Introduction The title of this report, "Sustainability Report 2008: The Earth, People & Energy," expresses the TEPCO Group's commitment to working for a sustainable society by offering superior energy services. The 2008 report gives an account of the TEPCO Group's CSR initiatives and achievements toward a sustainable society. We hope it would serve as a tool for enhancing communication between the TEPCO Group and all stakeholders who hold an interest in our operations. (Beginning with this 2008 edition, the scope of our report will cover the activities not only of TEPCO, but also of the TEPCO Group.) To better respond to our stakeholders' concerns and expectations of the TEPCO Group, the 2008 report has been produced in line with the AA1000 Assurance Principles*, which are widely accepted throughout the world as professional principles for creating sustainability reports. Topics to be contained in the report have been selected based on an evaluation of their relevance, from the five perspectives shown below. We have adopted external assessments for some of those perspectives, for greater objectivity. *AA1000 Assurance Principles The AA1000 series of principles are a set of standards developed by an international NPO called AccountAbility (the Institute of Social and Ethical Accountability). (www.accountability21.net) The five evaluation perspectives Evaluation perspective Materials used for reference Evaluation criteria 1 Issues which have a direct and short-term financial impact Annual reports and other such published materials Major issues related to corporate management Issues for which the company has set strategic policies Management plans and other such published 2 materials Issues deemed important by peer organizations (business CSR reports of domestic and foreign energy 3 peer-based norms) companies TEPCO Advisory Committee on Environmental Affairs Issues deemed important enough by stakeholders to take Internal and external opinions obtained from Social interests and 4 action (whether now or in the future) questionnaires to readers of this report and by other expectations means Issues deemed to originate from societal norms (These are indicated by regulations in force, future regulations, or GRI guidelines 5 standards and regulations that have become customary, Environmental reporting guidelines, etc. etc.) ※ TEPCO financial information can be found in our Annual Report, and information on TEPCO's environmental initiatives are introduced in the online version of our Environmental Activity Report. Other information sources are also available (see page 59). Sustainability Report 2008 Period covered FY2007 (April 2007 - March 2008) (This report also contains important information that has occurred outside this time period.) Scope of coverage TEPCO and the 242 companies of the TEPCO Group (see page 19 for a complete list of TEPCO Group companies) ※ Some references may be made to a limited scope only, as will be indicated in relevant sections. Date of publication July 2008 Scheduled date of next publication June 2009 Inquiries Corporate Planning Department, Environmental Department, or Corporate Communications Department Tokyo Electric Power Company, Inc. 1-1-3 Uchisaiwai-cho, Chiyoda-ku, Tokyo 100-8560 Japan Tel : (03) 6373-1111 Fax : (03) 3504-1570 URL: www.tepco.co.jp/en/index-e.html CONTENTS Management Commitment 4 Impacts of the Niigata-Chuetsu-Oki Earthquake and Actions Taken by the TEPCO Group 6 Executive Summary 2008 12 Providing Dependable Electric Power 14 Reaching for Sustainability TEPCO Group Management Principle 18 Practicing CSR in line with the TEPCO Group Management Principle 20 Corporate Governance 21 Risk Management 22 Information Security and Privacy 23 Compliance with Corporate Ethics 24 Legal Compliance 26 Measures to Prevent the Recurrence of Falsification and Other Improper Handling of Data on Power Generation Facilities 27 FY2007 CSR Activities and Plans for FY2008 28 The TEPCO Group's Environmental Initiatives Feature The TEPCO Group's Initiatives for Renewable Energies 30 Environmental Management 32 Inputs and Outputs in the Electricity Business 34 Environmental Indicators 35 Global Warming Countermeasures ─ Overview 36 ─ Supply-side Initiatives 38 ─ Supply-side Initiatives (Renewable Energies) 40 ─ International Cooperation Initiatives 42 ─ Initiatives with Customers 44 Proper Treatment of Air Pollutants and Hazardous Substances 50 Recycling Resources 51 Natural Environment Conservation 52 The TEPCO Group and the Community Feature Overseas Consultancy Services 54 How to read this report Active Communication with Stakeholders 56 Interaction with Customers 60 ● The following marks indicate that more Interaction with Local Communities 62 information is available on our website. Interaction with Children 64 =www.tepco.co.jp/en/index-e.html Interaction with Business Partners 65 E =www.tepco.co.jp/en/index-e.html > Interaction with Employees Challenges of TEPCO > Environment & 66 Community The TEPCO and Nuclear Power N =www.tepco.co.jp/en/index-e.html > Challenges of TEPCO > Nuclear TEPCO's nuclear power stations 70 Preventing the Recurrence of Data Tampering ● Terms followed by an asterisk (*) are explained and other Improper Handling of Data on Nuclear Power Facilities 71 on the same page. Disclosing Information about Our Nuclear Power Stations 72 ● Opinions and questions from our stakeholders Nuclear Fuel Cycle 74 and TEPCO's replies to them Third Party Opinions ● The mark introduces websites that provide relevant information. (TEPCO Advisory Committee on Environmental Affairs) 76 Communication with readers of the TEPCO Sustainability Report 78 Profile 79 Management Commitment The TEPCO Group contributes to creating a sustainable society by providing electric power in a safe and stable manner. We are reinforcing our nuclear power stations so that they will be safe and secure against disasters. TEPCO's Kashiwazaki-Kariwa Nuclear Power Station suffered damage in the Niigata-Chuetsu-Oki Earthquake that struck Japan on July 16, 2007. It was shut down following the earthquake, and remains closed today. We sincerely apologize to the local community and the wider society for causing much concern. We are currently conducting extensive inspections of the entire power station. So far, we have found no visible damage that could undermine the safety of its major facilities. The suspension of operations at the Kashiwazaki-Kariwa Nuclear Power Station has had a serious impact on our fundamental mission as an electric power company to provide a stable supply of electric power, as well as on our efforts to pursue environmental friendliness and economic efficiency. To overcome our current difficulties, we will make Group-wide efforts to transform the power station into one that will remain safe and secure in any disaster. Refer to our website for details of our inspection and restoration activities, and status updates. We consistently strive to deliver a stable supply of electric power. Electric power is indispensable to modern society. The TEPCO Group's greatest mission is to provide electric power that our customers can use with a sense of security, and contribute to better lifestyles and comfortable environments. Our CSR policy also states that the Group's basic social responsibility is to provide a safe and stable supply of electricity. The Kashiwazaki-Kariwa Nuclear Power Station accounts for roughly 10% of TEPCO's total output capacity and close to 20% of total generated power. However, due to the indefinite suspension of operations at the power station, we are accelerating the schedule for the high-efficiency thermal power plant that is currently under construction, restarting operations at a thermal power plant that has long been out of service, and buying emergency electricity from Masataka Shimizu other power companies, whatever the TEPCO Group can do to President secure stable supplies of electricity. We are also strengthening our Tokyo Electric Power Company predictive and preventive maintenance, to safeguard against disasters and deliver reliable electricity to our customers. 4 We are committed to preventing global We will advance hand-in-hand with warming. society. Global warming is a priority management issue for the The TEPCO Group produces and delivers electricity by TEPCO Group as we are responsible for roughly 10% of total operating power stations, transmission lines, and a host of other CO2 emissions in Japan. By providing quality electricity that facilities. However, we cannot do so without the cooperation of places minimum burden on the environment, we aim to reduce local communities. Based on an awareness of the significance of CO2 emissions and play a steady role in addressing the global- strengthening communication with society, we will continue to warming issue. pay heed to the voices of local communities and provide easy-to- To contribute to conserving the global environment, the understand information on a more frequent basis. TEPCO Group has set a target of reducing the average CO2 emission intensity over the five-year period between FY2008 We have a host of issues that we still must address. We will and FY2012 by 20% compared with FY1990. We realize that tackle them one by one at an appropriate pace that is not too slow, this is an extremely difficult target to achieve, with the closure yet not too fast, so that we may overcome them as early as of the Kashiwazaki-Kariwa Nuclear Power Station. However, possible and regain the trust of society. Through our business of we will do