Kansai Electric Power Group Overview

SpecialFeature

2Value Creation Story

Medium-term Management Plan

Business Overview

Foundation to Support Value Creation

Financial and Corporate Information

Bolstering Our Strengths

The Kansai Electric Power Group, as a lifeline provider, has been creating newvalues in a variety of areas including the electricity business while taking on
new challenges to contribute to the growth of Japanese society by leveraging
its “strength,” which originates from over 70 years of operations.

01 Nuclear power’s contribution as a zero-carbon power source

Zero-carbon power sources

01 As a leading company in zero-carbon energy, we have been striving to increaseenergy independence to secure stable supply of energy with a priority given tosafety in an effort to create a sustainable society.

Problem-solving power

02 We have been offering multiple solutions to provide new values, promoting
electrification and addressing various challenges and the needs of customers.

Comprehensive strengths of our Group

03 We have been providing solution services by leveraging the collective strengthsof our group companies, with particular emphasis on our business domains ofenergy, transmission and distribution, information and telecommunications, andlife/business solutions.

Responding to digitalization

04 We have been pursuing DX, primarily capitalizing on digital technology derived
from our electricity business, as DX is a key to achieving the Medium-termManagement Plan.
Click below to see our strengths:
https://www.kepco.co.jp/english/corporate/list/report/pdf/ar2022_e_07.pdf

Kansai Electric Power Group Integrated Report 2023

The output of Ohi Nuclear Power Station Units 1-4 reached 900 billion kWh on July 1, 2023, for the
first time since Unit 1 went into commercial operation back in 1979. This has never been achieved
before by a pressurized water reactor (PWR). The cumulative output of Mihama Nuclear PowerStation Units 1-3 and that of Takahama Nuclear Power Station Units 1-4 stand at about 359 billion
kWh and 778 billion kWh, respectively. With the three power stations combined, it brings total
output to about 2,039 billion kWh (as of the end of July 2023). We will continue to promote zerocarbon electricity at home and abroad by operating nuclear power stations in a safe, stablemanner.

Further expanding the possibility of nuclear power
The Group’s nuclear power initiatives involve “improving the operation of nuclear power plants,”“installation, expansion and replacement,” and “hydrogen production using nuclear power,” alldesigned to achieve the Zero Carbon Vision 2050, with safety ensured.
●Improving the operation of nuclear power plants

Efforts are underway to operate our nuclear power plants more efficiently to stabilize power
supplies and reduce CO2 emissions.

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Kansai Electric Power Group Overview

Value Creation Story

Medium-term Management PlanBusiness Overview

Foundation to Support Value Creation

Financial and Corporate InformationBolstering Our Strength
Specifically, we participate in a working group of the Atomic Energy Association (ATENA),
engaging in dialogues with the Nuclear Regulation Authority to shift to a flexible operating cycle
where the current maximum 13-month cycle is extended to a 15-month cycle. In addition,
periodic inspection procedures and periods are compared with those of other nuclear power
plants (in Japan and the U.S.) for streamlining processes, with discussions underway to optimize
overall operations.
●Installation, expansion and replacement

Discussions with plant manufacturers are underway to design next-generation light-water
reactors that outperform existing reactors in safety and cost efficiency to improve Japan’s energy
security and decarbonization.
●Hydrogen production using nuclear energy

We will extract the full potential of nuclear energy,
which constantly produces a massive amount of zerocarbon electricity to use the electricity and heat it
produces for hydrogen production in the future.

Example of recent activity

Fuel-cell vehicles

Electricity derived
from nuclear energy
Nuclear power generation

01

Clean hydrogen
derived fromnuclear energy

Hydrogen production

Curdle (cylinders)*1	FEED: Front End Engineering Design. Refers to the basic design (including
Clean hydrogen production is being demonstrated
in Tsuruga City, using electricity derived from nuclear
energy that emits no CO2 for the first time in Japan.

studies related to commercial, financial, and contractual matters) to be
conducted upon completion of conceptual designs and feasibility studies.
*2	E xchange rate of AUD 1 = JPY 90

Hydrogen use

Designing the infrastructure base for a large-scale hydrogen
supply chain

On May 29, 2023 the Company announced that it entered into an agreement with Iwatani
Corporation, Marubeni Corporation, Stanwell Corporation Limited, and Keppel Infrastructure
Holdings Pte. Ltd. on FEED*1 of the Central Queensland Hydrogen (CQ-H2) Project in theGladstone Region, Queensland, Australia, where green hydrogen derived from renewable energy
will be largely produced and liquefied for export to Japan as well as supplied to an ammonia

Kansai Electric Power Group Integrated Report 2023

production facility in the Gladstone Region. This project is the first of its kind, where theCompany’s hydrogen production business participates in FEED outside Japan, involving what
may be one of the largest scale of green liquefied hydrogen production in the world.
Extensive feasibility studies will be conducted to make the final decision on investment inphased-in production and distribution of liquefied hydrogen, which will start in around 2030.
The liquefied hydrogen will be supplied to the Company’s thermal power stations in the Himeji
area and to users nearby.
The Company and three of the participated companies (Iwatani, Marubeni and StanwellCorporations) have been conducting feasibility studies since 2021 on large-scale production ofgreen liquefied hydrogen and their export to Japan. With Keppel on board, who is a potential
green hydrogen user, we the five companies will jointly work on the FEED, which involves a total
investment of 117 million Australian dollars (about 10.53 billion yen*2), a sizable amountcompared with a total of about six million Australian dollars (about 540 million yen*2) invested inprevious feasibility studies.
Each of us, committed to being a pioneer inbuilding a large-scale hydrogen/ammonia supply
chain advocated by the governments of Japan,Australia, and Singapore, will leverage this project tohelp realize a carbon neutral world.

CQ-H2 Project overview

Water
Renewable
power sourceQueensland
Australia

Hydrogenproduction
facilities

Hydrogenstoragefacilities

Pipeline

Hydrogenliquefaction
facilities

18Kansai Electric Power Group Overview

Value Creation Story

Medium-term Management PlanBusiness Overview

Foundation to Support Value Creation

Financial and Corporate Information

Bolstering Our Strength

02 03 New company starts commercial operation of distributed energy resources
E-Flow LLC, which specializes in operation of distributed energy resources (DERs), was established in April 2023 to leverage the experience and expertise derived fromour Virtual Power Plant (VPP) business.
Taking over the VPP business of the Kansai Electric Power Company, E-Flow is committed to optimizing operation of customers’ DERs and maximizing their electric
values through its VPP, grid storage battery, and renewable energy aggregation businesses, which are expected to grow as we transition to a zero-carbon society.
E-Flow also offers services based on the distributed service platform “K-VIPs+,” which is equipped with an optimized operation AI incorporating cumulative
operational expertise and market transaction data to improve its earnings. Incorporated into the grid storage battery and renewable energy aggregation businesses inthe second half of fiscal 2023, this platform system will be expanded to other resources such as EVs and hydrogen production equipment.

Business objective

Business overview

E-Flow serves as a service infrastructure that connects various resources interactively anddelivers energy to the necessary locations, creating new value beyond the conventional
electricity business boundaries together with our customers.

E-Flow is the first company in Japan specialized in harnessing the value of electricity derived fromvarious distributed resources spread across the country. Through its distributed service platform, itcontributes to achieving the goal of zero-carbon emissions and stabilizing power supply and demand.
Whole sale
electricity market

April 2023

Supply and demand
adjustment market

Capacity*1market PPA To “monetize”
throughtransactions

Establishment ofa new company!

Datautilization

To intelligently“combine” resourcesAI
diagnosis
Optimalcontrol

Distributed Service Platform

Operation
management

Renewable energy Grid storage battery
Decentralization of energy resources
Large-scale power generation
Stable and efficient supply throughlarge-scale power generation

To “transfer” resources
between each other

Operatingdata

Supply-demand
data

Forecast
data

Transactiondata

We aim toachieve a revenue of30 billion yen by utilizing
various distributed energy
resources with a market
trading volume of
2.5 million kW byfiscal 2030.

Customer facilities

VPP*2 Business

Grid Storage Battery Business

Renewable Energy
Aggregation Business*1 PPA: Power Purchase Agreement *2 VPP: Virtual Power Plant

Making inroads to the storage station business
The Company will have a stake in one of the largest storage stations in Japan (48 MW / 113 MWh) and E-Flow will be in charge of its operation. With this business, we willcontribute to stabilization of electricity supply and demand and further introduction of renewable energy.

Kansai Electric Power Group Integrated Report 2023

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Kansai Electric Power Group Overview

Value Creation Story

Medium-term Management PlanBusiness Overview

Foundation to Support Value Creation

Financial and Corporate Information

Bolstering Our Strength

03 04 Investing one trillion yen in hyper-scale data center businessWe established CyrusOne KEP, Inc., a 50-50 joint venture with the US data center developer and operator CyrusOne, in May 2023. CyrusOne KEP, Inc. will develop andoperate hyper-scale data centers (HSDCs)*1, with investments of more than one trillion yen over the next 10 years or so, aiming for a total storage capacity*2 of 900 MW.
Utilizing both companies’ strengths: the Kansai Electric Power Group, which has developed its variety of businesses such as energy, real estate, information andtelecommunications, and CyrusOne, which has accumulated advanced expertise in sales, design, development, and operation of HSDC business, this venture company
will provide cloud service providers with the world’s highest quality digital infrastructure services, facilitating improvement in social and digital infrastructures.

Competitive strength●●●

Competitive strength

Sales capabilities targeting mega cloud service providers
Expertise in design and construction of data centers that meetthe needs of customers
Proven track records in advanced operation, etc.

●
●

●

●

Expertise in electricity supply
Acquisition, development, andmanagement of real estate
Expertise in data center
operation
Optical fiber network spanning
the Kansai area, etc.

Leveraging the two companies’ strengths
CyrusOne KEP, Inc. plans firstly to develop its business in the Tokyo metropolitan area and the Kansai area; its construction site for the first project has been secured in
the Kansai area, where it is preparing to start construction as early as possible.
*1:	E xtremely large data centers that are designed for mega cloud service providers to process a massive amount of data
*2:	Indicator that represents the size of data centers

Kansai Electric Power Group Integrated Report 202320