To addresses the challenges posed by climate change, HLC actively promote EVs of various brands and smart energy storage equipment. This ensures that the Company can promptly keep abreast of market trends, meet customers’ demands, adapt to regulatory changes, and accelerate the transition to low-carbon transportation. In terms of market risks, by closely monitoring changes in customer demand for low-carbon vehicles and analyzing the penetration rate of EVs and the development of charging infrastructure, we ensure that our fleet configuration aligns with market trends. Furthermore, through data analysis and customer feedback mechanisms, we promptly adjust vehicle procurement strategies and optimize our product portfolio to reduce operational risks caused by market fluctuations. In terms of policy and regulatory risks, HLC proactively tracks government policies related to carbon emissions, EV subsidies, and low-carbon transport. We also collaborate closely with major car manufacturers to ensure that the vehicle models introduced comply with environmental regulatory requirements standards while maintaining market competitiveness. HLC will continue to strengthen its climate risk management mechanisms, promote the development of a low-carbon fleet, implement climate adaptation strategies, and foster the sustainable transformation of the transportation industry.
Greenhouse Gas Emissions To fulfill our corporate responsibility toward climate change, HLC has conducted a greenhouse gas inventory in accordance with ISO 14064-1:2018 standards. This inventory of operational activities at 33 directly managed operational sites in Taiwan covers direct emissions (Scope 1), energy indirect emissions (Scope 2), and a portion of Scope 3 (other indirect emission sources). The largest emission source is purchased electricity (accounting for nearly 50% of total emissions), followed by refrigerant (HFCs) fugitive emissions from processes and repair/maintenance. This indicates that energy conservation and refrigerant management will be key directions for future carbon reduction efforts. In response to climate change risks, HLC currently follows Hotai Group's strategic direction and adopts a target-based management approach for annual greenhouse gas reductions. We have set a target to reduce carbon emissions by 3% per year starting from the baseline year (2025) and aim for a cumulative 25% reduction from the baseline year by 2030. This carbon reduction target covers Scope 1 and Scope 2 greenhouse gas emissions, and the inventory method must comply with ISO 14064-1 standards to ensure that carbon inventory data is accurate and meets international standards.
Energy Conservation and Carbon Management Initiatives HLC is fully promoting enhanced energy efficiency and low-carbon fleet transformation in line with the Group's "3% annual carbon reduction” strategic target . According to 2024 inventory data, despite the continuous expansion of HLC 's locations (a 6% increase), the total annual carbon emissions still decreased by approximately 7% compared to the previous year. This demonstrates our continued progress toward our carbon reduction targets. On the operational front, recognizing the high energy consumption of air conditioning equipment, we have actively implemented "air conditioning replacement and upgrade" and "regular energy-saving maintenance" programs. Regarding vehicle management, we have been progressively replaceing fuel-powered company cars for executives with HEV and plug-in hybrid electric vehicles (PHEV).
Water Resource Management Although HLC 's operational model is not water-intensive, given that vehicle repair/maintenance and facility operations still require water, water resources are considered one of our important environmental management priorities. The Company is gradually adopting various water-saving measures and water efficiency improvement mechanisms, including: Regular equipment inspection/repair and leak detection to reduce inefficient water consumption. Optimizing car wash processes at some locations by introducing high-pressure washing systems to reduce average water consumption per vehicle. Using water-saving valves in office restrooms and public areas to minimize unnecessary discharge. Promoting water conservation awareness through internal education and training and posted signs to remind employees to implement water-saving measures.