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TEPCO Integrated Report 2018 TEPCO INTEGRATED REPORT 2018 TEPCO Fuel & Power # Sodegaura Thermal Power Station [Sodegaura City, Chiba Prefecture] TEPCO Integrated Report 2018 1 TEPCO INTEGRATED REPORT 2018 Tokyo Electric Power Company Holdings # Midono Dam [Matsumoto City, Nagano pref.] TEPCO Integrated Report 2018 2 TEPCO INTEGRATED REPORT 2018 Tokyo Electric Power Company Holdings The song of “Memories of Summer” # Oze National Park [Katashina Village, Gumma pref.] photo by Genta covered by Miyuu (Oze Music Ambassador, avex management Inc.) TEPCO Integrated Report 2018 3 TEPCO INTEGRATED REPORT 2018 Tokyo Electric Power Company Holdings # Fukushima Daiichi Nuclear Power Station [Okuma Town & Futaba Town, Fukushima Pref.] TEPCO Integrated Report 2018 4 Introduction Since the accident that occurred at the Fukushima Daiichi Nuclear Power Station in March 2011, the TEPCO Group has been developing a new business model in order to fulfill our responsibilities to Fukushima and also to remain successful in the energy market, which has become increasingly more competitive. In recent years, society has come to hold companies more accountable for their actions and interest in ESG investment and the United Nation’s Sustainable Development Goals (SDGs) have increased. The TEPCO Group has used integrated reports as a tool for promoting communication with stakeholders, such as investors and financial institutions, to convey to them how the Group plans to increase corporate value and contribute to the creation of social value over the long term. In light of opinions and requests from those who read the previous integrated report released in 2017, this second report contains more detailed financial information based upon changes in the management environment as well as more developed content, such as our outlook for the energy industry in the year 2050. This report was edited with full cooperation across the board from all TEPCO Group departments involved and we declare Director and Chairman Representative Executive Officer and President the content of it, as well as the editing Tokyo Electric Power Company Holdings, Inc. Tokyo Electric Power Company Holdings, Inc. process, to be fair and accurate. September 2018 TEPCO Integrated Report 2018 5 TEPCO Integrated Report 2018 Forward-Looking Statements This report contains forward-looking statements regarding the Company’s plans, outlook, strategies, Reporting : Fiscal year 2017 (April 2017 to March 2018) and results for the future. All forward-looking statements are based on judgments derived from the period (The report also includes some important information information available to the Company at the time of publication. Certain risks and uncertainties could cause the Company’s actual results to differ materially from that falls outside the reporting period.) any projections presented in this report. These risks and uncertainties include, but are not limited to, the Scope : 83 TEPCO Group companies economic circumstances surrounding the Company’s businesses; competitive pressures; related laws and (including Tokyo Electric Power Company Holdings) regulations; product development programs; and changes in exchange rates. Publish : September 2018 Next publish : September 2019 Contact : Corporate Communication Office Referenced guidelines: Tokyo Electric Power Company Holdings, Inc. International Integrated Reporting Framework, International Integrated Reporting Council (IIRC) 1-3 Uchisaiwai-cho 1-chome, Chiyoda-ku, Tokyo 100-8560, Japan "GRI Standard 2016” Global Sustainability Standards Board (GSSB) Tel: +81-3-6373-1111 Guidance for Integrated Corporate Disclosure and Company-Investor Dialogues for Website: www.tepco.co.jp/en/index-e.html Collaborative Value Creation, Ministry of Economy, Trade and Industry TEPCO Integrated Report 2018 6 CONTENTS Things to convey Sections ● Message from President Kobayakawa TEPCO’s Responsibilities, Mission and Mid/Long- …………………………………… Term Business Strategy • Message from President 9 8 Top Message • Message from CFO ………………………………………… 13 ● Message from CFO Moriya Executing our Mid/Long-Term Business Strategy ● Message from Chairman Kawamura Key issues managed by the Board of Directors, • Message from Chairman …………………………………… 17 16 Corporate Governance long-term business issues and the company’s • Directors Responsible for Governance …………………… 20 contribution to achieving SDGs ● Status of recovery efforts in Fukushima • Revitalization ………………………………………………… 25 22 Fukushima ● Progress of decommissioning of the Fukushima • Decommissioning …………………………………………… 31 Daiichi Nuclear Power Station ● Future outlook of the energy industry in 2050 (Utility • The energy industry in the year 2050 ……………………… 41 3.0) and TEPCO Group's efforts aimed at making • TEPCO Fuel & Power ………………………………………… 49 that future a reality • TEPCO Power Grid ………………………………………… 55 ……………………………………… 40 Energy Service ● Business strategies and initiatives for the three core companies • TEPCO Energy Partner 61 (fuel/thermal power, power transmission/distribution and retail) • Nuclear Power Business …………………………………… 67 and for the nuclear power and renewable energy business • Renewable Energy Business ………………………………… 71 • Brand, Transparency, Human Resources, Six business foundations needed to enhance earning ● Intellectual Capital, Business Efficiency and Business Foundation power and to realize business strategy 74 Consideration for the Environment ………………………… 76 • Oze and TEPCO …………………………………………… 85 • Aim of this report …………………………………………… 87 ● Detailed information on environmental conservation • Financial Highlights, ESG Highlights ……………………… 88 End of Report activities in Oze, financial situation and ESG 85 • Group Companies, Stock Information, Equipment Overview, Corporate Profile ……………………101 TEPCO Integrated Report 2018 7 » to CONTENTS Top Message Tokyo Electric Power Company Holdings, Inc. Headquarters TEPCO Power Grid, Inc. Headquarters (Chiyoda-ku, Tokyo) TEPCO Integrated Report 2018 8 Top Message » to CONTENTS Message from President TEPCO’s Responsibility and Mission It has been one year since I became why TEPCO exists and during the Representative Executive Officer and President president of Tokyo Electric Power last year I have spent almost 50 days Tokyo Electric Power Company Holdings, Inc. Company Holdings, Inc. During this year, visiting the local communities and the TEPCO Group has come together to directly speaking with residents. We engage in initiatives to improve earning will continue listening to the opinions power in order to fulfill our responsibilities of stakeholders through direct dialogue to Fukushima whilst remembering the and take a leading and responsible role three core pillars of our new business in helping Fukushima to recover, such ■ Biography philosophy put forth upon reorganization: as by engaging in initiatives to eliminate Apr. 1988 : Joined the Tokyo Electric Power Company, Inc. Open, Create, Fulfill. These initiatives damage caused by harmful rumors. Dec. 2011 : General Manager, Marketing & Customer Relations Dept., have helped lay a strong foundation to As an energy provider, TEPCO Kanagawa Branch Office achieve the objectives of our Revised will also continue to fulfill our mission Jul. 2013 : General Manager, Commercial Customer Energy Dept., Comprehensive Special Business Plan to provide an inexpensive and stable Corporate Marketing & Sales Dept. (the Third Plan). supply of electricity while also striving to Jun. 2014 : General Manager, Corporate Marketing & Sales Dept., Fulfilling our responsibilities to create new value to improve customer Customer Service Company Fukushima, in particular, is the reason satisfaction. Jun. 2015 : Promoted to Managing Executive Officer and President of the Customer Service Company * Revised Comprehensive Special Business Plan (the Third Plan): The result of a complete revision made in May 2017 of the Comprehensive Special Apr. 2016 : Representative Director and President of TEPCO Energy Partner, Inc. Business Plan (May 2012) which was written after Fukushima Nuclear Accident by the Nuclear Damage Compensation and Decommissioning Jun. 2017 : Representative Executive Officer and President, Facilitation Corporation and the Tokyo Electric Power Company, Inc. to serve as the core of TEPCO’s operations and business. Tokyo Electric Power Company Holdings, Incorporated lnc. TEPCO Integrated Report 2018 9 Top Message Message from President » to CONTENTS Securing required funds Fukushima, help the area to recover, and energy mixes. Our retail business has move forward with decommissioning, proceeded with initiatives to supply new According to the TEPCO reform proposal but also leverage the capacity of every value through cooperation with different made by the TEPCO Reform and 1F department in the TEPCO Group to stably industries and other companies and to Problem Committee, which is a committee increase revenue and secure the funds establish sales platforms. Also the entire of experts formed by the Ministry of that are required even if it takes decades. TEPCO Group has been making efforts to Economy, Trade and Industry, a total During FY2017, we moved forward with engage in Toyota-style Kaizen activities. of approximately ¥22 trillion in funds is fuel and thermal power initiatives that These resulted in fifth consecutive year of needed to address the Fukushima Nuclear aim to complete a value chain through ordinary income and increased revenues Accident. And, of this amount TEPCO is the merger of existing thermal power and income for the first time
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