LG Display has established a carbon neutrality goal for 2050 to participate in global efforts to combat climate change and has created a roadmap for achieving carbon neutrality by reducing greenhouse gas emissions by 53% in 2030, 67% in 2040, and 100% in 2050 compared to 2018. To achieve the 2050 carbon neutrality goal, LG Display will pursue the following mid- to long-term task: ▲actively participating in and responding to government policies related to climate change ▲reducing the use of process gases in production equipment and investing in additional reduction facilities ▲developing and applying high-efficiency emission reduction technologies and low-carbon gas replacement technologies ▲developing and applying low-power production equipment and utility technologies ▲external offsets (purchasing carbon credits) ▲continuously developing eco-friendly products.
At LG Display, we assess the materiality of climate-related risks and opportunities, categorizing key factors by short- and mid-to-long-term impact. The financial implications of each factors and response strategies are presented as follows.
| Category | Type | Impact Period | Impact Category (Value chain) | Financial Impact | Countermeasures | ||||
|---|---|---|---|---|---|---|---|---|---|
| Short-term | Mid-term | Up- stream (Raw Materials, Supplier) | LG Display (Purchase, Production) | Down- stream (Use, Disposal) | |||||
| Transition Risks | Policy and Regulation | Strengthening of GHG Emissions Regulations and Policies | O | O | O | O | O | Increased costs for purchasing emission credits due to stricter GHG emission trading regulations | Participate in emissions trading through reasonable transactions based on continuous monitoring of emission allowance prices Establishment and implementation of GHG reduction targets |
| Increased Demand for Climate Change Disclosure | O | O | O | O | Increased costs for building data systems and certifications in response to global climate disclosure | Improve operational efficiency by establishing domestic and international climate disclosure systems | |||
| Supply Shortages Due to Increased Demand for Renewable Energy | O | O | O | O | Increased procurement costs due to fluctuations in renewable energy generation | Diverse portfolio composition for expanding the transition to renewable energy Review direct power purchase agreements to ensure stable mid- to long-term renewable energy supply | |||
| Continued increase in industrial electricity rates | O | O | O | O | Rising product costs due to increased electricity expenses | Reduce electricity consumption through energy-saving initiatives | |||
| Technology | Costs incurred for introducing carbon reduction technologies and replacing equipment | O | O | Increased costs for converting manufacturing facilities to low-carbon processes | Develop alternative technologies using low-carbon and environmental substitute gases | ||||
| Market | Increased customer demand for low-Carbon Neutrality | O | O | O | O | Revenue decline due to reduced product demand caused by failure to meet customer expectations | Develop and expand environmental products utilizing low-carbon technologies | ||
| Physical Risks | Acute | Heatwaves | O | O | O | Increased management costs due to reserve power shortages and overheating of transmission facilities | Operate uninterruptible power supply systems capable of independent power generation in case of power risks | ||
| Chronic | Rise in average temperature | O | O | O | Increased operating costs due to higher electricity usage by equipment such as refrigeration unit | Reduce power consumption by improving refrigeration unit efficiency Enhance energy efficiency by diagnosing site equipment and production processes | |||
| Acute | Water stress | O | O | O | Increased product costs due to water shortages caused by changes in precipitation | Strengthen and invest in tasks to increase water reuse | |||
| Opportunities | Technology | Stablishment of Production System Minimizing Carbon Emissions | O | O | O | Generate revenue by selling surplus emission allowances through the adoption of low-carbon processes | Timely investment in greenhouse gas reduction facilities Implement activities to reduce the use of process gases | ||
| Increase Water Use Efficiency | O | O | O | Reduce water resource management costs and enhance operational efficiency | Identify and implement water-saving initiatives by monitoring usage and optimizing process conditions | ||||
| Investment in Development of Energy-Efficient Products | O | O | O | O | Increase revenue by meeting growing demand for environmental products | Develop high-efficiency display technologies such as LTPO1) OLED2) | |||
1) LTPO: Low-Temperature Polycrystalline Oxide
2) OLED: Organic Light Emitting Diode
Development of GHG Reduction Scrubber LG Display has been investing in and installing greenhouse gas reduction equipment at its manufacturing sites since 2018 to reduce emissions from its production processes. The company is expanding the application and improving the efficiency of equipment(Plasma Scrubber) that reduces greenhouse gas(F-Gas2)) emissions by 90%. By 2030, LG Display aims to complete the development of technology that can reduce nitrous oxide(N₂O) emissions—used in deposition processes—by 80% and gradually expand its application across its sites, contributing to the achievement of carbon neutrality by 2050.
1) F-GHG : Fluorinated Green House Gases
Ongoing Company-wide Energy Saving Initiatives LG Display is improving the efficiency of utility manufacturing equipment and optimizing electricity usage in production facilities, led by a dedicated company-wide energy conservation organization. In addition, to support ongoing energy reduction activities, LG Display is optimizing equipment operation through DX-based solutions such as smart controls for chillers. The company is also collaborating with experts to minimize energy consumption in each facility and actively promote energy-saving activities.
Region-based
Market-based
LG Display began transitioning to renewable energy in 2021, and since then, its domestic facilities have switched to green premium energy, while its facilities in China and Vietnam have switched to RECs, resulting in 13% of the company's total power consumption being converted to renewable energy in 2022 and 15% in 2023. By 2024, the company increased the amount of renewable energy used to 3,071 GWh, accounting for 39% of its total power consumption. Going forward, LG Display plans to gradually expand its use of renewable energy by considering various renewable energy sources, with the goal of transitioning 100% of its power consumption at its China/Vietnam facilities to renewable energy by 2050.
LG Display is strengthening its ESG win-win management with its suppliers by operating Green SCM consulting and carbon partnerships, and promoting carbon neutrality climate change response activities. Through Green SCM (Supply Chain Management) consulting, LG Display provides its partners with greenhouse gas inventory establishment and energy diagnosis, supporting them in proactively responding to greenhouse gas regulations. Additionally, LG Display operates a carbon partnership certification program for suppliers who have successfully completed Green SCM consulting, providing incentives through regular post-management and supplier evaluations to promote green growth. Furthermore, since 2013, LG Display has been conducting comprehensive environmental management inspections and providing technical support to help suppliers strongly respond to environmental regulations.