Eco-efficiency. ESH R&D Center. Part 1. Introduction Part 2. Case study. Environment, Safety & Health

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1 Eco-efficiency Part 1. Introduction Part 2. Case study Environment, Safety & Health ESH R&D Center

2 Part 1. Introduction What is the Factor h2 Hynix definition of the factor h 2 (squared) originated from the concept of factor X. Factor h 2 can be used when comparing a target product to a reference product. Creating More Value with Less Impact Factor h 2 Eco-efficiency Eco-efficiency Factor h2 Roadmap Hynix semiconductor has established the factor h 2 roadmap in order to enable us to develop more environmentally friendly product. Hynix s factor 5 goal, by the year 2015 is one of ESH visions which shows our willingness to develop green products. Hynix will continue to make efforts to increase eco-efficiency and factor h 2 values by measuring major products every year as described in the roadmap below. Service Value 3.0 Value Improved Best Eco-efficient (2015 yr) (2013 yr) Factor (2011 yr) (2010 yr) Factor (2009 yr) Factor (2008 yr) Factor Factor 1 Worst Eco-efficient Environmentally Sound Environmental Performance Meaning of Symbol 1. h 2 stands for two h - one h from hynix - the other h from higher eco-efficiency 2. Green Circle stands for - Environmentally friendly wafer Fabrication 3. Five Rectangular stands for - Factor 5 - chip 1

3 Factor h 2 Results (2008~2011) Hynix has measured each year s factor h 2 value on a regular basis to see how many ecofriendly products have made the grade. As you can see in the graph below, we have more than achieved our goals due to successful achievement in the transition of nano-technology and process optimization yr 3.39 times increased compared to 2008 yr Here you can see more details of how 3.39, the result of year 2011, is measured. When it comes to measuring each year s factor h 2 value, we use sales fraction as a weighting factor on the eco-efficiency results of major target products which are representatives of applications. Below is an example of how to draw out factor h 2. Computing Graphics Mobile Consumer Network M NAND FLASH M Ecoefficiency X X X X X Sales Fraction wfsf*1 wfsf*2 wfsf*3 wfsf*4 wfsf* = ( ) wfsf : weighting factor sales fraction 2

4 How to measure the Factor of 2011? The eco-efficiency portfolio is a matrix to indicate how a target product (year 2011) has been improved compared to a reference product (year 2008). The vector of eco-efficiency indicates extent of improvement in both product value and environmental influence. Eco-efficiency Portfolio 6.0 Product Value Value Improved Best Eco-efficient M F M Weighed eco-efficiency from five product applications in year F G N4 N5 M M2 F2 N G2 C Worst Eco-efficient N3 G x1 C C F C Factor 5 Factor 4 Factor 3 Factor 2 Factor 1 Environmentally Sound Env. Performance (inverse of Env. influence) Product Value 1/Env. Influence Eco-efficiency C5 G4 M5 N5 F5 Computing Graphics Mobile Consumer NAND Flash

5 What is the Eco-efficiency? Eco-efficiency is a management philosophy that encourages business to search for environmental improvements that yield parallel economic benefits. It focuses on business opportunities and allows companies to become more environmentally responsible and more profitable. ESH R&D Center in Hynix semiconductor had developed our own eco-efficiency indicator based on the concept defined by the World Business Council for Sustainable Development. Creating More Value with Less Impact Ecoefficiency What is Hynix's eco-efficiency? Hynix eco-efficiency indicator falls into two groups, based on the basic eco-efficiency formula. The first group is the product value, measuring the degree of function improvement quantitatively, and the second group is the environmental influence value, taking three aspects into consideration. Aspect Category Item For more details on methodology, please see the previous prochure at 4

6 Part 2. Case study Product Application Computing Graphics Mobile Product Computing Graphics Mobile Consumer Network M NAND Flash M Computing memory is used in desktop, notebook PCs, netbook PCs, servers and mobile phones for main memory. In main memory industry, while the importance of commodity products used for desktops has been gradually reducing, product usage for high density servers and notebook PCs are becoming more important. Thanks to its outstanding performance, Graphics DRAM has been widely used in applications such as graphics cards and gaming systems. Among the graphics DRAM chips being produced, hynix s graphic memory is the fastest. Mobile memory is used in various mobile devices such as mobile phones, digital cameras and MP3 players. Mobile memory is expected to post the highest growth rates in IT applications, as a result of the convergence of information and communication. Consumer memory is used in such devices as digital TVs, set-top-boxes, DVD players; and peripheral devices such as network switches, hard drives, optical drives and printers. Hynix focuses on developing various new products in line with consumer application trend. Nand FLASH is a non-volatile memory chip typically used for data storage. In the past, it was mainly used in flash cards, USB drives, MP3 players, and PMPs. Recently, demand for NAND Flash products has been rapidly increasing as multimedia functions are expanding in the field of mobile devices, including smartphones and tablet PCs. 5

7 Consumer Network M NAND FLASH M Case Study Computing Target Product Reference Product 30nm class 2Gb DDR3 60nm class 1Gb DDR2 C5 Factor / nm class 2Gb DDR3 SDRAM boasts high performance and low power consumption. It supports data transfer rate up to 1,600Mbps and operates at 1.35 volts. This product features about 20% lower power consumption than 40nm class 2Gb DDR3. Product Value Factor : 2.04 High Speed High Density Low Voltage 1,600Mbps, a 2.4 time faster speed 2Gb, a 2 time increase in capacity 1.35V, energy saving 1/Environmental Influence Factor : 1.35 Material Consumption Global Warming Regulation Compliance 26% Material consumption reduction 25% PFCs & Electricity use reduction RoHS Directive & Halogen free 6

8 Case Study Graphics Target Product Reference Product 40nm class 2Gb GDDR5 60nm class 512Mb GDDR3 G4 Factor / nm class 2Gb GDDR5 SDRAM has high performance in the Graphics memory market. In addition to improved speed and higher density, power consumption on this product is significantly reduced since it operates on a 1.5V power supply. Product Value Factor : 2.91 High Speed High Density Low Voltage 5,000Mbps, a 3.6 time faster speed 2Gb, a 4 time increase in capacity 1.5V, energy saving 1/Environmental Influence Factor : 1.09 Material Consumption Global Warming Regulation Compliance 3% Material consumption reduction 25% PFCs & Electricity use reduction RoHS Directive & Halogen free Mobile Target Product Reference Product 40nm class 2Gb LPDDR2 70nm class 256Mb MODDR M5 Factor / nm class 2Gb LPDDR2 SDRAM is Used in various mobile devices such as mobile phones. This product has better perfomance and lower power consumption than LPDDR1. It supports data transfer rate up to 800Mbps and operates at 1.2 volts. Product Value Factor : 5.21 High Speed High Density Low Voltage 800Mbps, a 2.4 time faster 2Gb, a 8 time increase in capacity 1.2V, energy saving 1/Environmental Influence Factor : 0.54 Material Consumption Global Warming Regulation Compliance 92% Material consumption increase 93% PFCs & Electricity use increase RoHS Directive & Halogen free 7

9 Case Study Consumer & Network Target Product Reference Product 40nm class 1Gb DDR3 70nm class 256Mb DDR2 N5 Factor / nm class 1Gb DDR3 SDRAM is used in Digital TV, Set top boxes, and other so called digital consumer applications. This product with 1,333Mbps meet high speed demand for consumer applications. We can save energy by using this product since it operates at 1.5 volts. Product Value Factor : 2.72 High Speed High Density Low Voltage 1,333Mbps, a 2.3 time faster speed 1Gb, a 4 time increase in capacity 1.5V, energy saving 1/Environmental Influence Factor : 0.97 Material Consumption Global Warming Regulation Compliance 3% Material consumption reduction 19% PFCs & Electricity use increase RoHS Directive & Halogen free NAND Flash MLC Target Product Reference Product 20nm class 64Gb NAND Flash 50nm class 8Gb NAND Flash F5 Factor / nm class 64Gb NAND Flash MLC used for data storage has high density performance. Nowadays, this product is being widely adopted in the Smart Phone and Sata Box. Product Value Factor : 5.12 High Density 64Gb, a 8 time increase in capacity 1/Environmental Influence Factor : 1.04 Material Consumption Global Warming Regulation Compliance 10% Material consumption increase 32% PFCs & Electricity use reduction RoHS Directive & Halogen free 8

10 FAQ (Frequently Asked Question) 1 Is 2 What 3 Why 4 Does hynix eco-efficiency methodology sufficient for its product s Sustainability? Eco-efficiency is not sufficient by itself because it integrates only two of sustainability s three elements, economics and ecology, while leaving the third, social progress, outside its embrace. has been changed in hynix eco-efficiency & factor h 2? There have been a significant change in our indicator. We have included eco-efficiency results of mobile memory products due to rapid growth in the market. Otherwise, we excluded those of NAND Flash single level cell memory due to shrinking market. is the product value factor based on product functions? There are two types of approaches to measure a product value: monetary value and product functions. Monetary value, such as value added and sales prices, is relatively simple; however, it also has a weakness. chips, for example, are likely to be sensitively affected by the global economy and laws of supply and demand. The other approach is quantification of product functions or services, which are very clear expressions of product value. Monetary indicators tend to vary according to the market situation and change from time to time; Otherwise, product function, which people use as a primary criteria when purchasing a product,is easy to understand in terms of its value and less changeable. For this reason hynix prefer a product value based on product functions. this indicator cover life cycle of a product? Currently, hynix eco-efficiency indicator mainly focuses on the activities in manufacturing stages due to uncertainty of use and end of life scenarios, which are likely to largely affect the final results. However, hynix will expand its evaluation scope to cover the whole life cycle of a product, especially in environmental influence area in order to identify possible areas which could be improved. 5 What is the relationship between hynix eco-efficiency and eco-design? So far hynix has conducted a number of case studies for the eco-efficiency results. Based on these results, we are trying to adopt hynix eco-efficiency as a performance indicator of eco-design which enable greener memory chips. 9

11 6 Does hynix conduct a product level carbon footprint study? Yes, We do! Hynix has participated in the carbon footprint label program run by KEITI(Korea Environmental Industry & Technology Institute) for three years. This carbon footprint labelling is not a mandatory certification program but a program that businesses may participate in on a voluntary basis. So far hynix has certified three labels : two for DDR3 SDRAMs and one for NAND Flash. Furthermore, hynix has a plan to participate in the low carbon product certificate to be launched late For more details, please see at ( Greenhouse Gas Emission Certificate Low Carbon Certificate kg CO2-eq nm class 32Gb NAND MLC nm class 1Gb DDR3 SDRAM 40nm class 2Gb DDR3 SDRAM Products to be Certified Certified Products 7 How to use eco-efficiency indicator? Eco-efficiency itself is classified as a TypeⅡ environmental label, a single-attribute label developed by a producer (ISO 14020); therefore, we use our eco-efficiency indicator for self declaration Internal Use External Use Estimation of eco-efficiency on a new product Identification of possible areas to improve Self declaration tool for environmental communication Green marketing strategy 10

12 Hynix Semiconductor Inc. ESH R&D Center Address : San Ami-ri Bubal-eub Icheon-si Gyeonggi-do South Korea keemo.jeong@hynix.com Telephone :

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