Ernesto Heinzelmann, Embraco: Embraco’s Contributions to Energy Efficiency

“ Embraco’s contributions to energy efficiency” Ernesto Heinzelmann Sep, 2008 International Policy Leaders Dialogue, Washington D.C.

Energy consumption is a global concern... Ambitious global goals have been set Sources: Council of the Federation (Canada); CNIS (China); European Energy Commission; American Council For a Energy Efficient Economy; Ministry of National Infrastructures (Israel) To reduce energy consumption by 20% until 2020 To save 177 billion KWh (3,4%) per year in 2030 To reduce energy consumption by 20% until 2020 To reduce energy consumption by 20% between 2006 and 2010 To raise energy efficiency in 20% until 2020

...and the refrigeration segment plays a key role in this scenario Refrigeration accounts for 15% of the global electricity consumption

Energy efficiency in Household Refrigeration

Combined efforts of refrigerators and compressors manufacturers have reduced energy consumption 5 times in the last 30 years

Refrigeration system Compressor Crossover Technologies Cooling Components Cooling Mechanisms Cooling Cycles Source: Embraco 5x less energy consumption in the last 30 years

Energy consumption reduction The outcome of 100 million new systems per year in the world 2 years US$ 26 bi 2.5 years 155 million tons Household refrigerators’ consumption in the U.S. End user savings Largest worldwide Hydroelectric power production Reduction of CO 2 emission Source: Refrigeration system consumption: 2,900 KWh per year - internal analysis based on DOE 2006 data

Energy Regulations

Minimum Energy Performance Standards (MEPS)

Government sets the appliances maximum consumption

Labeling

Raise end users’ awareness on energy efficiency

Source: Collaborative Labeling and Appliance Standards Program - USA, Embraco Market Intelligence

Tax Incentives

Facilitate the purchase, installation or manufacturing of energy–efficient products

Compressor is a key component

Embraco 37 years of activities Global Leader in the Hermetic Compressors Segment 22% Global Market Share VCC’s Market Share: 100% North America 90% Europe 28 Million Compressors / Year + 380 Million Manufactured Products Global Network of Selling and Distribution

Embraco Facilities and People * August, 2008 Italy - 708 Sales office + Warehouse – 76 USA & Mexico Slovakia – 2,250 China – 1,356 Brazil – 5,504 9.894*

Embraco Energy savings initiatives 1983 Consumption of 700 BTU/h, single-speed compressor 180 W Launch of new compressors highly focused on energy efficiency 2006 110 W Embraco VCC 100 W

Embraco Energy savings initiatives

Compressor efficiency improvement over the years has...

Avoided the emission of

32 millions of tons of CO 2

in the atmosphere

Saved the energy consumption of all refrigerators sold in the U.S. for 6 years

Top Embraco high efficiency compressors

Embraco VCC

Most efficient variable capacity compressor of the market

EMC

The most efficient single-speed compressor in the world (produced in our China plant)

EM2

Replaced a bigger compressor, providing high efficiency while reducing the amount of raw materials used

EGX

Featured in a significant number of Energy Star products in the US

Technology innovation Our R&D structure R&D Centers in 3 continents (including 40 labs) Dedicated teams in each location (Brazil, Slovakia, Italy, China and USA) 400 highly specialized people (PhDs, Masters and Engineers)

Technology innovation Strongly supported by a global knowledge network More than 600 researchers in institutions like Univ. Illinois (US), Fraunhofer (GER), Univ. Glasgow (UK), POLO (BR), Univ. Timisoara (Romania), Univ. Shanghai (CH), Univ. ITL (PT), etc.

Technology innovation Outstanding results Around 65% of revenues generated from products launched in the last 4 years 2nd Brazilian company in patents’ placement in USA 770 patents granted in the world 29% market share in the Commercial segment Environmentally friendly products

Sustainability The Triple Bottom Line Approach Sustainability is in our DNA Economic Development Environmental Development Social Development Technology Leadership Diversity Program Environmental Management System Recycling Program for end-of-life compressors Ethics and Values Energy Efficiency Environmental Education Program Lean Concept Volunteer Program

Sustainability Environmentally friendly refrigerants We are constantly taking the lead in the development of compressors that use environmentally friendly refrigerants 1992 1994 2005 Year Evolution in alternative refrigerants R 290 R 600a R 744 (CO 2 ) 1930 1987 1995 R 134a R 404a R 407c Montreal Protocol Initial use of CFC in refrigeration

Sustainability Contributing to savings in the environment

When Chinese industry replaces old EC compressors by new EMB, we will save around 18,000 tons/year of:

Steel 15,000 cars Copper wire 1.5 times the driving distance between Washington, DC and Los Angeles Aluminum 2 boeings 777-300 aircrafts Iron 85 thousand car engine crankcases Reducing the size of compressors is one of our ways to promote sustainability

Embraco’s initiatives have been well recognized Miniaturized cooling device presented at Intel Developer Forum “ VCC Technology is among the 10 biggest Brazilian innovations in the last decade” Liebherr domestic appliances won the “Kitchen Innovation of the Year 2007” award in Germany. The VEMZ 9C is applied in this system “ Embraco, Synonym for Global Leadership and Quality in Cooling Solutions for the Refrigeration Market.” EMBRACO – WINNER OF THE 2008 “INTERNATIONAL STAR AWARD” OF THE ALLIANCE TO SAVE ENERGY

Embraco’s client portfolio

Embraco has been participating in the United Nations Global Compact Since 2004

Ernesto Heinzelmann President [email_address] www.embraco.com Responsible technology for a better quality of life