1. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 1 Eco-efficiency: Inside BASF and Beyond… Charlene Wall, BASF Corporation, Mount Olive, New Jersey

2. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 2 Introduction to Eco-efficiency Eco-efficiency Decision Tool Case Studies: Textile dyeing Logistics Refrigerators Eco-efficiency: Inside BASF and Beyond… Charlene Wall, BASF Corporation, Mount Olive, New Jersey

3. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 3 Sustainable Development is based on three Pillars Economy Society Ecology

4. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 4 What is Eco-Efficiency Analysis?  A comprehensive assessment of products and processes.  Ecological and economic aspects are equally weighted.  The products are analyzed from the end customers‘ perspective.  Potential scenarios and their effects are evaluated.  Eco-efficiency analysis is a standard tool in the BASF Group: more than 150 analyses have been carried out.

5. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 5 Alter- native 1 Alter- native 2 high Alter- native 3 Alter- native 4 Total costs costs low 1.0 Alternative 1 Alternative 4 Alternative 2 Alternative 3 Costs in $ per functional unit Costs Analysis

6. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 6 Development of Ecological Value Ecological fingerprint 0.00 0.50 1.00 Energy Consumption Emissions Toxicity Potential Risk Potential Raw Materials Land Use Parameters considered Raw Materials Energy consumption Land Use Emissions Toxicity Risk potential Ecological advantage Relative environmental impact Product 1 Product 2 Low High BASF 1 = greatest effect on the environment 0 = smallest effect on the environment

7. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 7 Energy consumption Raw material consumption Land Use 20% 20% 10% 20% 10% 20% Emissionen Toxicity potential Risk potential Emissionen Social Assessment Factors Emissions Luft- emissionen 50% Water emissions 35% Wastes 15% Luft- emissionen 50% 50% 20% 20% 10% Air emissions 50% Greenhouse warming potential Ozone depletion potential Photochemical ozone creation potential Acidification potential

8. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 8 Customer - related benefit: 1 unit of …. Alternatives investigated low eco-efficiency high eco-efficiency 0,3 1,0 1,7 Environmental impact (normalized) Alternative 2 Alternative 4 Alternative 1 Alternative 3 Alternative 1x % Alternative 2z % Alternative 3y % Alternative 4 t % The circle area is equal to the relative market position. 0,31,01,7 Costs (normalized) relative market position Ecoefficiency Portfolio: Links Costs and Environmental Impact

9. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 9 Dyeing Eco-efficiently: Helping small and medium enterprises make the best decisions Pilot project with UNIDO and UNEP as part of the United Nations - Global Compact initiative A software tool which allows the user to assess the eco- efficiency of various processing methods

10. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 10 Dyeing Eco-efficiently: System Boundaries Disposal Wastewater Off-gas treatment Production Steam Production of Dyes Auxiliaries Pre-treatment Dyeing Finishing Processing Steps Landfill Incineration Water Electricity Finished fabric

11. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 11 Dyeing Eco-efficiently: Inputs and Outputs User Inputs: Fabric quantity, number of processing steps, processing time Chemicals Utility consumption Process emissions Costs Eco-efficiency Manager Outputs: Portfolio: which alternative is the most eco-efficient? Environmental Fingerprint: what are the impacts of each? Relative comparisons for each of the categories: Emissions, Energy and Raw Material Consumption, Land Use, Toxicity and Risk Potential

12. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 12 Process Improvements A two-step dyeing process for mixed fabric was changed to a one-step process, by using a new chemical. Decreased energy and water consumption resulted in improvements in almost all environmental categories.

13. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 13 Process Improvements The new chemical provided environmental benefits at the same overall costs, even though the chemical price was more expensive.

14. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 14 Ecologistix - a Software developed by BASF The goal of this software is: to compare economics, environmental impact and responsible care for transporting products to offer innovative and responsible solutions to our customers Getting from here to there eco-efficiently

15. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 15 Getting from here to there eco-efficiently User Inputs: Payload Chemical hazard class Shipping fees Distances for land, sea Number of transfers Open/closed filling systems Eco-efficiency Manager Outputs: Portfolio: which alternative is the most eco-efficient? Environmental Fingerprint: what are the impacts of each? Relative comparisons for each of the categories: Emissions, Energy and Raw Material Consumption, Land Use, Toxicity and Risk Potential CO 2 savings potential

16. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 16 Logistic alternatives for supplying product to another site (14.000 t pro Jahr) Ludwigshafen Destination Site Rail, Tank-car (58 t Load, 755 km) Tank-truck (23 t Load, 698 km)

17. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 17 Alternatives Road transport, conventional tank- truck 23 t Load Rail, Tank-car, 58 t Load Customer Benefit: Transport of 14.000 t of product from Ludwigshafen to a customer 0,5 1,0 1,5 0,51,01,5 Costs (normalized) Environmental Impact (normalized) Getting from here to there eco-efficiently

18. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 18 Cooling Eco-efficiently: Refrigerators A project done by BASF for the German Green Party and the Wuppertal Institute Helps the consumer decide: “Should I buy a new refrigerator or continue to use my old one?” Considers production and disposal of the appliance itself, as well as energy consumption

19. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 19 Refrigerators: the Customer Benefit New Alternatives n Use of a 143 l cooling capacity refrigerator over 5 years n Continued use of a 10 year old refrigerator with 260 kWh/y or 330 kWh/y average energy consumption Customer Benefit n Buy a new refrigerator and dispose of/recycle the old one: two energy efficiencies (A & B) Product Use

20. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 20 0,5 1,0 1,5 0,51,01,5 Costs (normalized) Environmental impact (normalized) New A –Highest Efficiency New B – Lower Eff. Old 1 – Higher Eff. Old 2 – Lower Eff. Cooling Eco-efficiently: the Portfolio Base case Customer benefit: Use of 143l of cooling capacity over 5 years Alternatives considered New B New A Old 1 Old 2 High eco-efficiency Low eco-efficiency

21. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 21 Buying a new more energy-efficient appliance brings the greatest environmental benefit… …at only slightly higher cost Energy efficiency is key!!! Cooling Eco-efficiently: Refrigerators

22. b BASF Eco-Efficiency C. Wall BASF Corporation HELPING MAKE PRODUCTS BETTER TM 22 Eco-Efficiency Analysis: Our Innovative Instrument for better Products With an eye to the markets of the future, we believe that it is prudent to consider the environmental friendliness of one’s own products. That is why we felt it was important to develop an effective means of monitoring ecological and economic performance. Eco-efficient products and processes give BASF and our customers a competitive edge. For more information: www.basf.de/en/corporate/sustainability/oekoeffizienz/ or send an email to wallc1@basf-corp.com