Increasing community demonstration smart-grid projects
involving consumers

Smart-city initiatives are being developed worldwide, especially in the United States, Europe, andAsia. These smart-city projects are characterized as a social experiment by local communities
while involving consumers. Under these circumstances, the International Smart Grid Action
network (ISGAN) announced the 1st ISGAN Award in May 2014 as part of its ISGAN Award
program to commemorate the world's top smart-grid projects. Under the theme "Consumer
Engagement and Empowerment," this award advocated consumers as the main player in smart
cities. Expectations are high for smart-city projects to renovate society.

Achievement for the first time in 15 years of the world's
highest photoelectric conversion efficiency of crystal
silicon-based solar cells

Panasonic achieved the world’s highest photovoltaic conversion efficiency of 25.6 % with a crystal
silicon-based solar cells in April 2014 mainly by arranging electrodes only on the back side of cellfor maximizing the surface area to be exposed to the sun light. This has broken the then world
record of photovoltaic conversion efficiency of 25.0 % achieved by University of New South Walesin 1999. This is the first world record after 15 years for crystal silicon-based solar cells. Since thiswas achieved on cells of a commercial size, it is expected to directly contribute to improve
efficiency of solar cells on the market.

Startup of demonstration operation of a floating offshore
wind power system equipped with a transmission anddistribution unit

In November 2013, Fukushima Offshore Wind Consortium started operating the Fukushima
Recovery, Floating Offshore Wind Farm Demonstration Project - the world's first case of its kind.
Bottom-founded offshore wind power generators have been developed and used commercially ona large scale in Europe for over 20 years. Meanwhile, floating offshore wind power generators
have been built only in recent years on a demonstration basis in Norway and Portugal, leaving
technical problems unsolved for floating power generation, transmission and transformation. The
Fukushima Recovery, Floating Offshore Wind Farm Demonstration Project is the world's first caseof demonstration conducted using commercial-scale facilities to verify technologies to solve suchissues.Development of a prototype vehicle running on a liquid
fuel cell free of noble metals

In the Tokyo Motor Show of November 2013, Daihatsu Motor revealed a prototype vehicle "FCDeco DECK," which uses a fuel cell equipped with electrodes free of platinum or any other noble
metal. Daihatsu Motor had succeeded in developing a non-platinum electrode for anion-exchange
fuel cells, jointly with the University of New Mexico. The success led to the development of thenew prototype vehicle. By reducing the high cost of platinum or other noble metals, which had longbeen used in fuel cells for vehicles, the new type fuel cell also has the high potential for
proliferation in fuel cell vehicles.

Dramatic efficiency improvement in perovskite-typesolar cells

Developed for the first time in 2009, perovskite-type solar cells initially had efficiency of only 3.8%.
Subsequent development efforts have led to remarkable efficiency of 17.9%, showing
unprecedented fast advancement. Although we still need to lower production cost and enhancestability of the perovskite-type cells, its efficiency is now comparable to silicon type cells. Efficiencyof perovskite-type cells is expected to further improve in years to come and promote wider use.

Successive announcement of commercial operation ofCCS systems for coal-fired power plants

The CO 2 recovery and storage technology is expected to contribute to curb global warming.
However, since it is costly to introduce the technology, it has not been utilized by thermal power
plants so far. Nevertheless, commercial CCS projects for power plants have been increasingly
active thanks to governments’ support in some countries. For example, the Boundary Dam CCS
Project in Canada is the world’s first-ever project in commercial scale which comprehensively
deals with recovery after burning, transport and storage of CO2 in a commercial coal-fired power
plant. Their construction completion and inauguration of commercial operation of CCS system is
expected in 2015. The recovered CO 2 will be used not only for CO 2 -EOR but also for safety
evaluation and study of aquifer storage. Meanwhile, Parish Coal-Fired Power Plant in Texas, US,
is considering introducing a larger CCS system, which is scheduled to start commercial operationin 2016.

Disaster-resistant microgrid technology

In the wake of large-scale natural disasters such as the Great East Japan Earthquake andextraordinary hurricanes in the United States, microgrids have been attracting a keen interest as adisaster-resistant system capable of supplying electricity independently in a power outage. Thereis a growing tendency to introduce microgrids into key facilities and urban communities. Under
these circumstances, a number of demonstration projects have been carried out in the UnitedStates and other countries, including a high-reliability power supply system in New Mexico, U.S,
that works independently in buildings in a power outage, an uninterruptible power supply project in
California, and a microgrid system in Santa Rita Jail. These microgrid technologies, mainly aimed
to counter disasters, are expected also to make substantial contribution to GHG reductions.

Development of a new type of a nanostructured
carbon-based catalyst electrode for next-generationfuel cells

Los Alamos National Laboratory (LANL) developed, in June 2013, a carbon-based catalyst
electrode with nano-structure for next generation fuel cells. Most of the existing electrodes use
platinum as a catalyst. The high cost of rare platinum is the major challenge. Even though it is also
indispensable to use high-performance, high-reliability alkali electrolyte, the new type of catalyst
indicated the possibility of replacing expensive platinum.

Initiative for a vehicle-to-building system in progress

Vehicle-to-building systems deployment, in which batteries for electric vehicles are used as apower source, are now fully in progress in various parts of the world, including Japan, the UnitedStates, and France. In July 2013, Nissan Motor developed and started a demonstration project ofa vehicle-to-building system, by applying its "LEAF to Home" power supply system for households.
The experiment succeeded in cutting power consumption during peak hours by providing
electricity from the EVs via this system prior to peak hours.

Development of a SiC power semiconductor for
automobiles

In May 2014, Toyota Motor Corporation was the world's first to a power control unit using a SiC
power semiconductor, which was developed in collaboration with DENSO Corporation and Toyota
Central R&D Labs, Inc. They confirmed that Prius’ fuel efficiency had been improved by 5% when
the unit was applied to the car model. The development indicates solutions to enlargement andquality enhancement of SiC wafers and to establishment of SiC semiconductor process. It does
not only indicates the possibility of future fuel efficiency improvement of Electric Vehicles, Hybrid
Vehicles and Fuel Cell Vehicles, but also the possibility of extended application of SiC wafers toother industrial devices, contributing to significant CO2 emissions reduction.