Molie Quantum Energy Xiaogang Plant Fire Incident Progress Report (July 14 - July 27)

2025.07.28

Copied

Release Date: July 28, 2025

More than two weeks have passed since the fire incident at Molie Quantum Energy's Xiaogang Plant on July 14. As an international enterprise with social responsibility, we deeply understand the importance of transparent communication and are committed to regularly updating all stakeholders on the progress of this incident. Since the very beginning of the incident, the company has continuously cooperated fully with public authorities in their investigations, while actively promoting employee resettlement, remedial measures, plant area optimization, and diligently rebuilding relationships with the local community. Multiple tasks have been carried out simultaneously. This report aims to summarize the various response actions and future goals within two weeks after the fire, ensuring that all stakeholders can gain a more comprehensive understanding of our every effort and commitment.

I. Fire Incident Occurrence and Handling Process

(I) Notification Time

At 05:04 AM on July 14, 2025, the Molie Quantum Energy plant notified the fire department.

(II) Preliminary Determination of Ignition Point

Based on the comparison of CCTV footage retrieved from the fire scene after the disaster and on-site inspection, the preliminary judgment is that the ignition area was the "Formation Semi-finished Product Room Temperature Resting Area." This area is where batteries undergo a resting and curing process after partial formation. The ambient temperature in this area is controlled at 23±2℃, and no charging or discharging operations are conducted here.

(III) Firefighting Process

The fire department arrived at the scene approximately 05:20 AM after receiving the report and immediately began firefighting operations. The fire was brought under control in the afternoon of the same day due to continuous water spraying for cooling. By 08:00 AM the next day (July 15), all fire points had been extinguished, with surface temperatures around 40℃. Only a small amount of white smoke, which was water vapor, remained, and air quality was normal.

(IV) Personnel Evacuation and Injuries

When the fire occurred, the plant immediately activated its "Emergency Response Evacuation Plan" to evacuate personnel. All employees were evacuated to the designated assembly area for fire drills at the first instance. A total of 15 people were injured in this fire, including 12 company employees, 1 contractor personnel, and 3 firefighters. Most injuries were minor, sustained during evacuation. Only one contractor personnel suffered minor facial bone fractures and one employee was hospitalized for finger fractures (both have since been discharged), while the rest returned home on the same day after medical examination.

(V) Crisis Response and External Communication

Internal Command and Support:

̶ On-site Command: Immediately after the fire, the highest-ranking person in the plant, the plant manager, served as the commander and immediately reported to TCC Operations Headquarters.

̶ Operations Headquarters Deployment and Division of Labor: Shiue Ren-Jen, General Manager of TCC Battery Business and E One Moli Corporation, Wang Jian-quan, General Manager of Energy Storage Business Unit, and Liu Feng-Ping and Ye Yu-Chun, Vice Presidents of Operations Headquarters, traveled south on July 14 after the fire. They were respectively responsible for firefighting and safety projects, employee care, and external communication.

̶ Group CEO's Presence: TCC Group CEO Nelson Chang canceled his overseas business trip and arrived at the fire scene at 09:30 AM on July 15, accompanying the Deputy Mayor of Kaohsiung City to inspect the firefighting situation.

External Communication and Apology:

̶ At noon on July 14, the spokesperson for Operations Headquarters expressed apologies through television interviews and written statements for the impact of the fire incident on the community and Kaohsiung City.

̶ On July 15, TCC Operations Headquarters and the Molie Quantum Energy plant issued a press release, once again expressing their deepest apologies for the anxiety and inconvenience caused to the public and local residents by this incident.

̶ On the same day, Vice President Ye Yu-Chun of Operations Headquarters, General Manager Shiue Ren-Jen of Battery Business, and Molie Quantum Energy Plant Manager Yu Shiang-Bin attended a briefing hosted by Legislator Lai Jui-Lung, bowing in apology to all community chiefs, councilors, and concerned citizens from Xiaogang District present. The company is very grateful to Legislator Lai's office for holding a second briefing to continue showing concern for this incident and allowing our company to attend.

Initial Community Outreach: The criticisms and suggestions from the local community chiefs in Xiaogang District made us deeply realize our past neglect in interacting with the community. A dedicated neighborhood affairs team was formed after the fire, and a director was officially appointed to first contact 38 community chiefs in Xiaogang District by phone to express apologies and arrange personal visits.
Gratitude and Apologies to Emergency Services and Affected Parties:

̶ Company representatives personally visited the Xiaogang Fire Brigade, Gaogui Fire Brigade, Dalin Fire Brigade, Xiaogang Police Precinct, and Xiaogang Police Station to express gratitude and offer condolences and care to the three injured firefighters, Mr. Sun Cong-Ming, Mr. Huang Chun-Lin, and Mr. Zeng Yu-Jie.

̶ The 8 households on Changchun Street closest to the plant, as well as Taiwan Sugar, which had to suspend operations for one day due to the Molie Quantum Energy fire, have also been visited by executives and the plant manager to express apologies.

̶ The company also visited Director Shi of the Linhai Industrial Park Service Center and assisted in clarifying the widespread use of fluorine in industrial and consumer industries.

(VI) Environmental Monitoring and Information Transparency

The Environmental Protection Administration's Toxic Chemical Disaster Response Center and the Kaohsiung City Environmental Protection Bureau were deployed on the morning of July 14 and have been continuously monitoring air quality in the plant area and the Linhai Industrial Park. Their monitoring results are as follows:

July 14: A trace amount of hydrofluoric acid was detected at the fire scene at 09:47 AM. It is presumed to be residual from the electrolyte delivery pipe, volatilized in a very short time after the open flame appeared, and did not spread to surrounding areas.
July 16: The Kaohsiung City Government issued a press release stating that no toxic gases were released into the air at the scene, nor were any toxic substances affected.
As of July 19: The Environmental Protection Bureau continues to conduct three tests per day, and all values are within background levels.

(VII) Firefighting Water Treatment

All firefighting water was directed into the internal retention ponds within the plant area (with a storage capacity of 3,700 m3). Starting from the morning of July 14, fire department pump trucks assisted in continuously pumping water. Before being transported off-site for treatment, each truckload of wastewater was sampled to ensure that the pH value and water temperature met disposal standards. All test results met the criteria, and the water was then transported to the Linhai Industrial Park Wastewater Treatment Plant for treatment, and discharged after meeting the Environmental Protection Administration's effluent standards.

(VIII) Cooperation with Relevant Authorities' Investigations

Relevant executives and employees of the Molie Quantum Energy plant have fully cooperated with various agencies, including the Fire Department, National Fire Agency, Labor Inspection Office, Environmental Protection Bureau, and Ministry of Economic Affairs Industrial Development Bureau, in conducting relevant investigations, including on-site inspections, data collection, and interviews, with the aim of clarifying the cause of the accident as soon as possible.

II. Internal Investigation: Assisting in Clarifying the Accident

As the only manufacturer in Taiwan that develops and produces high-end ternary lithium batteries, Molie Quantum Energy deeply understands its critical position in the industry and its significant responsibility to society. This compels us to conduct a comprehensive and in-depth internal investigation into this accident with the utmost rigor.

Despite introducing process equipment from the world's most experienced internationally renowned manufacturers – these equipment suppliers also serve many well-known battery manufacturers – and with electromechanical design and construction companies being leaders in the domestic industry, this disaster and loss unfortunately still occurred. For this, we express our deepest apologies to all employees, community residents, shareholders, and the public. We feel obligated to thoroughly investigate the cause of the accident and provide a responsible account to all stakeholders.

To this end, in addition to fully cooperating with fire and judicial authorities in their investigations, the company has immediately formed an internal investigation team to fulfill its professional and corporate responsibilities. On July 28, we proactively submitted the preliminary report of the internal investigation team to the fire investigation unit for their reference. We commit to continuously and promptly providing all necessary information in the future, cooperating 100% with all relevant investigations to ensure that the truth comes to light.

Below is a summary of the multiple safety mechanisms adopted by the company in product design and manufacturing processes, and how we strive to ensure the highest standards of safety:

(I) Product Safety Design and Certification

Each of our batteries is designed with multiple built-in safety mechanisms from the source and has passed strict international standard certifications. This is our basic requirement for products leaving the factory.
The 21700 battery cells produced by our company are designed for high-end power applications, and their end products, such as commercial drones and aerospace research vehicles, have extremely stringent safety requirements. Therefore, "thermal runaway prevention" and "propagation prevention" are at the core of our design.
During the design, trial production, and formal production stages, the 21700 battery products not only undergo thousands of high-power charge-discharge cycle life tests, abuse tests, and functional verification under extreme environments such as extremely high/low temperatures by different internal units and multiple aspects to ensure the reliability of battery performance and safety, but they also obtain various test approvals from the Federal Aviation Administration (FAA) in the United States, the European Union Aviation Safety Agency (EASA), and the National Aeronautics and Space Administration (NASA) in the aerospace field, where safety requirements are most stringent. Currently, we are one of the few in the world approved for aerospace applications (space exploration, satellite applications), and adopted by the largest electric aircraft companies in the United States (Beta, Archer, etc.), becoming the world's first civilian commercial lithium-ion battery product to obtain permits and actually conduct thousands of port-to-port, civil airspace manned commercial missions.

(II) Manufacturing Process: Dual Protection Concept

The safety design of our factory is based on a "dual protection" concept: "source screening (quality control screening)" and "real-time response (automatic fire suppression system)."

First Protection: Source Screening (Quality Control Screening)

This firewall includes 100% comprehensive screening from product design, quality control screening, process screening, to pre-shipment, including temperature, current, voltage, impedance, and appearance inspection.

̶ Product Design Safety Mechanisms:

Each battery produced by our company incorporates multiple built-in safety mechanisms from the design source and has passed strict international standard certifications, such as:

UN38.3: Includes overcharge, thermal cycling, external short circuit, impact, forced discharge tests.

UL1642: Includes overcharge, forced discharge, external short circuit, impact tests.

IEC62133: Includes overcharge, external short circuit, impact, forced internal short circuit tests.

GB31241: Includes overcharge, external short circuit, strong impact tests.

BSMI: Includes humidity test, overcharge, forced discharge, external short circuit, thermal shock tests.

JIS62133: Includes overcharge, external short circuit, forced discharge, impact, forced internal short circuit tests.

In addition, we have obtained AS9100 production quality certification and IATF16949 electric vehicle certification, which are superior to our peers. These are all global independent certification bodies for lithium batteries, especially including European and American organizations, conducting actual on-site certifications.

̶ Rigorous Verification of 21700 Battery Cells:

The 21700 battery cells produced by our company are designed for high-end power application scenarios. Their end products, such as commercial drones and aerospace research vehicles, have extremely stringent safety requirements. Therefore, "thermal runaway prevention" and "propagation prevention" are at the core of our battery design.

̶ Fully Automated Detection in the Manufacturing Process:

Our company has a fully automated detection process lasting more than ten days in the battery manufacturing process. Through multi-stage high-temperature and room-temperature resting, and four VZ voltage and impedance electrical measurements, any potentially defective batteries are actively identified and removed, automatically scrapped by the machine.

After the machine automatically detects and confirms no potential defects, the batteries are automatically transported to the resting area for resting and curing after battery formation. The ambient temperature is constantly controlled at 23±3℃. All batteries in this area are in a static state without any electrical operations, and it is a fully automated operation, eliminating human operational risks.

̶ Safety Assessment of Batteries in the Resting Area:

Therefore, if there are no special abnormalities during the battery formation process, the probability of batteries in the resting area catching fire is extremely low. Even if an individual battery has an abnormality or short circuit, it will only result in the top cover of the battery detaching and venting pressure, without further combustion or causing other batteries to burn. The integrated steel casing of the battery almost never breaks at the bottom, preventing batteries from ejecting or causing other batteries to burn.

Second Protection: Automatic Fire Suppression

Even in the most extreme circumstances, the plant is equipped with an independent automated fire suppression system. It can immediately activate alarms and initiate initial firefighting procedures upon detecting smoke or high temperatures, minimizing the extent of the disaster.

̶ Preliminary Judgment of Possible Ignition Cause of This Fire:

After comparing images and conducting on-site inspections, the ignition point was located in the formation semi-finished product resting area. This area is used for the resting and curing of batteries after formation, with the ambient temperature constantly controlled at 23±2℃. No electrical operations are conducted in this area, and all batteries are in a static state.

Preliminary Analysis of Data Sources: Due to severe damage to various independent computer (central control and formation) hard drives, monitoring equipment hard drives, and hosts at the scene caused by the fire, only five CCTV video recordings from the formation area before the fire and during the initial ignition phase have been found regarding the "Formation Semi-finished Product Room Temperature Resting Area." Four of these CCTV images are already interpretable, and the last one is still being analyzed. In addition, there are interviews with the company's duty personnel on the day regarding the situation at the scene, relevant information provided by equipment suppliers, and fire alarm system records. Therefore, the company can currently only conduct a preliminary analysis of the cause of this fire from the aforementioned data and information.

Subsequent Investigation Plan: The company plans to proceed with the clearing and excavation of the "Formation Semi-finished Product Room Temperature Resting Area" (hereinafter referred to as "Resting Area") fire scene with the consent and under the supervision of the fire department, hoping to further retrieve the process computer host from the formation area to see if the process operation data from that day can be read, which will facilitate a more thorough clarification of the cause of this accident.

External Expert Assistance: In addition to establishing an internal investigation team, the company has also engaged fire safety experts and scholars to assist in clarifying the cause of this accident.

Based on the comparison of CCTV system footage retrieved from the fire scene and on-site inspection, and intensive analysis of recoverable equipment and images, the preliminary judgment points to an extremely unusual "multiple system anomaly and event superposition" situation, which will be the core of our internal investigation:

First Layer Anomaly: Heat Source in Resting Area Triggers Chain Reaction

Based on the currently collected evidence, the occurrence of this fire is presumed to be caused by a high-temperature heat source flowing through the resting area. The source of this heat source is currently unknown and requires more information for further judgment. This heat source not only triggered the fire alarm 1F sprinkler auxiliary pump to activate but also caused a large number of batteries in the resting area to simultaneously vent in a short period.

Second Layer Anomaly: Automatic Fire Suppression System Failed to Activate Effectively in Time

The "real-time response automatic fire suppression system" installed in the plant failed to activate effectively in time. The reason for its ineffective activation still needs further investigation, leading to the initial fire not being effectively controlled in time.

Third Layer Anomaly: Power Outage Led to Fire Suppression System Failure

Subsequently, a power outage from Taipower occurred, and the backup power supply was damaged and could not function, causing the plant's foam suppression system and fire sprinkler system to be unable to operate continuously.

These several safety systems, which should have operated independently, failed to perform as expected, coupled with successive events, collectively led to the escalation of the fire. We are conducting the deepest investigation into why these systems failed and the correlation between the events. The final conclusive judgment can only be made after the critical formation equipment host data excavation and recovery are completed.

III. Subsequent Operational Adjustments

Current Status of Suspension and Insurance Claims:

In accordance with government requirements, Molie Quantum Energy Corporation's Xiaogang Plant has been suspended for three months to cooperate with government agencies in the fire cause identification and disaster loss investigation. Currently, the insurance company has also dispatched personnel to conduct on-site inspections and investigations to proceed with the subsequent claims process.

Production Capacity Scheduling and Customer Communication:

Molie Quantum Energy's parent company, E One Moli Corporation, immediately contacted key global customers and supply chains at the first instance and promptly initiated production capacity inventory and scheduling at E One Moli Corporation's Tainan Science Park Plant to maximize its production capabilities and support affected orders.

Equipment Inventory and Cleaning:

We have initiated equipment inventory and cleaning work. Given that we operate in a cleanroom standard production environment, the primary task is to ensure the thorough cleanliness of all equipment and the environment to prevent any contamination from affecting future product quality.

IV. Preventive Measures: Comprehensive Review and Upgrade

Continued Cooperation with Incident Investigation:

̶ Molie Quantum Energy Corporation's Xiaogang Plant is currently actively cooperating with the fire investigation and prosecutorial police units, fully controlling personnel access. Some key evidence, such as the formation equipment host, is located in the core area of the fire and still awaits approval from the competent authorities to enter the fire scene for clearing and removal for professional recovery. The company will continue to cooperate with the prosecutorial police investigation and provide all necessary information.

̶ Cooperation of Process Equipment Suppliers in Investigation: Molie Quantum Energy immediately requested the internationally renowned manufacturer of the process equipment to be on-site to fully cooperate with the investigation and analysis of why their system failed to achieve the expected results. As the system of this internationally renowned company does not allow customers to log in independently, and they had just conducted routine maintenance on July 10 before the fire, the company will work with them to thoroughly investigate whether there are functional defects or design flaws in the equipment. If there is any progress, it will also be proactively reported to the investigative authorities.

Review and Optimization of Plant Design:

Chairman Nelson Chang and General Manager Shiue Ren-Jen have convened relevant executives for multiple meetings to review and optimize the plant design. The directions include:

̶ Strengthening Machine Fire Suppression Mechanisms: Reviewing their activation mechanisms and effectiveness, and planning to introduce AI assistance to intervene earlier in the initial stages of thermal runaway, and increasing the testing frequency of machine fire suppression mechanisms.

̶ Upgrading Plant Structure and Firefighting Equipment: If plant reconstruction is planned in the future, priority will be given to using high-strength structures with fire resistance and explosion protection for physical isolation, and evaluating the feasibility of introducing remote-controlled firefighting equipment or firefighting robots to reduce the risk for frontline personnel during disaster relief.

̶ Strengthening NG Product Handling Procedures: Comprehensively reviewing and strengthening the error-proofing and anti-fraud mechanisms in NG product handling procedures to prevent any abnormal products from entering subsequent processes, while comprehensively improving the plant's fire compartments, explosion-proof design, and the independence and reliability of backup power supplies.

Other Battery Plant Management Optimization:

̶ Immediate Deep Optimization of E One Moli Corporation's Tainan Science Park Plant Management: For the fire safety management of lithium battery production processes at E One Moli Corporation's Tainan Science Park Plant, another battery plant under TCC in the Tainan Science Industrial Park, the Environmental Safety and Health Office immediately increased inspection frequency after the fire, including air emissions, water resources, waste, toxic chemicals, occupational safety, and other management measures, to strengthen risk control.

̶ Risk Inventory and Response Drills: Inventorying high-risk operational areas and equipment, confirming equipment integrity, and advancing the 2025 high-risk production area response drills to be completed by August 31.

Enhancing Overall Fire Response Capability:

̶ Collaboration with External Fire Departments: After the incident, the Director of the National Fire Agency personally visited the plant, and the fire department continues to conduct regular inspections and mobile patrols, demonstrating the government's high regard for and continuous support of our company's fire safety.

̶ Strengthening Self-Firefighting Capability: To further enhance the company's response capability, we will strengthen and expand the in-plant firefighting team and consider setting up our own fire station within the plant area; deepen cooperation with fire departments around the plant area to increase the frequency of joint drills; and, using this incident as an example, jointly strengthen the operating procedures for responding to lithium battery fires.

̶ Introduction of Third-Party Supervision: After the incident, a third-party fire expert was commissioned to assist in reviewing the plant's fire safety mechanism optimization process to build public trust.

Policy and Regulation Enhancement:

̶ Optimization of Emergency Response Procedures: Adjusting emergency assembly points to increase the safe distance between assembly points and the plant area to enhance personnel evacuation safety.

̶ Strengthening ISO 45001 Certification Operating Procedures: Continuing to strengthen operating procedures based on existing ISO 45001 certification, including adding hardware facilities in various process areas to effectively block fire and prevent disaster expansion.

̶ New Regulations for Hazardous Chemical Labeling, etc.: In response to the anxiety caused by trace hydrofluoric acid measurements in the surrounding community, the environmental safety and health policies of both Molie Quantum Energy Corporation's Xiaogang Plant and E One Moli Corporation's Tainan Science Park Plant will immediately add regulations such as hazardous chemical labeling to ensure information transparency and reduce community concerns.

Relevant Training and Talent Development:

̶ Establishment of Internal Firefighting Team and Talent Development: Strengthening and expanding the in-plant firefighting team, and continuously arranging existing employees to receive fire-related training courses; actively recruiting professional talents from fire science disciplines in the future to further strengthen the plant's fire response capabilities and enhance the ability to deal with new types of fires.

̶ External Fire Cooperation and Resource Investment: Supporting fire departments around the plant area to purchase necessary equipment for responding to new types of battery fires; strengthening cooperation with fire departments to jointly establish standard operating procedures and precautions for responding to lithium battery fires; increasing the number of joint drills with fire departments to ensure the efficiency and tacit understanding of collaborative operations.

̶ E One Moli Corporation's Tainan Science Park Plant Response Drills and Skill Training: E One Moli Corporation's Tainan Science Park Plant has scheduled internal response drills from August to October 2025, covering scenarios such as gas leaks and electrical fires; new skill training will be added for existing Emergency Response Team (ERT) members and is expected to be completed by September. This will ensure that ERT members can quickly control the disaster situation and effectively prevent casualties in the event of an emergency.

V. Remedial Measures: Employee Care and Environmental Restoration

Environmental Remedial Measures:

̶ Proper Treatment of Firefighting Wastewater: Molie Quantum Energy Corporation's Xiaogang Plant strictly adheres to regulatory requirements, ensuring that firefighting water is not discharged directly into external water bodies.

̶ Introduction to Internal Retention Ponds: On the day of the fire, July 14, all firefighting water was directed into the internal retention ponds within the plant area (with a storage capacity of 3,700 m3).

̶ Professional Off-site Disposal: To avoid discharging wastewater with higher pH values, starting from the morning of July 14, fire department pump trucks assisted in continuously pumping water, which was then transported to the Linhai Industrial Park Wastewater Treatment Plant off-site for disposal before discharge.

̶ Optimization of Pumping Operations: The original pumping volume reached 25 trucks/day, which has been reduced to 15 trucks/day by July 24 and switched to gravity pumping to avoid noise from pumping motors.

̶ Continuous Air Quality Monitoring: The company will continue to cooperate with government units in monitoring air quality.

̶ Waste Removal: The plant area is currently still under control. Future waste handling and removal will strictly adhere to legal regulations.

Employee Assistance Programs (EAPs):

̶ Full Salary Payment and Financial Aid: In addition to full salary payment during the suspension period, the company also provides interest-free emergency loans to employees, with a cumulative maximum limit of NTD 600,000, to help colleagues facing short-term financial difficulties due to the incident.

̶ Professional Psychological Support: The company has partnered with an external third-party counseling center to launch an EAP program, providing free professional psychological support resources. This program features: multi-language services, flexible interview methods, and full confidentiality.

̶ Needs and Responses for On-site Personnel: The Group Operations Headquarters Vice President and Chief Human Resources Officer continues to care for colleagues remaining at the plant after the fire was extinguished and responds to their needs: providing water dispensers with hot water function, an extra set of cotton sweat-absorbent uniforms, preparing biscuits and snacks, backup cooling sprays, and considering high-temperature allowances.

̶ Employee Town Hall Meeting: After the incident, most colleagues were waiting at home for task assignments and adjusting their moods. We will hold an employee town hall meeting recently to explain future plans and how we will face more challenges together.

VI. Plant Cleaning Progress

Completed exploration of plant cleaning paths and installed emergency lighting in accordance with the fire department's official document.
Completed installation of necessary ventilation equipment for plant cleaning and started ventilation.
Initiated dewatering of the plant cleaning area.
Prepared tools, personal protective equipment, and provided pre-training and psychological counseling plans required for plant cleaning.
The Fire Investigation Section also conducted on-site inspections and officially issued a letter confirming the areas that can be cleared and removed.
Convened cooperating contractors to formulate the plant clearing and removal execution plan: Waste removal: The plant area is currently still under control. Future waste handling and removal will strictly adhere to legal regulations.

VII. Power Restoration Progress and Phased Firefighting Reinforcement

High-voltage substation (GIS) rescue completed.
Power supply to the disaster relief command center in the parking building has been restored.
Three generators have been set up to supply temporary lighting needed for the main plant building's clearing and removal. Normal power supply requires a separate plan to handle relevant power distribution panels after execution. Currently, emergency power is prioritized for clearing and removal work.
Established a joint defense team with the fire department, using drones and fixed-point red line monitoring for 72 hours of monitoring records. Temperature is controlled at 25℃−28℃, with no open flames. Water spraying has stopped, but the fire monitor remains on standby.

VIII. Post-Disaster Structural Safety Assessment Plan

Structural engineers and architectural engineers have jointly conducted three on-site inspections, confirming the safe areas for clearing, demolition, and excavation.

IX. Tracking Effectiveness and Future Outlook

(I) Environmental Management Effectiveness Measurement

Effectiveness of Firefighting Wastewater Treatment:

̶ Water Quality Testing: All firefighting water is centrally treated in the plant's grit chamber for sedimentation. Each truckload of wastewater is sampled before being transported off-site for treatment, ensuring that the pH value and water temperature meet disposal standards, and all test results meet the criteria.

̶ Final Discharge Standards: After wastewater is treated by the Linhai Industrial Park Wastewater Treatment Plant, it is also sampled before discharge to ensure that the wastewater meets the Environmental Protection Administration's effluent standards, causing no irreversible harm to water bodies, ecosystems, or human health.

Air Quality and Environmental Data Monitoring and Disclosure:

̶ Due to this fire incident, the surrounding community experienced panic regarding environmental quality. To rebuild the trust of the local residents in Molie Quantum Energy, Molie Quantum Energy commits to regularly disclosing environmental data.

̶ The company plans to regularly monitor air pollution-related indicators (including CO, HF, PM, TVOC, etc.) monthly for four months starting from the incident and publicly disclose the test reports. Preliminary results: As of now, all monitoring data meet standards, and no abnormalities have been found.

̶ Information Disclosure Mechanism: Regularly publishing plant environmental information, including air and water pollution data, for public review through Molie Quantum Energy's official Line account and physical paper announcements on community bulletin boards.

̶ Enhanced Air Pollution Monitoring: Publicly disclosing third-party air quality monitoring reports monthly for the initial 8-10 months after the accident, and quarterly thereafter for the mid-to-long term. Monitoring items include hydrofluoric acid, total suspended particulates (TSP), carbon monoxide, and total volatile organic compounds (TVOC).

(II) Employee Assistance and Training Effectiveness Measurement

Effectiveness of Employee Assistance Program (EAP): The EAP was immediately activated after the accident, providing free, anonymous psychological counseling services to all employees. Its effectiveness will be assessed through subsequent participation and feedback.
Employee Town Hall Meeting: The company has organized an employee town hall meeting to directly explain the progress of the incident, company response measures, and related rights to colleagues.
Effectiveness of Safety Education and Response Plan: The company will redesign internal emergency incident reporting procedures and response plans based on this accident and implement layered safety education courses and practical drills. Training content and implementation effectiveness will be continuously reviewed, and satisfaction surveys will be used to understand whether subsequent compensation plans and related measures are operating effectively.

(III) Community Relations Restoration Progress

After this fire accident, we deeply reflected. In the urgency of evacuating employees and extinguishing the fire, we failed to properly notify the surrounding community at the first instance, and the plant team usually neglected to interact with the neighborhood. We humbly accept the severe criticism from community chiefs, councilors, and even legislators; Molie Quantum Energy indeed neglected to participate in community development.

Although 70% of employees at the Molie Quantum Energy plant are from Kaohsiung, with 21% being genuine Xiaogang residents. In addition, 58% of our supply chain partners are local Kaohsiung enterprises, and over 40% of our procurement amount contributes to the local Kaohsiung economy, demonstrating our efforts to prioritize local talent. However, these are just small steps in our localization efforts. In fact, we still have many shortcomings in building good relationships with the community.

To ensure transparent communication and relationship restoration with the local community, the company has actively launched a series of community visits and information exchanges, and continues to listen to opinions from all parties. The progress is as follows:

Establishment of Neighborhood Affairs Team and Apology: The company quickly formed a neighborhood affairs team after the fire and appointed a plant executive as the public relations director. This team immediately contacted 38 community chiefs in Xiaogang District by phone to express apologies and scheduled subsequent personal visits, actively initiating community communication mechanisms to repair relationships.
Personal Visits: The Molie Quantum Energy Neighborhood Affairs Team has visited 13 community chiefs and 3 councilors within two weeks and will continue to visit all councilors and community chiefs in Xiaogang District. Molie Quantum Energy also visited 7 households on Changchun Street closest to the plant to express apologies; the scope of visits also included relevant supervisory departments within the Linhai Industrial Park.
Listening to Community Voices: The company deeply realizes that although most councilors and community chiefs directly presented serious accusations to the Molie Quantum Energy plant's neighborhood affairs team, they also provided many valuable suggestions, making us feel the warmth of the community and its expectations for the enterprise. Regarding the assembly and protest activity to be initiated by local community chiefs and residents on July 30, the company also realizes that it must actively face it and will continue to communicate and explain.
Key Points of Community Feedback: The Molie Quantum Energy plant has continuously collected opinions and feedback from local opinion leaders over the past two weeks. Preliminary feedback highlights include:

̶ Industrial safety must be done well to ensure no recurrence. Otherwise, residents will not feel at ease and will demand relocation.

̶ Manufacturing and finished products must be separated.

̶ Suggesting simple health check-ups or special clinics.

̶ Lack of interaction between Molie Quantum Energy and the neighborhood, requiring long-term cultivation and deepening neighborhood relations in the future.

̶ Ignoring job seekers introduced by community chiefs.

̶ Neighborhood relations primarily rely on financial resource input.

̶ Supporting the company in establishing a dedicated community contact window and hoping for prompt restoration of plant operations.

̶ Holding resident briefings to clarify doubts and reassure local residents.

̶ Whether the company can help residents understand the impact on respiratory and skin health in the future.

̶ If there is an opportunity to resume operations in the future, strict requirements must be placed on engineering contractors to comply with environmental regulations, such as speed bumps, measures to reduce increased traffic, no more disturbance to neighbors, new penalties, and enhanced regulatory effectiveness.

Actively Developing Diverse Community Feedback Programs: In response to the above feedback and community needs, the company is actively developing diverse programs, including:

̶ Establishing a transparent information disclosure mechanism: regularly publishing plant environmental information to the community for public review.

̶ Strengthening emergency incident reporting mechanisms: proactively establishing community mobile social networks to enhance emergency incident reporting mechanisms.

̶ Establishing a stakeholder contact window: responsible for daily communication and coordination with the community.

̶ Promoting community health activities: targeting the age structure of residents in Xiaogang District and generally concerned issues such as respiratory and skin health among Xiaogang residents, co-organizing health lectures with community offices, combining hands-on dietary therapy and herbal health charity clinics.

̶ Supporting and participating in various characteristic activities of communities in Xiaogang District.

Subsequent rounds of visits to community chiefs will further confirm feasible plans and directions.

(IV) Overall Project Response and Supply Chain Resilience

In addition to cooperating with the competent authorities' investigations, we also commit to taking the following countermeasures to thoroughly prevent similar incidents from recurring. Their effectiveness will be reflected in the clarification of the root cause of the incident and the comprehensive improvement of safety management.

Clarification of Fire Cause: We will exhaust all efforts to recover all digital evidence and, in collaboration with domestic and international experts, thoroughly clarify the root causes of this accident in terms of equipment, systems, processes, and personnel management. The depth of this investigation and the completeness of its conclusions will be key measures of effectiveness.
Supply Chain Stability: An emergency response plan has been activated to maintain close communication with customers and suppliers, with the premise of ensuring safety, striving to minimize supply chain impact. Effectiveness demonstrated: Through active communication, our supply chain partners generally expressed understanding and even proactively asked how they could assist.
Customer Support and Understanding: Many customers remain very supportive of our products after communication, with some even flying to Taiwan directly to ensure future shipment volumes. This is mainly due to the widespread application of Molie Quantum Energy's high-end ternary lithium batteries in aerospace technology, eVTOL, and other high-tech products. Their specifications are bound at the initial design stage and verified by international organizations, making them highly irreplaceable. This demonstrates our critical position in the supply chain and the unique value of our products. The smoothness of resumption of operations and the stability of the supply chain will continue to reflect the effectiveness of this measure.
Strengthening Safety Management System: This incident will serve as the highest warning. We will conduct in-depth re-education on safety awareness and response capabilities for all employees; comprehensively review the responsibilities and effectiveness of the existing safety management organization and adjust it accordingly to ensure more efficient handling of potential risks in the future. As we still need to cooperate 100% with the public authorities' fire investigation, the reorganization of Molie Quantum Energy's existing organization to strengthen the management team will be the focus of the next phase after the investigation concludes.

X. Reflection and Future Outlook

(I) Investigation Challenges and Deepening Industry-Academia-Government Collaboration

In the investigation process since the fire, we have deeply realized that clarifying issues related to the characteristics of ternary lithium batteries and complex manufacturing processes requires time and the input of professional knowledge from various sectors. This also reflects that the company still has great room for improvement in its usual technical exchanges and knowledge sharing with the industry, government, and academia. In the future, we will commit to strengthening in-depth interactions with all parties to jointly enhance understanding and response capabilities for new technology industries.

(II) Global Supply Chain and Operational Environment Resilience Assessment

Batteries are a key industry in energy transformation! Molie Quantum Energy is the only cell brand in Taiwan that has successfully entered the international market, with customers being leading technology enterprises in the US and Europe, playing a critical role in the global high-end battery supply chain. To ensure the stability of the global supply chain and avoid the risk of being unable to supply customers due to similar incidents, it is necessary for us to maintain a more stable global supply chain. At the same time, as an international enterprise, we must carefully monitor public opinion developments and dynamic changes in the overall operating environment, and strategically assess various potential risks that may affect the sustainable operation of high-end battery plants, to ensure that the company can proactively consider response plans and continuously strengthen operational resilience.

XI. Conclusion

Molie Quantum Energy Chairman Nelson Chang stated that we understand the public's concern for safety and commit to continuously promoting various response, prevention, and remedial measures with the utmost rigor and transparency, ensuring plant safety and community well-being. We will learn lessons from this incident, comprehensively review and enhance the company's risk management and social responsibility, aiming to become a more trustworthy corporate citizen.

Molie Quantum Energy Xiaogang Plant Fire Incident Progress Report (July 14 - July 27)