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May 2012 A case study on the assessment of environmental impact of ICT services in Korea Hyosik Min Environmental Strategy Manager CSR Office SK Telecom.

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Presentation on theme: "May 2012 A case study on the assessment of environmental impact of ICT services in Korea Hyosik Min Environmental Strategy Manager CSR Office SK Telecom."— Presentation transcript:

1 May 2012 A case study on the assessment of environmental impact of ICT services in Korea Hyosik Min Environmental Strategy Manager CSR Office SK Telecom

2 1 Contents I. SK Telecom Overview II. Background and introduction III.Approach and methodology IV. A case study: Real-time Navigation (RTN) V. ICT GHG potential abatement in Korea VI. Introduction to Further Study

3 Section 1 SK Telecom Overview

4 SK Telecom is the leading telecommunication company in Korea and has launched a lot of innovative services SK Telecom Overview Worlds Most Innovative Companies Ranked 91 st One of two Telco companies selected (April 2005) Winner of National Customer Satisfaction Index 1st Place for 14 consecutive years (October 2011) Best Asia Telecom Carrier Awarded two consecutive years (Telecom Asia & IDC, April 2007) DJSI world Sector leader in Mobile Telecommunications 84 96 02 06 07 11 AMPS CDMA 2000 1X EVDO HSDPA TD-SCDMA Test-bed HSUPA CDMA WiMax LTE Together With Shareholders Cutting edge Tech. and Servces Award & Recognition e-Commerce Real Time Navigation Movie & Video Music Cloud Service Mobile Game OnlinePortal Mobile Portal SNS Mobile Money

5 Telecommunication Market in Korea Korea has fast growing mobile communication market and SK Telecom has continued its sustainable growth Mobile subscriber Revenue Operating gain Net incomeEBITDA Number of subscribers Market Share $ 13,783M$ 1,837M$ 1,363M$ 3,895M26.6 million50.6% (As of Dec. 2011) Selected key figures of SK Telecom

6 SK Telecoms Environmental Management Strategy SK Telecom established companywide strategy for environmental management to actively respond to environmental issues Response to Climate Change Reduction of Social GHG Emissions(SE) Establishment of an Eco-Friendly Corporate Culture Comply with all demestic requlations related to GHG reductions Recognize the effects of the countrys GHG reductions through ICT Stabilize the companys environmental management system and reach a consensus among employees

7 Section 2 Background and Introduction

8 7 Background Importance of ICT toward GHG emission abatement has been studied globally Gartner report, 2007 ICT Industry is responsible for 2% of global carbon emissions GeSI:, 2008 Identified global emissions abatements in 2020 is five times of its own footprint

9 Introduction 8 A study on social GHG abatement by the use of ICT The purpose of the study was to; Demonstrate the potential GHG abatement of Green by ICT solutions in Korea between 2011 and 2020. The scope of the study included; Role of ICT in climate change mitigation in national level; Contribution of ICT services to abate GHG emission; Development of methodology to calculate GHG emission abatement; and Quantification of potential GHG abatement in Korea.

10 Section 3 Approach and methodology

11 10 Approach: ITU-T L.1410 Part 2 According to Part 2, we have applied Gap Analysis between Reference Product System and Target ICT service. Energy Fuel Transport GHG (CO 2 e) Energy Fuel Transport Less GHG (CO 2 e) Target ICT service (Project scenario) ICT service Comparisons between the systems on the basis of achieving the same functional units Reference Product System (Baseline scenario) First Order Effects The impacts created by the physical existence of ICT and the involved processes Second Order Effects The impacts created by the use of ICT service. This effects include the immediate abatement or increase in GHG emission after adopting ICT services Other Effects As rebound effects, the impacts created by the aggregated effects that consider time gained for end-user phase as well

12 11 SectorCategoriesQuantification Transport Movement of people Energy abatement = Unit energy consumption for each type of fuel × Fuel consumption r educed Movement of goods Energy abatement = Unit energy consumption for each type of fuel × Fuel consumption reduced Buildings Improved efficiency of office space Energy abatement = Unit energy consumption × Amount reduced Power consumption & Energy consumption Energy abatement = Unit energy consumption for each type of fuel × Fuel consumption reduced Storage of goods Energy abatement = Unit energy consumption × Amount reduced Improved work efficiency Energy abatement = Energy consumption per m 2 × Area used per person (m 2 ) × Workload improved (person-year) Industry Consumption of goods Energy abatement = Energy consumption to produce one unit of the product × Amount reduced Waste Energy abatement = Unit energy consumption for each type of waste × Amount reduced Approach: ITU-T L.1410 Part 2 We have applied quantification formulas by categories and secondary effects based on Part 2.

13 12 TransportationBuildingsCommerceProduction 1. Real-time Navigation (RTN) 7. Home Energy Management System (HEMS) 9. e-Commerce 14.Smart Motor 10. e-Government 2. Bus Information System (BIS) 11. e-Municipality 3. e-Logistics 8. Smart Grid 4. Telepresence 12. e-Health 5. e-Learning 13. e-Publication 6. Smart Work Scope Boundary: Analyzed 14 ICT services 1. Current offering from ICT industry players 2. Global Benchmarking 3. Governments ICT strategy and plans 3 selection criteria 14 ICT services for analysis

14 13 Methodology: 6 Steps of workflow Identify the functional unit and expected second order effects 1 Define scope and boundary 2 Develop two different scenarios for comparative analysis 3 Estimate second order effects and GHG emission abatement 4 Project GHG emission abatement by year 2020 5 Aggregate GHG emission abatement 6

15 Section 4 A case study: Real-time Navigation

16 15 Real-time Navigation (RTN) Identify the functional unit and effects Definition: A GPS-based service that provides real-time information of optimal routes and traffic condition to the destination. Functional unit: Movement of people from A to B in certain conditions such as time and cost. 1 t 123456 Types of EffectsPositive effectsNegative effects Impact on GHG emission First Order Effects As usage of RTN increase, production and network usage for RTN increases (+) Increase Second Order Effects As driving time and distance decreases, fuel consumption decreases (-) Decrease Other Effects As life span of vehicles increases, production for vehicles decreases As users spare time increases, energy consumption from other industry increases (+) and (-) Ambiguous

17 16 Real-time Navigation (RTN) Define scope and boundary Boundary for population/consumer Possible consumers for using RTN The LBS users among mobile internet service subscribers Mobile internet service subscribers** 48,085,000 subscribers % of internet service subscribers using LBS service** 19.3% People who are able to use RTN 9,280,405 people Boundary for transport Applicable vehicles for installing RTN Non-business cars, vans, trucks and business cars (assumed as taxis) t 123456 No. of vehicles that are able to install RTN (assumed that every possible consumer possesses his own vehicle) 9,280,405 vehicles Average annual travel distance per vehicle* 14,987km * 2008, Korea Transportation Safety Authority ** 2010, Korea Internet & Security Agency 2

18 17 Real-time Navigation (RTN) Develop two different scenarios Reference product system (baseline) Impacts on travel distance and fuel consumption while possible consumers dont use RTN ICT service (project) Impacts on travel distance and fuel consumption while possible consumers install and use RTN t 123456 No. of vehicles that are able to install RTN 9,280,405 drivers (or vehicles) Average annual travel distance per vehicle 14,987km Total distance travelled before adopting RTN 139billion km % of travel distance navigated by RTN* 16% % of fuel reduced**8.7% Travel distance reduction after adopting RTN 2billion km *, SK telecom **, Nissan Motor 3

19 18 Real-time Navigation (RTN) Estimate the GHG abatement in base year By adopting ITU-T quantification category Movement of people, reduced travel time in 2011 after implementing RTN is; Reduced distance by RTN2 billion km Actual Average Mileage8.32km/l Fuel saved by the reduced distance travelled239,886.66kl Emission factor of fuel2.47 tCO2e/l Emission abatement by RTN in base year592,520 tCO2e 4 t 123456

20 19 Real-time Navigation (RTN) Project the GHG abatement by 2020 Considering about, RTN service users CAGR 22% Potential GHG abatement by RTN by 2020 (unit: tCO2e) The number of usage per user Growth in automobile industry 20112020 Travel distance navigated by RTN`16%70% 20112020 Internet service subscribers using LBS service 19.3%90% CAGR Growth rate of car registered3.28% 3.5 million tCO 2 e in 2020 t 12345 6 5

21 Section 5 Potential domestic GHG abatement

22 21 610 793 695 118.4 20 14.57% Abatement potential 2011 2020 BAU Abatements Total emissions ICT direct footprint Abatements Potential GHG abatements of ICT services is 5.8 times of ICTs direct footprint. Conclusion Potential GHG abatements by adopting ICT services is expected to be more than 5 times of its direct footprint. Expected GHG abatement of each ICT services in 2020. Financial value via ICT services in 2020 is expected to be about USD 72 billion in terms of energy savings. (Units: tCO 2 e)

23 22 Implication The limitation of the study was; Absence of LCA approach for first order effect. The significance of the study was; The first case study which fully applied ITU-T L.1410 Recommendation: and The first study on assessing GHG abatements by the use of ICT in Korea (of Republic). The recommendation for further study is; Prioritization of 14 ICT services in terms of possibility of standardization; Applying LCA approach for first order effect; and Planning for developing CDM methodology.

24 Section 6 Introduction to further study

25 24 Introduction of Phase II Work Stream 1Work Stream 2Work Stream 3Work Stream 4 Possibility for global standardization Corresponding to ICT services of SK telecom Potential GHG abatement 2 target ICT services based on prioritization The scope and work streams of phase II : Supplementing with qualitative and quantitative methods (e.g. user surveys, experiments) Analyzing direct impact with LCA approach Discover target ICT services by prioritization Supplement target ICT services Cooperate with major global organizations Contributing a case study and sub- methodology to ITU-T Collaborating with global organizations of standardization/ telecommunication companies Recommend utilizing GHG abatement via ICT Suggesting development of CDM for ICT services overseas Suggesting utilizing GHG abatement under domestic GHG abatement plans Enhancement of the limitation in phase I Promoting global standardization of Green by ICT Reviewing the ways to approve GHG abatement

26 Thank you 25 Hyosik Min +82-2-6100-2253 hmin@sk.com


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