Technician session

Eco Industrial Park

Eco-Industrial Park (EIP) Initiative in Korea

Hung-Suck Park
Professor, University of Ulsan, Ulsan, Korea
Director, KICOX, Seoul, Korea

1
Contents

I KICOX & Industrial Parks

II Eco-Industrial Park Initiative in Korea

III Outcomes of EIP initiative

IV Future Strategies

2
 I
KICOX & Industrial Parks
Korea Industrial Complex Corporation: KICOX
(Established by Korean Ministry of Trade, Industry and Energy)
51 Core Industrial Parks (44,000 Co.s) supported by KICOX

Impact in Korea (‘09): 36% in Domestic Product, 45% in Export, 24% (0.8 mil.) Labors
National Industrial Complex General Industrial Complex Foreign Investment Zone Rural Industrial Complex

Seoul Namdong Osong Bukpyeong

Banwol Sihwa Gunsan Gumi Ulsan

Gwangju Yeosu Noksan Changwon

4
What does 973 Industrial Parks mean to Korea?

973 Industrial Parks (Approx. 80,000 Companies)

62% Production/79% Export/45% Employment

Industrial complex Role in Korea(2010)

INDUSTRIAL AREA COMPANY EMPLOYMENT PRODUCTION EXPORT

NUMBER 2
COMPLEX (MILLION M ) (THOUSAND) (THOUSAND) (BILLION $) (BILLION $)

National 41 792 45 1,007 358 135

Regional 484 488 22 647 152 73

Urban 11 2 1 1 1 -

Agricultural 437 70 6 140 24 6

TOTAL 973 1,353 74 1,796 535(62%) 214(79%)

* GNP in Korea : As a Pillar of Industry, Change $87 In 1964 $23,700 in 2011

5
Korea Industrial Complex Corporation’ Goal

“ Manufacturers in Industrial parks

have a Dream”
Upgrade Co-Sustainability
Working life with Tenant
Manufacturers
Companies
Sustainability

4 UP’s
1 Upgrade I.P. H/W·S/W Upgrade 2 Upgrade Customer-oriented I.P.
Driving QWL(Quality Working Life) Valley Customizing I.P. development
Factory lots analysis & control

3 Upgrade Companies’ Sustainability 4 Upgrade Infor. & Consulting Service

Co’s Assist by Clustering Method Factory Infor. & Consulting Service
Ecology Industrial Park Research & Development for I.P.
Society contribution Biz

6
 II
Eco-Industrial Park Initiative in Korea

7
What is EIP?

Raw Material Energy Raw Material Energy

Integrated Optimising
Production Center Resource & Energy
Efficiency

Waste Waste

Heat ,Waste ,Water, Air etc 3R + Tech w/Co’s Zero Emission

Conventional industrial complexes
Economic benefit
Focused on raw material, products
Disposed by individual or groups
Large quantity
Causes pollution
Environmental conflict
Eco industrial park
Criteria Economic & Environmental consideration
Network Focused on raw material, products, & by-
products, waste heat
Waste disposal Reuse and recycle
Waste generation Minimal/zero quantity
Social image Eco-friendly industry
Community Community friendly

8
Schematic of the EIP Project

Legal Act to Promote Environmental friendly industrial structure(Article21)

basis

Management
Ministry of Trade, Industry and Energy(MOTIE)
authorities Korea Industrial Complex Corporation(KICOX)

Project
1st Phase 2005. 10 ~ 2010. 05.
period 2st Phase 2010. 06 ~ 2014. 12.

Target 1st Phase 5 regions, 5 complexes

I.C 2nd Phase 9 regions, 46 complexes

2nd Phase Budget 2010 2011 2012 2013 2014

Project (in KRW billions ; mil. dollars)

budget 45.0 7.5 7.77 7.38

Central gov.
7.74 12.35
Local gov. 12.0 2.68 2.55 2.37 2.20 2.20
* 2005 ~ 2012 52 bil. won gov. support + 12 bil. won local gov. support

9
Organization

Ministry of Trade, Industry External assessment

and Energy
Establishment of general policy EIP project annual
progress evaluation

Assessment committee KICOX (Headquarter)

Project evaluation, Planning & budget management,
Review of key issues Evaluation of performance
of regional offices

Regional Regional advisory committee

EIP Review, advise and recommendation
Center for Regional projects

Cooperation organization Participating companies Participating institutions

University,
Local government Tenant companies
Research institute

10
3 Stage Master Plan : (’05~’19 )

2005. 11 : 1st Phase Pilot EIP with 5 industrial complexes

2010. 06 : 2nd Phase Diffusion on 46 industrial complexes with a Standard EIP model
(EIP design project for Bangladesh Chittagong Economy Processing Zone : ’12)

2015. 01 : 3rd Phase Edge Tech. EIP Model including all industrial complexes

1st phase Pilot period 2nd phase Diffusion period 3rd phase Completion period
2005.11~2010.5 2010.6~2014.12 2015.1~2019.12
Pilot on 5 industrial complexes Diffusion on 38 industrial complexes Construction of national EIP network

11
R & DB Strategy of Industrial Symbiosis Project

Project Financing Source

Main Gov.(70%) & Local Gov.(20% : matching), Private Co.(10% : technology fee)

Process
Identification Feasibility study Commercialization

Technology fee
(20~40% of government funding)
Budget for EIP projects
Support for project
management
9 EIP Centers Main Co

Top-down Assessment board Research funding

proposal (project selection for funding) (within 75% of necessary budget)

Selection based on
Finding : IS Project Commercial Design
Feasibility Potential
Research funding Research funding Profit Sharing
Bottom-up 10% 20% Negotiation among Co’s
Project suggestion ProjectCo.

University/Research
institute/Company Local Gov.

12
R & DB strategy of industrial Symbiosis Project

Identification Feasibility Commercialization

Expert Forum : clustering Offer : Investment plan
- Green R&BD : BAT
Coordinator Scheme - Facility Network
Material & Energy DB Cost Effective plan etc
Actualization of Benefits
- Auditing Network companies’ input
- Reasonable Profit sharing
- Marketing & Contracting
- Regulation matters

Regulation Relaxation

Bottom up types

Companies’ Network
consulted by objective C.D.s

by-product Catalyst by-product

Supply Demand
Company Company Company
energy (3R) energy

13
4 Core Strategies

Network Development for R&D in energy and resource

resource circulation
Networking among manufactures,
universities, research institute and
government agencies to
simulate resource circulation
between/among enterprises.
circulation technology
Promotion of technical development and
diffusion of outstanding techniques for
sharing energy and resource
between/among enterprises .

4 Core
Strategies
Diffusion of Success In - external exchange -
EIP project cooperative project
Boost the achievements diffusion for Exchange the information and the
promoting its commercialization of the techniques among synergy networks of
tasks completed and dissemination the the subsidiary organizations for
successful cases to revitalizing the exchange and
other parks. enhancing mutual cooperation.

14
Continuous Expansion of IS networks in an EIP
Development of EIP Strategy & Eco-
Efficiency Target
Eco-Efficiency Evaluation
Regional EIP Center of IS Networks in
Ulsan EIP
Top-Down IS Networking Potential
Identification
(Govt. Data, EIP Staff, Experts)

Bottom-UP IS Networking Potential Monitoring Assessment

Identification EIP Performance Enhancement
(Companies, Tech. Forums)

Feasibility Study for Business Model

R&D, Engg. Companies, Other
Stakeholders

IS Implementation
Stakeholder Satisfaction (Eco-
Efficiency Indicators) 15
 III
Outcomes of EIP initiative

16
Excellent Case

CO2 and steam network between Paper mill and Zinc smelter

Before after

CO2 steam
CO2

CO2
steam B-C boiler

3.8km

Input(Initial Investment)
Facility investment : steam and CO2 pipe (total 3,872m) the cost of equipment : $22.0 mil.

Output(Income : Business scale : steam 50~80 ton/hr, CO2 50 ton/hr supply)

Reduction of GHG emission : CO2 63,643 ton/yr (about $ 0.7 mil./yr)
Cost Cut from raw material & waste reduction : $6.6 mil./yr

17
Excellent Case

Organic Waste-to-Energy Network (PPP project)

Bio gas
9,000m³/day
Biogas Facility
50 ton/day
by Maturing at 45’ Waste LNG
Animall
Manure
Steam
91.2 ton/day

100 ton/day Steam

Food waste
Fertilizer
사업성과 8.8 ton/day

Economical Result
: $ 2 mil./yr profit because of 2,703 toe/yr Energy sustitution.

Preparing for the Anti-Marine dumping Law effective from 2013.

18
Excellent Case

Public EIP Infrastructure investment by KICOX (PPP)

Ulsan Yong-Yeon Steam High-Way Project (Total Investment 27.5 mil.)

Project Name Mea-Am dong
(Ulsan Y.H. Distric.) Foosung,
Samyangsa,
Steam High-Way Project Songwon Industry

Project Scale
S.Distributers, Steam condensate Pipe facility etc.
: 6km

Total Investment

￦27.5 mil.(KICOX ￦22 mil., Private ￦5.5 mil.) Sunamdong Yongjamdong

Taekwang Dupon, SK Gas,
Steam Supply Scale Industry Whasum Pacific Chemistry,
/Acryl Fact. NH Fact.
720,000ton/yr(90ton/hr, 8,000hr/yr), 42kg(pressure)

Expectation
- (Economy) 19.68 bil./yr
- (Environ-) 146,869t CO2 GHG Reduction

19
 SK Energy SKC

SK Energy
100 Ton/h
45 kg/cm2g

[step 1]
35 Ton/h
75 Ton/h
Sung-Am #1 16 kg/cm2G
25 Ton/h 45 kg/cm2g
incineration plant 16 kg/cm2G
SKC
Hyosung #2 [step 4]
Sung-Am #2 Yongyeon plant
incineration plant 35 Ton/h 20 Ton/h
(extension in 2012) 45 kg/cm2g 45 kg/cm2g
55 Ton/h
45 kg/cm2g
15 Ton/h
45 kg/cm2g 10 Ton/h
SK Energy 16 kg/cm2g
[step 3] [step 2]
FCC Plant
Hyosung #2 15 Ton/h
3 kg/cm2g
Yongyeon Plant

Sung-Am #1 30 Ton/h
Incineration Plant SK Energy Hyosung #1 45 kg/cm2g
Hyosung #1 Yongyeon plant
Yongyeon Plant Korea
PTG
Sung-Am #2 Hyosung #3
Incineration Plant 10 Ton/h Hyosung #3
Yongyeon Plant Yongyeon plant Korea PTG
7 kg/cm2g
KP Chemical

Hansol Chemical
Hanwha Chemical
10 Ton/h
18 kg/cm2g
Eastman [step 5]
20 ton/h
5 kg/cm2g
KP chemical 30 Ton/h Hansol EME
45 kg/cm2g
25 Ton/h (extension
SK Chemical 5 kg/cm2g in 2014)
25 Ton/h
Hanhwa 45 kg/cm2g
Chemical 70 Ton/h
45 kg/cm2g

Eastman SK Chemical

20
Commercialization Result
Project: 388 Found 251 Supported 159 Completed 83 Commercialized
(Process Improvement R&D: 52.2% Commercialization)

‘12Annual Result Cumulative result

(USD$ Million/yr) (USD$ Millions/yr)

Cost cut from Raw Material & Waste Reduction Cost cut 87.4 237.4
Economic
Added Revenue from New product Sales
Benefits Revenue 144.5 317.3
• Economic effects are 4.95 times governmental fund
(52BW) Total 213.9 554.6

Reduction of energy consumption Energy 18.9Ttoe/yr 491TTOE

Reduction of greenhouse gas emission
Environmental CO2 91.6Tton/yr 2191Tton
Reduction of solid waste emission
Benefits Waste 78.3Tton/yr 1713Tton
Reduction of water consumption
Water 16.8Tton/yr 352Tton
Reduction of SOx, NOx, emission
Air 15.6Tton/yr 618Tton

Social Promotion of new investment to recycle facility

Investment 191.4 (USD$ Million)
Benefits Job creation
Job creation 406

21
Major Outcomes

For the society For business

Developing a consensus on spreading
awareness of effective use of
resources in industrial complex and
prevention of environmental pollution
Expanding participating companies
and complexes
Building network in domestic/abroad industrial
ecology
Improving environment and creating
added value by participating resource
recycling project
Commercialization by equipment investment
after supporting projects
Saving costs of material and disposal,
increasing sales

For the government For industrial complex

Contributing to low carbon green growth Improving the image of industrial complex
and maximizing the project result by building
network between companies

reducing GHGs and waste Attracting new business by fundamentally

eliminating pollution
Strategy against Climate Change
attracting private investment and making new job Supporting for training, seminar, PR, business
openings consulting

22
Chittagong EPZ in Bangladesh (IS project)

Low - Carbon Green SEZ Framework Project

Place : Chittagong SEZ, Bangladesh (168 Manufacturers : Mainly Garment & Textile 90%)
Support Org. : World Bank (Sourcing from Korean ODA)
Biz Terms : 2012. 5 ~ 10
Free Trade & Invest
Legislation System
New Generation Energy Low Carbon Regulation
Policy
Program for Energy Efficiency Incentives
Industrial Symbiosis Organization system
Green Building
Low - carbon/Green SEZ
Sustainable Carbon
Society Infra. Finance

Setting Target for GHG New Financial Market through CDM

Inventory system for GHG Set the Automatic Carbon Trading Market
Carbon Foot-Print of Reduced Target Synergy between FDI&CDM
Production value chain

23
 IV
Future Strategies
New Regenerating efficiency & Cost Comparison

24
Future strategy of EIP development

Standardization & Diffusion

Set IT system for EIP Process
Set Resource & Energy DB

Sys
-tematic

Spon
Innovative
Green Global R&BD -taneous Advertizing successful
Model I.S. cases as Co’s
Set up Global Partner groups Sustainability
Low-Carbon strategy with
Optimizing Edge Tech. with Cost-benefit
Public & Profit I.S. Issuing the EIP Co.
Certificate with Official
Global N/W for IS Specialists
Incentive plans

25
2 nd Phase Vision (2010.6~2014.12)

To build the world class green EIP

Vision
through pan - regional network

Goal Enlargement of pan - regional resource circulation network

Strategy
Circulation Business Regional Korean EIP
Enlargement Activation Cooperation Internationalization

Network enlargement Development of Sharing with community Establishment of Korean

by hub - spoke method Incentive system EIP model
Action System - based BPX Improvement of Construction of International
construction project scope green infra standardization

26
Vision & Strategies

To implement innovative EIP leading to

Vision green growth of industrial complexes
100 IS network project
until 2014

Goal
Cost Reduction Reduce GHG Job Creation Co-Prosperity
3,000 BW/yr 100 ton/yr 1,000 1,500

Circulation Enlargement Regional Co-operation

Strategy Business Activation Korean EIP Internationalization

27
International Support & Collaboration

28
Thank You!