Kingspan estate. An on-site anaerobic digestion plant is providing both heat and power to our site in Pembridge. Rolling out wind turbines at our sites across the globe. Introducing solar thermal hot water across a number of our manufacturing facilities. Utilising biomass facilities at our sites e.g. in Pembridge, Hull and Germany

12 Generate More In 2015, Kingspan Access Floors UK replaced the old gas fired heating system in their manufacturing facility in Hull. Three biomass boilers were installed to provide space heating into the factory, using a fuel combination of sawdust waste from production or shredded chips from finished panel offcuts or panels returned from sites at the end of their life cycle. The boilers reduce carbon emissions by over 500 tonnes and give savings in gas consumption in the region of 3.5GWh per annum. 12

13 Generate More Currently an on-site anaerobic digester (AD) plant is exporting both heat and power directly into the largest of the Group s Insulation production facilities in Pembridge, UK. In 2015 the 500KVA electrical input provided 2.1GWh in electricity to the site. The AD plant also provided 2.3GWh of heat energy. 13

14 Buy More The procurement of renewable energy is a key part of our strategy. We aim to procure fully certified renewable energy as far as possible as the final step to making our sites Net-Zero Energy. In Europe and North America the market for renewable electricity is well developed with the availability of Guarantees of Origin (GO s) and Renewable Energy Certificates (RECs) in the respective markets. In other countries we are looking at irecs and other instruments to help render our energy renewable

15 Case Study: Kingspan Portadown Before After Project Card Building owner: Kingspan Environmental 1,307 kwp Rooftop Solar PV system 18,000m 2 Trapezoidal Roof Panels 100% Capital Financing 25 Year Guarantee Location: Portadown, Northern Ireland Project type: Refurbishment Currently delivering 1.05GWh/a Sector: Industrial / Manufacturing Completion date: Dec 2014 Installation time: 12 weeks 15

16 Case Study: Kingspan Selby Before After Energy Efficiency Rating Renovated 2.5MWp Rooftop Solar PV system 30,000m 2 Trapezoidal Roof Panels Redesign of the internal lighting system Project Card Building owner: Kingspan Insulation Location: Sherburn in Elmet, Leeds Project type: Refurbishment Sector: Manufacturing Completion date: March 2014 Installation time: 3 months Old 100% Capital Financing 25 Year Guarantee Delivering 2GWh/a 16

17 Case Study: Selby - Lighting Before After Expected 25 years savings are: 79.2 Gwh of energy equivalent to 6,980 homes 5.2 million 34,895 tonnes of carbon Dioxide saving 91% decrease in lighting energy demand Our work floor is transformed brighter, more comfortable and sustainable. Gerald McAdam, Operations Director 17

18 Energy Performance Contracts 3 sites in the UK and Ireland Holywell annual guaranteed saving 1.1GWh Sherburn annual guaranteed saving 2.5GWh Kingscourt annual guaranteed saving 0.8GWh Key energy conservation measures include: BMS Lighting Motors and drives Compressed air system Extraction systems All supported by: Extensive sub-metering of electricity, gas & fuel oil. (e.g. 69 meters at Sherburn) Monitoring and targeting savings with EPC Provider (Sherburn & Kingscourt) 18

19 Kingscourt Electricity Costs 19

20 Kingscourt Heating Costs 20

21 Kingscourt Comp. Air Costs 21

22 Kingscourt Electricity Consumption Sub-metering allows detailed analysis! 22

23 Sherburn Offices 23

24 Sherburn Discontinuous Line Monitoring & Targeting identified potential savings through turning heater banks off when not in production. Result from September 2016 was 32k/a saving Capex cost = 0 24

25 Current status * * * 2016 subject to final audit. 25

26 Current status 23% reduction 26

27 Current status 26% reduction 27

28 Current status 36% reduction 28

29 Current status 10x increase * * Forecast 29

30 Current status 2016: * * Forecast 7.6% * energy use generated on site 30

31 Benefits of NZE 2016 Carbon Disclosure Project 827 institutional investors with assets of US$100 trillion to motivate companies to disclose their impacts on the environment and natural resources and take action to reduce them 193 other A Listers including Microsoft, Citigroup and Unilever 31

32 Benefits of NZE 2016 Carbon Disclosure Project 32

33 RE100 - Renewable Power 33

34 Benefits of NZE Improved profitability Year Total Energy Use GWh Total Renewable Energy GWh NZE % 2012A A GWh A 312 equivalent to 88 1m Net Profit A* 403* P* 413* * Reflects significant expansion in

35 Summary of Benefits The business case: Proving Kingspan products & solutions work Improved Environmental Product Declarations (EPD) reduced carbon footprint. NZE Commitment and achievements can contribute to preferred supplier status External recognition e.g.cdp Alignment with leading companies taking action on climate change (CDP / RE100). Increased profitability Carbon emission reductions. Climate change mitigation impact 35

36 2020 Target Achievement 2020 Critical Success Factors: Save More Continued momentum & focus Generate More Maximise on-site generation Buy More strategy Availability of renewable energy Availability of renewable energy certification. Cost of renewable energy certification. Integration of new acquisitions. 36

37 Journey to NZE Win-Win. There s a really strong business case and a positive impact on climate change. 37

38 Thanks for listening! Mark Harris Divisional Building Technology Director Kingspan Insulated Panels +44 (0)