Risk Management and Actions

Action

Internal Carbon Pricing

Internal Carbon Pricing (ICP) is a mechanism by which companies internalize the external costs associated with their greenhouse gas emissions, encouraging them to incorporate carbon costs into decision-making and investment evaluations. Both the IFRS Sustainability Disclosure Standard S2 and voluntary disclosure standards such as the Carbon Disclosure Project (CDP) consider the price of internal carbon pricing and its application as information that should be publicly disclosed. According to PwC (2023), the top three key objectives of implementing internal carbon pricing for companies are to promote low-carbon investments, enhance energy efficiency, and change internal behaviors. An increasing number of companies are adopting internal carbon pricing to achieve their carbon reduction goals. The World Bank believes that companies implementing internal carbon pricing can drive internal emissions reductions, serving as a crucial tool for companies transitioning towards netzero emissions. By comparing various carbon pricing mechanisms and considering the European Union Emissions Trading System (EU ETS) as a global benchmark for carbon markets, ASUS aligns with the most comprehensive regulations and standards by following the EU Carbon Border Adjustment Mechanism (CBAM) and using its ETS price as the framework for internal carbon pricing assessment.

Pricing Principles
 

ASUS’s product manufacturing model primarily involves outsourcing manufacturing, where Scope 1 and Scope 2 greenhouse gas emissions are not significant, belonging to Scope 3 emissions in the value chain, with supplier emissions and product usage emissions accounting for over 90%. As a leading global green technology brand, ASUS integrates its core capabilities to promote product design and manufacturing towards decarbonization. It links carbon reduction goals verified by SBTi and product carbon footprint calculation procedures certified by thirdparty organizations. Therefore, “product carbon footprint” serves as the basis for internal carbon pricing calculations, with the main product’s internal carbon price set at $80 per metric ton of CO2e.

Carbon Pricing Management Applications

ASUS applies the shadow pricing method to integrate our internal carbon pricing mechanism into financial decision-making, assessing the potential impact of global net-zero progress and emission reduction efforts on our financial performance. By quantifying carbon costs, we encourage our business units to select environmentally friendly materials and adopt energysaving designs. Proceeds from future carbon fees will be invested in procuring or investing in renewable energy power, enhancing operational energy efficiency, and funding innovative decarbonization technologies. Following the introduction of our internal carbon pricing, we aim to drive green product revenue to exceed 50%, support suppliers in obtaining ISO 14064 third-party verification, guide key suppliers in setting Science-Based Targets (SBT) aligned reduction goals, and have our contract manufacturers and assembly plants certify to ISO 50001 while sourcing over 40% of their electricity from renewable energy. We anticipate reducing our product carbon footprint by more than 20% by 2030.

To ensure our emission reduction commitments are embedded in business decision-making processes, we disclose the performance of our internal carbon pricing in management reports, providing product operations teams with benchmarks for tracking and managing reduction outcomes. By promoting energy-efficient design and supply chain emissions reduction internally, we link up to 10% of variable compensation for our business unit leaders to the achievement rate of our Scope 3 SBTi targets—namely, a 30% absolute reduction in “Purchased Goods and Services” and “Use of Sold Products” by 2030 compared to the base year.

Carbon Pricing Audit Mechanism
 

To mitigate carbon risk and unlock new revenue growth opportunities, ASUS will enter the next phase of our internal carbon pricing initiative by setting interim targets and linking carbon reduction outcomes to business unit performance. We will formalize the collection of internal carbon fees and establish governance guidelines for the management and use of these funds. We will form a Carbon Reduction Project Review Committee to evaluate key indicators, such as the technical feasibility of reduction solutions and business cost-benefit analyses, and to expand our carbon reduction projects to include areas like renewable energy, resource and energy efficiency, and innovative low-carbon technologies.

Low Carbon Products

ASUS quantifies the potential environmental impacts it may cause in accordance with ISO 14040 and 14044 Life Cycle Assessment (LCA) standards. In order to reduce the carbon footprint generated by our products in their lifecycle, ASUS applies a circular economy mindset into product design and services, uses eco-friendly materials, improves energy efficiency, and extends usage cycles in our transition to low-carbon product development.

Use eco-friendly materials

The amount of plastic used in ASUS products accounts for over 30% of the overall weight of the mainstream products, making it the most commonly used material. Therefore, we work with our major raw material suppliers to explore ways to increase the use of Post Consumer Recycled Plastic (PCR) as much as possible without compromising high quality and durability of ASUS products.

  • Since 2017, more than 3,500 tonnes of recycled plastic have been used in our key products, resulting in a cumulative reduction of approximately 26,100 tonnes of CO2e carbon emissions.

Elevate energy efficiency

Continuously reduce carbon emissions during product use by making our software and hardware more energy efficient. The ENERGY STAR ® Program is the strictest energy efficiency program in the world. The energy efficiency design of our key products exceed the ENERGY STAR ® standards. Our external power supplies use the highest energy efficiency level in the market, Level VI, to overcome sales obstacles caused by global energy efficiency laws and create competitiveness in the green product market.

  • ASUS newly launched commercial and consumer laptops in 2024 exceed ENERGY STAR® standards by an average of 47.9% , resulting in a reduction of approximately 90,651 tonnes CO2e compared to products that merely met the ENERGY STAR® standard.
 

Supply Chain Carbon Reduction

The supply chain is the major source of greenhouse gas emissions for ASUS. Analyzing more than 100,000 data entries from environmental footprint surveys over the years, we identified 90% of emission was from key suppliers in the manufacturing process, including IC base(CPU, GPU), hard drives(SSF, HDD), panels, power supplies, motherboards, memory as well as EMS. We collaborate with these key suppliers through carbon reduction engagement and counseling program.
 

 

 

Improve Energy Efficiency of Headquarters

ASUS’ carbon emissions came from the use of electricity for office operations. Since 2015, we have built up the ISO 50001 Energy management system. Both of our operation headquarters have received the LEED Platinum certification, the top certification for green buildings. We aim to reduce electricity consumption by 1% each year and we have achieved the marginal benefits for improving energy efficiency. ASUS conducts regular identification of high-energy-consuming areas and equipment, performing performance measurements on items such as chillers, chilled water pumps, cooling water pumps, zone pumps, and cooling towers in air-conditioning rooms.ASUS launched a three-year energy-saving improvement plan in 2023. Under this initiative, we upgraded inefficient chillers at our operational headquarters—including the Lide Headquarters, the AI and Cloud Campus, and the Luzhu plant—with environmentally friendly refrigerants, and introduced variable-frequency temperature-difference control on cooling water pumps and cooling towers. We also deployed a centralized smart energy management system, with a total investment of NT$27 million. This plan is projected to reduce electricity consumption by 440,000 kWh annually, lower our electricity costs by 4.88% each year, and cut approximately 217 tonnes CO2e.

To strengthen the professional capabilities of our energy management teams, we conducted training courses in 2024, including ISO 50001 Internal Auditor training and instruction on the principles and operation of the new chiller units, with 14 participants and a 100% completion rate.

 

Group Subsidiary Assistance Program

Since 2022, ASUS has committed to aligning with SBT and initiated a Greenhouse Gas Inventory Assistance Program. This program aims to establish comprehensive inventory capabilities for group subsidiaries, assisting each subsidiary in setting reduction targets and carbon reduction pathways, while integrating group-wide reduction requirements and resource allocation. To further strengthen carbon data management, ASUS officially deployed our Carbon Data Management Platform, featuring one-click generation of inventory registers and reports to accelerate subsidiaries’ preparations for thirdparty external verification. Through this platform, ASUS and its subsidiaries now conduct quarterly emissions performance monitoring and have established a Seed Trainee Program to cultivate internal carbon management expertise, ensuring that each subsidiary’s carbon performance is tracked in real time, transparently, and traceability.

Expand the Use of Renewable Energy

ASUS continuously reduces the reliance on fossil-based electricity by implementing diverse renewable energy initiatives. In 2024, we wheeled renewable power to our Taiwan operations sites and installed rooftop solar photovoltaic systems at our U.S. overseas locations to directly supply the electricity required for operations under a self-generation, self-consumption model; we also signed clean energy power purchase agreements with local utilities at our Netherlands and Switzerland sites to ensure a stable, low-carbon power supply. Collectively, these actions reduced our non-renewable electricity consumption this year by approximately 75,488 GJ compared to the baseline year, corresponding to a greenhouse gas emissions reduction of about 11,612 metric tons of CO2e.
 

 

Pathway of Introducing Renewable Energy

ASUS adheres to the RE100 organization’s recognition of renewable energy by purchasing renewable energy technologies that are beneficial for improving the environment and reducing carbon emissions, such as wind energy, photovoltaic energy, geothermal energy, and hydropower. We are also in line with the renewable energy supply and matching system to achieve our RE100 target. In our strategies of purchasing renewable energy, ASUS will also take into consideration our global presence and the current situation of the renewable energy market before planning a phased renewable energy procurement goal, and working closely with the renewable energy industry.

By introducing renewable energy at overseas and Taiwan operations centers, ASUS achieved RE55 across our global operations centers in 2024. It is anticipated that in 2027, we will reach RE85. To keep up with the development trend of renewable energy technology, we will adjust our procurement ratio of renewable energy in a rolling manner and take into consideration the level of commercialization of new renewable energy technology, gradually incorporating it into the ASUS RE100 energy portfolio to balance the company’s profit momentum and carbon reduction obligations to move towards RE100.
 

Implement renewable power wheeling for Taiwan sites

ASUS has analyzed optimized scenarios for renewable energy across our global operations and developed short-, medium-, and long-term renewable energy roadmaps to steadily increase our renewable energy adoption rate. Beginning in 2024, our Taiwan sites—including the ASUS Headquarters and the AI & Cloud Innovation Campus—officially commenced renewable energy procurement under a Corporate Power Purchase Agreement (CPPA). In 2024, our Renewable Power Wheeling volume reached approximately 9.5 million kWh. That same year, we expanded rooftop solar photovoltaic installations and installed energy storage battery cabinets at our Corporate Headquarters and Luzhu campus, with commissioning slated for 2025. By integrating on-site generation and self-consumption models with energy storage technologies, we will significantly boost our renewable energy usage, optimize electricity efficiency and stability, and further enhance our corporate sustainability resilience. Looking ahead to 2027, we plan to introduce wind power, with an anticipated Renewable Power Wheeling volume of 20 million kWh, accelerating our journey toward achieving net-zero transformation.

 

Map of the ASUS Global RE100 Path

RE15

2022

  • Procurement of Renewable Energy Certificates from Overseas Centers
  • Promote Energy Transformation in Overseas Centers

RE30

2023

  • Signed CPPA
  • Procurement of Renewable Energy Certificates from Overseas Centers

RE50

2024

  • Signed CPPA to procure renewable energy through power wheeling (mainly solar photovoltaic)
  • Procurement of Renewable Energy Certificates from Overseas Centers

2025-2026

  • Signed CPPA to procure renewable energy through power wheeling (mainly solar photovoltaic)
  • Expand on-site solar photovoltaic installations and deploy energy storage systems
  • Procurement of Renewable Energy Certificates from Overseas Centers

RE85

2027-2029

  • Signed CPPA to procure renewable energy through power wheeling (solar photovoltaic and wind power)
  • Procurement of Renewable Energy Certificates from Overseas Centers

RE100

2030-2050

  • Attain RE100 Goal: Global Operations Centers RE100

Innovative Technologies

According to the IEA Net Zero report, among the technologies required to achieve the 2050 net zero target, only wind power generation, solar photovoltaics, and electric vehicles are considered mature, commercialized technologies. The majority of the remaining carbon reduction technologies are still at the prototype stage, requiring further technological breakthroughs and market validation. Therefore, ASUS is striving to keep up with the technological development trends and innovation feasibility, and innovation feasibility by leveraging external resources from academia and industry through its Innovation Development Office.

On the product front, ASUS actively engages in matching external startup technologies through the “ASUS and NTU Corporate Accelerator,” selecting technologies with promising carbon reduction potential and commercial viability for analysis of their applicability, such as innovative technologies for plastic waste recycling. ASUS conducts alignment and demand assessment between ASUS and innovative technologies, providing Proof of Concept (POC) validation environments for startup concepts.


For beyond value chain carbon reduction projects, ASUS references BVCM (Beyond Value Chain Mitigation) guidelines, as detailed below:

  1. Carbon credit projects for investment or procurement must adhere to ASUS’s internal carbon credit criteria, which are established with reference to reports from IPCC, The Oxford Principles for Net Zero Aligned Carbon Offsetting, ICVCM, NGO organizations, etc., to avoid greenwashing risks, all of which align with BVCM recommendations.
  2. Innovative carbon reduction technologies such as carbon capture and storage, clean technology, although making significant contributions to reducing emissions beyond the value chain, are constrained by insufficient investment funds or technological bottlenecks, preventing major breakthroughs for achieving economies of scale and widespread adoption by enterprises. In light of this, ASUS continues to monitor the development of innovative carbon reduction technologies and conducts feasibility assessments for investments in small hydropower, hydrogen energy, and others.
  3. ASUS recognizes the contribution of biodiversity richness to climate change mitigation and has planned and will collaborate with industry, government, academia, and other units to increase domestic carbon sink and biodiversity restorationrelated projects, contributing efforts to beyond value chain emission reduction initiatives.