energy and resource management

Climate change - There is increasing awareness and consensus regarding the affect of anthropogenic CO2 emissions as a contributing factor in global warming and climate change. There is also a growing list of actual and potential impacts from changing climate including increased storm intensity and changes to biodiversity, such as a decrease in the number of frog species in the world. TELUS has aligned our target with the Kyoto process for many years, and as a result, developed a strategy to mitigate against damage to our network from climate-related events, as described in our annual report at telus.com/annualreport. However, we are striving to do more than adapt our systems to potential change. Through the purchase of green power, as well as energy efficiency measures and the use of alternative energy, we continue with our attempts to lower our carbon footprint, despite underlying growth in the business. In 2006, we reduced our direct emissions. However, our indirect emissions increased slightly due to rising energy consumption, a situation we need to address in the coming years.

In 2006, TELUS was asked for the first time to participate in the Carbon Disclosure Project (CDP) survey, as a member of the Global FT500. The CDP represents 280 institutional investors, holding more than $41 trillion in assets. In an effort to improve disclosure on this potentially material risk, the CDP survey engages corporations on emissions profiles, mitigation strategies, and opportunities to the company from climate change. More information on the CDP report can be obtained from conferenceboard.ca and more information on climate change science is available at www.ipcc.ch/.

Alternative energy - Where possible, and economically feasible, we remain committed to expanding the use of alternative energy. At year-end 2006, there were 35 solar-powered installations in service, thereby forgoing the need for the equivalent in diesel generator use and the accompanying risks. In 2006, we developed the business case for use of a battery replacement technology at one site, which will reduce generator run time by half. TELUS is also investigating a proposal for wind power at a remote northern Alberta location, as part of a joint venture. We do not expect results from either initiative until late 2007. We undertook a study of our process for developing alternative energy in 2006, with the intent to establish targets for spending in this area in 2007.

2006 conferencing - In 2001, we began reporting carbon and nitrogen oxide avoidance, based on the use of our conferencing services as a replacement for travel. In 2002, video and teleconference calls were combined and we continue to report on the reduced greenhouse gases associated with these services. In 2006, use of conferencing services both internal and external to TELUS increased by 33 per cent overall. The calculation we use to determine the pollutants avoided has been in use since 1999 and was reviewed in 2006. No substantial changes were made at this time to the methodology or the assumptions therein.

Water usage - Although we do not engage in any significant manufacturing processes, we are a large company with many employees and we use a large amount of domestic water. We began tracking water use in 2003, as part of our effort to protect and conserve water. In 2006, we estimate that 88 per cent of our water usage is accounted for, which exceeded our target, and continues to trend in a positive direction. As we work to improve our tracking capability, we also continue our conservation efforts, such as installing automatic faucets and low flush toilets in some of our larger facilities. In addition, implementation of LEED building standards for new facilities, including future large buildings in Ottawa and Toronto, should enable improved tracking of water and water conservation.

Waste reduction - We continue to be challenged in our efforts to track the amount of waste TELUS creates because of the large number of facilities, the different types of operations, the remote locations of sites, and the varying methods for tracking or paying for waste collection. As a result, we remain unable to report on total waste for the company in a meaningful way. By assessing waste generated at some of our larger facilities, and increasing the tracking of total waste generated, we plan to improve the scope of waste reporting going forward.

In 2006, we handled approximately 38,000 litres (mainly oil and oily water) and more than 4,000 kilograms (mainly batteries) of hazardous materials, all of which were recycled or disposed of by licensed waste handlers.