Annual Report 2008
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The energy efficiency imperative

Global climate change and rising energy costs – these are major issues that people really care about. At Philips, we embraced the energy challenge early on, seeing it as a business opportunity that could benefit society at large.

With lighting, for instance, accounting for 19% of all electricity consumed throughout the world, we can make a significant impact. As the global market leader, we are committed to meeting people’s lighting needs by promoting and supplying energy-efficient and sustainable solutions and applications based on innovative new technologies, such as solid-state lighting.

In 2008, Philips and UK-based Gazeley Ltd announced a partnership agreement under which they will join forces to realize the most sustainable warehouse facilities by applying state-of-the-art energy-efficient lighting solutions.

Gazeley is a global provider of sustainable logistics space. It is committed to delivering environmental initiatives as part of its standard specification, at no extra cost to its customers.

Significant benefits

By applying Philips’ energy-efficient lighting solutions across its operations, Gazeley will cut energy consumption and CO2 emissions by up to 45% and reduce waste by as much as 83%. This will also yield cost-reduction benefits for occupiers – thanks to lower energy bills and the need for less maintenance activity – while the superior light quality will provide employees with a more pleasant working environment.

Smaller footprint, lower costs

At the signing of the partnership agreement, Jonathan Fenton-Jones, Global Procurement & Sustainability Director for Gazeley commented: “This partnership marks a major step forward in our strategy to deliver cutting-edge sustainability standards to our customers worldwide. To be able to work with a recognized partner such as Philips, which is at the forefront of environmental change, is an important business development for Gazeley and will enable us to significantly reduce our global footprint whilst providing customers with increased operational cost savings.”

In 2008, Philips and the Dutch Government signed a public/private partnership agreement, which will see the development of a new generation of sustainable – solar-powered – lighting solutions for Sub-Saharan Africa.

Entitled ‘Sustainable Energy Solutions for Africa’ (SESA), this project is linked to the UN Millennium Development Goals. It aims to provide 10 million people in Sub-Saharan Africa with affordable, appropriate and sustainable energy solutions – for lighting, cooking and water purification – by 2015.

A brighter future

Today an estimated 500 million Africans live without electricity. For them, night-time means either darkness or the flickering light of a candle or kerosene lamp. However, very few can afford the kerosene they need. As a result, at sundown life simply comes to a halt for hundreds of millions of people.

Lighting solutions like our solar-powered Solar Uday lantern and self-powered Dynamo Multi LED flashlight can really make a difference. The Solar Uday, for example, is cheaper to run than kerosene lamps and provides far more and higher quality light. It is also safer, as there is no fire risk, and better for health, as smoke is avoided.

There are economic and social benefits to being able to undertake activities in the evening hours. And these products also offer an environmental benefit, as they use a sustainable natural commodity – sunlight or manpower – to generate electricity.

Philips and the National Theatre in London are some 20 months into a five-year lighting partnership program to replace the landmark venue’s lighting scheme with a state-of-the-art dynamic and energy-efficient design.

Londoners and tourists have already seen a dramatic enhancement of the exterior of the iconic Thames-side building. Our LED lighting solution provides an endless color palette with which to paint the building, creating a spectacular and welcoming aura. New, smaller light fittings will help maintain the architectural integrity of the Grade 2 listed building.

Easy on the eye, easy on the environment

In addition to the immediate visual enhancements, upon completion Philips’ lighting technology will deliver a 70% reduction in the energy needed to illuminate the building’s iconic ‘flytowers’ and ultimately an estimated £100,000 annual saving for the National Theatre!

After the initial phase concentrating on the exterior, the focus switched to the interior and backstage areas of the theater. The public areas front-of-house have been fitted with lower-energy, higher-efficiency fittings. Here, the National Theatre believes this has reduced their lighting electricity consumption by more than 130,000 kWh every year! Similar fittings have been installed in the vast corridors, workshops and rehearsal rooms.

The Mayor of London at the time of the announcement of the partnership, Ken Livingstone, said: “Tackling climate change doesn't mean we have to stop enjoying ourselves, but it does mean that every sector of London life has to consider its impact on global warming. The work the National Theatre and Philips are doing is the perfect example of the kind of leadership we need right across London, continuing to offer Londoners and visitors the chance to see world-class theater, whilst lowering its carbon impact.”

Lasting contribution

The partnership between Philips and the National Theatre is not a ‘fit and forget’ operation. As Philips introduces new lighting technology, improvements will be installed to deliver ever-greater energy savings and further enhance the environment for everyone coming into contact with one of London’s most recognizable buildings.

This is an interactive electronic version of the Philips Annual Report 2008 and also contains certain information in summarized form. The contents of this version are qualified in their entirety by reference to the printed version of the Philips Annual Report 2008. The printed version is available as a PDF file on this website. Information about: forward-looking statements, third-party market share data, fair value information, US GAAP basis of presentation, use of non-US GAAP information, statutory financial statements and management report, revision and reclassifications and analysis of 2007 compared to 2006.
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