Delivering a Sustainable Future Through Innovation - presentation by Theresa Kotanchek, vice president for sustainable technologies and innovation sourcing, Dow Chemical

1. Delivering a Sustainable
Future Through Innovation
Dr. Theresa Kotanchek
Vice President for Sustainable
Technologies and Innovation Sourcing
The Dow Chemical Company
November 2010

2. Breakthroughs to
World Challenges
Sustainability is about our relationship with the world & how we
contribute to solving its challenges.
Energy Climate Water Health Transportation
Change & &
Nutrition Infrastructure

3. The World Needs Energy-2010
Primary Energy Electricity Losses 154 EJ
536 Exajoules (EJ)
Petroleum 180 EJ
Residential 56 EJ
Coal 148 EJ
Commercial &
Industrial 225 EJ
Natural Gas 125 EJ
Nuclear 31 EJ
Renewables 52 EJ Transportation 101 EJ
The chemical industry uses 38 EJ (8% of world consumption)
Adapted from EIA Energy Outlook May 2009, and IEA: Chemical & Petrochemical Sector 2009

4. The Fate of Carbon
Oil Refining Chemical Production
Natural Fuel Uses
Fuel Uses = 49%
Gas,
= 94%
Oil Naphtha,
180 EJ Fuel Oil,
Coal & Contained in
Asphalt, Biomass Products
Lubes, = 51%
Waxes 38 EJ
= 4%
Chemical
Feedstocks
= 2%
EIA 2004 Refining Data and IEA Energy Technology Transitions for Industry 2009.

5. Chemical Industry
How to Lower Carbon Footprint
1. Move to alternative FEEDSTOCKS that are
readily available and require less intensive
processing
2. Develop alternative POWER SOURCES for
industry & consumers
3. Develop energy SAVING products so that
fossil fuel use is decreased

6. Dow’s 2010 Investments in
Energy Technologies
Net Present Value
R&D Investment
in 2010:
(non risk adjusted)
>$400 MM
(risk adjusted)
~$7.5 B ~$2 B
Alternative Alternative Energy
Sources Feedstock Efficiency Efficiency Sources Feedstock

7. Alternate Energy Options

8. Ask the Right Questions
• What is the material balance?
• What is the energy balance?
• What is the cost?
• Is it sustainable?
• Have we defined proper control volumes?
For a successful technology, reality must take precedence
over public relations, for Nature cannot be fooled.
- Richard Feynman

9. Feedstock Oxidation States
9

10. Energy Cost
$/MM BTU $/gal cent/lb cent/lb $/ton $/bbl $/gal $/ton $/Bu $/gal cent/kWh
Poly- Gasoline Ethanol Electricity
Nat. gas Ethane Ethylene Coal Crude RBOB Biomass Corn wholesale all sectors
ethylene
May 2010 prices and last 2 years price density; Source: Dow. USA Middle East Brazil

11. Sugar Cane to Polyethylene Viability
Global Environment Brazil
Bz
Profitability
Profitability
US Bz
Bz
US US price
Bz Brazil price
Bz Brazil cost
February 2010 Prices and last two years price density; Source: Dow.

12. Potential for Solar Energy
Solar Capture Process W/m2 Efficiency
Sugar Cane to Ethanol 0.60 0.30%
Average Solar Radiation 1990-2004
Energy Crop - Fermentation 0.70 0.32%
US Corn to Ethanol (gross) 0.32 0.16%
Algenol 4.0 2.0%
Wind Farm 4.0 2.0%
Total solar energy on land
Concentrated Solar 3.2 1.6% = 697,000 EJ/year
PV cell (10%) 20 10% 1300 x world needs!
“I’d put my money on the sun and solar
energy. What a source of power! I hope Issues:
we don’t have to wait until oil and coal
run out before we tackle that.”
•Intermittency
Thomas Edison 1931 •Cost
Adapted from Mines ParisTech / Armines ©2006

13. Alternative Sources
Crystalline-Silicon Photovoltaics
Polysilicon Module System
Ingot Wafer Cell
(Feedstock)
DW&PS Perf. Fluids Binders Spec Films
Ion exchange resin— Cutting fluid. Next Binder for Al, Ag Flexible frontsheet,
catalyst for by- generation product paste for cell Encapsulant, and
product recycle development metallization. backsheet
Perf. Fluids Cleaners Metallization Additives Perf. Fluids
HTTF for distillation Cleaners—for debris and Light induced Plastic additives— Concentrated Solar
and reduction metal ion contamination plating to improve for backsheet Power thermal fluid
process removal cell performance laminate adhesives
DW&PS Adhesives
Ultra pure water (DOWEXTM resins, FilmtecTM elements) Thermoplastic, UV
curable & liquid
Waste water treatment and process (boron, silver removal and recovery) encapsulant.

14. Alternative Sources
Concentrated Solar Power
DOWTHERM™ A
Heat Transfer Fluid
• Established relationships with
important system OEMs
• Proven ability to deliver high
volumes to remote locations
• Back integration to key raw
materials
Addressable Market:
5,000 MW by 2020
Generating 400 MW of power in Spain and North America
Supplying 250,000 homes with electrical power
Reducing carbon emissions by 800,000 MT annually

15. Innovations for Tomorrow
Green Home
Power your home
with your home
Welcome Dow Board of
Directors
Solar Solutions www.dow.com/solar

16. Dow Participation in Thin Film PV
Cu
In
Ga
Se Overmold
PV
Deposition Film/Lamination Flexible Roofing
Dow Solar System

17. Transforming PV – The Automotive Analogy
Weight Savings =
1.5 lbs per door
Elimination of 50 parts

18. Dow Solar Solutions:
Delivering More Affordable Solar Energy
POWERHOUSETM Solar Shingle
ENERGY
• Building integrated photovoltaic (BIPV) design combines
roofing protection and power generation in one product
• Reduces installation costs by more than 50% compared to
conventional solar modules
• Proprietary electrical connections eliminate tedious and costly
on-roof wiring
High Efficiency & Sustainability
• 1 micron of CIGS (copper indium
gallium diselenide) PV semiconductor
Market Opportunity:
material -- 1/100 of the material of Si
$5 B (by 2015)
solar cells
Dow’s Share:
>$1 B of potential • Consumes 1/3 of the energy to
revenue produce
Launch: • Delivers up toof TIME Magazine’s
Named one 20% conversion
Named one of TIME Magazine’s
2011 efficiency
“50 Best Inventions of 2009”
“50 Best Inventions of 2009”

19. Energy Efficiency – The Net Zero Home
WEATHERMATE™ SILL SEAL
POWERHOUSE™ Solar Shingles Silicon Solar Array
THERMAX™ Wall Insulation
STYROFOAM™ Spray Polyurethane STYROFOAM™ Tongue & Groove
GREAT STUFF™ Fireblock STYROFOAM™ SIS
STYROFOAM™ PERIMATE™ FROTH-PAK™ Foam
Insulation & Sealant

20. Dow Building Solutions:
Next Generation Wall Systems
STYROFOAM SIS™ Structural Insulation Sheathing
ENERGY • Structural • Water Barrier • Polyisocyanurate
Reinforced Layer Facer Insulation
>80% recycled content; Prevents moisture Provides higher
hot-melt silicone-based and air intrusion R/inch (vs. XPS)
adhesive; reliability
testing exceeds code
requirements
External Insulation Finishing Systems
• Mechanical • Basecoat Mortar • Adhesive Mortar
Fastener with Mesh Cement-based latex
Embedded polymer with
• Primer-treated METHOCEL™
XPS Insulation modified waterproofing
mortar (IP filed)
Market Opportunity:
$2 B THERMAX™ Wall System
Dow’s Share: • Polyurethane • THERMAX™ (ci) • Flashing Tape
$200 MM (by 2014) Spray Foam Insulation Air barrier and novel
Insulation Eliminates thermal drainage plane
Launch: High R-value; keeps bridges due to steel-
cavity warm and dry gypsum
2009 to reduce potential
for mold growth

21. Dow Coating Materials:
Formaldehyde Abatement
TRANSPORTATION Breakthrough Formaldehyde Abatement Technology
& INFRASTRUCTURE for Interior Coatings
Market Demands Innovative Technology
• Formaldehyde confirmed as a • New-to-world, formaldehyde
carcinogen abatement technology removes
• Carpets, furniture, textiles, formaldehyde from the indoor air
construction glues have
• Developed by regional R&D team
formaldehyde releasing over
periods of 3-15 years based on the local market and
customer needs
• Formaldehyde awareness level in
China is very high
Cooperation With Key Partner Market Penetration
Asia Market
At Maturity: • Identified leading architectural paint • Formaldehyde-abatement paint has
$80 MM manufacturer as a strategic partner become a market trend in China
Dow’s Share:
• Convinced customers of innovation
needs through visual and
>80%
quantitative testing results
Launch:
2009 • Cooperated with customer on
technical standards development

22. Accelerating Breakthroughs in
Ultra Low-VOC Coatings
#1 in Emulsion Polymers Rapid Innovation...
New Binders & Additives Solve Key Unmet Needs:
…with Exceptional
Potential Performance
New Dow
n
W et Ad he sio
Ultra Low - Stain Resistance
VOC - Blocking Resistance
(5g/L) - Durability
Sc
ru b - Weatherability
Morphology Control
ilit a w
re s
- Scrub Resistance
ab T h
is t a
y
S t ze
nc
e
ee
Fr
#1 in High Throughput R&D ...With Exceptional Performance
Current offerings Good Our innovations
have good film hardness, but deliver low-VOC
- OR -
formation, poor film with no detriment
but poor hardness formation to performance

23. Dow Water & Process Solutions:
Ensure Clean, Safe Water
Water Leadership Validation & Implementation &
TRANSPORTATION & Development Commercialization
INFRASTRUCTURE • #1 position in reverse
osmosis membranes and ion
exchange resins
• Broadest portfolio of high- New UF Membrane High-Rejection Low-
Development Energy RO Membrane
performance enabling water
purification components
• Innovative technologies to
reduce the cost of Largest Active Area
UF Membrane
desalination and reuse by New RO Membrane
35% by 2015 Development
Market Opportunity:
>$5 B (today) • FILMTEC™ reverse osmosis
>$10 B (by 2020) membranes are valued by
Dow’s Share: the industry for their reduced
~$1 B (today) energy requirement and low Perchlorate Removal
cost of ownership New EDI Development IER Media
~$3.5 B (by 2020)
Launch:
Ongoing By 2015, 5 Billion People Will Live in Areas of Significant Water Stress

24. Alternative Sources
Energy Storage Materials
Mining Materials Components Cells Packs Application
Cathode Electrolytes
Anode Separator

25. Systems Thinking is a Competitive Advantage
• Ultra low viscosity
• High heat resistance
• Hydrocarbon based
Chip Underfill
Formulated
Dow Epoxy Systems Products
Performance
Products
EPOXY 12
Unique Building
Blocks

26. Wind Power Solutions
Needs
• Stronger & Lighter
• Easier to Produce
• Corrosion Protection
• Longer Life
Tensile yield stress (MPa)
140
120
100
80
60
40
20
0
00 01 02 03 04 05 06
E+ E+ E+ E+ E+ E+ E+
1. 1. 1. 1. 1. 1. 1.
Viscosity (mPa.s)

27. Energy Efficiency – Dow Processes
9
8
Cumulative Savings in $ Billions
7
6
5
4
3
2
>$9 billion saved
since 1994 1
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

28. Energy + Carbon = Value
• Carbon constrained economy exists today
• Companies that can adapt and partner to
provide total solutions will win
• Requires a new paradigm and creative
business models
By 2020, we project at least
$10 billion in additional sales
due to products and services that
reduce energy consumption and
GHGs

29. Our Innovations Are Aligned To
Global Megatrends
TRANSPORTATION & HEALTH &
ENERGY CONSUMERISM
INFRASTRUCTURE NUTRITION
Healthier
Photovoltaics Building Electronics
Diets
Systems
Wind Power Packaging
Architectural Rice
Systems
Coatings
Home &
Energy Personal Care Incipients
Grid Clean Water

30. Clean Technology & Sustainability Are
Central to Our Business
Dow Electronic Materials Dow Coating Materials
• Lower device power usage • Low-VOC coatings
• Photovoltaics and cell efficiency • Waterborne coatings
• Sustainable manufacturing • Biodegradability
processes • Smart coatings
Dow Specialty Materials Dow Building & Construction
• Rising demand for clean water • Zero ozone-depleting foaming
agent technology
• “Green” cleaners
• Lower building energy consumption
• Personal care products
• CO2 abatement
• Healthier food
• Building integrated photovoltaics
Dow Performance Materials Dow Adhesives & Functional Polymers
• Solar power & photovoltaics • High performance water-based
adhesives
• Wind turbines
• Photovoltaics
• Energy efficient vehicles • Bio-based adhesives
• Emissions treatment • Formaldehyde-free binders

31. Latin America Growth Domains
Energy Storage
Wind Solar Lightweighting & Distribution
Alternative
Agriculture Feedstocks Water