REVIEW OF OPERATIONS

Gas Segment
In the year under review, gas sales volume was down 1.9% year on year, to 13,942 million m3,
due to such factors as a decline in demand stemming from a warm winter and the economic
slowdown. On the other hand, gas sales rose 15.7%, or ¥170.5 billion year on year, to ¥1,257.5
billion, due to higher unit prices under the gas rate adjustment system. However, as a result ofhigher gas resource procurement costs stemming from increases in LNG prices, which continued
from the previous term, operating expenses were up 17.6%, to ¥171.3 billion, and operating
income was down 0.7%, to ¥110.8 billion.

Influence of Rising Gas Resource Costs
on Revenues / Expenditures

Influence of Temperature Changes
on Gas Sales Volume

In general, the prices of LNG imported into Japan are linked to

In the first half of the year ended March 2009 (summer), tempera-

crude oil prices. Consequently, under the influence of higher crude

tures were 0.5ºC lower on average than in the previous fiscal year.

oil prices, gas resource costs increased from the year ended MarchIn the second half (winter), however, the average temperature was

2008. Also, LNG prices reflect the average crude oil import prices

0.5ºC higher than in the previous year. Accordingly, in regard to air

in Japan from several months earlier. As a result, although crudeconditioning demand in the commercial sector, cooling demand in

oil prices experienced a downturn starting in summer 2008, LNG

the first half and heating demand in the second half were adverse-

prices continued to increase through the end of 2008, which also

ly affected. In addition, gas sales volume in the residential sector,

had an influence on the rise in gas resource costs.

where heating and hot water demand increases in the second half

Under the gas rate adjustment system (see “Characteristics ofof the fiscal year, was also negatively affected.

the City Gas Business in Japan” inside the front cover), changes ingas resource costs are reflected in gas rates and thereby recovered.

Outlook for the Year Ending March 2010

However, a certain period of time is needed before LNG prices are

We forecast a small increase in gas sales volume in the year endingreflected in gas rates and as a result, several months are required

March 2010, due to such factors as a rise in the number of new

until gas resource costs are recovered through gas rates. For most of

housing starts in the residential sector. In regard to economic

the year ended March 2009, the rise in gas resource costs preceded

trends, the difficult conditions seen in the January-to-March period

the rise in gas rates, and consequently, the recovery of gas resourceof 2009 are expected to continue throughout the fiscal year, andcosts was insufficient. As in the previous fiscal year, gas resource

consequently gas sales volume is expected to decline year on year

costs were under-recovered in the year ended March 2009.

in each of the commercial, industrial, and wholesale sectors.
Overall, gas sales volume is forecast to decrease year on year.

Gas Sales Volume by Sector(Consolidated)(Million m3)
15,000Temperature(Otemachi, Tokyo)

Results: Gas Sales Segment( ºC)(¥ billion)
1,500

35

1,257.530

12,000

1,200

999.5

25
9,000

1,087.0

900
20
15

6,000

600

10
3,000

300
5

0
Years ended
March 3107
Residential
Industrial

20

08

09

Commercial and others
Wholesale

0
Month

203.5
111.6

4

5

6

7

8

9 10 11 12 12

30Years ended
March 31

Year ended March 2008
Year ended March 2009
Average temperature in the year ended March 2008:
First half: 22.6ºC; second half: 10.6ºC; full year: 16.6ºC
Average temperature in the year ended March 2009:First half: 22.1ºC; second half: 11.1ºC; full year: 16.6ºC

07
Net sales

08

110.8
09

Operating income

Residential Sector
Overview

In this setting, in the residential sector, Tokyo Gas will leverage

In the residential sector, gas is principally used for household

its points of contact with its customers to implement thoroughheating and hot water as well as for cooking appliances, such as

market cultivation and will work to maintain and expand gas sales

gas ranges and ovens.

volume per customer. At the same time, we will strive to achieve

The Kanto area, which the Company has positioned as a
strategic area, is recording continued growth, and growth in thegrowth in total gas sales volume by increasing the number ofcustomers through aggressive marketing activities.

number of customers is expected to exceed 100,000 a year.
However, in recent years there has been a decline in the number of

Initiatives in Recent Years

people per household due to trends toward fewer children andEstablishment of Tokyo Gas LIFEVAL

nuclear families. In addition, there has been an increase in housing

Tokyo Gas has invested more than one-third of the equity in Tokyo

air tightness and insulation. As a result, gas sales volume per

Gas LIFEVAL, a new regional energy company, and promoted its

household unit is following a gradual declining trend. Also,establishment. Tokyo Gas LIFEVAL was established with the aim ofcompetition with all-electric housing, which is being promoted

building close relationships with customers by responding carefully

principally by electric power companies, is intensifying.

to their diversifying lifestyles and needs. Under Tokyo Gas LIFEVAL,

Residential Gas Sales Volume per
Residence and Number of Customers（m3/residence/year 45MJ/m3）(Millions)

450

11

300

10

150

9

0
Years ended
March 31

0

07

08

09

Tokyo Gas LIFEVAL’s service

Residential gas sales volume per residence (left)
Number of customers (right)
Figures for residential gas sales volume per customer
are non-consolidated figures for Tokyo Gas.

21

the sales and service functions that comprise points of contact
with customers, such as maintenance and sales of gas appliances,periodic gas facility safety check, and meter reading, are being
restructured and integrated. Excluding the wide-area markets,
we have established a system based on the division of our service
area in Tokyo, Kanagawa, Chiba, and Saitama prefectures into
approximately 65 service blocks. Following up on the 27 blocks
established in the fiscal year ended March 2009, we established
23 blocks in April 2009, giving Tokyo Gas LIFEVAL a total of 50
blocks. In October 2009, we plan to complete the establishmentof all of the blocks.
Start of general sales of “ENE-FARM” residential-use fuel cell
“ENE-FARM,” which provides a means to reduce CO2 emissions in
the residential sector, is a fuel cell cogeneration system thatgenerates electricity by separating hydrogen from city gas. Having
completed four years of large-scale verification testing, in May
2009 we achieved a world first with the start of general sales ofthese systems for residential use. “ENE-FARM” can make asignificant contribution to the realization of a low-carbon society.
At the same time, together with “ECOWILL” (a residential use gas
engine cogeneration system), “ENE-FARM” has been positioned by
Tokyo Gas as a strategic product that will facilitate the development of the new market for in-house power generation and will
support increased gas sales volume in the future. Over many years,
Tokyo Gas has built relationships of trust with housing developers,
housing construction companies, building contractors, architects,
and others. Leveraging these relationships, we will focus our“ENE-FARM” sales efforts on new detached housing. Also, during
the period covered by the medium-term management plan for

Residential-use fuel cell “ENE-FARM”

fiscal 2009 – 2013, we will work to reduce costs and to improveease of installation, aiming for a cumulative total of 42,000
installed units in fiscal 2013 and laying the foundation for fullscale diffusion.

Rate Initiatives
In the fiscal year ended March 2009, we implemented two rate-related initiatives in the regulated sector, comprising smallvolume costomers. First, rates were lowered in April 2008. Under the medium-term management plan for fiscal 2006–2010,
we took steps to reduce fixed costs through increases in management efficiency. We also promised to return, during thecourse of the plan, the results of those initiatives to gas users, who are as important stakeholders as shareholders. We havefulfilled that promise. This revision was a reduction averaging 1.51% in our tariffs for the entire regulated sector, encompassing both service and optional agreement tariffs in Tokyo, the largest district in number of customers. This rate reduction had
the effect of reducing gross profit by approximately ¥8.9 billion in the fiscal year ended March 2009. Also, one-fourth of thegas rate increase under the gas rate adjustment system for January to March 2009 was not adjusted in this period. This will
have the effect of reducing profit for the fiscal year ended March 2009 by ¥4.2 billion. We implemented special measures toadjust this evenly over the year from April 2009 to March 2010. In this way, we have taken steps to mitigate the scale of theincrease in gas rates stemming from the dramatic rise in the price of crude oil, and to meet the request of the national
government to stabilize living conditions for consumers.
A new gas rate adjustment system was introduced from May 2009. Please see “Characteristics of the City Gas Business in Japan” inside the front cover.

22

Natural gas cogeneration system using a leading-edge, high-efficiency gas engine (Makuhari District Heating and Cooling Center)

Commercial and Others, Industrial, Wholesale Sectors
Overview

Wholesale sector

Commercial and others sector

In the wholesale sector, we supply gas on a wholesale basis,

In the commercial and others sector, in line with the diverse needs

principally to 26 gas suppliers in the Kanto region (as of theof a wide range of customers, such as offices, schools, hospitals,

end of March 2009, excluding companies to which Tokyo Gas

and commercial facilities, gas is used in customized cogeneration

supplies LNG).

systems, gas air conditioning systems (absorption cooling andheating systems and gas heat pump air conditioning systems),

Initiatives in Recent Years

cooking equipment, and water heating equipment.

Commercial and others sector
With competition between gas and electricity intensifying, Tokyo

Industrial sector

Gas is making proposals for the optimal mix of energy systems to

In the industrial sector, we conduct sales of gas to customers withmeet customer needs. These activities involve the overall coordina-factories that use furnaces, boilers, and the like, and sell gas fortion of systems, including low-energy consumption, low-cost

power generation use to Independent power producers andsystems, such as cogeneration systems, as well as air conditioning,2

hot water, and cooking systems. In doing so, we work in coopera-

1Power producers and suppliers .

tion with wholly owned subsidiary ENERGY ADVANCE Co., Ltd.
1 Independent electric power companies that conduct wholesale electric
power supply
2 Companies, other than electric power companies, that supply electricity
to meet large-volume demand

to leverage energy services, such as ESCO operations, which cover
everything needed to conduct energy-saving renovations, including
technologies, facilities, human resources, and financial resources.
In addition to providing one-stop solutions encompassing a wide

Gas Sales Volume
in the Commercial and Others Sector

Gas Sales Volume
in the Industrial Sector(Million m3)(Million m3)

4,000

6,000

(Million m3)

5,732
5,336

3,000

2,972

3,126

Gas Sales Volume
in the Wholesale Sector
5,623

2,000

1,500

2,000

3,000

1,000

1,000

1,500

500

07

08

09

1,840

08

09

1,554

3,011
4,500

0
Years ended
March 31

1,828

0Years ended
March 31

07

08

09

0
Years ended
March 3107

23

range of energy-related services, we have worked to promote andyear, and we are forecasting a decline of about 10% year on year.

increase the efficiency of district heating/cooling systems, which

However, the trend toward low-carbon technologies continues toare drawing attention as high-efficiency methods of using energy.

grow, and as a result, we anticipate further progress in the shift

In the fiscal year ended March 2009, gas sales volume declined

to natural gas in tandem with a recovery in economic conditions.

year on year due primarily to the temperature-related effects of a

In response to this demand, we will work to increase gas sales

cool summer and warm winter and to reduced utilization rates ofvolume by extending pipelines to the Kashima and Northern Kanto

existing facilities in line with energy-saving measures. However,regions and by bolstering gas supply through LNG tanker trucks.

we will continue to propose superior energy services, with a focus
on cultivating fuel conversion and redevelopment projects in

Wholesale sector

urban areas and on meeting gas facility replacement demand,

To expand wholesale business, a framework that enables thewhich is expanding.

development of both wholesale gas suppliers and Tokyo Gas overthe long term is necessary. Tokyo Gas supports large-volume sales

Industrial sector

in the service areas of wholesale gas suppliers, and through the

In recent years, public demands for global warming countermea-

Gas Network Consortium, which is composed of 41 general gas

sures and other environmental initiatives have been continually

suppliers, mainly our wholesale gas customers, Tokyo Gas isstrengthening, and the higher price of crude oil has also had an

working to find common ground on various challenges and toeffect. In this setting, the shift to the use of natural gas as a fuelimplement measures targeting the resolution of those challenges.

in the industrial sector has progressed, and as a result, sales inIn the fiscal year ended March 2009, large-volume demand fromthe first half of the fiscal year ended March 2009 were favorable.

wholesale customers declined due to the economic slowdown,

However, in early fall, industrial production declined as inventories

but this was offset by development of new demand fromwere reduced under the influence of the economic recession,

wholesale gas suppliers and by facility expansions by existingand plant utilization rates were reduced, centered on the steel,customers. Consequently, gas sales volume was up 0.7% year on

machinery, and chemical industries. Gas sales volume saw sub-year, to 12 million m3, representing the only year-on-year increase

stantial declines. In the fiscal year ending March 2010, theof any sector.

economic slump is expected to have an effect throughout the

Breakdown of Gas Sales Volume by Industry
Commercial, Public, and Medical Use(Year ended March 2009)

Industrial Use (Year ended March 2009)

(%)

(%)

15.3% Company / office10.3% Wholesale / retail sales
17.0% Restaurant
5.6% Lodge / hotel
1.0% Beauty salon
2.8% Amusement place
1.1% Laundry
9.7% District heating and cooling
5.3% Other
23.0% Public
8.9% Medical

Penetration of Natural Gas Cogeneration Systems

Penetration of Gas Air Conditioning(Thousand kW)
1,500

12,000

1,000

8,000

500

4,000

0
Years ended
March 3105
Industrial use(Thousand kW)

06

07

08

Consumer use

A portion of cogeneration system capacity has been changed fromindustrial use to commercial use as of March 31, 2009.

24

21.3% Machinery / metal
3.1% Ceramics
12.9% Chemicals
10.3% Food
39.9% Power generation
12.4% Other

09

0
Years ended
March 31

05

06

07

Absorption typeGas heat pump air conditioning system

08

09

LNG Vessel “Energy Frontier”

Procurement and Transportation
Overview

from in April 2009, has been added to our long-term contract

More than 95% of the city gas supplied by Tokyo Gas is sourced

projects, thereby diversifying our LNG procurement sources, andfrom LNG, with 2% from LPG used to adjust caloric value, and thefrom the year ending March 2010, we plan to procure from Pluto

remainder from domestic natural gas and other sources. To realize

and Gorgon in Australia as well.

stable gas resource procurement, the Company is working todiversify its sources of LNG and currently has 10 long-term LNG

Expansion of upstream and transportation operations

contracts in six countries. We are also taking steps to facilitate

In addition to initiatives in the procurement of cost-competitive

flexible, competitive resource procurement in line with demand,

LNG, Tokyo Gas has upstream interests in projects from which LNG

such as increasing the FOB ratio, which makes possible transport

is procured—3% in the Darwin project and 5% in the Pluto

cost reductions through the use of our own vessels, and increasing

project. By participating in upstream projects, we acquire a variety

flexibility in volumes through changes in destinations and flexibleof know-how and facilitate flexible responses to changes in theincreases in transaction volumes in accordance with contracts.

operating environment, such as increase in crude oil prices. We
have also established our own fleet of tankers, which comprised

Initiatives in Recent Years

seven vessels as of May 2009, and we use that fleet to transport

Initiatives targeting stable procurement

LNG. These vessels are used not only for long-term LNG contracts

Since the second half of the fiscal year ended March 2009, gas

but also for transport of LNG procured via short-term contracts.

demand has declined due to the economic slump, but we are

Through these initiatives, we have increased procurement flexibility

utilizing the flexibility of the amount sourced from long-term LNG

and hiked the FOB ratio to 50%, thereby contributing to lower

projects, and consequently we are conducting procurement in line

procurement costs.

with demand fluctuations. Sakhalin II, which we began to source

Tokyo Gas LNG Imports by Country of Origin
Tokyo Gas Long-Term LNG Contracts(Thousand tons)
Country

2007

Years ended March 31
2008

Malaysia

3,309

3,767

4,482

(40.2%)

Australia

3,395

3,289

2,847

(25.5%)

Brunei

1,514

1,405

1,257

(11.3%)

Indonesia

626

740

742

(6.6%)

Qatar

598

715

631

(5.7%)

Others

749

958

1,203

(10.7%)

Total

10,191

10,874

Sakhalin

2009

11,162 (100.0%)

Tokyo
Qatar

BruneiMalaysia
Indonesia
New LNG project
Existing LNG project

Pluto
GorgonDarwinNWS

25

Tokyo Gas Sodegaura LNG Terminal

Production, Supply, and Infrastructure
Overview

Pipeline network development

Tokyo Gas receives about 11 million tons of LNG a year at three

The high-pressure trunk pipelines circling the Tokyo metropolitan

LNG terminals along the shores of Tokyo Bay and delivers city gas

area and the three LNG terminals work together to support theto its customers through a pipeline network of about 57,000 km—

reliable supply system of Tokyo Gas. To meet long-term demand

greater than the circumference of the earth. After LNG is received

growth, we have built the Chuo Trunk Line I, which runs north toat the terminals, it is transferred to LNG tanks that have a total

south through the middle of, and connects to, the trunk lines

storage capacity of about 3.4 million kl. It is regasified to naturalcircling Tokyo. The construction of this line was completed ingas using vaporizers, LPG is added to adjust the caloric value, andDecember 2008, a year ahead of initial plans. To secure demand

it is transported through the pipelines.

and expand operations from the second half of the 2010s, we willconsider and implement measures to expand the trunk infrastruc-

Initiatives in Recent Years

ture in the wide service area during the period covered by the

LNG terminals

medium-term management plan.

The Company’s LNG terminals are among the largest in the world,
and to respond to growth in demand for natural gas and to

Capital expenditures

increase supply stability, Tokyo Gas continues to undertake capitalIn the year ended March 2009, capital expenditures increased byinvestment. In November 2009, we will start construction of a

¥7.9 billion, or 5.7%, year on year, to ¥145.9 billion. On a non-

250,000-kl LNG tank, the largest in the world, at the Ohgishimaconsolidated basis, major capital investment activities include

terminal, with a target completion date of October 2013. The

supply facility projects—such as construction of trunk pipelines,

Company has also started investigation for constructing a fourth

construction of supply pipelines, and replacement of existing gas

LNG terminal in Hitachi, anticipating continued demand growth

pipelines—which totaled ¥83.1 billion, and terminal construction

from the 2010s in the 200-km radius of the Kanto region.

facilities, which totaled ¥8.8 billion. During the period covered by
the medium-term management plan, targeting expansion ofdemand over the medium-to-long term, we will allocate about¥580.0 billion for capital expenditures and investment and loans
with the objectives of developing demand and increasing production, supply, and infrastructure development.

Major Capital Investment Projects in the Year Ended March 2009
Project nameProduction facilities: ¥8.8 billion (Negishi LNG Terminal BOG facilities, etc.)• Distribution facilities: ¥83.1 billion(Chiba-Kashima Line, ¥8.9 billion; Chuo Trunk Line, ¥5.8 billion; New Negishi Line and¥106.5 billion
Yokohama Line II, ¥5.6 billion; newly constructed supply pipelines, ¥11.1 billion;
replacement of existing gas pipelines, ¥15.1 billion)• Service and maintenance facilities, etc.: ¥14.6 billion (System related: ¥7.0 billion, etc.)• Tokyo LNG Tanker, LNG tanker construction expenses: ¥8.5 billion
Total: ¥42.2 billion• ENERGY ADVANCE, cogeneration systems, ¥8.0 billion¥145.9 billion (after eliminations)•Tokyo Gas

Consolidated subsidiaries
Total:

26

Gas Appliance Sales Segment
To encourage customers to use gas more comfortably, we sell gas
appliances that are produced by other companies to specifications
determined by Tokyo Gas. For residential customers, we offer gas
cooktops, water heaters, gas air conditioning systems using hot
water, residential-use cogeneration systems, floor heating systems,
mist saunas, in-home power generation systems, and otherappliances. For industrial customers, we principally offer gas heatpump air conditioning systems. These residential and industrial
appliances are sold through such channels as affiliated companies
and cooperating companies. In the fiscal year ended March 2009,
we recorded lower sales and profits in this segment. Sales were
down 7.5% year on year, to ¥122.3 billion, and operating income
declined 28.3%, to ¥2.0 billion.

Mist sauna “MiSTY”

Installation Work Segment
This segment carries out construction, such as the installation ofgas pipes and valves on the sites of customers in our service area.
In the year ended March 2009, conditions in the housing
market worsened due to the influence of the economic recession.
The number of new housing starts in our service area declined
16.9%, to 217,000, and the number of installations undertakenby the Company declined. In addition, due in part to increasedmaterial prices, sales were down 14.4% year on year, to ¥49.0
billion, and the segment recorded an operating loss of ¥1.0 billion,
compared with operating income of ¥0.8 billion in the year ended
March 2008.

Real Estate Rental Segment
This segment‘s business primarily involves leasing and manage-

2010s, we are currently moving ahead with development planningment for the Shinjuku Park Tower and other office buildings. Thesein cooperation with a partner developer. In addition, the GINZA

activities are conducted by Tokyo Gas Urban Development Co.,

gCUBE building was opened in September 2008.

Ltd. In the year ended March 2009, sales were ¥35.6 billion, andoperating income was ¥7.4 billion.
Real estate operations are positioned to support increased
competitiveness in our integrated energy business, the corebusiness of Tokyo Gas. Results from the real estate business areused in the Company‘s core operations, and in regard to large scale
properties for which asset prices are expected to rise, we willconduct development to fully leverage the potential of the property
while limiting risk. Development funds are, as a general rule, fromreal estate sales, and there is no influence on core operations.
Major development projects will utilize a site of about 3.2
hectares in Tamachi and a site of about 20 hectares in Toyosu thatare suitable for development. With the objective of recording
business income from both of these properties in the middle of the
Shinjuku Park Tower

27

Other Business Segment
Overview

as one facet of measures to strengthen the value chain. In June

This segment includes energy services, facility construction and2008, we put the Energy Navigator, our sixth vessel, into service.

engineering, industry gas, LPG, system integration, electric power,

Due to the increase in the number of vessels and other factors,

credit and leases, and shipping operations.

Tokyo LNG Tanker Co., Ltd., which manages and operates theCompany’s fleet, recorded increased shipping revenues and higher

Initiatives in Recent Years

income. In May 2009, our seventh vessel, the Energy Confidence,In the year ended March 2009, energy services sales increased

was placed into service.

due to a higher number of new projects undertaken by ENERGY

In the year ending March 2010, the economic recession is

ADVANCE Co., Ltd. In electric power operations, Kawasaki Natural

expected to have an adverse effect on the revenues of ENERGY

Gas Power Generation Co., Ltd. began operation of its first unit in

ADVANCE Co., Ltd., Tokyo Gas Chemical Co., Ltd., and other

April 2008 and its second unit in October 2008. Consequently, we

companies. In addition, increases in depreciation accompanying

increased our share of the capacity of power generation projects

the introduction of our seventh vessel and higher charter fees will

to about 400 MW. As a result, sales increased, but due to higher

have an adverse effect on the operating income of Tokyo LNG

fuel costs and other factors, income declined. In shipping opera-

Tanker. As a result, we expect both sales and operating income intions, we are taking steps to bolster the capacity of our own fleet

the other business segment to decline year on year.

Kawasaki Natural Gas Power Generation

LNG Vessel “Energy Navigator”

Overview of Major Companies in the Other Business Segment (Years ended March 31)
Field

Major companies

Net sales

2009

2008

(¥ billion)

2009

2008

Change(%)(¥ billion)

Energy services

Tokyo Gas Co., Ltd., ENERGY ADVANCE Co., Ltd.

107.9

73.1

47.5

1.7

1.0

64.6

Industrial gas, etc.

Tokyo Gas Chemicals Co., Ltd.,Tokyo Oxygen and Nitrogen Co., Ltd.

38.0

39.0

(2.7)

1.4

2.1

(32.4)

LPG, etc.

Tokyo Gas Energy Co., Ltd.

38.9

38.6

0.7

0.2

0.0

498.1

System integration, etc.

TG Information Network Co., Ltd.

19.9

18.8

5.5

0.6

0.5

8.6

Electric power

Tokyo Gas Yokosuka Power Co., Ltd.,Tokyo Gas Co., Ltd.

30.3

15.5

95.5

(0.9)

(0.6)

—

Credit and leases

TG Credit Service Co., Ltd.

13.2

13.9

(4.8)

1.5

1.5

(3.2)

Shipping

Tokyo LNG Tanker Co., Ltd.

15.8

11.5

37.0

2.8

1.6

80.3

Facility construction, engineeringand others

Tokyo Gas Engineering Co., Ltd., Capty Co., Ltd.

99.4

109.4

(9.1)

5.8

6.3

(7.5)

363.7

320.3

13.6

13.4

12.7

5.6

Total

28

Operating income

Change(%)

TECHNOLOGY DEVELOPMENT

Strategic Direction of Technology Development

improvements in this technology, such as cost reductions, targeting

In technology development, we focus on three areas:

its use in multiple dwelling units in the second half of the 2010s,(1) the creation of appealing concepts and the development ofand will strive to foster its full-fledged diffusion. We will also

products that give concrete form to the value created by those

proceed with development and verification testing of solid oxide

concepts, (2) the development of innovative environmental

fuel cell (SOFC) technologies, which have the potential to offer

technologies that will contribute to the realization of a low-carbon

superior durability and cost savings. We have developed solar-society, and (3) technologies that support the operational plat-

powered hot water systems as a technology that uses renewableforms for stable administration of gas operations and for realiza-

energy and contributes to progress toward a low-carbon society.

tion of higher-level usage and cost reductions. In the fiscal year

From November 2008, we conducted the world‘s first onsite

ended March 2009, the Company allocated about ¥9.1 billion to

verification testing of CO2 separation and collection during the
production of hydrogen. This technology cuts CO2 emissions intechnology development.

half while maintaining production efficiency of about 80%, thereby

Major Initiatives

heightening the possibility of city gas usage in the future low-

Through the development of products that reflect consideration

carbon society.

for the understanding and materialization of customer needs,

In platform technologies, we work to make it possible forwe provide customers with systems and appliances incorporating

natural gas to be delivered safely to the customer and to be used

innovative environmental technologies.

without worries. To that end, we will continue to deepen, pass along,In the year ended March 2009, we completed large-scale

and utilize infrastructure construction technologies, maintenanceverification testing of a residential-use polymer electrolyte fuel cell

management technologies, combustion engineering-related tech-(PEFC) (sales name: “ENE-FARM”), and made significant progress

nologies, and gas quality management technologies, among others.

toward the market introduction stage. We will continue to make

The Technology Development Strategy of Tokyo Gas
Creation of Appealing Concepts andDevelopment of Appealing Products

Development of Innovative Environmental Technologies

Residential sector

Innovative energy-saving technologies for high-level use of city gas
Development of next-generation“ENE-FARM”(polymer electrolyte fuel cell)

Development of technologies
related to understanding
customers
Development of proposal-style
lifestyle products
Effectiveness and efficiency
testing
Commercialization
with consideration for quality

Renewable energy technologies, low-carbon technologies

New cooktop “My Choice”

Commercial and industrial sectors
Customer support technologies that contribute to retentionof existing customers and development of technologies that
increase the safety ofgas systems
Development of technologies
that utilize solar heat andbiomass.

Incomplete combustion warning
sensor for commercial kitchens

Development of SOFC
(solid oxide fuel cell)
Development of several hundred
kW class MCFC
(molten carbonate fuel cell)combined cycle system

Technologies using
biomass
Technologies for systems
combining solar heat/solar batteries withgas systems

Solar heat hot water system for
condominium housing

Technologies for thehighly efficient production
and use of hydrogen
CO2 separation, collection,transport, and processing
technologies

Technologies related to“Smart Energy Network”
composed of distributed
power sources

Hydrogen station

Technologies Supporting Our Operational Platforms
Production
Long-term facility
usage, increased
quality of terminal
operations, etc.

Pipelines
Maintenance of
security levels andoptimization of
security investment

MetersDevelopment ofservices using
ultrasonic meters,
etc.

29