Responses to Climate Change

We have joined the RE100, EP100, EV100 initiatives and the Science Based Targets initiative (SBTi) in 2020, established a full value chain greenhouse gas emission accounting system, identified and managed climate risks following international standards, and set emission reduction targets that are in line with PV industry's development and our operating conditions. We have also advocated energy conversation, emission reduction, and the use of renewable energy in our production bases, accelerated the certification of product carbon footprints, and thus became a forerunner in the industry's climate action and green development.

Governance?

LONGi has established a climate change governance system led by the Board of Directors. Several members of LONGi's Board of Directors are experts with years of experience in the PV and energy sectors and are thus able to accurately identify and manage risks, seize opportunities in the global green transition, ensure the effectiveness of climate risk management, and formulate climate actions suitable for the company’s long-term development.

Strategy

We have identified and analyzed the climate risks, vulnerabilities, and potential opportunities along the value chain through review, climate database risk screening, and industry research, forming a long list that involves 16 transformational risks, 65 physical risks, and 15 climate opportunities. Meanwhile, we have developed the corresponding climate risk management system, which is published in the 2023 Climate Action White Paper of LONGi.

Risk management

We have managed climate risks following the methods and processes stipulated in our risk management system and conducted analysis for 3 temperature rise scenarios, i.e. accelerated transition (<2°C/1.5°C), current policy (baseline), and high-temperature rise (>4°C), to comprehensively incorporate the risk identified and assessed into the strategic decision-making and daily operations.

Indicator and goal

In 2023, according to the Group’s situation, LONGi set climate-related indicators and targets with reference to international climate action target-setting methods and initiatives, and became the first PV company in China to pass the audit of SBTi.

Climate goals

Climate Actions

In 2023, we focused on internal operation and supply chain emission management, implemented a series of initiatives including carbon accounting, energy management, and construction of clean energy facilities, and formulated the Carbon Emission Management System Manual and Work Instruction for Construction and Evaluation of Zero-carbon Plant. We also built an online emission data management system leveraging the EMS system and in line with the requirements of the ISO 14064 standard, continuing to improve the verification of internal emission data.

Emission reduction in operations

Supply chain emission reduction

Note:

1. Due to the update of the regional power grids carbon dioxide emission factors, this report recalculates Scope 2 data for 2022 and 2021 based on the updated version of the Announcement of the Ministry of Ecology and Environment and the National Bureau of Statistics on the Release of CO2 Emission Factors for Electricity in 2021.

2. Scope 3 emissions encompasses purchased goods and services, upstream fuel and energy related activities, upstream transportation and distribution, waste generated from operations, business trips, employee commuting, downstream transportation and distribution, and final disposal of sold products.

In the Group's carbon emission structure in 2023

As for Scope 3, outsourced goods and services (category1) accounted for more than 90% of the total. Scope 2 and Scope 3 emissions showed a slight increase from 2022, mainly due to the increasing output and transportation cost for meeting the rapidly growing global demand for PV products.

Given the growing demand in the PV market demand, we will actively carry out carbon reduction projects, including setting three-year short-term emission reduction targets and pathways, completing and advancing the construction of more zero-carbon factories, participating in green power trading, and strengthening carbon reduction synergy with suppliers.

Energy Saving and Emission Reduction

LONGi has formulated the Energy Management Manual, Energy Management System, Energy Data Management Measures, and other institutional documents, set up the Group’s Energy Management Leading Group led by the chairman of the Board of Directors, and an Energy Management Office and Expert Team under it to ensure the standard implementation of the whole energy management process.

In 2023, we conducted an annual energy evaluation on 29 bases within the scope of assessment, and completed a total of 509 energy improvement projects; as of the end of the reporting period, a total of 25 bases have completed their Energy Management System construction and passed the certification, and 10 new bases were added in 2023. We have taken multiple measures including energy-saving technological reforms, energy management, and evaluation, and succeeded in realizing a remarkable annual electricity saving of 1,064 million kWh. This resulted in a 9.53% YoY decrease in the Group’s overall power consumption and an 18.32% drop compared with the base year.

Power saving targets

We have adopted green power in our production actively and optimized our energy structure. In 2023, 3,815 million kWh of LONGi’s total electricity consumption came from renewable energy, accounting for about 31.10% of the total electricity consumption, which was equivalent to about 2,124,399.46 tCO2e emission reduction.

LONGi’s energy usage (2021-2023)

We take 2020 as the base year, set the power consumption target for each product, and monitor the achievement of the target every year. In 2023, the reduction of power consumption per product for monocrystalline, wafers, and cells exceeded expectations.

LONGi’s power consumption reduction v.s. base year target (2021-2023)