The Japan Gas Association
1-15-12 Toranomon Minato-ku, Tokyo105-0001, JAPAN19 October 2020
JGA Chair Michiaki Hirose Press conference on 19 October 2020
Summary of remarks

1. LNG Producer Consumer Conference 2020 The 9th LNG Producer Consumer Conference was held by online
because of the COVID-19.
 At the beginning, Minister of Economy, Trade and Industry Kajiyama
stated an LNG strategy suitable for a new era in the midst ofenvironmental changes such as corona and decarbonization, and aimed
at expanding and make it flexible LNG markets and expanding the use ofcleaner LNG. We recognized that the Minister stated that Japan would
take the lead in improving international momentum.
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I would like to introduce some key-phrases of the Conference.
The first agenda was " Price mechanism favorable and sustainable forboth producer and consumer of LNG ". Panelists of the session stated; "Acommon price index that reflects supply and demand is needed.","Diversity of contracts is required to complement each other in complex
markets.", Long-term partnership with equality and mutual trust isessential."

The second agenda was, "De-carbonization through LNG value chain".
Panelists of the session stated, " LNG plays a major role as a substitutefor coal and for backing up and expanding renewable energy, and willcontinue to grow for the time being, especially in Asia." All stakeholders
need to work together for decarbonization for the future.", "To achieve
those, it is necessary to verify warming gas emission data for the entire
supply chain.", "Cost reduction of decarbonization through innovation andR & D is essential."1As a whole, while the growth of LNG will continue to be important as arealistic option to achieve both environmental friendliness and economicgrowth, there are also issues that need to be resolved. However, I
received a strong message from the conference that the issue could besolved by cooperation of all stakeholders and the future of LNG could bebrightened through cooperation.
To solve such issues, the Japan Gas Association will work on : 1) securingflexibility in the contract period and realize index links that reflect supply
and demand, 2) CO2 reduction through support for the spread andexpansion of distributed energy systems such as cogeneration, anddecarbonization by supporting innovation such as methanation*.

2. Status of full liberalization of gas retailing : three years and a half
have passed since the liberalization started from April 2017
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The number of switching cases exceeds 4 million nationwide, and about
half of them, more than 2 million, are in the Kanto region.
Looking at the switching rate, the national average is just over 15%, but at
Kinki (Kansai) and Chubu-Hokuriku regions, fierce competition continues,exceeding 20%. In addition, Hokkaido Electric Power Company entered
gas retail market in October this year. From Hokkaido to the north toKyushu, the flow of liberalization is spreading nationwide, just likeelectricity.
Comparing the switching situation three and a half years after theliberalization on the same level as electric power, gas is 20.4% andelectricity is 18.2%, and gas market is a little more competitive.
As I mentioned above, the liberalization of gas is steadily progressing, andalthough there are some difficult aspects from the standpoint of gas
companies, each company will continue to make various ingenuity andefforts in order to overcome this competition.

3 . Living and Town Future Conference 2020
The conference, which started last year, will be held online on October
28th this year because of COVID-19. Considering changes in the2environment caused by COVID-19 etc., we plan to disseminate
information on the importance of energy saving, environmental
friendliness, health and comfort, resilience, etc. in daily life and towns.
Specifically, including a keynote speech by Ms. Yoko Takeda of Mitsubishi
Research Institute, a panel discussion on the value of ENE-FARM in theCOVID-19 disaster and the future of changing living, and a decentralized
type integrated with urban development. We are planning to introduce
promotion measures such as distributed energy and examples of bestpractices.
We hope that this will be an opportunity to find hints on how we can live ahealthy and comfortable life while responding to the trend ofdecarbonization and the frequent natural disasters.

4 . Study committee on the Ideal Gas Business for 2050 [2nd (October6th)]

Following the last month, the 2nd meeting of "the Study committee on theIdeal Gas Business for 2050" was held on October 6th. The theme for themeeting was "low-carbon and de-carbonization" and "strengthen themanagement foundation". From the gas industry, Tokyo Gas and Osaka
Gas made presentations for the efforts and future challenges related tomanagement base and strengthening low-carbon and decarbonization.
The two committee members also gave us suggestive talks about thefuture of the gas business in a low-carbon and decarbonized society.
We hope to deepen the discussion in the future and reflect the results
here in the next Energy Basic Plan, which was started the other day.
We hope that the discussions will be further deepened and that the results
there will be reflected in next Strategic energy plan of the government
which was started to discuss the other day.

*methanation: one of carbon capture and recycle technology to synthesize methane from CO2-freehydrogen and CO2.

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