Industry Perspective
Joanne Howard
Challenges and Opportunities in Managing Agricultural Operations
for a Low-Carbon Economy
18 July 2007
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
John Deere Today
An American icon – founded in 1837 – growing
outside the United States for more than 50 years
 #1 provider to agricultural and forestry businesses worldwide
 #2 construction equipment provider in North America
 Quality leader in lawn, grounds and turf care equipment
 A leading worldwide manufacturer of off-highway diesel engines
 One of the largest equipment finance companies in the U.S.
 Key investor in alternative energy sources
 Exciting new entities: John Deere Agri Services, Intelligent
Mobile Equipment Technologies, Landscapes, Wind Energy
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
2
John Deere Today
Valley City, ND
Edmonton, Alberta
Minneapolis, MN
Fargo, ND
Zweibruecken, Germany
Bruchsal, Germany
Welland, Ontario
Klemme, IA
Waterloo, IA
Dubuque, IA
Horicon, WI
Davenport, IA
Moline, IL
Langley, British Columbia
Rock Valley, IA
Des Moines, IA
Ottumwa, IA
Springfield, MO
Coffeyville, KS
Tampere, Finland
Joensuu, Finland
Enschede, Netherlands
Horst, Netherlands
Gummersbach, Germany
Stadtlohn, Germany
Mannheim, Germany
Jiamusi, China
East Moline, IL
Greeneville, TN
Tianjin, China
Kernersville, NC
Fuquay-Varina, NC
Augusta, GA
Orenburg, Russia
Torreon, Mexico
Monterrey, Mexico
Saltillo, Mexico
Pune, India
Madrid, Spain
Catalao, Brazil
Richards Bay, South Africa
Saran, France
Brisbane, Australia
Arc-les-Gray, France
Horizontina, Brazil
Montenegro, Brazil
Tokoroa, New Zealand
Rosario, Argentina
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
3
2006 Net Sales & Revenues: $22.148 Billion
Credit 8%
Construction &
Forestry 26%
Other 2%
Agricultural 46%
Commercial & Consumer 18%
Investing nearly $2 million per
day in research and development
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
4
We Contribute…We Solve
Our Factories/Buildings
• Direct / Indirect
Emissions
Customers/Dealers
• Carbon sequestration:
agricultural, forestry, mowing
opportunities
Product
• Engine Emissions
• Biofuel Usage
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
Research & Development
• Renewable energy sources
• Biomass Activities
5
We Contribute
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
6
Greenhouse Gas Accounting Protocols
Consistency
Company A’s ton of GHG = Company B’s ton of GHG
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
7
Deere’s Direct vs. Indirect Emissions
Deere’s GHG Emissions
69% Indirect
31% Direct
Largest Direct Processes
• Foundry
• Heat Treat
• Painting
• Powerhouses
• Testing Operations
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
Purchased Electricity & Steam
8
Annual GHG Inventory
1,600,000
2006 Percent By Region (Absolute Basis)
1,400,000
Asia / Pacific
Rim
Canada
South
3%
3%
America
Mexico
1%
4%
1,200,000
Tons CO2-Equiv
1,000,000
Europe
11%
800,000
U.S.
80%
600,000
400,000
Year
2003
2004
2005
2006
200,000
0
2003
2004
2005
Direct
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
2006
Indirect
9
Energy Cost (US$)
$78,685,880
$87,130,072
$100,139,930
$111,983,680
2006 CO2 Tonnage Breakdown (FY2006 Data)
Offices Leased
1%
Warehouses
4%
Manufacturing Direct
29%
Offices - Owned
4%
Manufacturing Indirect
60%
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
Fleet
2%
Manufacturing: 89%
10
Enhanced External Communications
2006 Global Citizenship Report
External Web Page
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
11
Voluntary Program Participation
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
12
John Deere & USCAP
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
13
Industry Perspective: We Contribute
• Standardization
• Uniform federal framework of climate legislation
• Uniform guidelines for GHG inventory and registry
• Credit for Early Action
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
14
We Solve
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
15
Fuel Efficient Diesel Engines
John Deere Power Systems
Performance optimized Tier 3
PowerTech Plus™ engines
providing industry-leading fuel
economy, power, response
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
16
8430 Tractor: Set new
record as most fuelefficient row crop tractor
ever tested in the
Nebraska Test Lab
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
17
Use of Renewable Materials
John Deere Power Systems
25 x ‘25 Renewable Fuels Champion
Promoting quality standards, handling,
distribution and use of biodiesel fuels
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
18
Use of Recycled Materials in Products
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
19
Conservation Tillage Equipment
"The single-disc fertilizer
openers provide efficient
fertilizer placement with
minimal soil disturbance." —
Grant Troop, Quarryville, Pa.
"The pneumatic down pressure
feature on my 1770NT planter easily
adjusts from the tractor cab and
provides more down pressure options
than you will ever find that you
need." — Kenneth Wisehart, Shirley,
Ind.
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
20
Precision Farming Equipment
John Deere Ag Management Solutions
• GreenStar
AutoTrac
• iTECPro
Multiple
precision Ag
applications
Precision Ag Solutions for
Growers Worldwide
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
21
Nutrient Application Equipment and Solutions
John Deere Agri Services
Turning information into insight and strategies that add
value and strengthen businesses across the agri-food
supply chain
• OptiGro
• Soil
Information
Systems
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
22
Financial Services
John Deere Wind Energy
• Provide advice, debt and equity
investment and the foundation for a
successful project through:
• Long-term, comprehensive project
management services
• Turbine supply
• A stream-lined project approval
process and technical support
• Expertise in agriculture, financial
services and wind energy technology
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
23
Wind Climate benefits
• A single turbine displaces 2700 tons of Carbon Dioxide
annually
• Current fleet of installed turbines in US
• Avoid 19 million CO2 tons annually
• Avoids burning 16 million tons of coal each year or 50
million Barrels of Oil
• Avoids consumption of Water in fossil fuel generation
• Avg. per person consumption for energy: 100,000
gallons of water
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
24
= Operating
(75.2 MW)
= In Construction
(228.5 MW)
= Planned (Approved)
(233.15 MW)
Project Locations
17 April 2007
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
25
JD Wind 3
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
26
One Farmer’s Sentiments on Wind Energy
"I think it's one of the greatest things that ever happened.
It's good for my pocketbook. It's good for the environment.”
-- Chuck Goodman, retired farmer near Alta, Iowa;
Has three wind turbines on his land
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
27
We Solve: Summary
• Fuel-efficient diesel engines
• Use of renewable materials in products
• Corn- and soy-based plastics for some
combine and tractor components
• Conservation tillage equipment: planters, air
seeders, drills
• Precision farming equipment: GreenStar
AutoTrac and iTEC Pro
• Nutrient application equipment and solutions:
OptiGro and Soil Information System
• Wind energy service provider
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
28
Industry Perspective: We Solve
• Technology Policies and Measures:
• Renewables - use / research / standards
• Emission Offsets:
• Ensuring robust and reliable participation by agricultural
and forestry sectors in climate policies
• Offsets should include a variety of options, e.g. soil, plant, forest
sequestration, methane capture, renewable energy
• Offsets must be verifiable
• Development of a single, nationwide standard for verifying and
accounting for agriculture and forestry offsets is needed
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
29
Questions?
For further information:
Joanne Howard
309 765 5152
howardjoannem@johndeere.com
INTEGRITY • QUALITY • COMMITMENT • INNOVATION
30