《东京电力公司(TOKYO ELECTRIC POWER)2022年年度报告(118页).pdf》由会员分享,可在线阅读,更多相关《东京电力公司(TOKYO ELECTRIC POWER)2022年年度报告(118页).pdf(118页珍藏版)》请在三个皮匠报告上搜索。
1、Integrated Report 2022Develop the future of energy Deliver a comfortable lifeOur Mission is to give all stakeholders,including regional residents,our customers,and business partners,“a comfortable life”not just by providing a stable source of electricity and gas,but also by providing value that exce
2、eds each individuals expectations through our efforts to“Develop the future of energy”.This is also our“Purpose”as an energy provider.We commit to fulfilling our responsibilities to Fukushima.We pursue expanding possibilities in the world of energyand deliver value beyond the expectations of individ
3、ual customers.We strive to earn the trust of our customers and partners.We create value focusing on global carbon neutralityand regional disaster preparednessfor a safe and sustainable society.Top priority on safety Fulfill our responsibilities Customer-focused Dare to innovateOur Vision looks five
4、to ten years into the future.The TEPCO Groups business is built upon the trust of our stakeholders.In order to create a safe and sustainable society,we will engage in initiatives to create new value from carbon neutrality and disaster prevention as we aim to become a corporate group that continues t
5、o be trusted and chosen by the peopleOur Values are the standards of conduct for achieving our Mission and Vision of which each and every employee have to remain constantly aware.The principles of conduct indispensable to the TEPCO Group are“top priority on safety”and“fulfill our responsibilities.”W
6、e will grow as a company along with our employees by continuing to put the“customer-focused”and implementing“dare to innovate”.MissionVisionValuesPurpose and value creationTEPCO Groups MissionIn anticipation of changes to our energy supply-demand structure,we at the TEPCO Group are developing indepe
7、ndent and distributed demand-side energy systems as we seek to create social value that centers around carbon neutrality and preparedness.The TEPCO Group views the trend towards carbon neutrality as a business opportunity and we shall leverage our strengths,such as interaction with our customers and
8、 our technical prowess,etc.,to drastically shift the focus of our business model from the sale of electricity to facility services that revolve around electricity thereby increasing corporate value.We are pursuing the possibilities of energy in order to provide value that exceeds the expectations of
9、 our customers.1TEPCO Integrated Report 2022TEPCO Integrated Report 2022 Executive SummaryPurpose and value creationMissionDevelop the future of energy Deliver a comfortable lifeWe commit to fulfilling our responsibilities to Fukushima.We pursue expanding possibilities in the world of energy and del
10、iver value beyond the expectations of individual customers.Fulfilling our responsibilities to FukushimaMaterialityVisionStable supplyIn order to fulfill our responsibilities to Fukushima,the TEPCO Group is quickly and appropriately providing compensation,engaging in activities to promote recovery,an
11、d safely and steadily engaging in the decommissioning process while prioritizing efforts to regain the trust of regional residents.Compensation and recovery initiatives based upon our“three resolutions*”In conjunction with the lifting of evacuation orders,the situations of evacuees are changing in v
12、arious ways.In light of this,we continue to listen carefully to each individual to understand their situation,and quickly provide suitable compensation based upon our three resolutions.Furthermore,we are providing both manpower and technical cooperation to ensure that the environment to which evacue
13、es return is livable by contributing to national and local government projects to help businesses rebuild,and restoring/revitalizing town/city functions.Completing decommissioning while coexisting with the regionIn order to move safely and steadily forward with the decommissioning of the Fukushima D
14、aiichi and the Fukushima Daini nuclear power stations,which includes initiatives to handle water treated with multi-nuclide removal equipment(ALPS treated water),and promote“balancing recovery with decommissioning”by vitalizing decommissioning-related industries,we shall engage in two-way communicat
15、ion with regional residents as we aim to complete decommissioning while coexisting with the region.*1.Provide compensation to everyone who needs it;2.Provide compensation quickly and meticulously;3.Respect settlement proposalsDuring FY2022,we identified 18 key business issues through significance as
16、sessments and are in the process of setting objectives for each of these issues.We have also selected executive officers to be in charge of each of these business issues and the degree to which objectives have been achieved will be one of the factors used to determine the remuneration given to these
17、 parties.We strive to earn the trust of our customers and partners.We create value focusing on global carbon neutrality and regional disaster preparedness for a safe and sustainable society.The TEPCO Group engages in initiatives to secure supply and minimize price fluctuations so that our customers
18、can use electricity without worry.Securing supplyThe power supply-demand situation from the end of March until the end of June 2022 was tight,however by implementing supply-side countermeasures along with demand-side countermeasures,such as enlisting the cooperation of society to save electricity,et
19、c.,we were able to avoid power outages.As we head into winter,we shall secure enough supply through a public appeal for additional supply power.Furthermore,in order to stabilize supply-demand,we are aiming to recommence operation of nuclear power stations by making every effort to improve safety,suc
20、h as cooperating with additional inspections by the Nuclear Regulatory Agency,and obtaining the understanding of regional residents,which is the most important matter.Minimizing price fluctuationsIn light of the drastic fluctuations and rising prices in Japans wholesale power market,we have revised
21、electricity rates for our special high-voltage and high-voltage customers.We know that this will cause an inconvenience,but we are accelerating initiatives to save energy and electricity along with customers in order to reduce this burden.In particular,we are expanding our energy-conservation/electr
22、icity-saving services and also providing assistance for air-conditioning cleaning and the purchase of equipment used to manage power use,which are unique measures taken by the TEPCO Group.Examples of issues in important areas(Board of Director management)key management issues(Material Issues Managed
23、 by the Board of Executive Officers)Financial objectivesFukushima Initiatives Balancing recovery with decommissioning(steady initiatives for disposing of treated water)Involvement in urban development and initiatives for eliminating harmful rumorsCreate annual profits on the order of 450 billion fro
24、m FY2030 onward(Renewable energy business)Earn net profits on the order of 100 billion in FY2030Contributing to recovery in Fukushima through the steady implementation of decommissioning/contaminated water countermeasures based upon the Mid/Long-Term RoadmapBusiness foundation Human resource develop
25、ment and establishment of a new corporate culture Strategic development/deployment of human resources to maximize corporate value Nuclear power business Nuclear power/nuclear fuel cycle(thoroughly implementing safety measures at the Kashiwazaki-Kariwa Nuclear Power Station Cooperating with inspectio
26、ns and implementing safety measures in order to recommence operation of the Kashiwazaki-Kariwa Nuclear Power Station Increasing corporate value Customer value creation/enlargement in anticipation of a carbon neutral society(promotion of key businesses)Revamping our business portfolio in new areas of
27、 business in order to increase corporate value Implementing measures based on ESG strategiesIncreasing the value of offered retail energy servicesEstablishment of a world-leading business management foundation Use of renewable energies for primary power sources Refer to pages 78-87 for details.Refer
28、 to pages 30-31 for details.Refer to pages 28-29 for details.2TEPCO Integrated Report 2022Aiming to increase corporate value and create social valueAn overview of ESG initiativesEnvironment GovernanceSocialThe TEPCO Group views the trend towards carbon neutrality as a business opportunity and we hav
29、e announced our carbon neutrality business plan as a strategy for creating value that will help us achieve our vision.Furthermore,we are also developing information disclosure pertaining to climate change,which includes carbon neutrality objectives,based upon stakeholder engagement and TCFD guidance
30、 that was revised in 2021.The achievement level of the FY2030 objective is approximately 85%(CO2 emissions:80 million tons CO2)*2 and the CO2 emission coefficient is 0.452 kg-CO2/kWh*2Improving the effectiveness of the Board of DirectorsIn order to ensure the objectivity of assessment processes and
31、results,we enlisted the assistance of a third party during our FY2021 effectiveness assessment.As with last fiscal year,the Board of Directors has been deemed effective,but we are striving to further improve effectiveness through further improvements.Human capital investment linked to management str
32、ategyOur human resource management strategy focuses on for priority issues(1)Human resource strategies that accelerate“ambidextrous management”(2)Diversity and inclusion(3)TEPCO work innovation(4)Foundation strengthening Promoting initiatives to respect human rightsIn August 2021,we announced the TE
33、PCO Groups Human Rights Policy that is based on the United Nations Guiding Principles on Business and Human Rights,and we engage in human rights due diligence while also constructing mechanisms to handle complaints and taking remedial action.Scenario analysisThe results of our analysis of multiple c
34、arbon neutrality scenarios suggest several things.We expect an increase in demand-side electrification and distributed power sources,household power generation and consumption,as well as locally-produced/locally-consumed power.The fluctuation output of solar and wind power creates the risk of mismat
35、ched supply and demand,so the key to stable supply is to“store and use”power by leveraging storage batteries and hydrogen,etc.We expect an increase in the use of CO2-free electricity,such as renewable energies,etc.,as well as the use of hydrogen/ammonia,etc.Reflecting the revised TCFD guidanceWe are
36、 further disclosing information pertaining to climate change based on the revised TCFD.Director remuneration reflects ESG performance level Carbon neutrality measure cost Carbon neutrality-related investment Internal carbon pricing Climate-related assets The financial impact of risks/opportunities a
37、nd response strategies Transition planBusiness model reform and urban development initiativesWe will drastically shift the focus of our business model from electricity(kWh)sales to facility services that closely impact our customers.Furthermore,we shall promote initiatives to enlarge the scope of th
38、ese new services on the order of entire communities.*1:From Scope 1,2 and 3 power sales.Scope 1 and 2 emissions will be reduced to FY2019 levels*2:Latest figuresCarbon neutrality declarationFY2030 objectivesReduce CO2 emissions originating from the sale of power to 50%of FY2013 levels*12050 objectiv
39、esReduce CO2 emissions originating from the supply of energy to essentially zeroPurpose and value creationTEPCO Integrated Report 2022 Executive SummaryRefer to pages 32-41 for details.Refer to pages 50-55 for details.Refer to pages 42-49 for details.Refer to pages 57-58 for details.Refer to pages 2
40、3 for details.kWhFacilityAggregationFuture business of TEPCOWe will reform the business model to realize a carbon neutral society together with individuals,corporations and local governments.Electrical and environmental values Aggregation businessCustomer-oriented facility service businessCommunityC
41、orporationHouseholdPast business of TEPCOkWh sales businesskWh3TEPCO Integrated Report 2022TEPCO history and business developmentTEPCOs history of self-reforms to meet the demands of the times and provide care-free and comfortable living.Founding of Tokyo Dento(Predecessor to TEPCO)In 1883,Japans fi
42、rst electric company,Tokyo Dento,was founded.In 1887,Japans first thermal power station,Daini Dentokyoku,came online.Dentokyoku transmission panelSign from when TEPCO was foundedMinami-Yokohama Thermal Power StationOi Thermal Power StationPromoting the“1L per person”policy during the second oil cris
43、is in 1979Electricity essential for the modernization of JapanIncreased need for power during the period of rapid economic growthCountermeasures for pollution generated during the period of rapid economic growthBasic Law for Environmental Pollution Control(1968)Tokyo Environmental Pollution Preventi
44、on Ordinance(1969)Extrication from dependence on oil as a thermal power fuel in the wake of the second oil crisis in the 1970sAct on the rational use of energy(Energy Efficiency Act)(1979)Founding of TEPCOTEPCO was founded in 1951 in conjunction with we organization of the electric industry.Through
45、proactive power source development and technical innovation focused on highly efficient,large-capacity,cutting-edge thermal power,TEPCO was able to provide a stable supply of electricity at low-cost thereby supporting Japans“rapid economic growth.”Since its creation,the TEPCO Group has focused on cr
46、eating customer value by meeting the demands and needs of society and has not shied away from reforms in order to change along with the times and the environment.Going forward,we will continue to expand the possibilities of energy in order to enable our customers to live care-free and comfortably,wh
47、ile also solving social issues and contributing to social development through the creation of value that exceeds the expectations of our customers.Pollution countermeasure initiativesIn order to reduce soot and smoke,nitric oxide,and sulfur oxide emissions from thermal power plants,TEPCO started usi
48、ng LNG that does not contain sulfur or nitrogen as fuel for power generation,and commenced operation of the Minami-Yokohama Thermal Power Station,the worlds first mono-firing thermal power plant.Minas crude,which contains approximately 0.1%sulfur,was also employed to start operation of the Oi Therma
49、l Power Plant,Japans first Minas crude-firing thermal power plant.Transitioning from the oil crisis to a best mixThe second oil crisis had a huge impact on TEPCO.In order to extricate itself from dependence on oil as a power source,we switched to using LNG as a thermal power fuel.As a result,in FY19
50、79 we became the first company to generate more power from LNG then crude oil.One other factor that helped to reduce our dependency on oil was the development of nuclear power stations.In addition to providing stable power,nuclear power stations do not emit CO2 thereby contributing to global warming
51、 countermeasures.Furthermore,we also focused on the development of large-capacity pumped-storage hydropower plants that perform superbly during peak demand periods,and initiatives to increase output from existing hydropower plants.We didnt just reduce our dependency on oil,but rather diversified pow
52、er sources through the use of nuclear,LNG thermal,coal-thermal and hydropower,and leveraged the unique attributes of each to generate power efficiently thereby finding our way to a“best mix”that enables us to flexibly respond to fluctuations in demand and changes in international resource availabili
53、ty.1883TEPCOs historySocial background/needsSales3Purpose and value creation4TEPCO Integrated Report 2022Recovery promotion activitiesGreen power markTotal deregulation of retail power market(2016)Total deregulation of retail gas market(2017)Legal separation of transmission sector(2020)Ex
54、pectations for carbon neutralitySalesApprox.5.3 trillionOrdinary profitApprox.46.2 billionGross power sales233.8 TWh*From the 1994 Consolidated financial statement7654321(Trillions yen)Deregulation of retail power market(2000)Increased social interest in environmental actionGreat East Japan Earthqua
55、ke and Tsunami(2011)Enlargement of new servicesWith the deregulation of the retail market in 2000,we began a service that allows general household customers to inform us via the Internet if they plan to move in accordance with our desire to“manage the company more from the perspective of our custome
56、rs.”In the same year,we commenced operation of the Hachijojima Wind Power Plant,Japans first commercial wind power plant.Furthermore,in cooperation with 10 other companies,TEPCO jointly established the Japan Natural Energy Company,Inc.,which generates power from natural energy sources on behalf of c
57、ustomers.TEPCO also engaged in initiatives to expand the use of natural energies that put a small burden on the environment through,for example,the development of the Green power certificate system,which is a new mechanism for companies.Transition to a holdings companyIn 2016,as we entered the era o
58、f reform kicked off by the total deregulation of the retail power market,TEPCO split into TEPCO Fuel&Power Inc.,TEPCO Power Grid Inc.and TEPCO Energy Partner Inc.,thereby transitioning to a holdings company.In 2019,our fuel and thermal power businesses were integrated into JERA Co.,Inc.in accordance
59、 with an alliance with Chubu Electric Power Company,Inc.thereby making renewable energies and nuclear power the mainstays of the TEPCO Groups power generation infrastructure.Furthermore,TEPCO Holdings,Inc.s renewable energy business was taken over by a new company,TEPCO Renewable Power,Inc.,in 2020.
60、Aiming to create a carbon neutral societyIn our 4th Comprehensive Special Business Plan announced in 2021,we put forth our objective of,“reducing carbon emissions originating from the supply of energy to essentially zero by 2050.”While continuing to provide a stable supply of power,the TEPCO Group w
61、ill shift its business model to focus on carbon neutrality and contribute to improving resilience,while working with business partners,local governments,and each and every customer to create a carbon neutral society by 2050.Recovery in FukushimaSince the Great East Japan Earthquake and Tsunami and t
62、he accident at the Fukushima Daiichi Nuclear Power Station,TEPCO has quickly and suitably provided compensation,engaged in activities to promote recovery,and has moved forward steadily and safely with decommissioning in order to fulfill our responsibilities to Fukushima,such as providing compensatio
63、n to victims of the disaster and completing disaster cleanup.2000201120162021(FY)5TEPCO Integrated Report 2022Strengths and capitalLeveraging our strengths and capital for the continuous creation of valueSince our foundation,we have continued to respond to the needs and demands of society throughout
64、 our long history and create value through our business thereby cultivating unique strengths and increasing our capital.Our strength lies with the competitiveness of the TEPCO Group,which is the driving force behind our growth,and our capital allows us to create new value.Going forward,we shall stre
65、ngthen both of these assets to continue to create value amidst our incessantly changing business environment.The strengths and attributes of the TEPCO GroupAs we move into the future,the world and Japanese society aims to move away from fossil fuels with which most of energy is produced at the momen
66、t,and move toward the use of renewable energies,or in other words,a sustainable society.As all of society aims to complete this transformation,the TEPCO Group must show our core competence as an energy operator and leverage our four supply/demand-side strengths,namely,our connection with our custome
67、rs,our coordination with regional communities,our grid management assets,and our existing power source assets,as we aim to be a corporate group that continues to be chosen by society.Demand sideSupply sideThe basis of our strengths/competitive superioritySupplying electricity to customers in the met
68、ropolitan area and number one in the country in terms of power sales volumeAreas of further strengtheningRespond to various needs through alliances,etc.,as we transition to a distributed system,such as household generation/household consumption,and locally-produced/locally-consumed powerThe basis of
69、 our strengths/competitive superiorityBased on our mission to provide a stable supply of power,we are striving to maintain wide-area balance to maintain grid stability as distributed power sources expand.O&M*1 know-how pertaining to power facilities used for grid linkage in the metropolitan area,whi
70、ch has a healthy appetite for powerAreas of further strengtheningOperation of new grids that utilize storage battery technology,etc.,as power sources become more distributed in the future.The basis of our strengths/competitive superiorityTrust cultivated through building social infrastructure rooted
71、 in the community and improving preparedness/resilienceAreas of further strengtheningExpand/strength and preparedness agreements pertaining to improving resilience to fiercer natural disastersThe basis of our strengths/competitive superiorityPower source portfolio built from the perspective of S+3E*
72、2Power facility O&M knowhowAreas of further strengtheningDevelop/leverage power sources,such as renewable energies that can help create a carbon neutral society*1 Operation management and maintenance inspections*2 The basic point of view of Japans energy policy.To achieve Energy security,Economic ef
73、ficiency,and Environmental friendliness while providing SafetyConnectionwith our customersGridmanagement assetsCoordination with regional communitiesExisting power source assetsPurpose and value creationDemand sideSupply sideConnectionwith our customersGridmanagement assetsCoordination with regional
74、 communitiesExisting power source assetsEnergy operator6TEPCO Integrated Report 2022Accumulated capitalThrough our electricity business,the TEPCO group has steadily accumulated not only tangible capital,such as manufacturing capital,but also intangible capital,such as human,intellectual,and social c
75、apital to provide services with high added value.In order to continue to meet the needs and demands of society and our customers,we believe it is important to acquire advanced business skills and know-how based on stable supply,and coordinate/co-create with society and our customers.Accordingly,we s
76、hall accelerate investment in each of these capitals,and further develop the strengths of the TEPCO Group as an energy operator as we aim to continually increase corporate value.CapitalCapital attributes/superiorityAreas of further strengtheningHumanNumber of employees:37,939Employees with power fac
77、ility O&M know-howCultivate human resources that can create businessCultivate DX human resourcesEmploy skilled human resources from outside the companyIntellectualHave know-how pertaining to hydroelectric/nuclear power facilities,grid linkage and O&MPromote DX and advancing technology through digita
78、lization and the proactive use of dataAcquire technical prowess pertaining to offshore wind power and hydrogen usageManufacturedAmount of power generated from non-fossil fuels(including-pumped storage)(Hydroelectric:9.88 million kW/Nuclear:8.21 million kW)Transmission lines:28,453km(aerial),12,513km
79、(underground)Distribution Lines 344,208(overhead)、39,207(underground)Approximately 1,800 substationsDevelop 67 million kW of renewable energyLeverage distributed power sourcesNaturalRenewable energy resources such as our wealth of waterNatural environment of the Oze National ParkLeverage natural cap
80、ital more effectively(develop offshore wind power,hydroelectric repowering)Ensure biodiversitySocial andrelationshipRelationship with the local governments in the Kanto region,which includes the capital,Tokyo,and has an appetite for powerNumber of preparedness agreements signed with local government
81、s/companies:Over 300Strengthen alliances with other companies to create a carbon neutral societyFinancialApproximately 70 billion procured through the issuance of green bondsMore than three times the carbon neutrality-related investment goal of“a maximum of 3 trillion by FY2030”stated in the 4th Com
82、prehensive Special Business PlanUtilization of sustainable financeConnectionwith our customersGridmanagement assetsCoordination with regional communitiesExisting power source assetsEnergy operatorHumanIntellectualManufacturedNaturalSocial andrelationshipFinancialPurpose and value creationStrengths a
83、nd capital7TEPCO Integrated Report 2022 Maximum use of existing power source assets through efficient management and development of renewable energy sources Recommencement of operation of nuclear power stations Connection of multiple small-scale distributed power sources with demand households Stabl
84、e supply of low-cost electricity Construction of locally-produced/locally-consumed systems Quick and suitable compensation based on our three resolutions Initiatives aimed at rebuilding peoples businesses and lives,and independence Cooperation with industrial infrastructure creation Safe and steady
85、decommissioning based on the Mid/Long-Term Decommissioning Action PlanIntellectualManufactured Approx.1,800 substations Over 400,000 kilometers of Transmission and Distribution Networks Distributed energy systems Hydroelectric power (domestic:163,offshore:5)Nuclear power stations Power facility O&M
86、Technical developmentHumanEconomic businessPower transmissionand distributionBusiness model transformation in the value chain(details on the next page)Management philosophyPenetration andembodimentStrengthening the governance systemDemandPower generationRevitalizationDecommissioningCompensationFukus
87、hima Human resources that can create business DX human resources External human resources Human resources with know-how pertaining to power facility O&M and grid Group growthResponsibilityforFukushimathe creation ofa carbonneutral societyCreates valuefor the customerBusiness FoundationBusiness Activ
88、itiesOutput/OutcomeDisasterprevention andstable supplySocial andrelationship Client AlliancesFinancial Sustainable finance Carbon Neutral related investmentNatural Local/Rivers/Sea Wind Water resources SolarAmount of CO2-freecontract option salesMore than 10 TWh(corporate clients)(FY2030)CO2-free co
89、ntract optionsales percentage100%(corporate clients)(FY2050)EnvironmentSocietyCustomerInvestor50%reduction in CO2emissions originating fromthe sale of Scope 1,2 and 3(FY2030)Reduction of CO2emissions originating fromthe supply of energy toessentially zero(FY2050)Return sustainable growthprofits to s
90、ociety(Net profits on the order of100 billion through theuse of renewable energies asprimary power sources)Provide information toregional communities andcoordinate with themConnectionwith ourcustomersGridmanagementassetsCoordinationwith regionalcommunitiesExisting powersource assetsTurn annual profi
91、ts on theorder of 450 billion from FY2030onward after securing500 billion per year to handlecompensation anddecommissioningEnergyoperatorThe business environment surrounding the TEPCO Group is largely changing due to the global trend towards a carbon neutral society,demand for stronger resilience ag
92、ainst ever fiercer and widespread natural disasters,and the soaring price of fuel all over the world resulting from the situation in Ukraine.However,even amidst these difficulties,the TEPCO Group is gaining the trust of society and our customers through our economic projects and Fukushima initiative
93、s,and will become indispensable.Value creation processGlobal trend towards carbon neutrality/Issues pertaining to the stable supply of power,such as fiercer and more widespread natural disasters,soaring fuel prices,tight power supply-demand situations,etc./Fierce competition in the retail market sin
94、ce deregulationBusiness environmentPurpose and value creation8TEPCO Integrated Report 2022Build a locally-produced/locally-consumed systemsConnection of multiple small-scale distributed power sources with demand householdsStable supply of low-cost electricityMaximum use of existing power source asse
95、ts through efficient management and development of renewable energy sourcesPower transmission and distributionDemandPower generationValue chain business model reformsBecoming a corporate group that enables a safe and sustainable society through value creation based on carbon neutrality and preparedn
96、ess,and is therefore trusted and continually chosenAction for ChangeWhile the TEPCO Group is using hydroelectric and nuclear power as baseload power sources and developing renewable energies,such as offshore wind,the way that society uses energy is changing as the transition on the demand side to in
97、dependent/distributed power facilities,such as household power generation/household consumption and locally-produced/locally-consumed power,accelerates.In order to convert the social demands to business opportunities,we must go beyond the supply and sale of electricity and reform our business model
98、into one that provides energy services that includes everything from the purchase and installation of power equipment to long-term maintenance/management of such equipment.Furthermore,we will provide energy services that utilize storage batteries and electric vehicles to not only households and corp
99、orate clients,but also regional society and communities thereby contributing to urban development that is carbon-neutral and resilient in the face of disaster.In order to focus on these initiatives,we shall create departments and develop technology while also coordinating with local government and p
100、romoting alliances with other companies.HumanManufacturedSocial andrelationshipLeverage knowledge pertaining to DX/IT/marketingLeverage expertise in advanced energyLeverage our ability to propose solutionsCO2-free contract option salesLeverage recharging facilities,such as storage batteries,etc.Comp
101、rehension/application of domestic/international transmission/distribution technology/systems/trendsAcquire and develop experience pertaining to the management of undersea DC power transmissionLeverage experience managing aging assetsLeverage experience constructing hydroelectric power facilitiesDeve
102、lop and leverage solar power,offshore renewables,offshore wind,and nuclear powerLeverage know-how pertaining to conventional power facility O&MProactively leverage DXMake existing power facilities more efficientExpand distributed power facilities(solar,storage batteries,etc.)More than three times th
103、e carbon neutrality-related investment goal of“a maximum of 3 trillion by FY2030”stated in the 4th Comprehensive Special Business PlanStrengthen/develop alliancesEnter into preparedness agreements with local governmentsIntellectualNaturalFinancialPurpose and value creationValue creation process9TEPC
104、O Integrated Report 2022Dear Readers,The TEPCO Group is Japans largest electricity operator and it manages energy supply infrastructure for primarily the Kanto region,which includes the capital,Tokyo.The TEPCO Group is engaged in various business reforms in order to fulfill our responsibilities to F
105、ukushima,however in addition to the global trend towards carbon neutrality,demands to strengthen resilience to fiercer and more widespread natural disasters,and the transformation of the economy and society brought upon by the Covid-19 pandemic,soaring fuel prices caused by the situation in Ukraine
106、have led to dramatic changes in the TEPCO Groups business environment.In order to respond to these changes in our business environment,the TEPCO Group announced“business structural reforms aimed at balancing long-term stable supply with carbon neutrality”on April 28,2022,which is based on our 4th Co
107、mprehensive Special Business Plan,and is focused on maintaining the current stable power supply.At the same time,we are transitioning to a business model that offers new value based on carbon neutrality and preparedness as we aim to further improve profitability and increase corporate value.In order
108、 to maintain stable supply,it is vital that we can recommence operation of nuclear power stations upon ensuring safety.However,we must first prioritize the rebuilding of trust with communities and members of society that have been damaged by the string of improprieties that occurred in our nuclear p
109、ower division.Furthermore,as we dispose of water treated with multi-nuclide removal equipment(ALPS treated water)in accordance with the governments basic plan that was announced in April 2021,we shall lead efforts to minimize reputational damage and ensure safety.The TEPCO Integrated Report details
110、the steps that the TEPCO Group is currently taking in order to“increase corporate value”and“create social value”as well as the business initiatives that we shall engage in in the mid/long-term.When writing this report,we referred to the integrated reporting framework put forth by the IFRS and made s
111、ure that the report reflects the TEPCO Groups business philosophy of incorporating financial and non-financial information into our business strategies based on integrated thinking.The entire TEPCO Group was involved in the writing of this report,and we hereby declare that all information contained
112、within is fair and true.Representative ExecutiveOfficer and PresidentTokyo Electric PowerCompany Holdings,Inc.Chairman of the BoardYoshimitsu Kobayashi Tomoaki KobayakawaTEPCO Integrated Report 2022Reporting period:April 2021 March 2022(Some important information obtained outside this period has als
113、o been included)Report subjects:51 consolidated companies of the TEPCO Group(Some important information outside of the scope he has also been included)Period of publication:October 2022Planned Dateof Next Report:September 2023A note on future forecasts included in the reportPlans,strategies and perf
114、ormance forecasts included in this report are based upon information available to TEPCO at the time of publication.These forecasts/predictions contain various uncertainties,such as the business environment surrounding TEPCO,competitive environment,related laws,business development plans,and exchange
115、 rates,etc.,and it is possible that latent risks with the potential to reverse these predictions/forecasts may manifest.Therefore,we ask that you please be aware that the actual performance/business environment in the future may differ from what has been noted in this report.Opinions expressed and e
116、diting policy10TEPCO Integrated Report 2022ContentsPurpose and value creationManagement PhilosophyExecutive Summary 2TEPCO history and business development 4Strengths and capital 6Value creation process 8Opinions expressed and editing policyDear Readers,10Commitment of upper managementMessage from t
117、he President 12Message from the CFO 17Board of DirectorsMessage from the Chairman 20Board Effectiveness 23Directors 24Strategies for creating valueRoadmap for achieving our vision 26Recognizing the business environment and materiality 28Stable supply 30Carbon neutrality strategy 32Urban development
118、by the TEPCO Group 42Restructuring our business portfolio 48Human capital 50Stakeholder engagement 56Efforts to Respect Human Rights 57Biodiversity 59Developing technology(intellectual capital)60TEPCO DX-based business structure reforms 6288894Business strategiesStructure 64TEPCO Group su
119、mmary 65Renewable Power 66Transmission and Distribution 68Energy Retail 70Fuel&Thermal Power 72Nuclear Power 73Developing Overseas Projects 77FukushimaCompensation/Recovery 79Decommissioning 81Corporate GovernanceCorporate Governance Structure 88Remuneration System 91Risks and opportunities 92Data S
120、ectionFinancial Highlights 94ESG Data 100Status of use by retailers of power composition 106ESG assessment by external parties 107SASB INDEX 108Consolidated Subsidiaries 112Stock Information 113Links 114Editors Note 11511TEPCO Integrated Report 2022Message from thePresidentAiming to balance carbon n
121、eutrality with the stable supply of powerRepresentative Executive Officer and PresidentForewordFulfilling our responsibilities to FukushimaFulfilling our responsibilities to Fukushima is the biggest mission of the TEPCO Group.In 2022,evacuation orders for the specified recovery and revitalization ar
122、eas in Katsurao Village,Okuma Town and Futaba Town were lifted on June 12,June 30,and August 30,respectively.In order to ensure that regional residents can return to their homes without worry,it is of vital importance that we move safely and steadily forward with the decommissioning of the Fukushima
123、 Daiichi Nuclear Power Station.We must also move forward with decommissioning while prioritizing safety and keeping in mind that decommissioning is the basis for recovery in Fukushima.At the same time,we are also gradually moving forward with the handling of water treated with multi-nuclide removal
124、equipment(ALPS treated water),in accordance with the governments basic policy,which is one of our most important decommissioning initiatives.We have also started to take real steps forward with our projects to accumulate decommissioning industries in the Hamadori region,such as establishing a compan
125、y for the manufacturing of decommissioning-related products.Going forward,we hope to obtain the understanding and cooperation of local residents in regards to everything from Commitment of upper managementTomoaki Kobayakawa12TEPCO Integrated Report 2022construction to manufacturing.By moving steadil
126、y forward with decommissioning in this manner we shall create infrastructure for revitalizing the regional economy through the decommissioning process and“balance recovery with decommissioning“hand-in-hand with regional residents.We will continue to ensure that everyone in the TEPCO Group realizes t
127、hat our origins lie in Fukushima,and make every effort to fulfill our responsibilities to Fukushima.Dealing with changes to our business environmentEnsuring a stable supply of power and revising electricity ratesThe earthquake that occurred off the coast of Fukushima Prefecture on March 16,2022 caus
128、ed damage to many thermal power stations along the coast of the Pacific Ocean thereby resulting in frequent tight supply-demand situations caused by the lack of supply power.The entire TEPCO Group made every effort to implement measures on the supply side,and we also enlisted the cooperation of our
129、customers to save energy and improve our demand response,thereby preventing large-scale power outages.We are very grateful for the cooperation of our customers.Going forward we must remain vigilant,and coordinate with the national government and the Organization for Nationwide Coordination of Transm
130、ission Operators as we maximize our efforts on both the supply and demand sides.On the other hand,Japans ability to procure energy is weakening due to soaring fuel prices caused by the situation in Ukraine this year and also the abrupt weakening of the yen.In conjunction with this,prices in the powe
131、r market(Japan Electric Power Exchange price)have increased remarkably over the short term thereby resulting in not only a worsening in revenue for retail electricity operators(TEPCO Energy Partner),but also difficulty with handling additional contract requests from customers.In order to solve this
132、problem,on September 20 we announced a revision to our electricity rates for special high-voltage and high-voltage customers.The main points of these revisions are a“reflection of current thermal power source composition”in the fuel cost adjustment system,and“new establishment of market price adjust
133、ments for reflecting current prices of procurement from the Japan Electric Power Exchange”upon incorporating additional power procurement fees that correspond to additional demand(approximately 20 TWh/year)from additional contract requests that we have yet to be able to fulfill.These revisions will
134、for the most part eliminate the risk of worsening revenues in conjunction with fluctuating fuel/market prices,but it is also important to engage in initiatives to reduce the impact of procurement from the Japan Electric Power Exchange within which current prices are soaring.Therefore,the recommencem
135、ent of operation of nuclear power stations has been partially incorporated into our rate cost price calculation in order to minimize the burden on our customers as much as possible.In particular,we have assumed that Kashiwazaki-Kariwa Nuclear Power Station Unit 7 will account for 75%(nine months-wor
136、th)of power in FY2023,which is the rate calculation period.We do not know when we will be able to recommence operation of the Kashiwazaki-Kariwa Nuclear Power Station,but we are continuing to cooperate with additional inspections by the Nuclear Regulatory Agency and making every effort to improve th
137、e safety of our power stations.Regardless,in order to ensure energy security and also avoid the impact from soaring fuel prices,the entire TEPCO Group is working earnestly to recommence operation of nuclear power stations as quickly as possible.In order to do this,we shall complete nuclear reforms t
138、hat are currently underway,and engage in more initiatives with the strong intention of operating our nuclear power business in the future with strong roots in the community and on the ground.Message from the President13TEPCO Integrated Report 2022Message from the President The TEPCO Group will also
139、strengthen initiatives related to energy conservation and energy-saving in order to reduce the burden felt by customers by these electricity rate revisions.While coordinating with government projects,we have offered demand response options for corporate clients and also energy-saving incentive optio
140、ns,such as the Energy-Saving Challenge 2022,etc.,for households.Going forward,we will offer services unique to the TEPCO Group,such as assistance with the purchase and installation of energy-conservation equipment,assistance with air-conditioning cleaning,and energy management services,as measures t
141、o work hand-in-hand with customers through facility maintenance and upgrades.Through these measures,we aim to conserve approximately 3%of the annual power sales volume of the TEPCO Group,which corresponds to approximately 6 TWh,by FY2024.Our current power supply-demand situation is quite serious,but
142、 addressing this issue aligns with our vision of creating a carbon neutral society in that we seek to create a society that is not dependent upon fossil fuels.In this respect,we at the TEPCO Group believe that this is an excellent opportunity for us to convert risk into business structure reforms to
143、 not only respond to the current crisis,but also achieve carbon neutrality in the future.The TEPCO Groups value creation and progress status of business strategiesProgress with the 4th Comprehensive Special Business Plan and a business model reformsIn the 4th Comprehensive Special Business Plan anno
144、unced in 2021,the TEPCO Group announced that it is aiming for carbon neutrality by 2050.Chairman of the Board Kobayashi and outside directors have repeatedly discussed our carbon neutrality strategy,and agreed on goals for 2030 and 2050 after which on April 28,2022,we announced our“Business Structur
145、e Reforms to Achieve Balancing Long-term Stable Supply and Carbon Neutrality.”The main objectives of these reforms are to lower our dependence on fossil fuels over the mid/long-term,and promote the use of renewable energies on the supply side as primary power sources while also constructing locally-
146、produced/locally-consumed energy systems on the demand side and linking the two thereby creating a new robust and flexible power system.Our approach to achieving these objectives is to maximize use of the resources of the TEPCO Group and leverage alliances with other companies to make a dramatic shi
147、ft to a business model that focuses on facility services,such as distributed power sources and storage batteries,etc.,and try to create new corporate value.According to this new business model,we will carefully watch the use of energy and facilities by our customers and offer energy service provider
148、(ESP)packages that promote energy-conservation and electrification with each customer,and help them to optimally manage power use.Based on this business we shall enlarge our coverage area and provide a supplement for unstable renewable energies,such as storage batteries and platforms that strengthen
149、 demand response functions.Since this service business will be closely tied to the buildings and facilities of customers,we must enlarge and shift to an energy service business model that integrates supply-side electricity business with demand-side needs.The key to succeeding with these initiatives
150、is to form alliances with different industries that have strengths pertaining to urban development,home,building,and factory construction,etc.,and companies with new energy facilities/technology.In order to promote these business structure reforms that aim for carbon neutrality,in April 2022 we sele
151、cted chief innovation officers and alliance directors to create a structure for engaging in group business transformation.Leveraging the strengths of the TEPCO GroupI believe that the TEPCO Group must not lose the“capability it has cultivated as an operator.”This capability includes the ability to r
152、espond and make improvements that has been 14TEPCO Integrated Report 2022Message from the Presidentcultivated through the course of operating power stations and electric facilities and handling troubles,and accumulated know-how lined with various experiences,including failures.I believe that this is
153、 where the strength of the TEPCO Group lies.In order to create a carbon neutral society,we mustnt be confined to thinking in terms of“supply-side”and“demand-side,”but rather need the ability to operate integrated and seamless energy systems upon understanding the attributes of both.I believe that in
154、 order to implement business reforms aimed at carbon neutrality,we can utilize the strength of the TEPCO Group that lies with the“capability it has cultivated as an operator.”In particular,this strength should contribute greatly to system design,optimal management,and the standardization of safety a
155、nd reliability,etc.,as we spread the use of new electrification facilities.A definitive example of this is the ability of the TEPCO Group to provide various technical services from the perspective of the user,such as asset management for maintaining the longevity and safety of new equipment,such as
156、storage batteries,etc.,and the stabilization of local grids by using demand response control that is synchronized with customer equipment.I believe that the role of the TEPCO Group in this age of carbon neutrality is to stand in the shoes of our customers to provide energy facilities that are superi
157、or in terms of environmental friendliness,economic efficiency,convenience,and resilience,and continue to provide services that are trusted by our customers and can be used with them for a long time without worry.And,through these initiatives we shall“increase corporate value”and“create social value.
158、”Aiming to turn annual profits on the order of 450 billionIn order to fulfill our responsibilities to Fukushima we aim to turn net profits on the order of 450 billion annually.In order to achieve this goal,we have speedily implemented discontinuous reforms that include business reorganization and in
159、tegration.In particular,we have engaged in so-called“upstream development,”such as the integration of our fuel and thermal power business into JERA Co.,Inc.and the expansion of our renewable energy business by TEPCO Renewable Power Inc.,etc.,in order to improve global competitiveness.In the future w
160、e believe that the energy 15TEPCO Integrated Report 2022industry will also focus on the“locally-produced/locally-consumed”approach as we aim for urban development that balances preparedness with carbon neutrality,which is a global trend.In other words,facility service businesses that look to distrib
161、ute power sources on networks close to customers and centralize storage battery facilities,and area/energy/management platforms for effectively controlling these facilities.TEPCO is currently examining areas in which to focus investment in anticipation of this type of business reforms that will cont
162、ribute to a carbon neutral society.We originally plan to invest approximately 3 trillion in these new areas of investment that focus on mainly renewables,nuclear power and grid facilities as noted in the 4th Comprehensive Special Business Plan.However,if we include the investment in new areas pertai
163、ning to carbon neutrality,for example,distributed power resources,the construction of value chains for our storage battery business,demand response,and the construction of an aggregation business,etc.,then we believe we will need to more than triple the amount of investment to approximately 9 trilli
164、on.Investing in this manner in new areas will require alliances with different industries and department reorganization/integration,so TEPCO plans to identify potential alliance partners and fields of investment during FY2022.A message to stakeholdersWe would like to thank our shareholders and inves
165、tors for their support of the TEPCO Group even in the wake of the Great East Japan Earthquake and Tsunami.We continue to engage daily in discontinuous reforms based on the 4th Comprehensive Special Business Plan.The TEPCO Group has chosen the difficult path of“balancing carbon neutrality with stable
166、 power supply.”Amidst the recent changes to the global environment,we are putting all effort into rebirthing the company in order to deal with issues that energy operators have never experienced before.Rebuilding trust is a priority management issue since we always keep in mind that we can only exis
167、t with the trust of the regional communities and society.With a strong understanding that we are the ones that create the future of energy,we shall fulfill our responsibilities to Fukushima and increase corporate value.We ask all our stakeholders for their continued understanding and support.Message
168、 from the President16TEPCO Integrated Report 2022Representative Executive Officer,Executive Vice President,Chief Financial Officer(CFO)Message from the CFOPave the way to 450 billion through the 5th Comprehensive Special Business PlanFY2021 performanceHarsh business environment caused by soaring fue
169、l pricesSpurred by soaring fuel prices and the impact of the Russia/Ukraine situation since February 2022,the external environment during FY2021 became even harsher.FY2022 continues to put not only the TEPCO Group,but the entire power industry in a disadvantageous position with even higher fuel pric
170、es resulting from changes on the international stage.As a result of the aforementioned conditions,it is impossible for us to make any detailed performance forecasts at this point in time.We expect poor performance in the future as long as fuel prices continue to soar as they have,so on August 31,202
171、2,TEPCO decided to underwrite a capital increase in order to prop up the financial standing of TEPCO Energy Partner(EP).EP announced on September 20 of the same year that it has revised its rate options for special high-voltage and high-voltage customers.Going forward the entire TEPCO Group will str
172、ive to improve revenue.In regards to fuel prices,since most of the fossil fuels used for power generation are procured from overseas,to what extent we can avoid expensive spot fuel purchases will be key.To achieve this,we need to work with the government on energy-saving programs and enlist the coop
173、eration of customers to save energy,and then give back to the customer by keeping electricity rates low.In regards to nuclear power,we must first and foremost ensure the S,or“Safety,”in our S+3E approach.And,since nuclear power is superior in terms of the 3Es,we hope to get these power stations back
174、 up and running.EP is also currently starting initiatives to get customers to install solar panels and storage batteries within their current electricity budget so that they can use electricity without using expensive Hiroyuki Yamaguchi17TEPCO Integrated Report 2022Message from the CFOfuels,or in ot
175、her words,fossil fuels.Looking back at the 4th Comprehensive Special Business Plan and our plan for FY2022Measures for strengthening earning powerThe annual 450 billion profit goal of the 4th Comprehensive Special Business Plan assumes and includes profits from new businesses,and since the developme
176、nt of asset services in particular is a mid/long-term initiative,reorganizing our electricity business,which is the current base for our forecast,is a pressing issue.Amidst this situation,TEPCO Renewable Power,Inc.(RP)plans to newly develop a total of 67GW of renewable energy in Japan and overseas w
177、hich will ensure that we will turn a profit of approximately 100 billion annually as of FY2030.We already manage three hydrologic power stations in other countries and are strengthening infrastructure here in Japan by increasing the output potential of aging small and medium-sized hydroelectric powe
178、r plants through repowering.EP is currently rolling out asset services in order to achieve its quantitative goals.However,any company can provide just asset services.In terms of the technical skill involved,its not something that only TEPCO is able to provide.Its important for us to create a world i
179、n which the TEPCO Group alone can provide such asset services by offering everything from technical support,and maintenance to after service.Whether were talking about prices or services,the only way to turn large profits is to construct a business model that only the TEPCO Group can offer,and sprea
180、d it nationwide.JERA Co.,Inc.is also working steadily to achieve its FY2025 consolidated net profit goal of 200 billion,and TEPCO Power Grid Inc.(PG)is also building a strong revenue foundation.PG also has the potential to expand its business into the spheres of data centers and 5G by leveraging its
181、 assets,so were going to take advantage of all of these possibilities to reach our 450 billion profit goal.We understand that the timeline for achieving this goal is an issue,but this will be addressed in the 5th Comprehensive Special Business Plan.Alliances are indispensable for achieving our goals
182、.While JERA,RP and our nuclear power stations are essential for fulfilling our power generation requirements,as our customers move toward carbon neutrality,we plan to examine alliances with partners outside our existing framework in addition to alliances with manufacturers and installers.Using our c
183、ash flow to achieve carbon neutralityThe 4th Comprehensive Special Business Plan sets a maximum investment goal of 3 trillion,but as we announced in April 2022,we believe that in order to achieve carbon neutrality throughout all of Japan,we need to contribute another 6 trillion or more in investment
184、.The original 3 trillion was to come from support from financial institutions as well as the issuance of green bonds from RP.However,this will be used by RP to establish new renewable energies business.Looking forward to the future,we are considering the use of sustainable finance,and if we have the
185、 power to create cash flow from these new businesses,we will be able to expand the various means by which capital is procured.If investors except the business model we are proposing,there should be other means by which to procure capital in addition to project financing.Furthermore,we are examining
186、how to increase capital that we cannot procure through alliances.I must reiterate that I personally believe it is important to think about what type of business model we can create before we think about the means for procuring capital.I believe that if we can propose an outstanding business model an
187、d cash flow creation process,then the money will follow.Our chief innovation officer(CINO)and Vice President Kojima is working at a fevered pitch to examine how to construct this new business model.It has already been announced that we shall propose this new business model in April 2023,and it is my
188、 role to propose methods for how to procure capital at the same time.Financial policyOur financial policy in anticipation of achieving carbon neutralityHow capital is distributed differs depending on the timeline.Since fuel prices are currently soaring,our first priority is to support our current el
189、ectricity business.However,we cannot stop our march to achieving carbon neutrality in the future.Furthermore,as the base of our electricity business is lifted,it will be possible to distribute capital into new areas and turn 18TEPCO Integrated Report 2022Message from the CFOourselves in the directio
190、n of new businesses.Firstly,we will strive to strengthen our revenue base so as to get investors on board by creating cash flow based on our electricity business.In that respect,we realize that the time until the 5th Comprehensive Special Business Plan is announced is extremely important for achievi
191、ng our annual goal of 450 billion in profits.Hedging price fluctuation risksForeign exchange rate fluctuations have an impact on fuel procurement.JERA is already hedging fuel prices,but we must secure quantities sufficient for maintaining stable supply.In other words,the only thing the TEPCO Group c
192、an do is hedge quantity.Saving energy also results in a reduction in the amount of expensive fossil fuels used,and as a result,leads to reducing the impact of the exchange rate.The foreign exchange rate also impacts nuclear power fuel procurement,but since the volume of fuel is minimal compared to t
193、he amount of power generated,engaging in initiatives to recommence operation of nuclear power stations and shifting our focus away from coal and LNG will help us hedge these risks.In other words,a best mix of power sources is extremely important.A message to shareholders and investorsAutonomous mana
194、gement of the TEPCO GroupIn order for the TEPCO Group to engage in autonomous management,we mustnt merely solve the aforementioned issues,but also maintain a high rating in the market.We must increase the profitability of our base electricity business and then construct a business portfolio aimed at
195、 carbon neutrality,or in other words,the entire TEPCO Group must move towards the same goal and understand that everything is connected.My role,and mission,is to open up the pathway to 450 billion by the announcement of the 5th Comprehensive Special Business Plan.Problems we perceive as we contempla
196、te our ideal stateWe have steadily engaged in the business of providing power,but lack know-how when it comes to asset services.Furthermore,we have had little interaction with customers outside of the provision of power,so we need the cooperation of partners to engage in businesses through which we
197、directly engage with customers.In regards to capital procurement,I already mentioned that procuring capital will come after we formulate a business model,but we are currently diversifying our means for capital procurement.Its important for not only the people that handle capital in the accounting di
198、vision,but also people engaged in business on the ground to have know-how pertaining to these matters.I believe by doing so we can engage in both capital procurement and business effectively.I believe we must increase the number of people that have this type of financial skill.Expectations for emplo
199、yeesI believe that people of like mind can only do like things.I want employees to think,“well,I cant do what others can do,but I can do this.”Successful people are not necessarily doing anything thats terribly difficult,theyve just persevered on a certain path,and discovered their potential.And,as
200、a result,they have found the path to success.Going forward,I hope to work with employees as CFO to contribute to the growth of the TEPCO Group.A message to shareholders and investorsIn closing,let me just say to shareholders and investors that I apologize for not being able to distribute dividends s
201、ince the disaster.I know you all are waiting for two things;stable dividends and share price recovery.We are striving to turn that dividend number into a plus figure for you.And,in order to meet your expectations,we have to achieve three things:we must show that we can complete decommissioning and p
202、rovide compensation,stably secure capital to do so,and build a robust financial foundation.In order to provide dividends,we need distributable amounts and cash,and share price may increase if we can show our vision for the future to the market.Presenting our pathway to turning annual profits of 450
203、billion in the 5th Comprehensive Special Business Plan will promote dialogue between us and shareholders/investors,and if the market sees that,it may be reflected in our share price.In order to meet your expectations,we shall present in detail our pathway in the 5th Comprehensive Special Business Pl
204、an.19TEPCO Integrated Report 2022Tokyo Electric Power Company Holdings,Inc.Chairman of the BoardThe direction we should take in light of the business environment surrounding the TEPCO GroupIt is said that the intense environmental changes we have witnessed around the world in recent years are the re
205、sult of climate change caused by an increase in greenhouse gases.I personally believe that these environmental changes are an important issue that will dictate the fate of the human race,and feel a sense of crisis.Definitive action must be taken quickly Message from the ChairmanI will be the driving
206、 force behind an effective Board of Directors,support the continued existence and sustainable growth of the TEPCO Group,and contribute to the creationof a carbon neutral societyas we move into the future.In Japan,the public and private sector have come together to launch initiatives aimed at creatin
207、g a carbon neutral society,such as starting discussions about the governments implementation of GX(green transformation).I personally believe that the role of the TEPCO Group,which produces a relatively large amount of CO2 emissions,is important for achieving this goal.On the other hand,the TEPCO Gr
208、oup,and Japan as Yoshimitsu Kobayashi20TEPCO Integrated Report 2022a whole,has found itself in a harsh situation when it comes to the stable supply of power due to a lack of fuel,such as LNG,resulting from the situation in Ukraine.In addition to this,foreign exchange rate fluctuations have caused pr
209、ices to soar in various sectors,including electricity rates,and as such,supplying a stable source of power at low-cost has become even more pressing of an issue in order to reduce the burden on the economy and our lives.Amidst this situation,the TEPCO Group is engaged in fierce competition with othe
210、r companies as a result of deregulation of the retail power market,and,due to the added difficulty of soaring fuel prices,is finding it very hard to generate revenue.However,in addition to fulfilling our responsibilities to Fukushima,we also have a responsibility as an energy operator to secure a st
211、able source of power and contribute to the creation of a carbon neutral society.In order to do this,we must ensure that the company lives on and continues to grow;and it is necessary that the entire Group realizes this.In order to enable the company to live on and grow,we must expand our sphere of b
212、usiness even more than ever.Up until now the TEPCO Group has sold a single product,kilowatt hours,and enlarged our energy solutions business,such as by providing support for energy-conservation,however with the extreme speed at which our lives are changing as a result of changes in the worlds energy
213、 situation and the progress of digital transformation,we must quickly provide detailed solutions in the form of various services that meet the expectations of our customers and society as well as changes in the environment,and contribute to society.In our 4th Comprehensive Special Business Plan,the
214、TEPCO Group put forth goals of enabling the company to survive,enabling continued growth,and turning annual profits on the order of 450 billion.In order to achieve these goals,we are engaged in initiatives to provide a stable supply of power,create a carbon neutral society,and provide services that
215、will satisfy our customers.The role of the Chairman of the BoardI am involved in the management of TEPCO in a unique manner that differs from other companies.In addition to being an outside director,I am also Chairman of the board,Chairman of the nominations committee,and members of the compensation
216、 and auditing committees.As I supervise the executive branch of the company in this manner,I also attend executive meetings and give my opinions.All this while the majority of shares of the company are owned by the Nuclear Damage Compensation and Decommissioning Facilitation Corporation.The reason w
217、hy this is the way it is,is because the company supports important infrastructure for society;namely,power.Additionally,it must safely and steadily complete decommission the Fukushima Daiichi Nuclear Power Station and fulfill its responsibilities to Fukushima in the form of promoting Fukushima to re
218、cover.In order for the TEPCO Group to complete this mission,executive initiatives must be continually supervised.Also,at the sake of being repetitive,I must mention that the TEPCO Group serves an important role and has tremendous responsibility when it comes to creating a carbon neutral society,so I
219、 feel it is necessary to engage in initiatives in unity with the executive branch,and as so,I will continue to do my best as Chairman of the Board.Assessment of the Board of Directors FY2021 initiativesFor approximately three years from 2012 until 2015,I supervised the TEPCO Groups management reform
220、s implemented immediately after the Great East Japan Earthquake and Tsunami as an outside director.After stepping down from this position,I was involved in the management of the TEPCO Group from various positions,such as a member of the Nuclear Damage Compensation and Decommissioning Facilitation Co
221、rporations operations committee and was appointed Chairman of the Board in 2021.Compared to when the disaster occurred,the current Board of Directors is more open and freer when it comes to discussions with company executives.On the other hand,when I look back at the discussions held by the Board of
222、 Directors during FY2021,I feel that a lot of time was spent discussing current management issues,such as measures to address revenue issues and the progress status of nuclear reforms,etc.,and not enough time was spent discussing“earning power”needed for the sustainable growth of the entire Group.Go
223、ing forward,I would like to have many discussions about mid/long-term topics for Message from the Chairman21TEPCO Integrated Report 2022the sustainable growth of the TEPCO Group while linking these topics to,for example,initiatives aimed at creating a carbon neutral society.Initiatives to improve th
224、e effectiveness of the Board of DirectorsThe current TEPCO Board of Directors,which includes six outside directors,is currently comprised of 13 members with diverse backgrounds and experience in other industries.I mentioned earlier that discussions by the Board of Directors are open and free,but in
225、order to have these discussions fit more with the actual situation of the TEPCO Group and conditions on the ground,and to improve the effectiveness of the Board,outside directors must maintain broad and objective viewpoints while also understanding the conditions that the TEPCO Group bases and actua
226、l conditions on the front lines in the field.After being appointed Chairman of the Board,I have made time to visit the front lines in the field,see equipment,and exchange opinions with employees.By seeing the actual condition of facilities,and hearing the opinions of employees Message from the Chair
227、manthat work there and how they approach their jobs,I have been able to notice new things.Therefore,from FY 2022,we have been creating opportunities for other outside directors to visit the front lines and exchange opinions with employees.In regards to the structure of the Board of Directors,I belie
228、ve we must be more aware of diversity in light of changes to the domestic and overseas business environment,for example,the construction of new supply chains in accordance with changes in globalism,changes to the innovation environment brought upon by digital transformation and green transformation,
229、and the state of competition with other companies.A message to our stakeholdersCurrently,addressing energy issues is a pressing matter for Japan,but even in the mid/long-term,if we intend to create a carbon neutral society,we must implement various measures on both the power supply and demand sides,
230、and reduce our dependency on fossil fuels.These are very difficult issues to solve for Japan,which has a low energy self-sufficiency rate,but its something we must succeed at for Japans continual development and the next generation.In that respect,it is energy operators like the TEPCO Group that can
231、,and must,solve these issues head on.Based on our new corporate philosophy of“pioneering the future of energy for peace of mind and comfort”we will do our best for all of our stakeholders.Thank you for your continued understanding and support.22TEPCO Integrated Report 2022Board EffectivenessBoard of
232、 DirectorsTokyo Electric Power Company Holdings Inc.is striving to improve the effectiveness of the Board of Directors,which is the linchpin of governance,by engaging in lively debate during which a diverse group of outside directors with a plethora of experience and knowledge voice their opinions.F
233、urthermore,once a year,the effectiveness of the Board is assessed through questionnaires distributed to directors and discussions by the Board.In addition to questionnaires,the objectivity of the effectiveness assessment was ensured by having a third-party assess and analyze questionnaire responses,
234、which are then discussed by mainly outside directors.Assessment methodQuestionnaires are distributed to all members of the Board of Directors,nominations committee,and compensation committee.A third-party agency analyzes/assesses the responses from the questionnaire,which are then discussed by prima
235、rily outside directors prior to review by the Board.Assessment result summaryThe TEPCO Board of Directors has been deemed effective because it is comprised of a suitable number of diverse members,allows free debate,has been ranked highly through questionnaires in continuation from FY2020,and because
236、 there have been no serious issues pointed out with the Board.Status of initiatives to address issuesIn continuation from last fiscal year,during FY2021,the following initiatives were undertaken based upon the issues identified during the effectiveness assessment.The Board of Directors will continue
237、 to make further improvements as it strives to improve effectiveness.Questions for which responses improvedQuestions for which responses worsenedAddressing risks such as by providing information pertaining to significant riskBoard director are proactively speaking outAnalysis and reflection in busin
238、ess plans of monitoring results and debates concerning mid/long-term strategiesTime allocation by the Board of DirectorsSupport for executives to enable quick decision-makingHolding of discussions pertaining to strategies for improving earning powerIssues identified during FY2020Status of FY2021 ini
239、tiativeFurther develop discussions pertaining to mid/long-term strategies and strategies for improving earning power.Have the Board of Directors get reports on,and hold discussions pertaining to,the progress with achieving goals put forth in the business plan.Provide more information on risk to the
240、Board of Directors.Provide risk information to the Board of Directors as needed and have the board continually discuss significant risks in particular.Strengthen supervisory functions for the nuclear power division.Share the latest information about the nuclear power business as necessary.Create opp
241、ortunities for outside directors to visit TEPCO facilities.Enable outside directors to visit TEPCO facilities and exchange opinions with employees in the field.Understanding and handling by theBoard of Directors of strategies and risksFY2021FY2020Assessmentneutrality rate(3点)Board of Directorcomposi
242、tion andstructureBoard of Director operationand practical mattersBoard of Directorsupervisory functionsDecision-making cultureof the Board of Directors4.84.14.04.73.84.14.14.64.04.7Visit to the Aomori OfficeVisit to the Management Skills&Strategies Research CenterRefer to pages 91 for details.23TEPC
243、O Integrated Report 2022Outside directors Board of Directors24TEPCO Integrated Report 2022NamePositionFY2021attendanceCompanyEnergyEngineeringFinancial accountingLegalESGInternational operationsSales/marketingStatus of important multiple positionsYoshimitsuKobayashiBoard of Directors:15/15Nominating
244、 Committee:7/7Audit Committee:16/16Compensation Committee:9/9 Outside Director,Mizuho Financial Group,Inc.HidekoKuniiBoard of Directors:18/18Nominating Committee:2/2Audit Committee:16/16Compensation Committee:10/10HideoTakauraBoard of Directors:18/18Audit Committee:21/21Compensation Committee:9/9 Ce
245、rtified Public AccountantShigeoOhyagiBoard of Directors:18/18Nominating Committee:9/9Compensation Committee:10/10 Advisor,Teijin,Ltd.Outside Director,Mitsubishi UFJ Bank,Ltd.Outside Auditor,JFI Holdings,Inc.Outside Director,KDDI Inc.ShoichiroOnishiBoard of Directors:18/18Nominating Committee:9/9Audi
246、t Committee:21/21 CEO,Frontier Management,Inc.CEO,FCD Partners,Inc.Attorney at LawAsaShinkawaBoard of Directors:15/15Audit Committee:16/16 Partner,Nishimura&Asahi Outside director,NintendoNNNNAAACCCCA5-year tenure2-year tenure2-year tenure1-year tenure8-year tenure1-year tenureChairman of the Boardi
247、nd.ReappointmentOutsideind.ReappointmentOutsideind.ReappointmentOutsideind.ReappointmentOutsideind.ReappointmentOutsideReappointmentOutsideNote 1)The above table does not express all of the knowledge that the candidate has.Note 2)Ms.Asa Shinkawa fulfills the independency standards stipulated by the
248、Tokyo Stock Exchange Group,Inc.as well as the“Independency Determination Standards for outside Directors”stipulated by TEPCO,but has not been registered as an independent director.Outside DirectorNominatingAuditCompensation :ChairIndependent directors:Independent directors as stipulated by the Tokyo
249、 Stock Exchange Group,Incorporated.TEPCO has registered its independent directors with the Tokyo Stock Exchange Group,Inc.Nind.OutsideACDirectors25TEPCO Integrated Report 2022NamePositionFY2021attendanceCompanyEnergyEngineeringFinancial accountingLegalESGInternational operationsSales/marketingStatus
250、 of important multiple positionsTomoakiKobayakawaBoard of Directors:18/18Nominating Committee:9/9*The reasons forappointment and a briefpersonal history aredescribed on pages 12-22 of the 98th NOTICE OFCONVOCATION.https:/www.tepco.co.jp/en/hd/about/ir/stock/pdf/220526_1-e.pdfSeijiMoriyaBoard of Dire
251、ctors:18/18HiroyukiYamaguchiN/AChikaraKojimaN/AToshihikoFukudaN/AShigehiroYoshinoBoard of Directors:15/15Nominating Committee:7/7YoshihitoMorishitaBoard of Directors:18/18Audit Committee:21/21NN6-year tenure1-year tenure3-year tenure5-year tenureReappointmentReappointmentNewNewNewReappointmentReappo
252、intmentNewNewNewADirectorDirector2030Roadmap for achieving our visionStrategic system for enabling“a comfortable life”The TEPCO Group is engaged in various types of value creation that revolves around“carbon neutrality”and“preparedness,”and we believe it is our purpose to enable everyone connected t
253、o our company to live“a comfortable life.”In order to achieve this goal,we are steadily implementing the strategies put forth in the 4th Comprehensive Special Business Plan and working towards our carbon neutrality goals.*Originating from the sale of Scope 1,2 and 3 power.Emissions from Scope 1 and
254、2 power compared to FY2019 levels.Decarbonize power supplies Enlarge facility service business(Solar power/storage batteries,etc.)Fulfill our responsibilities to Fukushima Regain the trust of society Strive to achieve carbon neutrality Stable supply/preparednessDevelop 67GW of renewable energy(Annua
255、l net profits on the order of 100 billion)Invest more than three times the maximum of 3 trillion on the precondition that alliances are formed20502022Carbon neutrality goalsCarbon neutrality strategyRevenue forecastBasic policies of the 4th Comprehensive Special Business Plan(materiality initiatives
256、)Reduce CO2 emissions originating from the sale of power by 50%of FY2013 levels*Reduce CO2 emissions originating from the supply of energy to essentially zeroOrdinary income(consolidated)Decommissioning reservesSpecial liabilitiesGeneral liabilitiesApproximately300 billion yenApproximately200 billio
257、n yenApproximately300 billion yen450 billion yen scale(net profit)Approximately 500 billion yenFY2030 onwardLate 2020sCreate value based on carbon neutrality and preparednessContribute to a comfortable lifeSupply-sideDemand-sideStrategies for creating value26TEPCO Integrated Report 2022Summary of ca
258、rbon neutrality roadmapA world in which society can live a comfortable life is indispensable for achieving carbon neutrality in 2050,and the TEPCO Group aims to make such a world.We shall draw up scenarios and strategies aimed at achieving carbon neutrality,and turn the new possibilities from value
259、based on the energy delivered to our customers(=“the possibilities that energy holds”)into something tangible thereby contributing to carbon neutrality in Japan.Contribute to Japans reduction targets by promoting the electrification of energyReduce CO2 emissions of electricity delivered to customers
260、 under Scope 1,2 and 3 by 50%in FY2030 compared to FY2013(44%of power from non-fossil sources)Reduce CO2 emissions from the supply of energy to net zero by 2050*Revised as suitable in light of progress with CN technology and economic feasibility,and alignment with the governments energy/global warmi
261、ng policiesCN:Carbon NeutralityCarbon neutrality-related investments to be drastically reviewed on the premise of allianceSocietyTransportationTransmissionRenewablesNuclearThermalDistributionConsumer(Commercial/Households)IndustryGridsSupplyContribution to carbon neutrality in JapanIncrease the use
262、of EV and enlarge charging networksPromote electrificationDistribution Leverage distributed energy resources and improve the value of such resources Microgrids/distribution technology development/construction/operationDomestic offshore wind development/introductionFloating offshore wind farm develop
263、ment/introductionBottom-fixed offshore wind farm introductionIncreased use of pumped storage power generation facilitiesDevelop renewable energy businesses overseasImprove the operating rate of existing hydroelectricpower plants and repower small/medium size plantsIncreased use of storage batteries/
264、adjustment abilityCN of adjustment ability that combines use of storage batteries.Grid use optimization Introduction of power refeeding methods,transition to market-led to congestion management,market-adjusted transmission/distribution gridsWide-area Promote the master plan,and strengthen highly cos
265、t-beneficial cross-region interconnection facilitiesLeverage nuclear powerSupport JERAs zero emissions 2050Develop CO2-free electricity optionsSupply hydrogen P2G(ElectricityHydrogen)DemonstrationElectrify industrial processesCommercialize the storage battery business and provide servicesReplace com
266、pany vehicles with EVDevelop/offer CN services in the mobility fieldMake the emission-free EV tanker ship a reality20502030FY2030Solar power/storage batteryPursue national scale on the premise of alliancesFY2021FY2030【Households】Over 9.7 TWh of Demand development【Households】Increase of more than 820
267、,000 Electrification product contracts FY2030【Corporate clients】10 TWh of CO2-freeelectricity optionsFY2050【Corporate clients】100%CO2-free electricityoptionsFY2030【Renewable energy】Newly Develop approximately 67GWFY202515,000 rapid chargers FY2030Replace all company cars with EV1 million membersby F
268、Y20302050Zero emissionsSupply hydrogen produced with renewable energiesStrategies for creating valueRoadmap for achieving our vision27TEPCO Integrated Report 2022Recognizing the business environment and materialityThe TEPCO Groups materialityMateriality identification processExternal Environment Ass
269、essmentIdentifying Risks and OpportunitiesMateriality AssessmentThe TEPCO Group separates measures for creating value and issues that require deliberation from a long-term standpoint into four categories:Fukushima matters,business foundation,nuclear power matters,and corporate value increase.At the
270、same time,the significance of each issue is assessed by determining its social and financial impact in order to identify key management issues(materiality)to be handled by the Board of Directors.In addition to the trend towards carbon neutrality,the business environment surrounding the TEPCO Group i
271、s changing greatly due to,for example,soaring fuel prices resulting from the global situation.We are analyzing various business environments in order to address these changes.Significant business risks are analyzed/identified and discussed by the Risk Management Committee,while the same is done for
272、significant opportunities by the Future Management Committee Committee.Furthermore,due to considerable social interest in ESG and sustainability,etc.,issues that management should address are discussed by the ESG Committee.The details of discussions and assessments conducted by each committee are le
273、veraged to identify risks and opportunities when performing significance assessments.Significance assessments of management issues are performed while focusing on social impact and financial impact.The largest mission of the TEPCO Group is to fulfill our responsibilities to Fukushima,so the”responsi
274、bilities to Fukushima”category is considered to have a large social impact.Other management issues with the potential to have considerable social and financial impact are brought before the Board of Directors,which audits and supervises them.HighFinancial ImpactMaterial Issues Managedby the Board of
275、 DirectorsMaterial Issues Managedby the Board of Executive OfficersHighFukushima ResponsibilitiesSocial ImpactCreating value basedon carbon neutralityand preparednessThe direction of growth as we look ahead to 2050Tight powersupply-demandFierce retailcompetitionInternationalsituationDomesticpolicies
276、Economic/socialenvironmentTechnologytrendsRecognizing our business environment through 2030StakeholderengagementSoaringfuel pricesGlobaltrend towardscarbonneutralityESG CommitteeP93RiskManagementCommitteeP92FutureManagementCommitteeP93Strategies for creating value28TEPCO Integrated Report 2022FY2022
277、 materialityThrough significance assessments,key management issues comprised of 18 categories were identified during FY2022,and specific goals were set for each.Furthermore,managers and executive officers were selected for each management issue,and the degree of achievement of each goal is used as a
278、 factor when determining remuneration.FY2022 management categoriesStatus of FY2021 initiativesExamples of categories in key segments(Managed by the Board of Directors)Example of key management issues(Managed by the executive Board)ObjectivesAchievementsFukushima matters Balancing recovery with decom
279、missioning(Steady initiatives aimed at disposing of treated water)Contribute to recovery in Fukushima through involvement in urban development and initiatives to eliminate harmful rumors Make measures for contributing to urban function and environment recovery/revitalization a reality Increase the q
280、uantity of products from Fukushima Prefecture that are bought and sold by merchants Steadily continue to provide compensationGoals on the left have been achievedSteady implementation of decommissioning/contaminated water countermeasures based on the mid/long-term roadmap Reduce the amount of contami
281、nated water being generated to less than 150m/day Manufacture equipment for the trial removal of fuel debris from the first unit(Unit 2)and build mockups Composition of symbolic deals with local companiesGoals on the left have been achievedBusiness foundation Cultivating human resources and establis
282、hing a new corporate cultureStrategic development/deployment of human resources in order to maximize corporate value Implement key strategic measures based on an optimal overall viewpoint,and create resources for deployment to new spheres of businessMore personnel deployed than plannedNuclear power
283、business Nuclear power/nuclear fuel cycle(Thorough implementation of safety measures at the Kashiwazaki-Kariwa Nuclear Power Station)Safety measures/reviews aimed at the recommencement of operation of the Kashiwazaki-Kariwa Nuclear Power Station Implement activities to foster understanding amongst c
284、ommunity members about the Kashiwazaki-Kariwa Nuclear Power StationNuclear reforms promoted in light of the series of improprietiesIncreasing corporate valueCreating/enlarging value for customers in anticipation of a carbon neutral society(Promoting key businesses)Revise business portfolio in new sp
285、heres of business in order to increase corporate value Position each business in consideration of the future vision that the TEPCO Group aims to achieve in order to increase corporate valueGoals on the left have been achievedMaking measures based on ESG strategy a reality Obtain the best ESG ranking
286、 for domestic power companies and formulate a decarbonization roadmapGoals on the left have been achievedIncrease the value of providing retail energy services Achieve ordinary income goalsOrdinary income:-66.4 billionEstablish a global-leading business management foundation Build a future transmiss
287、ion/distribution network by optimizing power facility investment/cost(Formulate facility configuration plan)Goals on the left have been achievedTurn renewable energies into primary power sources Move forward with preparations to win the bid for domestic offshore wind power contracts(bid on to ocean
288、areas during the first public offering)Bid lost during first public offeringStrategies for creating valueRecognizing the business environment and materiality29TEPCO Integrated Report 2022Stable supplyStrategies for creating valueAn increase in demand caused by unseasonably cold weather and record-br
289、eaking heat at the end of March and the end of June of this year,the shutdown of multiple power stations as a result of earthquakes,etc.,and the arrival of power station regular inspection periods,caused a tight power supply-demand situation.In order to combat these issues,the TEPCO Group came toget
290、her to implement supply-side countermeasures while also implementing demand-side countermeasures in the form of asking customers for their cooperation in saving electricity,thereby enabling us to avoid power outages.To address the lack of supply power this winter,we made a public appeal to general t
291、ransmission/distribution operators nationwide,including TEPCO Power Grid,for additional supply power thereby securing the necessary amount,and we have kept supply stable through coordination with the government and the Organization for Nationwide Coordination of Transmission Operators.End of March*M
292、arch 22:Government issues tight supply-demand warning Multiple power stations in the Tohoku/Tokyo area shutdown on March 16 as a result of an earthquake that occurred off the coast of Fukushima Prefecture(Approximately 4.7GW)Heat demand greatly increased as a result of unseasonably cold weather Low
293、solar power output caused by bad weather(generated power output was approximately 10%of the facility capacity)Some power stations were conducting regular inspections in preparation for an increase in power demand during the summer(July/August)End of June*June 2730:Government issues tight supply-dema
294、nd warning Large increase in cooling demand caused by a record number of extremely hot days(abnormal weather)Some power stations were conducting regular inspections in preparation for an increase in power demand during the summer(July/August)TEPCO Power GridAdditional supply power countermeasures ac
295、tivatedPower received from other areasCustomers in areas awaiting power were asked to conserve electricityTEPCO Energy PartnerDemand response activatedCustomers asked to conserve electricity and to produce additional output with household generatorsTEPCO Renewable PowerAccurate operation of pumped s
296、torage hydroelectric plantsOutput increased from hydroelectric power plants Power station repair arrangements madeJERAOutput increased from thermal power stationsOff-line power stations(publicly call for power)brought back onlinePower station repair arrangements madeCauses of tight power supply-dema
297、ndEnergy-conservation effect(March 22 estimate)Energy-conservation effect(kW)Maximum:3.5 GWhEnergy-conservation effect(kW)31.4 GWh(Approximately 3%of the daily power volume for March 22)Main countermeasures implementedSource:49th Power/Gas Basic Policy Subcommittee meeting document 5-1(May 17,2022)P
298、rior day estimate,Demand forecast prior to energy-conservation,Actual demandForecasted demand prior toenergy-conservationAmount of energy conserved Maximum:3.52GWEstimated demand at 18:00 onMarch 21 the day beforeActual value30TEPCO Integrated Report 2022Strategies for creating valueStable supplyEle
299、ctricity rate revisions in light of soaring fuel prices and initiatives to reduce the burden of rate hikesPrices in the Japan Electric Power Exchange(JEPX)continue to soar in conjunction with the rising fuel prices caused by changes to this years international situation.The situation has resulted in
300、 electricity rate hikes that are having a huge burden and impact on economic activities,society,and our customers.However,it is the mission of the TEPCO Group to provide a stable supply of electricity and stabilize rates even amidst this situation.Currently,TEPCO Energy Partner is seeing an increase
301、 in consultations from customers that have not yet been signed,and the cost of procurement from JEPX is one factor choking revenues.In light of this situation,we have decided to revise electricity rate options for special high-voltage and high-voltage customers who are particularly impacted by the w
302、holesale market price.In addition to the conventional fuel cost adjustment system,the direction of these rate revisions shall be threefold:The new introduction of a mechanism for adjusting fluctuations in market price;standard contract option unit price revisions;and,the reflection of revisions to c
303、onsigned rates in conjunction with the introduction of the consignment revenue cap system.Furthermore,in order to minimize the burden on our customers,assumed operation of nuclear power plants has been incorporated into our rate revision estimate.In light of the fact that we predict an increase in r
304、ates even after including nuclear power,we shall further develop energy-conservation and energy-saving initiatives as measures to further reduce the burden on our customers.In particular,in addition to offering demand response(DR)options for corporate clients and also our“Energy-Saving Challenge 202
305、2”for household customers,we have added plans that will reduce the burden on our customers through energy-conservation and are developing similar programs.Furthermore,a unique service being offered by the TEPCO Group is assistance with air-conditioning cleaning and the purchase of equipment for mana
306、ging power usage in order to continually increase the energy-saving effect for our customers.Furthermore,by further promoting measures to assist customers with the purchase of facilities that will help to achieve carbon neutrality,and getting society and our customers to experience the benefits of s
307、uch practices,we will get through these tough times hand-in-hand with you.Measures to reduce the burden on our customers Energy-conservation initiatives Market price trend201511.022.1Remaining stableSudden rising prices9.310.210.79.112.014.3(/kWh)2520002020212022(1Q)(FY)*Create
308、d from Japan Electric Power Exchanges(JEPX)area price for TokyoCorporate clientsDR options(kW reduction)Future measures(Unique to the TEPCO Group)Household clientsEnergy-Saving Challenge 2022(kW reduction)Assistance with the purchase of energy-conserving equipmentAssistance with air-conditioning cle
309、aningEnergy management services,etc.DR options(kWh reduction)Energy-Saving Challenge 2022(kWh reduction)31TEPCO Integrated Report 2022Carbon neutrality strategyCarbon neutrality strategyIn April 2022,the TEPCO Group announced its plan for achieving carbon neutrality as a strategy for creating value
310、as we look to achieving our vision.Since we became the first Japan energy company to support the TCFD recommendations in 2019,TEPCO has engaged in leading initiatives,such as creating a separate renewable energy company,etc.,and we will continue to reform our business structure so as to balance stab
311、le supply with carbon neutrality while also enabling sustainable growth along with society.Coexistence of large-scale power sources and mass power transmission,and locally produced and locally consumed power sourcesSupplyGridsZero emission of electricityMetrics and Targets*From Scope 1,2 and 3 power
312、 sales.Scope 1 and 2 emissions will be reduced to FY2019 levelsElectrification of energy demandSocialCarbon neutrality declarationFY2030 objectivesReduce CO2 emissions originating from the sale of power to 50%of FY2013 levels*2050 objectivesReduce CO2 emissions originating from the supply of energy
313、to essentially zeroStrategies for creating value32TEPCO Integrated Report 2022GovernanceGovernance/risk managementThe TEPCO Group regards the handling of ESG,including climate change risks and opportunities,as important business issues,and as such the Board of Directors has selected managers(ESG Man
314、aging Executives)to oversee these matters.The managing executive gives quarterly reports to the Board of Directors on the status of these issues,and the Board of Directors overseas climate change risks and opportunities by reviewing strategies,action plans,achievements and the progress with achievin
315、g goals.Furthermore,the ESG Committee,for which the President serves as Chairman,regularly discusses ESG-related issues and coordinates with the Future Management Committee and the Risk Management Committee.The Board of Directors engages in lively discussions about important topics.Primary topics di
316、scussed by,and reported to,the Board of Directors(FY2021)Future direction of TEPCOs offshore wind power business The direction of initiatives aimed at achieving carbon neutrality by 2050 The overall state of electrification and plans going forward The direction of 2050 carbon neutral strategies The
317、direction of shifts in business structure in anticipation of a carbon neutral societyThe degree of achievement of ESG-related objectives is reflected in executive remuneration.As we aim to promote ESG-based operation,KPI pertaining to non-financial ESG performance are included in indicators for the
318、performance-related remuneration for executives involved,and as such,achievement level,such as the aforementioned KPI,etc.,is considered when the Compensation Committee determines salary.Remuneration typePayment baseIndicatorsPayout rateBase salaryThe amount paid reflects the executives title,whethe
319、r or not they have representative rights,and the duties of their positionPerformance-related remunerationA percentage is set based on the executives title,whether or not they have representative rights,and the duties of their position.The amount paid also reflects company performance and personal pe
320、rformance.Company performance(Company performance as stipulated in the business plan(consolidated ordinary income prior to deduction of special liabilities based upon the Nuclear Damage Compensation and Decommissioning Facilitation Corporation Act)0145%Personal performance(Cost reduction indicators
321、for each department the executive is in charge of,and other KPI)*KPI that indicates the personal performance of involved executives includes non-financial ESG performanceRisk managementStructureBoard of DirectorsPresidentESG CommitteeRisk Management CommitteeFuture Management Committee(Dedicated Sub
322、committees:Carbon Neutral Challenge Task Force)Discussion of general proposals for addressing ESG Strategic disclosure plansCooperateRefer to pages 92.93 for details.Strategies for creating valueCarbon neutrality strategy33TEPCO Integrated Report 2022Scenario analysis(for the entirety of Japan)TEPCO
323、 envisions two scenarios selected from multiple reference scenarios.In scenario 1 by which TEPCO aims for carbon neutrality in 2050,electrification on the demand-side,and the spread of distributed power sources,continues.As the use of solar power and storage batteries increases on the demand-side,it
324、 is expected that there will be an increase in household power generation/household consumption,and locally-produced/locally-consumed power.This is effective for improving resiliency to disasters.However,there is the risk of mismatched demand and supply due to the large fluctuations in output from s
325、olar and wind power.In order to stabilize supply,it is extremely important that we match power sources used for baseloads(hydroelectric/nuclear/geothermal)with power sources for which the supply-demand balance can be adjusted(zero-emission thermal).In particular,the idea of“store and use,”by which e
326、nergy storage(storage batteries,hydrogen,etc.)is leveraged,is the key to stable supply.Reference ScenarioScenario Analysis ResultsScenario Analysis ResultsTEPCOScenario1IEA WEO NZE scenarioScenario created by TEPCO6th Basic Energy Policy As regulations pertaining to climate change become stricter al
327、l over the world,technical innovation will occur and spread thereby greatly reducing CO2.The use of fossil fuels will be strictly limited as countermeasures are not implemented in various fields.Temperature rise is kept within the range of approximately 1.5 2 C,and natural disasters,such as typhoons
328、,etc.,become fiercer,but on a limited scale.The technological development of hydrogen/ammonia,etc.accelerates and a certain number of thermal power stations that leverage these technologies remain in operation.The use of offshore wind power increases,but operation of a certain number of nuclear powe
329、r stations is required.Highly cost-effective energy/conservation/electrification progresses demand-side electrification and the spread of distributed power sources progresses(solar power spreads as a package with storage batteries)TEPCOScenario2IEA WEO CPS Legal regulations pertaining to climate cha
330、nge become stronger in advanced nations only,and innovation,if it occurs,does not spread due to economic incompatibility thereby resulting in slow progress with CO2 reductions.The global economy,and developing nations in particular,is still dependent to a certain extent on fossil fuels in 2050.Tempe
331、rature rises approximately 4C leading to fiercer natural disasters caused by typhoons,etc.Even though distributed power sources spread,since there are no technical substitute measures,and a certain number of thermal power stations remain in operation.Even if cost-effective energy-conservation/electr
332、ification progresses with existing technology,most of the energy systems will still be dependent upon fossil fuels.20202520302035204020452050TEPCO scenario 2CO2 emissionsTEPCOscenario 1Strategies for creating valueCarbon neutrality strategyStrategy34TEPCO Integrated Report 2022Energy flow
333、There are many paths to creating a carbon neutral society by 2050.One of the paths being examined by the TEPCO Group is to shift from a model where fossil fuels are changed into heat and electricity and used for energy,to a model where CO2-free electricity generated domestically using renewable energies and nuclear power,etc.,and hydrogen/ammonia,are primarily used.Power compositionThe number of t