Domestic Energy Business

Daigas Group’s Business

What We Aim to Be in FY2031.3 and decreased ¥12.6 billion year-on-year to ¥42.6 billion Summary of Current Situation due to influences from competition and time-lag profits, despite an increase in gas sales volume for residential use Although competition in the energy business has been driven by low air and water temperatures. For the fiscal intensified in the Kansai area since the full deregulation of year ending March 31, 2019, segment profit is assumed the retail electricity market in April 2016 and the retail gas to decrease by ¥7.6 billion year-on-year to ¥35.0 billion, market in April 2017, we are actively working to achieve reflecting competition and a pullback from low air and growth in the domestic energy business. We are striving water temperatures experienced in the previous fiscal year. to develop our business as an energy marketer in a new era by strengthening each of three areas in the domestic Forecast for the fiscal year ending March 31, 2019 energy business; namely gas manufacturing and sales, gas distribution, and electric power generation and sales. Net Sales ¥994.0 billion Segment Profit ¥35.0 billion Specifically, we are first ensuring a stable energy supply and unparalleled safety for existing customers in the Kansai area to enable use with peace of mind. In addition, Domestic Energy/Electricity we are proceeding with comprehensive provision of energy supply and services by expanding the electric power and Summary for the Fiscal Year Ended March LPG businesses and enhancing life support services and 31, 2018, and Outlook for the Fiscal Year one-stop services as utility agent, while taking measures Ending March 31, 2019 to curb the number of customers leaving. Furthermore, by broadly deploying expertise and services as well as For the fiscal year ended March 31, 2018, segment alliances developed in the Kansai area, we aggressively profit increased ¥4.5 billion year-on-year to ¥20.7 billion entering into markets mainly in the Greater Tokyo area due mainly to the acquisition of electric power retail other than the Kansai area, aiming to reach more than 10 contracts. For the fiscal year ending March 31, 2019, million customer accounts by FY2031.3 although we will continue to progress with acquisition of electric power contracts, segment profit is assumed Domestic Energy/Gas to decrease by ¥4.2 billion year-on-year to ¥16.5 billion, owing to competition and other factors. Summary for the Fiscal Year Ended March 31, 2018, and Outlook for the Fiscal Year Forecast for the fiscal year ending March 31, 2019 Ending March 31, 2019 Net Sales ¥197.0 billion Segment Profit ¥16.5 billion For the fiscal year ended March 31, 2018, segment profit

Net Sales (billion yen) Segment Profit* (billion yen)

1,380.7 1,191.0 124.5 243.7 1,154.9 1,129.2 1,018.8 206.4 157.7 197.0 28.8 107.5 91.9 71.4 41.6 63.3 16.2 1,136.9 51.5 994.0 20.7 948.5 911.2 971.4 95.7 16.5 50.2 55.2 42.6 35.0

15.3 16.3 17.3 18.3 19.3 15.3 16.3 17.3 18.3 19.3 (forecast) (forecast)

| Gas | LPG, Electricity and Other Energy | Domestic Energy/Gas | Domestic Energy/Electricity

* Segment profit = Operating profit + Equity in earnings of affiliates

22 Gas Sales

Gas sales volume for the fiscal year ended March 31, 2018 decreased 3 from the previous fiscal year due to a decrease in sales volume for Trends in Consolidated Gas Sales (million m ) non-residential use exceeding the increase for residential use. With regard to gas sales volume for residential use, the influence of 10,000 increased demand for hot water and room heating driven by low air and water temperatures surpassed the decrease in sales volume due 8,694 8,580 8,290 to customers moving to other companies and improved efficiency 8,052 7,723 in appliances. With regard to gas sales volume for non-residential 32 34 33 use, the decrease due to customers moving to other companies 31 32 and declined usage at particular customers surpassed the increase fueled by demand development and increased operation of 6,560 6,387 equipment at existing customers. 6,073 5,937 5,000 5,732 Gas sales volume for the fiscal year ending March 31, 2019 is expected to decrease and be below levels of the previous fiscal year for both residential use and non-residential use. Residential use is projected to be lower than the level of the previous fiscal year due to a pullback from the effects of low air and water temperatures experienced in 2,186 2,083 2,103 2,160 the previous fiscal year and customers moving to other companies. 1,957 Non-residential use is projected to be lower than the level of the 0 previous fiscal year due to declined operation of equipment at particular 15.3 16.3 17.3 18.3 19.3 (forecast) customers and the influence of customers moving to other companies.

2017.3 2018.3 Change | (Non-consolidated) Residential use | (Non-consolidated) Non-residential use Consolidated number of gas 6,255 5,996 -260 supply contracts (thousand) | Consolidated subsidiaries

Non-consolidated number of gas 6,230 5,970 -260 supply contracts (thousand)

Electricity Sales

Electricity sales volume for the fiscal year ended March 31, 2018 increased from the previous fiscal year for both Trends in Consolidated (Domestic) Electricity Sales (million kWh) wholesale and retail sales. Growth in the number of low- 10,951 voltage electricity supply contracts was strong particularly. 8,948

For the fiscal year ending March 31, 2019, we are working 8,596 11,671 to further raise the number of low-voltage electricity 8,360 8,500 7,954 supply contracts to increase electricity sales volume. 2,355 995 2017.3 2018.3 Change 15.3 16.3 17.3 18.3 19.3 (forecast) Number of low-voltage electricity 305 619 +314 supply contracts (thousand) ■ Domestic electricity sales volume ■ Retail ■ Wholesale, etc.

Customer Accounts

The number of customer accounts as of March 31, 2018 was 8,270 thousand, an increase of 270 thousand from Trends in Number of Customer Accounts (millions) the end of the previous fiscal year. This is primarily due to new installation in the gas business, acquisition of electricity contract, an increased number of installations 10.00 8.90 of ENE-FARM and acquisition of maintenance and 8.00 8.27 warranty contracts, despite a decrease affected by the full deregulation of the gas retail market. We will aim for 8,900 thousand accounts by March 31, 2019 through 17.3 18.3 19.3 2030 focusing on acquisition of electric power, the Sumikata (forecast) Target Plus service and maintenance and warranty contracts.

23 Measures for Reliable Supply, and Safe and Secure Use

Total pipeline length (As of March 31, 2018) Osaka Gas: approx. 61,900 km Energy Resource Procurement Qatar, Oman, Russia, and Papua New Guinea. In addition, Daigas Group: approx. 62,400 km the natural gas liquefaction business in Texas, USA is Shiga East Office set to launch operations. We are continuing to strive for Diversifying sources of supply and the terms increasingly stable and reliable procurement of LNG. inki Trunk and conditions of agreements Line-Shiga Line eii Office Unlike oil reserves, most of which are located in the Furthermore, procurement of LNG from the USA will Middle East, reserves of natural gas, which are used as enable us to enter into new types of agreements where yoto Shiga Mie-Shiga Linevd materials for city gas and for power generation, are found LNG procurement prices are indexed to Henry Hub Shiga Office prices, in addition to the traditional agreements in which Hyogo inki Trunk Line-No.2 West Line Mie all over the world. inki Trunk Line-No. 3 LNG prices are generally linked to the price of crude oil. West Line Himei Office inki Trunk With longer expected years of production than those of The diversification of pricing mechanisms will stabilize inki Trunk Line Headquarters Line-eii Line LNG prices should there be a surge in crude oil prices. In Himei Line oil, the superiority of natural gas as an energy source is inki Trunk Line-No.2 Takasago Line North Office addition, by investing in liquefaction projects, we will be able To Okayama West Line highly recognized. Osaka Gas started to import LNG from Himei‒ eihan Office to procure price-competitive LNG from among Henry Hub Okayama Line Brunei in 1972 and has since diversified its suppliers. inki Trunk Line Currently, Osaka Gas procures supplies of LNG from the prices, expect to lead to reductions in the price of LNG. Amagasaki Line Himei LNG Nabari Kintetsu Gas eight countries of Brunei, Indonesia, Malaysia, Australia, Terminal Nara Office Co., Ltd. Business Area Osaka Office inki Trunk Line Osaka East Office Bay Line inki Trunk Line-No. 2 East Line Hyogo Office Countries with Natural Gas Reserves and Countries from which Osaka Gas Procures LNG South Office inki Trunk Line-No. 1 Nabari City Hyogo Office East Line

Major country with natural Senboku LNG Terminal II Senboku LNG Terminal I gas reserves* Nara 1km Russia Country with which Osaka Gas 35.0 Service Area: has concluded a long-term Nabari City, Mie Prefecture procurement agreement Norway Turkmenistan Canada 1.9 Toyooka Energy Shingu Gas Co., Ltd. 1.7 19.5 Iran Figures indicate the amount China Co., Ltd. Business Area Business Area Legend Iraq 33.2 of natural gas reserves (Unit: trillion m3) Saudi Arabia 3.5 5.5 Worldwide proven USA Service Area Headquarters, Of ce 8.0 natural gas reserves High-Pressure Trunk Line Research Institute Algeria 8.7 * Source: “BP Statistical Review of (owned by Osaka Gas) World Energy 2018” provided by BP plc. 4.3 Malaysia Wakayama Major Pipeline LNG Terminal 193.5 Shingu City (owned by Osaka Gas) Nigeria UAE 2.7 Wakayama High-Pressure Trunk Line Gas holders 5.2 Egypt 5.9 trillion m Toyooka City Office 1.8 Venezuela (owned by other company) Kuwait Brunei 6.4 Qatar 1.7 0.3 2km 1km 24.9 Papua New Oman Indonesia Service Area : Toyooka City, Service Area : Shingu City, 0.7 2.9 Guinea Hyogo Prefecture Wakayama Prefecture 0.2 Australia 3.6

1972 1977 1989 1995 1998 2000 2008 2014

Importing of Importing of Importing of LNG Importing of Importing of Importing of Importing of Importing of LNG LNG from LNG from from Australia LNG from LNG from LNG from LNG from from Papua New Brunei begins Indonesia begins begins Malaysia begins Qatar begins Oman begins Russia begins Guinea begins

Use of Daigas Group LNG Carrier Fleet LNG Purchase Volume (thousand tons)

1,000 By utilizing the Daigas Group carrier fleet consisting 900 of seven ships, we are striving to further stabilize 800 the procurement of energy resources and reduce 700 transportation costs while diversifying our suppliers in an

600 effort to expand our LNG trading business. 500

400 300

200 100

As of April 1, 2018

24 Supply Systems Gas Service Area of the Daigas Group

Total pipeline length (As of March 31, 2018) Supply network structure Osaka Gas: approx. 61,900 km Daigas Group: approx. 62,400 km For stronger supply capabilities and improved reliability Shiga East Office of city gas, we regularly inspect our pipeline network, implement planned reinforcements and replacements with inki Trunk Line-Shiga Line pipelines constructed of stronger material on a regular eii Office basis. Additionally, in response to increasing demand for city gas, we have been working to extend new pipelines yoto Shiga Mie-Shiga Linevd as well to establish a strong network. Shiga Office Hyogo inki Trunk Line-No.2 West Line Mie inki Trunk Line-No. 3 West Line High-Pressure Trunk Line of the Osaka Gas Himei Office inki Trunk Beginning Lengthd inki Trunk Line Headquarters Line-eii Line Line name Himei Line of use (km) inki Trunk Line-No.2 1972 Kinki Trunk Line-No. 1 East Line (Northbound) 79 To Okayama Takasago Line North Office West Line 1973 Sakai Link Pipe 11 Himei‒ eihan Office Okayama Line Senboku No.1 Link Pipe 5 inki Trunk Line 1975 Amagasaki Line Senboku No.2 Link Pipe 5 Himei LNG 1976 Kinki Trunk Line-No. 1 East Line (Southbound) 30 Nabari Kintetsu Gas Terminal Nara Office Co., Ltd. Business Area Kinki Trunk Line-No. 2 East Line 92 Osaka Office 1978 Kawachi Line 14 inki Trunk Line Osaka East Office Bay Line inki Trunk Line-No. 2 East Line 1980 Hokko Link Pipe 12 Hyogo Office South Office 1986 Harima West Coast Line 7 inki Trunk Line-No. 1 Nabari City Hyogo Office East Line 1989 Kinki Trunk Line-No.2 West Line 158

Senboku LNG Terminal II 1994 Kinki Trunk Line-No.3 West Line 73 Senboku LNG Terminal I Nara 1996 Takasago Line 3 1km Kinki Trunk Line Bay Line 21 2000 Service Area: Torishima Link Pipe 1 Nabari City, Mie Prefecture 2001 Torishima Line 1 Toyooka Energy Shingu Gas Co., Ltd. Kinki Trunk Line-Keiji Line 46 Co., Ltd. Business Area Business Area Legend 2003 Kinki Trunk Line-Himeji Line 7 Service Area Headquarters, Of ce Kinki Trunk Line-Shiga Line 46 High-Pressure Trunk Line Research Institute 2006 (owned by Osaka Gas) BS Hikone Line 1 Wakayama Major Pipeline LNG Terminal 2010 Kinki Trunk Line Amagasaki Line 7 Shingu City (owned by Osaka Gas) Wakayama Mie-Shiga Line 23 High-Pressure Trunk Line Gas holders Toyooka City Office 2014 (owned by other company) Himeji-Okayama Line 86 2016 Aioi Line 3 2km 1km Total 731 Service Area : Toyooka City, Service Area : Shingu City, Hyogo Prefecture Wakayama Prefecture

Safety System that Works 24 Hours a Day, 365 Days a Year High-Quality Safety and Reliability

To ensure reliable supply of city gas, our safety system estimates We have approximately 200 service chain partners in our daily demand, makes production plans, and sends production service area that work closely with customers in their orders to production facilities. The system also performs reliable and areas providing Sumikata Services (home services) in efficient controls that respond to changes in demand through means addition to contract services for the Company (such as such as wirelessly operating gas holders that store and release gas opening and shutting off gas service and maintenance as necessary. For a pipeline network with a total extended length of of gas equipment). We receive calls 365 days a year and approximately 61,900 km (equivalent to 1.5 times the circumference have a 24-hour reception system in place particularly of the earth), regular inspection and maintenance are conducted for gas appliance repairs. If a call is received by 3:00 as preventative measures for ensuring safety. The Central Safety p.m., one of 1,300 technicians qualified by Osaka Gas to Command Center operates 24 hours a day to monitor and control repair gas appliances will visit the customer on that day. the status of gas supply in an integrated manner and is ready to Customers have given a 98% customer satisfaction rating promptly respond and dispatch staff from respective locations to the speed with which repairs are completed after their upon receiving reports from customers. In the event of a large-scale call is made. accident or natural disaster such as an earthquake, the center will Calls received serve as a company-wide command center that communicates and 365 days a year collaborates with each business base.

Same-day repair High customer system (for calls satisfaction received by 3:00 p.m.)

25 Measures to Maximize Customer Accounts

For maximizing customer accounts, we are aiming to Initiatives Aimed at Promoting Installation of ENE-FARM become a company that is consistently chosen by customers in the areas of energy supply such as city gas, LPG, electric Since its launch in June 2009, ENE-FARM has been well power, and other energy-related services by continuing to received by many customers, and total sales volume provide services that go beyond customers’ expectations. recently reached 80,000 units. Measures for Residential Use The CO2 reduction effect by 80,000 units of ENE-FARM is 118 thousand tons*1 per year, equivalent to planting For more than 110 years, we have provided a stable energy supply of approximately 8.51 million cedar trees*2. Osaka Gas and superior safety and reliability to earn customers’ trust. On the are striving to achieve total sales volume of 100 thousand base of this trust, we are providing electricity and gas supply as well units of ENE-FARM early and advance further technology as new products and new services to strengthen relationships with development and cost customers. In addition, we established the Innovation Headquarters reduction while continually in April 2018 in order to accelerate this initiative. contributing to the realization of comfortable living for In April 2017, we began providing a new service, Sumikata Plus, customers, mitigation of offering emergency home repair services that provide primary environmental loads, and response to household problems as many times as requested enhancement of energy and living support services that supports customers’ food, health security. and energy savings, for a fixed monthly fee of 216 yen (including consumption tax) for customers subscribing to Gas-Toku plans from among our gas rate options.

Starting from April 2018, we expanded the target customer of this service to all of our customers and added the new services, 200,000 Smile Check, which offers water leakage inspection, light fixture Growth in Cumulative Number of ENE-FARM replacement advice, underfloor inspections, etc. In addition we 82,289 began to provide four services, including Mamoryukku which offers Units Sold (units) emergency supplies with replacement services, for an additional fee. 64,048

Expanding IoT Service 48,340

37,021 Starting from April 2018, further enhanced services are

provided for customers who enjoy the IoT residential fuel cell 23,258 ENE-FARM type S or energy saving water heater ECO-JOZU.

We are providing new added value by utilizing the IoT, namely, gas appliance operations through smart speaker, 14.3 15.3 16.3 17.3 18.3 21.3 hot water monitoring service using smartphone app and etc. (Planned)

Services/Functions Content For customers using the IoT supported ENE-FARM and ECO-JOZU *1 Estimated figures calculated by the Company for instances 1: Gas appliance operation Enables customers to speak to where traditional gas-powered hot water and heating systems through smart speaker Amazon Echo to fill up a bath tab or are replaced with a new ENE-FARM type S (on assumption of a operate floor heating detached house with a family of 4). 2: Hot water monitoring Sends remote family members service using smartphone app notifications of hot water usage [Applied rates] For a traditional hot water and heating system, using smartphones, offering a the floor heating standard plan (option discount of 9%) for gas casual watch over family life and the meter-rate lighting A plan for electricity are applied. 3: Living-related newsletter Sends newsletters about tips and hints service using smartphone app on how to use gas appliances and For ENE-FARM type S, the my home power generation rates other useful living information (weather (option discount of 9%) for gas and the meter-rate lighting A and editorials) to smartphones plan for electricity are applied. *Gas and electricity charges are 4: Gas usage visualization Provides breakdown of gas usage service (by water heating, room heating, and respectively calculated based on rates for August 2017 of Osaka water reheating) of IoT supported gas Gas and Kansai Electric Power (consumption tax included). appliances on the My Osaka Gas page Renewable energy generation promotion levies included in electricity charges are based on the amount effective for Alexa, use the gas Filling up the bathtub. FY2018.3. Purchase rates for surplus power is based on rates remote control to Check to make sure 3 as of August 2017. [CO2 emission factors] gas: 2.29kg-CO2/m ﬁll up the bathtub. the drain is closed. (Source: the Company), electricity: 0.65kg-CO2/kWh (Source: the average factor of thermal power plants in FY2014.3 stated amazon alexa Osaka Gas server in the Global Warming Countermeasure Plan approved by the Cabinet in May 2016)

*2 CO2 absorption of cedar trees per unit is 13.9kg-CO2 per year and per tree (Source: 1997 Forestry White Paper of Japan. 1. Order bathtub 2. Hot water begins Based on a 50 year-old and 22 meter-high cedar tree with a ﬁll by voice to ﬁll the bathtub diameter of 26 cm)

26 Measures for Commercial and Industrial Use Services Using ICT

To enable optimized, efficient energy usage, we provide For the commercial and industrial customer, we have solutions to meet utilities-related outsourcing needs at our developed various services using Information and customers, along with services that leverage engineering, Communications Technology (ICT). the IoT and other advanced tools in the development of We are providing Eneflex that makes operational status technologies and products needed by our customers. “visible” in gas air conditioning systems, and controls We also offer these services beyond the Kansai area. In energy-saving system and “Motto Save” system which March 2018, we invested in Reliance Energy Okinawa displays energy use throughout a building. In addition, which engages in the ESP business. we have in recent years launched “ekul” service, which meets various usage visualization needs beyond the energy field.

Utility Agent Contract “ekul” is a service which can measure and immediately provide gas and electricity usage information in real time, As a utility agent, the Daigas Group has a full range and can also measure various data, including water of utilities-related services. OGCTS Co., Ltd. provides usage, number of customers, temperature, and humidity. comprehensive one-stop services combining nine categories. By proposing in a single package optimized ■ Simple Three-step Measurement utility facilities (for gas, electricity, water, etc.), no requirement and Notification Service for initial investment, optimized procurement of energy, 1 Simple installation using 2 Measurement of usage 3 Convenient monitoring facility operation/maintenance, and wireless technology volume every 10 minutes 24 hours energy-saving technical advice after a day from anywhere facility introduction, we ensure continuous energy- and cost-saving not only at Osaka Gas the time of introduction but also during Noti cation from operation. Wireless Osaka Gas ® measurements Collected every Transmission of 10 min online noti cations

Electricity Cooling Heating Electricity Heat Renewable Water Energy energy management Expanded Use of Gas Cogeneration Incoming Water Operation power Air Cogeneration Solar power treatment and maintenance Systems and Air Conditioning Systems equipment conditioners installation equipment advice

We are continuing to propose cogeneration systems Electricity Gas procurement procurement and gas air conditioning systems that help reduce peak ENNET Corporation Daigas Group electricity and promote energy conservation. Design Energy Fund- Energy and Operation Maintenance conservation raising procurement construction advice Industrial Gas Cogeneration Running Capacity (thousand kW)

1,581 1,580 1,589 1,574 Engineering Services 1,519

Leveraging technologies built up over the years, we carry out thorough investigations into energy load at all customer facilities and provide solutions to issues faced by the customer using simulations and other measures at one of Japan's largest test sites. Construction work and post-project maintenance are also carried out by the Daigas 14.3 15.3 16.3 17.3 18.3 Group. We propose total solutions, including regular inspections, emergency troubleshooting and facility Gas Air Conditioning and Gas Heat Pump Cumulative Capacity (thousand kW) upgrades. 17,742 16,728 17,266 15,621 16,162

Diagnosis results

Industrial facilities Power measurement Approx. 5,900 units Approx. 1,700 systems 14.3 15.3 16.3 17.3 18.3

As of March 31, 2018 (Note) Output basis

27 Businesses Outside the Kansai Area

The Kansai area is the backbone of our business. To Co., Ltd., as an LPG marketing company in the three ensure sustainable growth, we are planing to leverage metropolitan areas of Tokyo, Osaka and Nagoya, and set our expertise and know-how built up through our Kansai up CD Energy Direct Co., Ltd. which provides gas, electric businesses, to develop new businesses outside the area power and peripheral services in the Greater Tokyo area. transcending regional and corporate boundaries, through These initiatives enabled us to create a wide-area energy alliances with other companies. business network centered on the Greater Tokyo area. In fiscal years 2017,3 and 2018,3 we decided to take The Greater Tokyo area is a huge market. By expanding stakes in Fukushima Gas Power Co., Ltd., Ichihara wide-area businesses centered on this market, we are Biomass Power Co., Ltd., and Ogishima Toshi Gas Co., aiming to ensure the growth of our domestic energy Ltd. in the Tokyo area. In addition, we also set up ENEARC business. 2016.10 2017.9 10 2018.2

Fukushima Gas Power Co., Ltd. Ichihara Biomass Power Co., Ltd. Ogishima Toshi Gas CD Energy Investment Founding Co., Ltd. Direct Co., Ltd. ENEARC Co., Ltd. Founding Fukushima Gas Power Co., Ltd. Founding Construction of new LNG thermal power plant (1.18 million k) April 2020: Planned launch of operations Ogishima Toshi Gas Co., Ltd. Construction of a heat volume adjustment facility for the production of city gas April 2020: Planned launch of operations

Ichihara Biomass Power Co., Ltd. Construction of new biomass power plant (50,000 k) Kansai Chubu Kanto October 2020: Planned launch of operations

Strengthening the Engineering Business

In April 2018, we restructured the Engineering Department In May 2018, we took consultancy orders relating to handling LNG terminal and power-plant design, and the LNG first-phase construction of a third LNG terminal for CPC Terminal & Power Generation Business Unit handling safety and Corporation, Taiwan (CPC), a state energy company (with stability of operations and relaunched them as the LNG Terminal operational launch scheduled for 2023 near Taoyuan & Power Generation & Engineering Business Unit. By ensuring International Airport), as well as to an LNG terminal in centralized development of “owners’ know how”--that is, expertise Taichung planned by Taiwan Power Company (TPC) (with in the design, construction and operation of LNG terminals built operational launch scheduled for 2023 near the CPC up over years of business development--we aim to ensure still Taichung LNG terminal). CPC terminal III safer and more stable operation of existing infrastructure. At the same time, we plan to accelerate the development of new infrastructure outside the region and overseas by strengthening Taipei engineering functions within a holistic paradigm of infrastructure CPC Taichung terminal construction, operation and maintenance management.

LNG Terminal & LNG Terminal & TPC Taichung Taichung Power Generation Engineering Dept. Power Generation & terminal Business Unit Engineering Business Unit

Safe, stable operation Engineering design/ Centralized “owners’ know-how” of LNG terminals and construction at LNG for design/construction and power plant, etc. terminals, etc. operation of LNG terminals, etc.

LNG Terminal & Former LNG Terminal & Power Generation & Power Generation Business Unit Engineering Business Unit Kaohsiung Engineering Dept. CPC Yongan terminal Af liated companies Osaka Gas Engineering Co., Ltd.

Gas & Power Co., Ltd etc.

28 Power Source Development

The Group’s Power Source Composition power sources, and, in Japan, have expanded output to around 2,000 MW, mainly comprising natural gas-fueled thermal power. In response to the phased-in liberalization of retail sales in In this broadening of power sources, we are working to the power sector since 2000, we have launched a power rely not only on thermal power, but also on renewables retail business with affiliate ENNET Corporation as distributor. such as wind, solar and biomass-based energy. We have taken measures to develop demand and broaden

1 Total Power Generation Capacity* Total: Approx. 2,007 MW (As of June 30, 2018)

Thermal Power Sources*1 Renewable Energy Power Sources, etc.*1

• Senboku Natural Gas Power Plant (Wind Power Generation) • Himeji LNG Terminal •Hayama Wind Farm Power Plant, Hayama Wind Farm Power • Senboku LNG Terminal I Plant • Torishima Energy Center, Gas & Power •Hirogawa Myojin-yama Wind Power Plant, Hirogawa Myojin-yama • Funamachi Power Plant, Nakayama Joint Power Generation Wind Power Plant • Nagoya Power Plant, Nakayama Nagoya Joint Power Generation •Yura Wind Power Plant, Yura Wind Power Generation • Nagoya II Power Plant, Nakayama Nagoya Joint Power Generation •Hizen Wind Power Plant, Hizen Wind Power Generation • Fukushima Natural Gas Power Plant, Fukushima Gas Power (Under construction) •Hizen South Wind Power Plant, Hizen Wind Power Generation • Yamaguchi-Ube Power Generation (Under consideration) •Hirao Wind Power Plant, Hirao Wind Power Generation • Himeji Natural Gas Power Generation (Under consideration) •Inami Wind Power Plant, Inami Wind Power Generation •Shiribetsu Wind Power Plant, Shiribetsu Wind Power Generation (Under construction) (Solar Power Generation) •Torishima Solar Power Plant, Gas & Power •Torishima Solar Power Plant II, Gas & Power •SHOO Solar Power Plant, Gas & Power •Hirogawa Myojin-yama Wind Power Plant, Hirogawa Myojin-yama Wind Power Plant Senboku Natural Gas Power Plant Torishima Energy Center •Yawata Solar Power Plant, Nabari Kintetsu Gas Co., Ltd. •Nissan Green Energy Farm in Oita, JGC Mirai Solar Co., Ltd. •Yura Solar Power Plant, Yura Wind Power Generation (North) Total: approx. 1,694 MW •Yura Solar Power Plant, Yura Wind Power Generation (South) (Biomass Power Generation) •Matsusaka Woody Biomass Power Plant, Biomass Power Cogeneration Power Sources Technologies Inc. •Ichihara Biomass Power Plant, Ichihara Biomass Power Co., Ltd. •Uji Energy Center, Gas & (Under construction) Power •Settsu Energy Center, Gas & Power •Senri Energy Center, OGCTS Co., Ltd.

Uji Energy Center Inami Wind Power Plant Torishima Solar Power Plant

Total: approx. 91 MW Total: approx. 222 MW*2

*1 Includes volumes of power generated by equity-method affiliates within *2 Includes biomass-mixed combustion. the Osaka Gas Group. Does not include projects under discussion or at the construction stage.

The Future of Power Development of the fiscal 2 018 management plan, we revised upward our fiscal 2030 target for power from renewable sources In the overall Group power portfolio, we plan to be from around 500 MW to 1,000 MW, in both the Japan and generating around 5,500 MW in Japan by fiscal 2030, and overseas markets. By aggressively introducing renewable around 3,500 MW overseas. To reach the 5,500 MW target energy, we aim to curb emissions of greenhouse gases and for Japan, we aim to ensure flexible responses to demand contribute to attainment of a low-carbon society. Our goal through combined procurement from the power market and is creation of a competitive but highly environment-friendly from peer suppliers. Moreover, at the time of compilation power supply portfolio by fiscal 2030.