Scaling Up Energy Efficiency for Climate Change Mitigation Frank O Brien-Bernini, Owens Corning Chief Sustainability Officer
Context a private sector view Strong global macro trends Energy use & availability Climate change Population / global consumption Presenting a massive opportunity in our markets Desire to achieve sustainability Energy efficiency interest public and private Green building & renewables demand Winning with green today! Pink-is-Green our business and communication strategy Scaling Up Energy Efficiency for Climate Change Mitigation
Owens Corning Sustainability Business Strategy 1. Greening our Operations 2. Greening our Products 3. Accelerating energy efficiency improvements in the built environment
Greening Our Operations: Energy Intensity Reduction is a Key Driver 1.00 0.95 0.90 0.85 0.80 Energy Intensity 2002 2003 2004 2005 2006 2007 2008 1% Energy Intensity Reduction $5 million EBIT Intensity Reduction 2012 Energy 25% GHG 30% PM 20% VOC 25% Water 15% Landfill 35% NOx 25%
Low Cost / No Cost Solutions Thousands of engaged employees reducing energy use and sharing results
Proven Solutions Energy Project Portfolio 40 40 Annual Investment ($ in millions) 35 30 25 20 15 10 5 Investment Savings 35 30 25 20 15 10 5 Executed Portfolio Savings ($ in millions) 0 2006 2007 2008 2009 Forecast 0 A pipeline of rapid-return capital projects
Proprietary Technology and Processes 55 Recycled Glass Use in Insulation Percent 50 45 40 35 30 More than 1 billion lbs/yr 2002 2003 2004 2005 2006 2007 2008 Insulation Furnace Composites Furnace Leading Edge Technology Energy and emissions reduction Manufacturing cost reduction Capacity increase Longer asset life
Greening our Products: Leading in green / sustainable building Common themes include products that 1. Save Energy or Water 2. Use Salvaged, Recycled or Agricultural Waste Content 3. Conserve Natural Resources through 1. Reducing Material Usage 2. Exceptional Durability or Low Maintenance 4. Avoid Toxic or Other Emissions 5. Contribute to Safe, Healthy Indoor Environment 6. Are Reusable or Recyclable at End of Life Compelling Products & Messaging that cuts through
Winning the Green Beauty Contest
Buildings Dominate CO2 Emissions more than industry and more than transportation CO 2 Emissions From Fossil Fuel Combustion by End Use Sector Industrial 80 MMTC 5% Industry 377 MMTC 25% Transportation 482 MMTC 32% Buildings 658 MMTC 43% Commercial 265 MMTC 17% Residential 313 MMTC 21% Towards a Climate Friendly Built Environment - Marilyn A. Brown, Frank Southworth, Therese K. Stovall OAK RIDGE NATIONAL LABORATORY (Prepared for the Pew Center on Global Climate Change)
Green Beauty Contest Products that are green you can believe in Building Insulation Curbing Global Energy Demand Growth: The Energy Productivity Opportunity Diana Farrell, McKinsey Global Institute May 2007
Accelerating Energy Efficiency Improvements: Higher quality homes financed by utility savings 3000 Mortgage Energy Cost Total Annual Cost ($/yr) 2500 2000 1500 1000 500 0 Standard Home Lowest Total Cost High Efficiency Pathway to win/win/win green buildings
(1) Source: Department of Energy and Claritas ixpress Studies (2) Source: Owens Corning (3) Source: Owens Corning Accelerating Energy Efficiency Improvements: Building retrofits financed by utility savings 80 Million Under Insulated Homes (1) x Up to $2,125.00 per Home (2) = Opportunity Well less than 1% (3) of the reinsulation opportunity was captured in 2007
Top 5 List for Scaling Up Energy Efficiency for Climate Change Mitigation 1. Focus on what matters most guided by analytics 2. Establish organizational design / talent that will lead change 3. Set clear goals, objectives and incentives that define winning and track and report against these 4. Follow the money find creative ways to solve the split incentive dilemma 5. Intentional outreach content and creative communications Passionate CEO commitment "tone at the top"
Scaling Up Energy Efficiency for Climate Change Mitigation Frank O Brien-Bernini, Owens Corning Chief Sustainability Officer