PLANET 2050 - Cummins

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PLANET 2050PROSPERITY LEADERSHIP ADVOCACY NURTURE ENVIRONMENT TOGETHER Cummins Plan Overview

PLANET 2050Cummins is committed to makingpeople’s lives better by poweringa more prosperous world.That prosperity includes strongcommunities, robust businessand environmental sustainability.TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYEnvironmental sustainability leadership for the next several decadesrequires a focused approach, starting with the choice of materialto how products are designed, made, used — and disposed.Sustainability actions can be thought of as value creation(increase innovation, improve competitiveness, and strengthenculture), as well as value protection (reduce regulatoryuncertainty and strengthen risk mitigation).That is why Cummins has created its PLANET 2050 environmentalsustainability strategy. The strategy sets big targets for 2050 andspecific goals for 2030. It will help employees see the roles theyand Cummins play in our company’s and planet’s sustainable future.There are three primary focus areas for the strategy:1. Reducing greenhouse gas (GHG)emissions in line with climateexperts’ recommendations.2. Doing our part to use natural resourcesin the most sustainable way possible.3. Our communities are betterbecause we are there.Cummins firmly believes the companies that are successfulin the future will deliver more value to customers with lessof an environmental impact. Cummins intends on beingone of those companies.Cummins Plan Overview2

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYOUR 2050 ASPIRATIONAL TARGETSNet positive impact in everycommunity where we operate Sum of environmental good Local environmental footprintNear zero localenvironmental footprint2050 TARGETS:Customer success poweredby carbon neutral technologiesthat address air quality2050 TARGETS:Nothing wasted» Design out waste in productsand processes» Use materials again for next lifePROSPERITY LEADERSHIP ADVOCACY NURTURE ENVIRONMENT TOGETHER Cummins Plan Overview» Reuse water and return cleanto the communityNOTESReferences to “facilities” relate to all consolidatedoperations and joint ventures subscribing to Cummins’Enterprise Environmental Management System.Goals will be periodically assessed for progressand continued practicability.1. Reduce absolutegreenhouse gas (GHG)emissions from facilitiesand operations by 50%.2. Reduce scope 3absolute lifetime GHGemissions from newlysold products by 25%.3. Partner withcustomers to reducescope 3 GHG emissionsfrom products in the fieldby 55 million metric tons.Carbon neutrality and near zeropollution in Cummins’ facilitiesand operationsUSING NATURALRESOURCES IN THEMOST SUSTAINABLE WAYPLANET 2050SCIENCE-BASED TARGETS2050 TARGETS:DOING OUR PART TOADDRESS CLIMATE CHANGEAND AIR EMISSIONSOUR EIGHT 2030 GOALS4. Reduce volatile organiccompounds emissionsfrom paint and coatingoperations by 50%.CIRCULAR ECONOMYCOMMUNITIES AREBETTER BECAUSEWE ARE THERE5. Create a circular lifecycleplan for every part to useless, use better, use again.6. Generate 25% less wastein facilities and operationsas a percent of revenue.7. Reuse or responsiblyrecycle 100% of packagingplastics and eliminatesingle-use plastics indining facilities, employeeamenities and events.8. Reduce absolute waterconsumption in facilitiesand operations by 30%.FORWARD-LOOKING DISCLOSURE STATEMENT Information provided in this document that is not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statementsregarding forecasts, guidance, preliminary results, expectations, hopes, beliefs and intentions on strategies regarding the future. The forward-looking statements made herein are made only as of the date of this document and we undertake no obligation topublicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect our performance may be found in our filings with the SEC, which are availableat www.sec.gov or at www.cummins.com in the Investor Relations section of our website.3

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYDEVELOPING PLANET 2050Scientific research on climate change and naturalresources makes a compelling case for strong action.The United Nation’s International Panel of Climate Change’s (IPCC) report of October 2018 callsfor accelerated actions to cut GHG emissions 45% from 2010 levels by 2030 and 100% by 2050to keep the earth’s warming to 1.5 degrees Celsius from pre-industrial levels.According to a WorldResources Institute report, “Companies that anticipate a growing population that will demandmore water and energy also anticipate business risks related to scarcity and volatility,including increased costs, regulations, and supply vulnerabilities and disruptions.”It is increasingly evident that the purposeful use of natural resources is vital to thewell-being of economies, the planet and communities.Sustainability isan interconnectedsystems conceptOur communities andour business dependon our collectiveresponse to improvethe health of the planet.ECONOMIESPLANETNATURAL RESOURCESFINANCIAL STABILITY& WELL-BEINGCOMMUNITIESNATURAL RESOURCESCLIMATE, BIODIVERSITY &ECOSYSTEM WELL-BEINGHEALTH &WELL-BEINGProsperity ChainCummins Plan Overview4

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYCummins also was guided by these compelling trendsemerging now:»» Materials extraction has tripled since 1970 and isforecast to increase by 55% in the next decade.»» Projections that by 2030 the world’s global demandfor water will exceed our 2015 supply by 40%.Strategy considersinterests of allstakeholders Broad portfolio of power solutions that enables important work Climate target pathway expertise Anticipate what comes next for our customers,looking beyond obvious needs by bringing insightand new thinking to their challenges»» Current and emerging regulations in Europe and aroundthe world may increasingly impact Cummins’ business.»» More than 90% of the world’s children breathetoxic air every day. Create value for customersand society that also createsvalue for shareholders»» Weather-related events affect 205 million lives annually Deliver on financialobjectives»» 1.4 billion pounds of trash wind up in the world’soceans every year.As Cummins developed its strategy, it also used the long-standingstrategy of the stakeholder model of governance. It is basedon the idea that through understanding, decision making,compromise and communication, leaders can turn individualgroup self-interest into mutual long-term benefit for allstakeholders. We understand that results matter becauseour existence depends on meeting the needs of our stakeholders. Seek to understand theneeds of communitiesCustomersShareholders Work with communitiesto solve problems(today and adaptationto emerging future)CommunitiesCUMMINSEmployees Continue corporatevalues which caresabout all stakeholders Provide opportunitiesfor employee innovation/work to make a realdifference for environmentSuppliersPartners Resilient supply chainthat adapts to emergingenvironmental andsocietal challenges Partner to achieveenvironmental leadershipthrough innovation Partner to remove complexbarriers to 2050 visionCummins Plan Overview Government, other businessesand nongovernmentalorganizations, universities,national labs, etc.5

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYGOAL DEVELOPMENTPLANET 2050 follows our firstcomprehensive plan announcedin 2014 with five facility goals, lateramended with products in-use andlogistics goals (2015) and a newproduct vision statement (2016).Cummins product lifecycle analyses have indicated thatproducts in-use fuel consumption is our greatest GHG impact.Findings also indicate the greatest potential for water and wastereduction from products can be realized by reducing materialconsumption, which is predominantly determined during theproduct design phase. In fact, about 70% of a product’senvironmental impact is determined early on in the design phase.Results of our environmental assessmentCummins product lifecycle analyses have indicated that products in-use fuel consumption is our greatest GHG impact.All others1 percentLogistics &transportationCumminsfacilitiesProductsin useProducts in use3 percent4 percent12 percent99 percentCummins facilities19 percentGHGsRaw materialsand processing88 percentWASTEWATERRaw materialsand processing74 percentCummins Plan Overview6

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYLIFECYCLE ANALYSISCummins’ Action Committee for Environmental Sustainability (ACES) is comprised of functional,business and regional leaders from across the company. Since early 2012, its focus has beento look at the company’s environmental impact using the lens of the full product lifecycle,from design and manufacture to end of life. In each phase of the cycle, we asked ourselves:How might we lessen our environmental impact?Design out waste and pollutionReduce hot testExtend lifetime of resourcesthrough reuse, repair,refurbish or remanufactureDESIGN & VALIDATIONOF TECHNOLOGYIncrease sustainable coatingsOnly use what is neededwith parts that have a lowerembodied energyAFTERMARKETFuel efficient productsMATERIALSCarbon neutral technologiesthat address air qualityKeep products andmaterials in use longerUSEUse recycled materials,renewable resources,sustainable partnersReduce machining scrap,packaging and plastic wasteReduce potable water use,increase water reuseDISPOSALCummins Plan OverviewPRODUCTIONReduce energy use and increaserenewable energy opportunitiesEliminate pollution from operations7

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYALIGNING WITH THE SDGsThe ACES team has benchmarkedbest-in-class and sector sustainabilityplans and reviewed the UnitedNations Sustainable DevelopmentGoals (SDGs) – and its list of morethan 160 key performance indicatorsand targets – to inform its thinkingand plan development.In 2017, the company formally committed to developscience-based targets under the Science Based Target Initiative.This approach provides a framework for Cummins to calculateGHG goals for products and facilities that are in line withrecommendations by climate scientists. In addition, the teamconsidered the best options based on the October 2018 reportby the International Panel on Climate Change4, which sets ahigh bar to limit global temperature rise to 1.5 degrees Celsius.Cummins goals and targets alignclosely with 12 (listed below) of the17 UN Sustainable Development GoalsTHE SIXPRINCIPLESBEHINDPLANET 20501. Developinnovativetechnologysolutionsthat result insustainableoutcomes2. Partner tosolve complexproblems3. Design out wasteand pollution4. Reuse resourcesat their highestvalue for as longas possible5. Connect inspiredemployees withmeaningfulaction6. Advocate forregulations thatare tough, clearand enforceableCummins Plan Overview8

PLANET 2050PLANET 2050 is a long-range business strategy with anenvironmental lens. What makes PLANET 2050 different?TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARY1. Science-basedGHG reduction goals»» Scopes 1, 2 and 3»» New productportfolio roadmaps»» Absolute insteadof intensity goalsDESIGN OUT WASTE2. Source fewer naturalresources by design»» Use less. Use better.Use again.»» SustainableMaterials Lifecycle»» Waste minimizationmindset3. Stakeholdersneed our leadershipin responding toenvironmentalchallengesEXPANDED PRODUCT LIFECYCLECummins Plan OverviewBROADER STAKEHOLDER COLLABORATION4. Vision is to connectsocietal purposewith employees’daily work9

PLANET 2050THE GOALSCummins two science-basedtargets for climate changeencompass scopes 1, 2 and3 emissions, which includeits facilities and operations(1 and 2) and products (3).Scope definitions are:Further details about the eight PLANET 2050 goalsby focus area are in the pages that follow.DOING OUR PART TO ADDRESSCLIMATE CHANGE AND AIR EMISSIONS2050 TARGETS2030 GOALSTHEMESCustomer successpowered by carbonneutral technologiesthat address air quality1. Reduce absolute greenhouse gas (GHG)emissions from facilities and operationsby 50%.»» Innovative technologies,fuel efficiency,advanced fuels,partnerships, advocacyCarbon neutrality and near zero pollutionin Cummins’ f acilitiesand operations3. Partner with customers to reduce scope 3GHG emissions from products in the fieldby 55 million metric tons.Cummins Plan Overview2. Reduce scope 3 absolute lifetime GHGemissions from newly sold products by 25%.4. Reduce volatile organic compounds emissionsfrom paint and coating operations by 50%.»» SCOPE 1: direct emissionsfrom owned or controlledsources (e.g. facilities andoperations)»» SCOPE 2: indirect emissionsfrom the generation ofpurchased energy (e.g.facilities and operations)»» SCOPE 3: all indirectemissions (not included inscope 2) that occur in thevalue chain of the reportingcompany, including bothupstream and downstreamemissions (e.g. products)Both goals are aggressiveand based on climate science.Our facilities 2030 sciencebased GHG goal is in linewith the 1.5 C trajectory;our product goal is in linewith the Paris ClimateAgreement of 1.5 - 2 C.10

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYPRODUCTS GOALSGOAL #1Calculating lifetime emissions of sold productsReduce absolute lifetimeGHG emissions from newlysold products by 25%GOAL #2Partner with customers to reduceGHG emissions from products inthe field by 55 million metric tonsThe scope for the products’ science-based target (SBT)includes GHG emissions generated during the use phaseof the product throughout the product lifetime. The goaldoes not include full lifecycle or well to wheel considerations,per definition of the official Science-based Target Initiative(SBTi) guidance. Cummins used sector decarbonizationdata provide by the SBTi and applied it to its existinglifetime emissions model.Start with Cumminsvolumes by segmentand engine model soldin the reporting yearMultiply by the attritionrates to determine thevolumes in operation eachyear moving forwardDetermine attritionrate using our partsconsumption modeland customerengineering analysisApply the efficiency agefactor to years goingforward to determineyearly miles per gallonThen convert milesper gallon or gallons perhour to million metricstons of CO2eApply the CO2econversion factor fordiesel based on theEPAs EF Hub and AR 4Products in-use (PIU) engines are those that are currentlyin use today or new installations with current products thatincorporate new learnings in fuel efficiency. Fuel efficiencyimprovements that are in scope under this goal will be thosethat are implemented at a Cummins plant, at the OriginalEquipment Manufacturer (OEM), or at the customer workingwith our distribution business. This goal is a continuationof the goal set with a baseline year of 2014.Cummins Plan Overview11

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYREACHING THE GOALSThe future of power requires a multi-faceted strategy. Our customersneed the right tools for their work. And these power solutions must bereliable, efficient, flexible and sustainable to meet the evolving demandsfor powering our communities and the infrastructure and equipmentthat shape our world. They also must comply with stringent emissionregulations, help address climate change and be part of the solutionfor the energy and environmental challenges facing the planet.Cummins is further advancing diesel and natural gas engine technologyand will continue bringing new solutions to market. It is developingelectrified solutions and investing in alternative technologies like naturalgas and hydrogen fuel cells and exploring other new technologies.Meeting our science-based producttarget of a 25% CO2 reduction2018809 millionmetric tonslifetimeemissions Strong regulatory framework – existing and future Improving products and ensuring innovative, competitivetechnology solutions exist for all applications Market acceptance of new technology Customer and industry partnerships2030Cummins will monitor key signposts such as technology mix andadoption rate of low carbon technologies driven either by customerrequest, market demands or regulations. Actions to meet the goalswill include strong integration into product planning as keyconsiderations for decision making.607 millionmetric tonslifetimeemissions»» Research and technology investment portfolio»» Design and architecture selection»» Product planning»» Policy advocacyThe diagram to the right depicts internal analysisof how we might meet the 25% goal.Cummins will continue to build on the global momentum of its 2020products in use goal, launching new initiatives, better fuel economyimprovements and an increase in the number of overall projects.Global fuel economy teams have been building functional capabilityvia fuel economy forums, training and tools.Cummins Plan OverviewCO2CO212

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYFACILITIES GOALSGOAL #3GOAL #4Reduce absolute GHG emissionsfrom facilities and operations by 50%Reduce VOC emissions from paintand coating operations by 50%The 50% absolute carbon emissions reduction by 2030 froma base year of 2018 is a target consistent with the level ofdecarbonization required to keep global temperature increaseto below 1.5 C compared to pre-industrial temperatures.Air pollution is a growing global health concern, and emissionsregulations and enforcement are increasing. For these reasons,addressing air pollution is a top environmental priority for Cumminsproducts as well as our facilities and operations. Volatile organiccompounds (VOCs) are a key component in smog formation,and VOC emissions are highly regulated in many of thecountries where Cummins operates.REACHING THE GOALSCummins plans actions in these areas:»» Reduce absolute energy consumption in facilitiesthrough efficiency upgrades.»» Reduce production and research and developmenthot test fuel consumption.»» Install regenerative dynos and load banks at existinghigh-horsepower research and development test cells.Painting and coating processes at Cummins facilities accountfor 73% of the VOC emissions from Cummins facilities,with the rest from combustion of fossil fuels.KEY TAKEAWAYThe Sciencebased TargetInitiative providedthe sector dataneeded to helpdevelop ourproduct CO2reduction goal.»» Install energy storage if unable to export excess testpower to neighboring site or grid.»» Increase innovative processing through 3D Printingand design innovation, advanced manufacturingand connected supply chains.»» Provide more renewable electricity through onsitesolar photovoltaics and offsite power purchase.»» Replace selected leased and owned executive cars,service and yard vehicles with electric vehicles;install electric vehicle charging stations.Cummins Plan Overview13

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYFAQS:DOING OUR PARTWHAT IS THE SCIENCEBASE TARGETINITIATIVE?Following the Paris ClimateAgreement in 2015, severalorganizations including UnitedNations Global Compact, CDP,World Wildlife Fund and WorldResources Institute partneredto develop the Science BasedTarget Initiative aimed at drivingambitious corporate climateaction. Hundreds of companiesare taking science-based climateaction and 285 companies haveapproved science-based targets(as of October 29, 2019).Cummins signed its commitmentletter in June 2017 and is thefirst on and off highway industrialmanufacturer to have approvedtargets in 2019.WHAT IS A SCIENCEBASED TARGET?WHAT OPPORTUNITIES INENERGY EFFICIENCY ARE LEFT?A science-based target is anobjective, scientific evaluation ofwhat is needed for global GHGemissions reduction by sectorto limit climate change. Thesetargets provide an approachfor companies to manage theiremissions over the long term.Our proposed goals align withthe levels of ambition definedand currently accepted by thescience-based targets initiativein alignment with internationalconsensus of climate scientists.We have extensive experience in energy efficiency management,gained during the pursuit of three previous generations of goalsstarting in 2009. Hundreds of projects have been implemented atour facilities around the world, including conventional technologysuch as LED lighting, compressed air optimization, variablefrequency drives, building management systems, etc., andless conventional technology like regenerative dynamometers.We have implemented effective management toolkits, financialanalysis tools, project hopper and dashboard, and trainingprograms to support deployment of skills, tools and best practices.Many of the best, highest-return projects have already beenimplemented, and future improvements will, in general, be moredifficult and expensive. However, opportunities still exist, andnew ones will emerge along with the need to upgrade or replaceexisting facility and process machinery and equipment, and asmore efficient technologies become available. The US DOE predictsthat on average, a company’s energy intensity will improve 1% peryear based on technology improvements alone (replacing obsoleteequipment and machines).To find out more about SBTIvisit: sciencebasedtargets.orgCummins Plan Overview14

PLANET 2050WHAT ARE THEOPPORTUNITIES INHOT TEST FUELCONSUMPTION?Most Cummins engines andgenerator sets undergo “hottesting” in test cells (using dieselor natural gas) during the regularproduction process (exceptionis Columbus MidRange EnginePlant engines for RAM pickups).An estimated 5.3 million gallonsof diesel fuel were consumedduring production testing.An estimated 7.2 milliongallons of diesel fuel wereconsumed during research anddevelopment testing. Significantbut unquantified electrical poweris also required for test cell airhandling and cooling systemequipment. Engine and gensethot testing is a major source offacility air pollutant emissionsand government regulationsare increasingly mandatingexpensive and energy-intensiveexhaust aftertreatment tocontrol these emissions.Hot testing also consumesCummins Plan OverviewTARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYsignificant volumes of water toreject waste engine and dynoheat through cooling towers (anestimated 116 million gallonsin 2018, which is 12% of thecompany’s total water use). Thegoal proposes deep reductionsin production hot testing,to be potentially replacedby improved quality control,design modifications and/orcold testing (engines driven byelectric motors) and analysis leddesign innovations.This will require significant studyand analysis for hot testing.HOW DOES HIGHHORSEPOWERTEST ENERGYRECOVERY WORK?With conventionaldynamometers, all outputpower is converted to heat,which is rejected to theatmosphere through coolingtowers. Regenerative dynotechnology converts engineoutput power to electricity.Two of the 15 high horsepower(HHP) dynos at our SeymourEngine Plant are regen (therest are conventional), andby themselves generateapproximately 17% of thesite’s total electricityrequirements). From a GHGgoal perspective, energyrecovery from HHP test cells arethe priority because of the highfuel consumption and potentialelectric power recovery.Regen dyno installation costsare more expensive thanconventional dynos, but regendynos provide greater technicalcapabilities, require less cooling,and reduce operating costs,carbon emissions and coolingwater consumption. They arealso somewhat larger, requiringmore physical space for agiven capacity output thanconventional dynos.WHAT IS OUR RENEWABLE ENERGY STRATEGY?While Cummins continues to minimize the amount of energyneeded to power the company’s operations through efficiencyand process improvements, Cummins also needs to reduce theenvironmental impact of that energy through renewable sources.Four of the company’s guiding principles specifically apply to theselection of renewables to ensure Cummins maximizes benefitsfor the environment avoids green washing:GUIDINGPRINCIPLES»» Additional: Must lead to a net increase in renewable energy.Buying Renewable Energy Certificates (RECs) doesn’t meetthis criterion; improve access to renewables where goodoptions don’t exist.»» Tangible: Must be understood and accepted by stakeholders.We seek renewable generation geographically close to ouroperations, and options that are simple and easy to grasp;visibility to community, customers etc.»» Cost effective: Generate the most environmental and businessbenefits for the investment. Factors include financial return oninvestment, local environmental conditions (air quality, waterscarcity, carbon intensity of grid power), regulatory pressure,stakeholder interest, and strategic incentives.»» Transparent: Clear, complete accounting and disclosure;follow Carbon Disclosure Project, Department of Energy guidelines.15

PLANET 2050USING NATURAL RESOURCESIN THE MOST SUSTAINABLE WAY2050 TARGET2050 TARGETS2030 GOALSTHEMESNothing Wasted»» Design out wastein products andprocesses5. Create a circular lifecycleplan for every part to use less,use better, use again.»» Water efficiency and reuse, near zero globalirrigation (lawn care), no one time water use»» Use materialsagain for next life6. Generate 25% less wastein facilities and operationsas a percent of revenue.»» Reuse water andreturn clean tothe community7. Reuse or responsibly recycle 100%of packaging plastics and eliminatesingle-use plastics in dining facilities,employee amenities and events.»» Intentional sourcing and use of natural resources –additive manufacturing, topology optimization,material selection, remanufacturing, service strategy»» Waste minimization realized in facilities, packaging,material scrap reduction, dining facility plastics8. Reduce absolute water consumptionin facilities and operations by 30%.Cummins Plan Overview16

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYGOAL #5Create a lifecycle plan for every partto use less, use better, use againKEY TAKEAWAYUsing naturalresources in asustainable waychanges the focusfrom disposing ofexisting waste tocreating less wastefrom the start.This goal is to drive processes, data and innovation tointentionally design in the intelligent use of natural resourcesembodied in the materials that we use. We consider thissustainable material efficiency (also known as “circular economy”)and have approved design principles to use less, use better,use again. There is a realization that what has made Cumminssuccessful in the past regarding material use most likely willnot hold true for the future. A Design for Lifecycle approach forsustainable material efficiency lays out the path to bridge thegap for natural resource constraints and increased regulations.REACHING THE GOALThis requires upfront use of:»» Topology and multi-disciplinary optimization»» Additive manufacturing and design innovation»» Sustainable material selection»» Service strategy that extends use of componentsand products longer»» Ability to disassembleTWO WASTE GOALSGOAL #6Generate 25% less waste in facilitiesand operations as a percent of revenueGOAL #7Reuse or responsibly recycle 100%of packaging plastics and eliminatesingle-use plastics in dining facilities,employee amenities and eventsCurrent waste goals are around recycling and zero disposal.Support efforts have resulted in the development of training andtools as well as strong recycling processes and infrastructure thathave established a foundation for waste management. Ongoingefforts focused on recycling remain necessary and are not onlyimportant in meeting goals but also represent a key opportunityto engage every employee in meaningful environmental initiatives.These waste goals are designed to move waste up thehierarchy towards “reduce” and “reuse” versus the previousfocus on management once a waste has been generated.This will require management tools and investment in returnableand reusable packaging, as well as process improvements inmanufacturing and services.»» Remanufacture, reuse or recycle at end of useCummins Plan Overview17

PLANET 2050TARGETS AND GOALSDEVELOPING PLANET 2050DOING OUR PARTFAQ: Doing Our PartUSING NATURAL RESOURCESFAQ: Using Natural ResourcesCOMMUNITIES ARE BETTERSUMMARYREACHING THE GOALSGOAL #8Cummins plans actions in these areas:Reduce absolute water consumptionin operations by 30%»» Design out waste in new products by ensuring initialproduction is very close to the final shape, reducing theneed for sur

PLANET 2050 PLANET 2050 is a long-range business strategy with an environmental lens. What makes PLANET 2050 different? 1. Science-based GHG reduction goals » Scopes 1, 2 and 3 » New product portfolio roadmaps » Absolute instead of intensity goals 2. Source fewer natural resources b

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