KMG Chemicals is committed to excellence in environmental, health and safety performance. We take pride in being a welcome corporate citizen and making a positive difference in the communities in which we operate. We are guided by an unwavering focus on the safety of our employees and customers, an adherence to environmental stewardship and a respect for the communities in which we operate.
Our Sustainability-related efforts encompass three main focus areas: Safety, Energy Efficiency and Environmental Footprint. In each of these areas, we analyze and measure our performance annually against a baseline (our fiscal 2014 year) and have set a target goal for performance (our fiscal 2018 year).
Since developing our baseline goals in 2011 KMG Chemicals has divested in some areas and expanded in other areas. The large acquisition of the OM Group’s Ultra Pure Chemicals business in 2013 caused us to reset our baseline year from 2011 to 2014 to account for the large difference in metrics.
As we continue to grow we are still making changes to the metrics baseline but have decided to keep fiscal 2014 as our baseline. In fiscal 2015, KMG closed its Fremont, California site and consolidated its operations into other sites. In fiscal 2016 and 2017, KMG Chemicals acquired additional sites in the United States and Canada. Both the divestitures and acquisitions had an impact on KMG Chemicals’ environmental, health, safety, and sustainability performance as evident below.
We measure our safety performance using protocols developed by the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA). In the chart below, we summarize our safety performance in terms of recordable injuries and illnesses per 200,000 employee work hours. In fiscal 2017, we recorded 0.43 injuries/illnesses per 200,000 employee work hours, down from 1.4 injuries/illnesses per 200,000 employee work hours in fiscal 2016. In fiscal 2017, we recorded three recordable events, down from nine in fiscal 2016. By fiscal 2018, we aim to generate an overall recordable injury/illness rate of 0.61.
As KMG Chemicals develops a larger global presence, all our sites are constantly striving to improve their safety performance to become a world-class leader in safety.
We focus on materials and energy conservation through the careful management of the environment and of our natural resources. Each year, we set specific objectives to lower our power usage per pound of product produced and to reduce our waste generation versus an established baseline.
By fiscal 2018, we aim to achieve a 5% increase in product produced per unit of energy (including electricity and natural gas) consumed. For electricity consumption, this means producing 5% more kilograms of product per kilowatt hour consumed. For natural gas consumption, this means producing 5% more kilograms per cubic meter of natural gas consumed.
Energy Efficiency — Electricity
Electricity energy efficiency increased in fiscal 2017, as we produced 4.04 kg of material per kWh of electricity used compared to 3.97 kg of material produced per kWh of electricity used in fiscal 2016. KMG facilities continue to research and invest in energy efficient projects to improve our energy efficiency.
Energy Efficiency —Natural Gas
Our natural gas efficiency decreased slightly in fiscal 2017, producing 49.54 kg of material per cubic meter of natural gas vs. our baseline of 51.2 kg . Natural gas usage is greatly influenced by temperature at many of our sites with gas being used for heating of the occupied spaces and to prevent freezing of pipes.
Our Environmental Footprint initiatives encompass three main focus areas: 1) greenhouse gas emissions; 2) water consumption; and 3) waste reduction through recycling and reuse. We are also engaged in the implementation of Environmental, Health, Quality, Safety and Security policies at all our locations.
Greenhouse Gas Emissions
Our greenhouse gas (GHG) emissions increased in fiscal 2017 compared to our baseline level in 2014. Specifically, KMG generated 19,165 tons of carbon dioxide (CO2) equivalent in fiscal 2017, up from 16,413 tons of CO2 equivalent in fiscal 2014. The increase in GHG emissions in fiscal 2017 is due to ramping up production at several of our site, especially overseas. We continue to strive for reduction as we expand our operations and add production facilities.
We measure our water utilization in terms of kg of material produced per cubic meter of water consumed.
In fiscal 2017, our water utilization efficiency increased by 5% vs. our base year fiscal 2014, as we produced 446.45 kg of material/cubic meter of water vs. 426.74 kg of material/cubic meter of water in fiscal 2014. While our manufacturing operations are not strongly influenced by water usage the increase in production globally did caused the increase in water usage in fiscal 2017.
By fiscal 2018, we aim to produce 448.08 kg of material per cubic meter of water consumed, an increase of 5% from our fiscal 2014 baseline level.
As a result of our recycling and reuse efforts, our operations produce little waste. In fact, KMG generated 0.0319 kg of waste per kg of material produced in fiscal 2017. While this is up compared to 0.0261 kg of waste in fiscal 2016 sites continue to search for outlets to recycle and reuse. By fiscal 2018, we aim to generate 0.0227 kg of waste/kg produced, representing a 5% decrease from our fiscal 2014 baseline level.