From the Green Line to the Bottom Line: Orange for Environment

Erasmus Mundus Master Course

Pervasive Computer & Communications for Sustainable Development

(PERCCOM)

Université de Lorraine - Sept 23th 2013

Denis Guibard Vice-President, Sustainability Products & Services

1 France Telecom Group confidential 1

Agenda

Orange today

Sustainability, Innovation and Value creation

ICT and environment

Orange for Environment

Global Approach

Some examples

Orange for Development

2 France Telecom Group confidential

Orange: over 231 million customers worldwide

• 169 million mobile customers ( • 15 million broadband internet (ADSL, fibre) customers

• Operating on Mass Market in 32 countries

• 170 000 employees

• French State share: 27%

• Turnover : €43.5bn; half of it outside France

• Cash Flow : €8 bn

Orange Labs : Multicultural R&D close to its markets

Tokyo Japan

Beijing, China

Technocenter (Châtillon) 8 R&D centers

San Francisco Warswa , Poland London

Spain Madrid & Barcelona

Cairo R&D center

Amman Technocentre

4 France Telecom Group confidential

Corporate Social Responsibility (CSR) at the heart of the strategy

Moving from reparation and philanthropy to CSR in strategy, marketing and processes

Sustainability as an innovation and value creation opportunity

4 commitments and 8 objectives at the top of the company

A group-wide organization and toolbox (stakeholder dialog and reporting)

5

environmental

social economic

sustainable

equitable

viable bearable

efficiency resource optimization in operations

cost savings

Corporate Social Responsibility and sustainable development: Turning challenges into value creation opportunities

corporate image and brand management responsible marketing and communication. QoS reinforcing customer loyalty

helping customer acquisition

differentiation eco-conception and responsible

products

increasing market share

growth new markets and products

new revenues

compliance regulation, Legal

avoiding legal actions and penalties

6

???

«I want to raise the profile of CSR both in our thinking and in our strategy»

Stéphane Richard, Chairman and CEO, June 2011

The 4 pillars of Orange CSR commitment

a responsible employer for France Telecom-Orange, being a responsible company is above all a case of recognizing and supporting its employees

a world lived in trust because the digital world opens up many opportunities but is also a vector for risks, Orange attempts to insure transparency, quality and safety to all its customers

a world accessible making information and communications technologies accessible to as many as possible is core to the Group’s commitment and a major responsibility

moving towards a greener world the Group is finding innovative solutions for a greener eco-citizen world while minimising its own energy footprint

7

Eco-designing our products and helping our customers reduce their environmental footprint

targeting -20% CO2 emission by 2020 focussing on recycling of old mobile devices

Promote digital inclusion by developing solutions for the largest number of people and reducing all typesof digital divides

serving economic and social development across our footprint

being a leader in quality of service in Europe fostering safe and responsible usage

of our products and services

building a new social contract - supporting employees in their development - promoting equal opportunity

CSR at the heart of Orange strategy create value for all stakeholders

recognise and support our employees

ensure transparency, quality and security for our customers

share the benefits of the digital world with as many people as possible

find innovative solutions for a greener world

ORANGE 4 COMMITMENTS ORANGE 8 PRIORITIES

en

vir

on

men

t so

cie

ty

em

plo

ye

es

cu

sto

me

rs

8

Sustainability, Value creation and new business models

Collaborative Consumption

Service Economy Circular Economy

9

Agenda

Orange today

Sustainability, Innovation and Value creation

ICT and environment

Orange for Environment

Global Approach

Some examples

Orange for Development

10

Main environmental issues

And world population keeps growing

Energy Consumption

Green House Gas (GHG) emissions

& Climate Change

¨ Pollution & Waste

Resource Depletion

Biodiversity reduction

Deforestation

Water

11

ICT & Environmental issues

Energy Consumption

GHG emissions

ICT is responsible for 2% of GHG emissions growing with penetration rate

and individual usage explosion

Potential for reducing the remaining 98%

E-Waste

4.6 6.7

2005 2008

Telecoms

25

28,6

Electric consumption France TWh/year

Consumer electronics

& Information

systems

2012

8.5

25,8

6,2%

7,3% 6,7%

% of French total electricity consumption

power

land use

industry

agriculture

transport

buildings

IT / Telco

others

• 73 M tons in 2015 ( Worldwide ) • 14 kg/year per capita in France expected to double by 2018 • Only 3.4 kg per capita handled or recycled in France in 2008 sources: ADEME, Peak Research

Rare materials consumption

ICT share in world

consumptipon

Estimated reserves

Gold 12% 15 – 20 years

Silver 30% 15 – 20 years

Copper 30% 20 – 30 years

Antimony 50% 10 – 15 years

Resource Depletion

“China which hold 95% of the market to reduce rare earth export quota”

12

GeSI’s SMART 2020 report series identified ICT as a major low carbon enablement opportunity

2008 SMART 2020 Report

• Globally, ICT solutions have the potential to reduce

by 15% (7.8 Gt CO2e) of the remaining 98% CO2e

emitted

2008 U.S. Addendum

• ICT enabled solutions could cut annual CO2e

emissions in the U.S. by 13–22% from business as-

usual projections in 2020

• This translates to a gross energy and fuel savings of

$140-240 billion dollars. These savings are

equivalent to a reduction in total oil consumption by

11-21% and a reduction of oil imports into the U.S.

by 20-36%

13

The enabling effect covers four primary areas

14

The case of France

France GHG émissions should decrease from 536 MtCO2 in 2007 to 489 MtCO2 en 2020 taking into account actions already engaged .

By 2020, GHG emissions could be further reduced by 32 MtCO2 by an intensive use of ITC in various economic sectors. This would amount to 7% of France total GHG emissions or 1/3 of the reductions targeted by 2020.

15

ICT enabling GHG emissions reductions (France)

3 main areas

Electricity consumption at peak hours: 9 MtCO2 reduction by 2020

Smart Home (heating and appliance remote control)

Electrical vehicle smart recharging system

7.9 TWh potential gain by 2020, equal to the total ICT sector consumption

Transports optimization: 15 MtCO2 by 2020

Smart logistics

Eco-driving tools

Pay as you drive

Dematerialization : 3.1 MtCO2 by 2020

Video-conferencing, teleworking

E-commerce

16 16

Agenda

Orange today

Sustainability, Innovation and Value creation

ICT and environment

Orange for Environment

Global Approach

Some examples

Orange for Development

Orange for Environment: a 3 pillar approach

Green Customer

Intenal Impact Eco-design

(& green usages

Green ICT & ICT for Green

Help our customers reduce their own impact

Reduce our internal direct impact

Reduce the impact generated by our products and services

Oryx solar stations Data Centers WEEE

Eco-design Eco-rating Mobile collection

Smart grids Smart cities Eco-mobility

18 interne France Télécom - Orange

Data centers optimization

Virtualization

Free cooling

Enlarging operating temperature range

Moving from 1.9 to 1.3 PUE

Reducing IT and network energy consumption and CO2 emissions

• Renewable energies

2500 solar sites

Experimenting

o Wind mills

o Fuel cells

One of Orange main CSR objectives: Master our energy consumption, to decrease our CO² emissions by 20% in 2020

Solar Energy

Over 2500 solar-powered stations already up and running in Africa.

100% solar power plants, truly low-cost operating systems for rural off-grid areas.

Already rolled-out in Senegal, Madagascar, Guinea. Niger, Botswana and Ivory Coast.

Positive impact for all stakeholders:

Extended coverage providing service in areas where traditional solutions may not have been implemented

Lower energy consumption and better quality of service thanks to innovative design.

Environmentaly-friendly.

Each station produces on average 25% more energy than it needs. Orange is studying speficic projects to use this surplus to help surrounding communities.

Projected savings per solar-powered station:

1300 litres of fuel per year

35 tons of CO2 per year

20 interne France Télécom - Orange

Eco-design (Liveboxes et Set top boxes)

Energy efficiency commitments (Codes of conducts et voluntary agreements)

Switches

Sleep mode

Eco-rating

Universal, smart charger

Mobile collection and recycling

Reducing Orange products and services impact

21

Integrate Ecodesign in Product Development : a phased, segmented approach

4 levels:

Off-the shelf devices “Procurement” approach

• Co-designed products ( e.g. Livebox)

Priority work on devices based services: clusters Broadband, Very High Broadband, TV (& Business for Livebox Pro) + Home Automation

• Services : minimizing a service global environmental impact (architecture, devices, application, usage)

Ecodesign in Service Architecture and Software

Complex, innovative approach under study

Energy consumption and carbon emission from shared systems to be allocated per service

• Infrastructure

Equipment Eco-procurement (see off-the-shelf devices)

Environment Green IT, data centers energy efficiency

Architecture

Environmental performance as IT&N design criteria (beyond energy cost in TCO)?

New approach to be studied in parallel with Service Ecodesign

22

Eco-design and value creation : cost savings and differentiation An eco-design reference case: Livebox 1.2

Work on size, material, packaging, consumption, processes

Weight : - 35%

Electric consumption: -26%

Packaging : - 30% in volume and -25% in weight

Electronic board -19% CO2 emisson over the life cycle

Reduction in part number

Homogenization of plastics

Easier subsystem dismantling

20 to 30% improvement for 9 out of 11 LCA parameters.

efficiency resource optimization in operations

cost savings

differentiation eco-conception and responsible

products

increasing market share

23

Eco-labeling

The objective is to calculate the environmental performance of products sold by Orange :

To provide a clear information to consumers about the environmental impact of products they use

To help customers to make the appropriate choice when purchasing

To evaluate & influence manufacturers to deliver more environmental-friendly products

The methodology has been developed with WWF and BIO Intelligence Service :

The information is based on data provided by suppliers and analyzed with BIO Intelligence Service

24

A detailed label with 3 indicators

Carbon footprint (CO2 limitation)

Amount of CO2 produced during product life cycle i.e. manufacture, transport & use

All being deduced from the manufacturers answers to our questions.

To determine emissions during use at home by the customers, we calculate with a reference number of hours of calls every month, the energy necessary to recharge the phone, and the CO² contribution of every Kw/h in the country

Resources preservation

Actions taken by manufacturers to limit sensitive & non-renewable substances in terms of environment, economy or society

Eco-friendly design, of which hazardous substances

Highlights specific actions from manufacturers to reduce the environmental impact of their devices including limitation of hazardous substances

All these indicators form an overall score, called the "environmental score".

25

Eco-rating in France in online shops

26

mobile collection and recycling - 2nd hand market

27

Mobile handset: the most sold electronic product

More than 1.7 bn mobile devices

sold in 2011

European users change their device within 24 months use

More than 50% of mobiles sold are for replacement

(up to 80% in Europe)

28

Mobile handsets have an environmental impact

Scarce Resource Depletion

% world production

used by ICT

Estimated stocks

Gold 12% 15 – 20 yrs

Silver 30% 15 – 20 yrs

Copper 30% 20 – 30 yrs

Antimeny 50% 10 – 15 yrs

More than 70% of the environmental impact is due to manufacturing

Usage accounts only for 1% to 20% depending upon the energy mix

Keeping a phone for 2 years instead of one saves 10kg CO2

Ref mobilemuster

Shielding Steel

Main/screen card connection

PE, Cu

Screen card Main card

Browser pad PE, Cu

Phone pad PE, Cu

Back cover PC-PLA

Front face Al, Mg, PC, PS

Phone pad casing PC

Back face PC-PLA

Slide mechanism Mg

PC : Polycarbonate PC-PLA : Polycarbonate polylactic acid mixture PE : Polyethylene PS : Polystyrene

Al : Aluminum Cu : Copper Mg : Magnesium

Average Composition of Mobile Phone

– ABS-PC 29%

– Ceramics 16%

– Cu and compounds 15%

– Silicon Plastics 10%

– Epoxy 9%

– Other Plastics 8%

– Iron 3%

– PPS 2%

– Flame retardant 1%

– Nickel and compounds 1%

– Zinc and compounds 1%

– Silver and compounds 1%

– Al, Sn, Pb, Au, Pd, Mn, etc., less than 1%

29

Increasing risks

Environmental risks o hazardous materials (waste)

o energy consumption

Resource exhaustion

Stakeholder expectations

o customers (B2B, B2C)

o SRI investors

o media & NGOs

Regulatory pressure

Raising opportunities

Brand image

Marketing opportunities o on-line & in shop traffic

o enriched offers

New Business

o mobile refurbishing & recycling

Social benefits

o job creation

o social offers with second-hand phones

the issue

1.7b handsets sold worldwide in 2011

average collection rate below 5%

2 bn handsets in Europe by 2015 if not action

New ambition regarding mobile colleection rate

The increasing inventory of old mobile phones is creating risks while opening opportunities

30

Mobile collection : the focal point to optimize the inventory of in-use and idle handsets and reduce their environmental impact

extraction Manufacturing Sell Use End of

Use

Extend mobile lifetime

Refurbish

Second hand market

Recycle

Raw materials sort collect

Store

Dump

31

Collection, Recycling or Refurbishing of used devices creates value

Collect used devices

Customer

Step 1 Customer returns

a used device

Step 2 Device is sold

to a contractor

Step 5 Buy refurbished

device

Step 6 Refurbished Device

is sold

Resell

Distribution

Screen & Refurbish

Step 3 Screen

Step 4 Refurbish

Smelters Brokers

Processors & Refurbishers

used

used

used

refurbished

32 Mobo interne Groupe France Télécom

Mobo, a comprehensive ecosystem to support mobile collection in an operational and funny way

1 2

3

A smart collected,

connected via Internet

lback-office : A web service platform web

A mass market web site to support animations and

promotion canpaigns

33

Helping our customers reduce their energy consumption and carbon footprint

Teleworking

Smart Grids

Smart cities

Platforms & applications (Orange and partners)

Smart meter

Panel

Sensors/ other equipments

Home Automation Box / Livebox

PC

3G / Wifi

From Machine to Machine (M2M) to

• Smart Grids

• Smart Cities

35

Orange Labs - M2M Research Object Management Meeting - André Bottaro - November 2011

M2M (Internet of Things) : an enabler for Green Applications

Ambition: Build the Internet of Sensors and the Smart Grid, drive the choices regarding sensor networks and deliver interconnection to service platforms using smart gateways.

Smart Home &

Energy Efficiency

Smart City &

Smart Metering

Smart Grid

Security

Energy

Water

A common communication network to be deployed

A common service platform

M2M IT Enablers

Smart Grids

Energy /Telecoms convergence

37 37

Smart Grid : Telecoms & Electricity

Copper, Poles, Electrons….

38

Telecom & electrical power : crossed applications

Energy for Telecommunications and Telecommunications for Energy

39 39

Power 2.0?

Power Grid supporting internet (PLC)

Power Grid : from Broadcast to P2P?

40

Massive deployment of advanced ICT application throughout the French economy could :

Reduce by 32 MtCO2 , ie 7% GHG emissions by 2020

Contribute in that way to 1/3 of the global improvement by 2020

ICT are absolutely needed to help other economic sectors achieve such gains

ICT : a key lever to improve (french) economy environmental performance

*Etude BCG 2009 Green IT – FIEEC – Alliance TIC – Fédération Française des Télécoms

41

Peak hour optimization : 9 MtCO2 in 2020*

2 immediate triggers

Displaying real time consumption

Smart Home : real time, fine tuned appliance management

Preparting for new usages

Smart Electrical Vehicle charging system

Optimizing power consumption at home

*Etude BCG 2009 Green IT – FIEEC – Alliance TIC – Fédération Française des Télécoms

42

Smart grids to shave peaks

Two way communication help shaving peaks

Encourage consumer to optimize his consumption owing better information and instant response to adapted tariffs (demand response)

Adapt production and routing based on detailed analysis and anticipation of

customers demand

Especially relevant for the French energy mix

*Etude BCG 2009 Green IT – FIEEC – Alliance TIC – Fédération Française des Télécoms

43

Smart Grids : 3 domains

Upstream Downstream

Source: Erdf

Mete

r

Internet

44

Stakes

Network command and safety

Equilibrium

Intégration of local renewables productions

Demand response

Energy efficiency

Telemetering

Electrical vehicle

Cost savings and confort.

And ….

45

A telco in the energy world?

Mastering key enablers Mobile networks

Sensors/actuators networks

M2M application

Open Platforms /App stores Sensors management

Data sharing

Wavenis OSA

ETSI ERM / M2M

CEN TC 294 IEEE 802.15.4g

IETF 6LowPAN / Roll

IP Routing

Protocol

Radio

definition European

Smart Metering

Mandate

Mangement of millions of equipment at the end user premises. Remote management (maintenance; upgrades)

Real time management

Billing

Standardisation

46

Box and Energy Efficiency

Platforms & applications (Orange and partners)

Smart meter

Panel

Sensors/ other equipments

Home Automation Box / Livebox

PC

3G / Wifi

47

Smart grid: domestic network

Source: ReactivHome project

48

Smart grid: domestic network

Source: ReactivHome project

Is your Electrical Vehicle really green?

Atmospheric vehicle

140 g CO2/km

Average GHG emission in

2020

EV without smart

charging

165 g CO2/km

GHG emissions if charged

at peak hour

EV with smart

charging

18 g CO2/km

GHG emissions if charged off

peak

50

Telemetering and consumption management: the water case

Concentrator Gateway

Concentrator Gateway

data collect

and

data analysis

Utility ( billing , CRM) Utility ( billing , CRM)

wireless Data flow mediation

measures

supervision

alerts

smart

metering

Smart meters

Business application and customer displays

Business application

Data collection network

Services to end customers

connectivity collection network

Service platform

City monitoring

Fixed line

Smart Grids

Energy /Telecoms convergence

52

From smart grid to sustainable and connected cities

Smart Grid network architectures and equipments can serve a larger

number of mutualized applications

City

Neighborhood

Hood Building

Home

Smart mobility

Risk management - Alerts

City monitoring and management

Environmental monitoring

Ressources management

53

Smart city : an urban M2M network

Capillary Radio LAN

M2M gateway

Service Platform

Disp

lay

Recyc

ling

XDSL

Application servers

Watering Metering

2G/3G/Wifi Meshed

Environment Waste

Repeater

Deployment of sensors and activators on top

of a "low power consumption" network

( battery, solar… ) in urban environment, with rapid and easy deployment based on self powered

network equipments

Bi-directional network for tele-action on activators

Supervised and secure network using radio technologies. Unreachable GSM areas

can be covered thanks to licence free radio Band

54

Smart cities: Green & Connected Cities

55

ICT & Smart mobility

Service economy:

Car/bike sharing (Velib)

Car-pooling

Multimodality management

Collaborative working

Eco-centers2.0. Teleworking

56

57

Connected and Colloborative Centers

58 58

Agenda

Orange today

Sustainability, Innovation and Value creation

ICT and environment

Orange for Environment

Global Approach

Some examples

Orange for Development

59

Infrastructures &

Connectivity

Added Value

Services

Ecosystems &

&

innovation enablers

Innovation

A strategic framework shaping Orange action in support of local social and economic development in Africa

60

Thank you!

Denis Guibard denis.guibard@orange.com +33 1 44 44 11 55