Environmental Sustainability

Water Usage and Recycling

Wafer Works' water intake has had minimal impact on the local area. Both the Yangmei and Longtan fabs are situated in Taoyuan City. According to the World Resources Institute's "Aqueduct Water Risk Atlas," the areas where Wafer Works operates face a medium to low risk of water resource stress. The Longtan fab draws water from third-party providers (tap water) and utilizes surface water collected from rainwater. This water undergoes sedimentation in settling tanks before being recycled for various purposes. Similarly, the Yangmei fab obtains water from third-party providers (tap water) and licensed underground wells. During the establishment and expansion of our facilities, we had consistently submitted water usage plans, which had been approved by the relevant regulatory authorities. These plans were then evaluated by the Taiwan Water Corporation Second Branch to ensure they meet the required water demand. The water source is drawn from the Shihmen Reservoir, which provided an average water supply of 556,730,000 tonnes annually from 2018 to 2022. In 2023, the Company's water intake was 1,940,500 cubic meters, accounting for only 0.35% (<5%) of the total intake. It is expected to have no marked impact on local water usage. The water resource management program is based on three strategies: reduction, reuse, and recycling. Measures such as using water-saving faucets, water-saving devices, and water saving toilets are implemented to reduce water consumption. Wastewater from water purifiers recycled for use in cooling towers and scrubbers. Rainwater is also gathered for watering trees and plants.

Additionally, Wafer Works recycles wastewater generated from cutting and grinding equipment, as well as QDR discharge water from machine cleaning for reuse.

Effluent Discgarge

Wafer Works treats all wastewater through proper sewage facilities, ensuring that effluent quality meets the regulatory discharge standards. Regular testing is performed to ensure that the effluent does not significantly impact nearby water bodies. Moreover, Wafer Works has a monitoring and data acquisition system in place to oversee various indices during the wastewater treatment process, including Chemical Oxygen Demand (COD), Suspended Solids (SS), fluoride concentration (F-), and pH levels. This system allows for immediate action in case of any malfunction, preventing environmental contamination. If abnormal water quality is detected, the monitoring system promptly alerts on-duty personnel to take appropriate measures to prevent violations and environmental pollution. Since its inception, Wafer Works has placed a premium on water pollution prevention and water resource management. We continue to promote water recycling initiatives annually, striving to reduce water consumption and protect water resources.

During the reporting period, Wafer Works' water intake was 720.87 million liters for the Yangmei fab and 1,219.63 million liters for the Longtan fab. The total wastewater produced was 645.92 million liters for the Yangmei fab and 1,020.80 million liters for the Longtan fab.

The monitored values of water intake and discharge for Wafer Works' Longtan and Yangmei fabs during the reporting period are as follows:

Energy Management and Policy

The energy usage of Wafer Works' Longtan Fab during the reporting period is detailed in the table below. In 2023, the Longtan Fab reduced its electricity consumption by 5,026,000 kWh compared to 2022, achieving a 5.71% reduction in electricity usage. Additionally, energy consumption decreased by 18,111 GJ compared to 2022. Similarly, the Yangmei Fab saw significant energy-saving results in 2023, reducing its electricity consumption by 13,345,600 kWh compared to 2022, and decreasing its energy usage by 50,276.86 GJ.

Energy Intensity

Energy Saving Achievements

Climate Change Response

Wafer Works has established internal control and audit systems, as well as risk management measures. Due to global warming leading to extreme weather events and the rising awareness of environmental conservation, energy efficiency, safety, and health, the Company has striven to fulfill its corporate social responsibility to establish a foothold in the industry. Following the framework of the Task Force on Climate-related Financial Disclosures (TCFD), Wafer Works' response can be categorized into governance, strategy, risk management, indicators, and targets. Sustainable Development Committee members identify climate-related risks and opportunities, formulate response strategies, and report to the Board of Directors annually. The Board of Directors oversees the effectiveness of implementation.

Short-, Medium- and Long-term Climate Risks and Opportunities for 2023

 Climate-related Impacts

In 2023, Wafer Works' total greenhouse gas emissions (Scope 1 and Scope 2) amounted to 64,403.3147 metric tons of carbon dioxide equivalent. The primary emissions came from Scope 2 purchased electricity, followed by process emissions, including perfluoropropane (C3F8) and nitrous oxide (N2O). For the first time in 2022, Scope 3 emissions were included in the inventory, primarily focusing on other indirect emissions generated from outsourced activities, with emissions sources owned or controlled by other companies.

Wafer Works is driving energy-saving and carbon reduction initiatives, aiming for sustainable and green production operations. In addition to the increase in Scope 3 emissions, the downturn in the semiconductor industry in 2023 led to a decline in revenue, contributing to an increase in emission intensity due to electricity use to maintain uninterrupted production.

Wafer Works Carbon Reduction Goals

The greenhouse gas emissions for the past three years (Scope 1) are as follows:

Environment, Health and Safety Policy

Wafer Works has established operation and maintenance procedures for air pollution control, water pollution prevention, and waste management. Relevant departments strictly adhere to these procedures to ensure all facilities operate at maximum efficiency. Various monitoring systems are installed at the discharge points of pollution control facilities. If monitoring values exceed alarm thresholds, operators will follow emergency response and notification procedures to address the issue immediately.

Each year, we carry out emergency response drills for air and water pollution control and enhance internal environmental awareness to prevent environmental pollution and legal violations. Under this comprehensive pollution control monitoring and management system, Wafer Works did not contravene any environmental regulations from 2021 to 2023.

Air Pollution Control

Wafer Works' strategy for air pollution control starts by optimizing processes to minimize the introduction of pollutants into exhaust gases. Subsequently, high-efficiency equipment is deployed to treat pollutants within the exhaust, guaranteeing compliance with government standards regarding the level of pollutants emitted into the atmosphere. Wafer Works classifies emissions into alkaline exhaust, acidic exhaust, and volatile organic compounds (VOCs). The air pollution control equipment varies based on the type of pollutants being

treated, and all emissions comply with the regulations set by the Environmental Protection Administration. Wafer Works also prioritizes the rights of neighboring companies and community residents. All equipment operations are centrally monitored by staff on a 24-hour rotating schedule. Continuous monitoring devices are installed to track VOC emission concentrations. Any variations in operating conditions are under constant monitoring, and if they deviate beyond the preset limits, an immediate alert is sent out.

Circular Economy and Waste Management

Wafer Works adheres to a circular economy reuse model focused on waste reduction at source and circular economy. In 2021, we achieved BS 8001 circular economy certification (SGS verification) and obtained commercial model maturity - optimization. Recycled scrap constituted 21.21% of total production capacity, while recycled ingot head and tail materials and pot scraps made up 20.32% of total input. In 2023, we maintained these operational performances, continuing our efforts in waste reduction and recycling.

Wafer Works has a comprehensive waste treatment and recycling mechanism. General waste is transported by certified waste management companies to government-designated incinerators. Industrial waste, such as sludge and oily sludge, is sorted, collected, and handed over to local certified waste management operators. Wafer Works classifies waste into recyclable waste, general industrial waste for incineration, and general industrial waste for recycling. The waste output for 2021 to 2023 is shown in the following table:

Wafer Works produces several types of industrial waste: general industrial waste, hazardous industrial waste, empty chemical containers, and recyclable waste. All waste is stored and transported according to legal regulations.

The methods for disposing of industrial waste at Wafer Works are as follows: 86% recycling, 9% incineration, and 5% resource recovery. Please refer to the waste disposal method distribution chart for detailed information. Wafer Works focuses on reducing pollution and managing waste through recycling initiatives. The primary source of hazardous industrial waste is empty chemical containers that contain chemical materials during the manufacturing process. These containers undergo regular annual audits, and each waste shipment is tracked with manifests to collect and monitor related data. The 86% recycling rate includes both general and hazardous industrial waste. In 2023, Wafer Works managed hazardous industrial waste, including empty chemical barrels, through a partnership with recycling processors. The process involves cleaning, neutralization, testing, certification, shredding, and recycling the plastic, with approval from regulatory authorities.