UN Approves NGK Insulator's CO2 Emissions Reduction Project in Mexico as a CDM

December 18, 2012

NGK Insulators, Ltd. (President: Taro Kato; Headquarters: Nagoya, Japan) has announced that a CO2 emissions reduction project being conducted by its manufacturing subsidiary NGK CERAMICS MEXICO, S. DE R.L. DE C.V. in Mexico was approved by the United Nations as a Clean Development Mechanism ("CDM"). The project was approved by the UN CDM Executive Board and registered as a CDM on September 14, 2012. Going forward, the project is expected to reduce CO2 emissions by approximately 5,000 tons a year.

For NGK Insulators, this marked the third project registered as a CDM. The two previous CDMs were a project by local manufacturing subsidiary P.T. NGK CERAMICS INDONESIA for reducing CO2 emissions by 1,400 tons a year that was registered in March 2011, and another project by NGK CERAMICS MEXICO for reducing emissions by 5,600 tons a year that was registered in June 2011.

NGK CERAMICS MEXICO is primarily a base for manufacturing cordierite diesel particulate filters ("DPF") for large diesel vehicles and large-size HONEYCERAM catalytic substrates. The facility was established to enhance the Group's supply framework in response to increased demand resulting from a global tightening of diesel vehicle exhaust regulations. It began production in July 2011.

Firing at high temperatures is a vital process in manufacturing ceramics. Consequently, developing technologies for reducing the energy consumption, CO2 emissions and environmental impact of this manufacturing process is an important priority for NGK Insulators. The project in Mexico achieved energy efficiency and reduced greenhouse gas emissions through the installation of highly heat-efficient regenerative burners to the firing kilns. The resulting reduction in greenhouse gases will be credited to the Group's reduction in CO2 emissions.

The NGK Insulators Group will endeavor to reduce CO2 emissions both in Japan and at Group companies overseas, with the aim of reducing its environmental impact globally.

Glossary of Terms

Clean Development Mechanism
This is one of the notable emissions trading schemes defined in the Kyoto Protocol. As a system, CDMs enable companies to credit the CO2 emissions they reduce through technology transfers and investment in developing countries to their resident industrialized country. CDM projects are approved and registered at the UN after the countries providing and receiving the technology transfer and investment reach an agreement.

Regenerative Burner
These burners are designed to reduce fuel consumption by very efficiently recovering heat energy from the burner exhaust. Regenerative burners contain a heat storage material that stores heat and transfers it to combustion air when the burner exhaust and the combustion air are passed through the material alternately, improving fuel efficiency.

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