“Energy Efficiency -A Knowledge Management Perspective”

World Environment Center Roundtable Basel, October 24-25, 2002

Karl F. SchmidtVP, WW Env.Affairs

AGENDA

• Energy Management at J&J

• Best Practice/Program Deployment

• Critical Success Factors

Energy Management

• Focus started in 1974 – rising costs, disrupted supply• Regional Energy Committees – Corp.Energy Director

– WW reporting system ($140MM costs in 2001)

– Explore new technologies, conduct energy surveys

• Coordinate purchasing of energy supplies/services• Coordinate major programs that benefit Corporation• Drive Energy Star Enhanced Best Practices

Objective: Assure continuity of operations, reduce costs and environmental footprint

Coordinated Programs

• Climate Change Action Plan including:– Climate Leaders, Green Lights (US and EU),

Motor Challenge, Energy Star Buildings

• Green Power Development Group (WRI)– Large US energy users committed to developing

green power mkts (J&J, IBM, Dow, DuPont, GM)

• Robust Energy Reporting System– Energy tracking/profiles, project summaries

CO2 Reduction Plan

•Implement 100% of Enhanced Best Practices by 2005

•Aggressively pursue clean energy supplies

•Implement new facility design criteria for all construction

•Pilot & develop innovative technologies & practices

•Add CO2 emissions to Operating Co. dashboards

•Consider market based CO2 trading (under dev.)

PHARM

CPC

MDD

Legend: Caution Needs attentionOn-target Not applicable

Next Generation Goal

Compliance/Risk Management

Mgmt. Systems/ISO 14001

New Product/Process Review

Conservation/Community Outreach

Energy Use

Water Use

Raw Material Use

Packaging Use

Waste Reduction (NPO)

Environmental Performance Dashboard: Mid-Yr. 2002

J&J’s Worldwide Progress

CP&N Worldwide

13 4

2 13 4

2 13 4

2 13

67

76%

84%

4.3%

0.7%

2%

72%

13 4

2

Actual‘01 Target

1) Non-Hazardous2) Hazardous3) Toxic4) Waste Mgmt. Methods

55 or Less Viol/ Spills

100 % ISO Certified

100% w/ Plans

100 % of New Prod.

50 % Best Prax

- 1 % CO2

2%

2%

2%

2%, 1%1%, 2%

By Business Group

42

36 %

_+15 %

0

100

100

100

100-4

10

5

10

105

10 5

‘05

Goa

l

Energy Efficiency: Neutrogena

J&J’s 1st Photo- Voltaic System : Clean, Renewable & Reliable

Provides 20% of total electric demand

Concurrent with Peak Demand

Favorable Payback w/ Subsidies & Tax Incentives

Great Publicity!

Green Energy for Cordis Europa, supplied by NUON.

*Starting 2001- 10% energy from ‘Green’ supplier*Employees given chance to purchase. •Total: 1,300,000 kW/yr •CO2 emissions avoided= approx. 1.6 million pounds/yr

Critical Success Factors

• Single person responsible (Champion)– Team to implement at each site

• Goals with timeline established early

• Management support and recognition

• Provide forums/tools to share– Website, conferences, communications

• Regular internal/corporate reporting