Shikoku Electric Power Group
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Shikoku Electric Power Group INTEGRATED REPORT 2023

Editorial Policy
This report has been compiled as an integrated report to provide all stakeholders, including
shareholders and investors, with a better understanding of the Shikoku Electric Power Group by
presenting our Group's basic approach to creating sustainable corporate value, as well as an
overview of the status of actual initiatives and the outlook for the future, including both financial
and non-financial information.
Further detailed content that was not published in this report is available on our website.
We hope that this report will help build good relations between our Group and stakeholders.
Shikoku Electric Power Outline (in Japanese only)
https://www.yonden.co.jp/corporate/yonden/index.html
Investor Relations
https://www.yonden.co.jp/english/ir/index.html

Shikoku Electric Power GroupINTEGRATED REPORT

ShikokuElectricPower
Company
Website2023

Initiatives for Sustainability (in Japanese only)
https://www.yonden.co.jp/corporate/csr/index.html
Carbon Neutral Challenge (in Japanese only)
https://www.yonden.co.jp/corporate/carbon_neutral/index.html
Corporate Governance (in Japanese only)
https://www.yonden.co.jp/corporate/ir/policy/governance.html
Shikoku Electric Power Group Information (in Japanese only)
https://www.yonden.co.jp/corporate/yonden/group/index.html

Reporting Period
FY2022 (April 1, 2022−March 31, 2023)
However, when it is appropriate to show past historical data and recent cases, we report on
matters that fall outside this period.

Scope of Reporting
This report covers Shikoku Electric Power Co., Inc. (the Company) and its subsidiaries andaffiliated companies.

Reference Guidelines for Presentation of Non-Financial Information

・ “Guidance for Integrated Corporate Disclosure and Company-Investor Dialogues for
Collaborative Value Creation,” Ministry of Economy, Trade and Industry
・“International Integrated Reporting Framework,” International Integrated Reporting Council (IIRC)
・“Sustainability Reporting Standards,” Global Reporting Initiative (GRI)
・“Environmental Reporting Guidelines (2018 version),” Ministry of the Environment
・ “Recommendations of the Task Force on Climate-related Financial Disclosures,” Task Force on
Climate-related Financial Disclosures (TCFD)・ “SASB Standards for Electric Utilities & Power Generators,” Sustainability AccountingStandards Board (SASB)

Publication Date
Japanese version: Published September 2023; English version: Published November 2023

Contact Information
Policymaking & Strategy Planning Group, Corporate Planning Dept., General Planning Division(Shikoku Electric Power Co., Inc.)
2-5, Marunouchi, Takamatsu, Kagawa 760-8573, Japan
TEL: +81-87-821-5061 (Receptionist) Fax: 087-825-3018 E-Mail: ir@yonden.co.jp

Caution Regarding Business Forecasts and Forward-Looking Statements
Forecasts included in this document are forward-looking statements based on data available atthe time of their release and assumptions that are deemed reasonable. Actual results may differ
substantially due to a number of factors.

01

Shikoku Electric Power Group INTEGRATED REPORT 2023

Contents

Shikoku Electric Power Group
Value Creation
Shikoku Electric Power Group Vision ……………………………………

3

History of Shikoku Electric Power Group ………………………………

5

Sustainable Value Creation Process ……………………………………

7

Shikoku Electric Power Group Medium-Term Management Plan 2025 ……

9Group Strengths in the Value Chain ……………………………………

11

Business Management that Increases Sustainability (ESG Initiatives) ……

13

Shikoku Electric Power Group by the Numbers……………………

15

Carbon Neutral Challenge 2050 …………………………………………

17

Promotion of Digital Transformation (DX) ……………………………

20

President’s Message ………………………………… 21
Value Creation through Business
Activities
Electric Power Business …………………………………………… 29
Electric Power Generation ………………………………………… 31
Sales …………………………………………………………………… 37
Transmission & Distribution ……………………………………… 39
Businesses Other than Electricity……………………………… 41

Expansion of Growth Businesses ………………………………… 42
Creation of New Business and Services ……………………… 45

Business Management that Increases
Sustainability (ESG Initiatives)
Initiatives that Increase Sustainability ……………………………… 47
E: Responding to Environmental Issues …………………………… 48
S: Coexisting in Harmony with Communities and Maintaining and
Improving Employee Motivation ………………………………… 55
G: Enhancing Corporate Governance ……………………………… 61

Financial/Corporate Information
Main Data on Electric Power Business …………………………… 72
10-Year Financial Summary ………………………………………… 73
Main ESG Data ………………………………………………………… 75
SASB Standards INDEX ……………………………………………… 77
Management Discussion and Analysis (Consolidated) …………… 79
Corporate Data and Stock Information …………………………… 81

Shikoku Electric Power Group INTEGRATED REPORT 2023

02

Shikoku Electric Power Group Value Creation

Shikoku Electric Power Group VisionWe, the Shikoku Electric Power Group, share with employees our desire to be a force for the happiness of ourcustomers and community members, and will, as a multi-utility corporate group supporting work and life, contribute to
comfortable, safe, and secure living, and to the Shikoku region’s development.

Shikoku Electric Power Group’s
Mission and Ultimate Purpose
We are committed to the continuous provision ofhigh-quality services, centered on energy, that interconnect
with the lives that people lead. In this way, we contribute to
comfortable, safe, and secure life as well as to the Shikoku
region’s development.

Creating
the future

Corporate message

Seeking to bea force for happiness

03

Shikoku Electric Power Group INTEGRATED REPORT 2023

Eco-friendly

Community
coexistence

Three key points inrealizing our group vision

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Shikoku Electric Power Group’s Future Vision

Aiming to be a multi-utility
corporate group supporting
work and life
By toughening and diversifying our infrastructure, technologies and services
centered on the electric power business, and entering new business and market areas,
we will aim to increase our corporate value and contribute to the development of the
Shikoku region as a “multi-utility corporate group supporting work and life.”

Creation of affluent
lifestyles through smart
technology
We will promote DX and provide
various services centered on theenergy and telecommunications
services fields as a “platform in the
Shikoku region”

Realization of adecarbonized society
We will promote the low carbonizationand decarbonization of power sources,
the further use of electric energy, andtake on the challenge of becoming“carbon neutral in 2050”

Issue resolution andeconomic revitalizationin the Shikoku region
We will promote initiatives that
contribute to the growth andrevitalization of local communities andthe expansion of the nonresident
population

Shikoku Electric Power Group INTEGRATED REPORT 2023

04

Shikoku Electric Power Group Value Creation

History of Shikoku Electric Power Group
Since our founding, we have fulfilled our public-interest mission as an energy supplier while expanding our business bysolving social issues that change with the times, and digging up customer needs.

1951 (Founding) to 1970
SocialSituation

Our
company’s
moves

Surge in electric power demand due to higheconomic growth

1971 to 2000
The oil crisis, the bubble economy and its collapse, and economic globalization<Power supply development andgrid development><Construction of a well-balanced power source configuration and the enhancement of
main power transmission systems>

・Shift in power sources development away fromhydroelectric power generation, mostly towards
oil-fired power generation
・Construction of transmission and distribution
facilities in parallel・After the oil crisis, we promoted the development of coal-fired, nuclear and other power sources to realize awell-balanced power source configuration
・We switched to 500 kV main transmission lines and regional interconnectors connecting to Honshu via two routes<Electric power business>

1970

Sakaide Power Station (oil)commenced operation

1965

Saijo Power Station (oil)commenced operation

1953

1977

2000

Tachibana-wan Power Station (coal)commenced operation

1994

Ikata Power Plant Unit No. 3(nuclear power) commenced
operation

Ikata Power Plant Unit No. 1(nuclear power) commenced
operation

Matsuogawa Daiichi Power
Station (hydropower)commenced operation

2000

Operations commenced at
Anan-Kihoku DC main line

1994

1982

J-POWER interconnectors
commenced operation between
Honshu and Shikoku

Hongawa Pumping Power
Station commenced
operation

1962* Anan Converter Station, which is theentry point on the Shikoku side.

220 kV operation commenced on
J-POWER’s Chushi main line

* The Honshu-Shikoku interconnectors are attachedto the bridge girders of the Seto Ohashi Bridge.

1994

500 kV operation commenced on
the Shikoku-chuo main line

1962

180 kV operation of main power transmission
system commenced in Shikoku<Businesses other than electricity>
05

Shikoku Electric Power Group INTEGRATED REPORT 2023

1997

District heating supply
business commenced* The Sunport area of Takamatsu City,
where Shikoku Electric Power supplies heat.

fShikoku Electric Power Group
Value Creation

President's Message

2001 to 2010

Changes in society in association with the spread of the internet
and mobile phones

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information2011 to present

Great East Japan Earthquake, expansion of renewable energy introduction,
crisis in Ukraine, and promotion of GX<Liberalization of electricity retailing and expansionof telecommunications business, etc.><Sudden changes in electric power business environment andtaking on the challenge of becoming a multi-utility company>

・After liberalization, electricity rates were reduced multiple times
・Biomass co-firing with coal-fired power ahead of competitors
・Expansion of IT/Communication business and entry into international business・Rapid increase in renewable energy sources linked to the power system
・Higher efficiency and low carbonization of thermal power generation through replacement
・Expanding operations in businesses other than electricity

2010

Replacement of Sakaide Power Station
Unit No. 1 with LNG-CC
Commencement of operation at
Sakaide LNG terminal

2023

Replacement of Saijo
Power Station Unit No. 1

2016

Replacement of SakaidePower Station Unit No.2
with LNG-CC

2010

Expansion of Matsuyama
Solar Power Station

2005

Woody biomass co-firing
commenced at Saijo
Power Station

2020

The transmission & distribution
business was spun off

Shikoku Electric Power
Transmission & Distribution Companyof Feed-in Tariff (FIT) system with
2012 Commencement
fixed purchase price for renewable energy

1996-2008

7 rate reductions throughincreased efficiency of management

and cancellation of treasury stock
2001-2011 Buy-back(cancellation of approx. 57 million shares)

2004

2008

Grid-connected capacityof solar and wind power

Approx.

490 MW

Approx.

(end of fiscal 2012)2013

Commencement of data
center business

3,610 MW

(end of fiscal 2022)

2022

Commencement ofoperations at
Niihama LNG Co., Ltd.

Overseas IPP business
commenced

Optical telecommunications
services business supplying individual
households commenced (STNet, Inc.)

Businesses Other
than Electricity

Fiscal 2011 operating profit * Qutar−Ras Laffan C
Power and Water Project

5.6 billion yen

Growth in profits

Fiscal 2021
ordinary profit in above

18 billion yen

Shikoku Electric Power Group INTEGRATED REPORT 2023

06

Shikoku Electric Power Group Value Creation

Sustainable Value Creation Process
We will realize the creation of sustainable corporate value by forging stronger relationships of trust with every stakeholder
who supports our Group’s business, and fulfilling our social responsibilities widely through business activities.

Aiming to be a multi-utility corporate group supporting work and life

Creation of sustainable corporate value

Revealing social issues

・Realization of

low-cost and stableenergy supply(ensuring energy
security)

・Realization of adecarbonized society in
2050 (decarbonization of
power sources andpromotion of theelectrification of society)

Management strategy /Business strategy

Value creation throughbusiness activities

diversification of work styles

Shikoku ElectricPower Group・Increase and intensification ofMedium-Term
Management Plan
2025

Electric powerbusiness
Businesses Other
than Electricity

Environment
issues・Lifestyle changes and・Declining population,
dwindling birthrate and aging
societynatural disasters

Changes insocietyE

SSocialEnvironment

Recognition of risks and opportunities
for sustainable value creation

G

Changes in business climate

Governance・Steep rises in fossil fuel prices[Core competence]Management resources

and wholesale electricity
market prices

・Heightened risks from a tight[Mission and reason for being]supply/demand balance forelectricity

・Large-scale introduction ofrenewable energy powersources

Changes ingovernment policies,
systems, andregulations

Contributing to comfortable, safe and secureliving and the development of regional communities

・Stronger nuclear power[Action charter]

Sustainable growth and development throughthe fulfillment of social responsibility

generation safety
regulations

・Competition inelectricity retailingbusiness

・TechnologicalTechnologicalinnovation

innovations andpromotion of DX[Corporate message]

Seeking to be a force for happiness[Corporate philosophy]

Living in the community, moving forward with thecommunity, and prospering with the community

07

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

・Providing stable,

high-quality, andlow-cost energy

Customers

Management strategy / Business strategy<Medium-Term Management Plan 2025>

See pages 9—10

・Providing society

with useful products
and services

・Returning profits toStrive toward sustainable creation of value by
combining the electric power business andbusinesses other than electricity

Shareholders
andInvestors

Electric power business
Strengthening of business foundations and improvementof profitability in electric power generation, sales,
and transmission and distribution

shareholders by continuously
improving corporate value

・Prompt and appropriate

disclosure of information

・Coexistence and sustainable
development with regionalsocietyBusinesses other than electricity
Expansion of growth businesses centered on IT /Communication business and international business

Regional
Society・Thorough implementation ofcompliance

Creation of social value

Offer value to stakeholders

Business management that increases sustainability<Continuous ESG Activities>

・Minimizing environmental impact

See pages 48—70

Identify key issues (Materialities) that are closely linked
to business activities and promote continuous initiatives
through annual PDCA cycles

and contributing to the realizationof a decarbonized society

GlobalEnvironment

・Promoting environmental
preservation activities

・Respect for personalities andindividuality, and promotion ofdiversity

Management resources (Core competence)
Diverse and highly
competitive power
generation mix

Highly reliabletransmission anddistribution network

Strong credibility and brandpower in Shikoku region

Employees

・Commitment to providing safe
and comfortable working
conditions

Abundant humanresources, technologies,
and knowhow

・Implementation
Suppliersof fair and free
tradeSound financial structure

Shikoku Electric Power Group INTEGRATED REPORT 2023

08

Shikoku Electric Power Group Value Creation

Shikoku Electric Power Group
Medium-Term Management Plan 2025
- Reforming and taking on challenges for sustainable growth and development -Policy for Initiatives Targeting Fiscal 2025
With our core electric power business and businesses other than electricity as our twin wheels, we will “strengthen thebusiness foundations and improve the profitability of electric power generation, sales, transmission and distribution business”
and “expand growth business centered on telecommunications business and international business,” while making
maximum use of the Group’s management resources and cooperating positively with the region and other businesses.

Maximized use of management resources

Strengthening of collaboration with the region /other companies

Business activities (Sources of sustainability)[Electric power business]
Strengthening of businessfoundations and improvement of
profitability of electric power
generation, sales, transmission
and distribution

Creation ofsustainable corporate
value[Businesses other thanelectricity]
Expansion of growthbusinesses centered on IT /Communication business andinternational business

Promotion of DX(Acceleration of business activities)

Offer value to stakeholders<Reference>
Positioning of Medium-Term Management Plan 2025

Medium-Term
Management
Plan 2020

FY2016-FY2020
FY2011-FY2015
Overcoming the crisis
that occurred inassociation with thesuspension of operationof all nuclear power
plants following theGreat East Japan
Earthquake

09

Medium-Term
Management
Plan 2025

FY2026-FY2030

FY2021-FY2025
Period in which the Groupis building a solid
foundation for its vision forfiscal 2030

The profitability of theelectric power businessdeclined due to a fall inthe operation rate of Ikata
Unit No. 3 as a result of aprovisional disposition,
more intense retailcompetition, and othersuch factors

Shikoku Electric Power Group INTEGRATED REPORT 2023

ShikokuElectric PowerGroup Vision

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information(Announced in March 2021)

Management Indicators, Shareholder Returns
FY2016 to FY2020 FY2025(average results for(targets)the past 5 years)

Managementtargets

FY2030(long-term targets)

We will continue to acquire profits thatexceed the cost of capital.

2.0%

ROA
Approx. 3%(ROE: Approx. 7%)(ROE 4.4%)

4.0%

3.0%

(7%)

billion yen

Approx. 35
billion yen(Value at end
of FY2020)

Shareholders’Equity Ratio

More than 25%(Interest-bearing
debt ratio: Less
than 2.0 times)

(8%)

50.0

35.0

(Interest-bearing (2.0 times)
debt ratio: 2.4 times)

Cash flows
from operating
activities

billion yen

billion yen

IT/Communication business

International business

International businessElectric power generation & sales business:
approx. 11 billion yen
Transmission & distribution business:
approx. 6 billion yen<10-year average>
About 110 billion yen

120.0

billion yen

billion yen

billion yen

Profit target by segment(1.5 times)

110.0

83.9

Approx. 110
billion yen

Electric power business

30.0%

25.0%

22.8%

We will acquire funds for growthinvestment andcapital policy steadily

20.4

FY2030(long-term targets)

We will aim to balance securing financial
soundness with the reduction of capital costs.

We will aim to maintain andexpand business scale

Ordinary profit

FY2016 to FY2020 FY2025(average results for(targets)the past 5 years)

Managementtargets

Electric power generation & sales business:
approx. 18 billion yen
Transmission & distribution business:
approx. 6 billion yen

8.0

billion yen

7.0

billion yen

6.6 billion yen(Including international
business)

7.7

billion yen

Approx.

4.0

Consolidated
ordinary profit

billion yen

Consolidated
Ordinary Profit

50%

8.0

Consolidated
Ordinary Profit

billion yen

Approx.

50.0

50%billion yen

35.0

billion yen

20.4

billion yen

10.0

8.0

6.1

billion yen

billion yen

billion yen

FY2016 to FY2020(Average results for the past 5 years)

FY2025

FY2030(Targets)(Long-term targets)

Cash flow allocation (FY2021 to FY2030)

Cash flows from operating
activities
1,100 billion yen

Maintenance and renewal
700 billion yen

Strategic
investment
200 billion yen

Expansion of renewable energy, low carbonization of thermal power
generation, investment in international and new business, etc.

Capital policy
200 billion yen

Dividends, reduction ofinterest-bearing debt, etc.

Shareholder Returns

Basic policy

Target to aim for・Our basic policy for shareholder returns is to issue stable dividend payments. We will determine dividend levels based on
thorough consideration of such factors as business performance, financial condition, and the medium-to long-term outlook
for the operating environment.
・We will work toward early dividend payments of 50 yen per share, assuming that the safe and stable operation of Ikata
Unit No. 3 leads to such outcomes as a normalized business environment and the securing of stable profits.

・We will aim for the further expansion of shareholder returns by achieving the target profit level as we head towards fiscal
2030.

Shikoku Electric Power Group INTEGRATED REPORT 2023

10

本店

Shikoku Electric Power Group Value Creation

Group Strengths in the Value Chain
We deliver a wide range of value to customers and business partners by maximizing the Group’s strengths, from fuelprocurement to power generation, transmission, distribution, and energy services, focused on the electric powerbusiness.

Fuel procurement

Electric power generation

We conduct the economical and stable procurement of coal, LNG,
and oil in thermal power generation, and uranium used in nuclear
power generation based on the characteristics of fuel types.
Used nuclear fuel is stored at the power station and then sent to a
reprocessing plant, where it is reused as fuel after processing.

From an S (Safety) + 3Es (Energy security, Economic
efficiency, and Environment) perspective, we are aiming torealize a well-balanced power source configuration basedon the individual characteristics of nuclear, renewableenergy and thermal power sources, and we are conducting
economic demand-supply operations.

Highly reliable transmission anddistribution network

Competitive and well-balanced
power generation mix● Proportion of baseload powersources with low generation cost*
Approx.

● Proportion of environmentally-friendly

renewable energy and nuclear power
among internal power sources

Approx.

50● World-leading quality electricity%

United States (California)

40

Italy
France%● Resilience during disasters

Our large power stations are distributed along the Seto
Inland Sea, far from the assumed epicenter of a major
earthquake (in the Pacific Ocean).

* Baseload power sources means nuclear, hydro (run-of-river type) and coal.

Abundant human resources, technologies,
and knowhow● Possess a wide range of human resources

Construction andengineering businessApprox.

8,000
people3%

11

Others:Electric
powerbusiness:

53%

Agriculture

10%

60

…

450 (minutes)● Resilience during disasters

The main transmission lines are connected to Honshu
via two interregional interconnectors.

Strong credibility and brand power in
Shikoku region

23

Reliability survey of
Shikoku Electric Power

1.90

Confidenceof approx.

Transmission& distribution

Total:

261

16

patents

Approx.
IT/
Communication
business

12
Measurement
technology

Number of contracts forindividuals and households

69

5

Chemistry
IT/Communication
business

30

that is closely rooted to the Shikoku region

Electric power
generation &
sales

76

17

Energybusiness

19

Manufacturing
Others:%0

Source: “Overseas Electric Power Industry Statistics 2022,” Japan Electric Power Information Center

Number of patents held
Others17%

United Kingdom
Shikoku Electric Power
Transmission &Distribution Co., Inc.

● Maintain high reliability as an energy company

primarily in the electric power business
Number of employees

Trends in annual power outage time per customer
home compared to overseas * Excluding work-related power outages

4Construction andengineering

37

Shikoku Electric Power Group INTEGRATED REPORT 2023

millionNote: Our share of low-voltage contracts for electricity
sold in the Shikoku region: Approx. 85%
Note: Implementation date: October 2022
Subjects: 2,000 people 18 to 69 year-old men
and women living in Shikoku

86%

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Electricity Supplied

Business Management that
Increases Sustainability

Financial / Corporate Information

Total Electricity Sales

Retail sales

23,413

Own generated
power

Purchased Power

14,66019,827
FY2022

Other(Purchased Power,
WholesaleExchanges, etc.)

34,487Wholesale

9,339

Thermal(million kWh)

8,520

Lighting

FY2022

7,686

32,752

11,133(million kWh)Power

Nuclear15,727

6,903

Renewable energy

6,140

Renewable energy

1,791

Transmission & distribution

Providing energy services

We consistently deliver low-cost, high-quality electricity to ourcustomers by improving the supply reliability of our transmission,transformation, and distribution equipment.
To prepare for large-scale disasters, such as future Tonankai
and Nankai earthquakes, we are preparing counter measuresagainst tsunami and restoration systems for our equipment.

We offer a wide range of services in electric power business,
IT/Communication business, LNG sales business and otherfields, making full use of the trust and brand power we have built
over many years and the abundant human resources,
technologies and knowhow of the Group.

Facilities for electric power business (As of September 30, 2023)

Sakaide (Total: 1,385 MW)
Unit No. 1: 296 MW (LNG)
Unit No. 2: 289 MW (LNG)
Unit No. 3: 450 MW (oil, etc.)
Unit No. 4: 350 MW (LNG, etc.)

Honshu-Shikoku (Honshi)
interconnected lines(2 lines, 1,200 MW)[between Shikoku and Chugoku]

Saijo (Total: 750 MW)
Unit No. 1: 500 MW
Unit No. 2: 250 MW(Coal and woody biomass)

Takamatsu
KagawaAsa

Okawa
To southern partof Awaji Island

NarutoSanukiToyo

Nyugawa

Matsuyama

Saijo

Kawauchi

Hongawa
Bunsui Daiichi

Yanadani
Omogo Daisan

Odo

Awa

Matsuogawa Daiichi
Kagedaira

Hirayama

HironoAnan Converter station
Anan-Kihoku DC main line
(1,400 MW)(between Shikoku and Kansai)

Kochi

Hongawa (615 MW)
Hiromi

Ikawa

KokufuMatsuogawa Daini

Matsuyama

Ozu

Unit No. 3: 450 MW (oil)Mishima

Kitamatsuyama

Anan (450 MW)

Naharigawa

Tachibana-wan (700 MW)
700 MW (coal)

615 MW (water pumping)

Ikata (890 MW)
Unit No. 3: 890 MW(As of March 31, 2023)

Substations (500 kV)
Nuclear Power Station
Substations (187 kV)
Thermal power Station
AC/DC Converter station
Hydropower Stations (over 20 MW)
Solar Power Station* Dotted lines (transmission lines)
represent equipment (power lines)
Transmission line (500 kV)
from other companies.
Transmission line (187 kV)Transmission line length

3,398kmDistribution line length

46,357km

Substations 240 locations

23.26 million kVA

Shikoku Electric Power Group INTEGRATED REPORT 2023

12

Shikoku Electric Power Group Value Creation

Business Management that Increases
Sustainability (ESG Initiatives)
Based on the perspectives of E (Environment), S (Social) and G (Governance) and the SDGs in our Group’s region,
we have identified priority issues that are closely linked to our business activities and are advancing sustainablevalue creation initiatives while fulfilling our social responsibilities.

Priority issues to increase sustainability (Materialities)

E (Environment)

E

Realization of adecarbonized society

・Consideration and implementation of CO2 emission reduction measures inconsideration of government energy and environmental policies

Strategy planning andinformation disclosure

・Enhancement of strategy planning and information disclosure based on
TCFD recommendations
・Promoting understanding of climate change measures among
stakeholders

Formation of arecycling-based society

・Promoting the reduction, reuse and recycling of waste

Promotion of regional
environment preservation

・Appropriate implementation of environmental monitoring during
construction work and publication of results
・ Positive promotion of environmental preservation activities together withthe community

Communication with
regional society

・Continuous implementation of activities to promote a relationship of trust
to connect with local people
・Continuous implementation of energy-related education for the next
generation

Promotion of
measures against
climate change

Advancingenvironmental
preservation activities

S

S (Social)

Promotion ofcoexisting in harmony
with communities

Regional revitalizationand issue resolution

・Continuous implementation of various activities that contribute to regional
revitalization and resolutions to local issues

Promotion of diversity
and inclusion

・Fostering a work environment where diverse human resources, including
women and people with disabilities, can play active roles

Creating comfortableworking environments

・Improvement of productivity and workplace vitality based on workstylereforms

Stringent occupational
health and safety measures・Thorough implementation of basic rules through safety education
・Promotion of disease control and mental healthcare

Acquisition and developmentof human resources who willcontribute to the company’s
growth・Enhancement of education and training for human resource development
・Passing on the necessary capabilities for the electric power businessCo-existence andco-prosperity with suppliers・Continuous implementation of fair and free transactions as equal partners

Enhancing corporate
governance・Improving the transparency and quality of management by strengthening
management supervision functions, etc.

Improvement of corporate
value through IR activities

・Implementation of two-way communication with shareholders andinvestors

Promoting compliance・Thorough implementation of legal compliance and corporate ethics

Ensuring of information
security

・Promotion of measures to improve information security
・Thorough implementation of personal information management andeducation

Fostering employee
motivation

Maintenance andimprovement ofpartnerships with
suppliersG
G (Governance)

Practicing transparent
management

13

Promoting compliance

Shikoku Electric Power Group INTEGRATED REPORT 2023

RelatedSDGs

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Key Indicators and Initiatives

See pages 75-76

Financial / Corporate Information

Please refer to "Main ESG Data" for the definition of ESG indicators and changes over time.

Fiscal 2022 Results
CO2 emissions from theretail sector(values excluding the FIT
free allocation)

Business Management that
Increases Sustainability

Numerical targets andfiscal 2023 policies

11.70 million tons-CO2<FY2030 target>
Approx. 9.8 million t-CO2(down 50% from FY2013)

Capacity fromdevelopment of new
renewable energy sources

Total: 300 MW<FY2030 target>
Total 500 MW

Coal ash recycling ratio

99.6％<FY2023 target>
99% or more

Long-term
management targets

ShikokuElectric PowerGroup Vision
See pages 3-4

Intensity of SOx/NOx
emissions

SOx 0.1 g/kWh
NOx 0.3 g/kWh<FY2023 target>
SOx 0.3 g/kWh or lessNOx 0.5 g/kWh or less

Implementation ofvisiting-for-dialogues
activities at Ikata
Power Plant

Implemented for 27,000 homes

Continued on the same scale

Activities at Shikoku-ke
Supporters Club

Implementation of various lively events

Expanding activities in cooperation
with other companies

Ratio of female managers

3.5％<FY2025 target> 5% or more

Rate of taking childcare leave(when also including
vacation taken for the
purposes of childcare)

100% for female employees and9.6% for male employees (89%)<FY2025 target> 100% for female
employees and 15% or more formale employees

Promotion of healthmanagement

Certified as an Health andProductivity Management
Organization (four consecutive years)

Health and Productivity Management
Organization

Acquisition anddevelopment of humanresources

Implementation of training for acquisitionand succession of technical skills in theelectric power business; expanding work
experience outside the company, etc.

In addition to continuing theinitiatives described on the left,enhancing mid-career recruitment

Maintaining andenhancing efforts toimprove partnerships
with suppliers

Compliance with the Declaration ofPartnership-Building

Continuous implementation

Frequency andattendance rates ofmeetings of the Board of
Directors and Audit &Supervisory Committee

Board of Directors: 11 meetings, 98.7%
Audit & Supervisory Committee:
18 meetings, 97.7%

Further enhancement of content

Implementation of
IR activities

Company briefings by the President:
twice
1 on 1 meetings by IR Secretariat: 70
times, etc.

Further enhancement of content

Promoting compliance

Participation rate in complianceeducation - 100%

Continuous implementation of employee
education activities; strengthening ofinternal controls by Conduct Policy
Compliance Project; establishing rules forcontact management with competitors

E（Environment）

See pages 48-54

S（Society）

See pages 55-60

0 casesPreventing security incidents andminimizing impact through rapid
response

G（Governance）

See pages 61-70

Serious security incidents

Management targetsof Medium-Term
Management
Plan 2025
・ FY2025 targets
・ FY2030 targets
See pages 9-10

Carbon Neutral
Challenge 2050
<CO2 emissions>
・ FY2030 targets
・ FY2050 targets

See pages 17-19

Shikoku Electric Power Group INTEGRATED REPORT 2023

14

Shikoku Electric Power Group Value Creation

Shikoku Electric Power Groupby the Numbers
We are aiming for the realization of sustainable value creation by raising target indices not only in the financial
aspect, but also in non-financial aspects related to the environment, society, and corporate governance.

Financial Highlights
Ordinary profit (loss) / Net profit (loss) attributeto owners of the parent company

Operating revenues■ Electric power business■ Businesses other than electricity

billion yen

billion yen

735(billion yen)

98.1

400

639.6

102.8

631.4

30

106.7

616.3

20

16.9

18.0
5.1 2.9

0
-10

0

2018

2019

2020

2022

2021

(FY)

Cash flows-30

billion yen

Cash flows frominvesting activities

150

-91.6

54.5

billion yen

-55.5

2020

（％）

2022

2021

(FY)

-82.4

-150

2018

5.4

5.6

2.4

2.5

ROE

-7.5

％

％

4
49.8

36.0

2

7.3

-99.9

-89.3

2019

2020

0.8

0

-37.1

-27.8

-1.0

billion yen
6

52.2

0
-100

2019

ROA

107.3

-50

-22.5 -22.8

2018

Free cash flow

(billion yen)

50

-6.2

ROA* (Return on Assets) / ROE (Return on Equity)

Cash flows fromoperating activities

100

-12.1

-20

* As a result of the application of the Accounting Standard for Revenue Recognition in
fiscal 2021, consolidated sales decreased by 159.4 billion yen from the level before
application of the standard

36

billion yen

27.9

25.1

10

735

535.2

200

-22.8

billion yen

40

98.1

101.7

600

-22.5
(billion yen)

800
97.6

■ Net profit (loss) attribute to ownersof the parent company■ Ordinary profit (loss)

-75.2

2021

-0.4
-1.0

-2.0

-2

-55.5
-125.1

0.9

-4

-91.6

-6

2022

(FY)

-7.5

-8

2018

2019

2020

2021

2022

(FY)

* ROA is calculated as: Business profit (ordinary profit + interest expense)/Average total
assets (average for period start/end)

Interest-bearing debt balance / Interest-bearing debt ratio■ Interest-bearing debt balance

948.2
900

3.2

billion yen

2.2

700
600

2.4

3.2
948.2

860.2

(Times)

（Yen）

3.0

40

2.0

771.6

800
704.2

717.0

2018

2019

0

times

2.7
2.2

■ Dividend per share

Interest-bearing debt ratio(billion yen)

1,000

Dividend per share / Dividend payout ratio

30

yen
(%)

205.8
30

30

30

200
30

150

20

100

10

50

1.0
0

2020

2021

2022

(FY)

0

36.4

2018

34.1

2019

2020

2021

0

0

2022

(FY)

* The dividend payout ratios for fiscal 2021 and fiscal 2022 cannot be calculated due tothe recording of net losses.

15

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Financial Information

Business Management that
Increases Sustainability

Financial / Corporate Information

See pages 73-74

Non-financial Information (Main ESG Data, SASB Standards Index)

See pages 75-78

Total assets / Shareholders' equity ratio

Capital investment / Depreciation expense■ Total assets■ Capital investment

1,612

Shareholders equity ratio

billion yen

18.3

％

(billion yen)

1,600
1,400

23.6

1,353.9

23.6
1,373.6

1,612.0
22.8(billion yen)

25

100

1,500.7
20.8

1,430.4

87.3

（％）

80
20
18.3

1,200

15

1,000

10

■ Depreciation expense

52.4

billion yen

billion yen

100.7
88.0

83.9
64.8

60

87.3

85.8
59.6

62.7

58.5

52.4

40
20

2018

2019

2020

2021

2022

Non-financial Highlights

E

CO2 emissions volumes*1.2 andCO2 emissions intensity*1.2■ CO2 emissions volume

10.41

million tons-CO2

CO2 emissions intensity

0.447

0.526

0.6
0.447

20
10
0

［12.97］

2018

12.52

11.86

9.14

［13.72］［13.12］

2019

2020

2021

［10.24］

0.2

10.41

0

2022

(FY)

*1 Values pertaining to retail sales based on the Act on Promotion of Global WarmingCountermeasures (reflecting adjustments made under the feed-in tariff system)*2 Values in parentheses are the values for *1, excluding the FIT free allocation (samebasis as Shikoku Electric Power’s FY2030 targets).

Shikoku Electric Power and Shikoku Electric Power
Transmission & Distribution Co., Inc.

0.24
2

1.83

1.80

S

Social

2.06

Ratio of female employees

9.2

％

8.2

8.2

8.5

8.7

9.2

2.7

2.6

2.8

3.1

3.5

2018

2019

2020

2021

2022

6
4

0

G

Composition of directors*
Ratio of■ Outside director ■ female directors

5peopleGovernance14

people

(%)

2.06

20

6%

15

4

7%

13%

0.00

2018

2019

2020

0.36

0.24

2021

2022

5
(FY)

*1 The number of deaths and injuries per one million working hours (requiring one day or more off work), is thetotal for Shikoku Electric Power and Shikoku Electric Power Transmission and Distribution Co., Inc. The datacollection period is the fiscal year for Shikoku Electric Power and Shikoku Electric Power Transmission andDistribution Co., Inc. January to December for all industries.
*2 Source: Ministry of Health, Labour and Welfare “Survey on Industrial Accidents”

0

14%

14%

5

5

4

5

13

11

10

9

9

2018

2019

2020

2021

2022

10
0.00

％

(People)

2.09

(FY)

Combined total for Shikoku Electric Power and Shikoku Electric Power Transmission& Distribution Co., Inc.

9

1

0

S

(%)

10

(FY)

Social3.5■ Internal directors

All industries*2

1.95

0.12

2022

2

［11.70］Labor accident frequency rate*1

2021

8
0.4

0.408
12.30

2020

％

kg-CO2/kWh

0.569

2019

Ratio of women in managerial positions(kg-CO2/kWh)

0.528

2018

Ratio of female managers* /ratio of female employees*

Environment(Million tons-CO₂)

30

0

(FY)

15
10
5

* People after the General Meeting of Shareholders in June

Shikoku Electric Power Group INTEGRATED REPORT 2023

16

本店

Shikoku Electric Power Group Value Creation

Carbon Neutral Challenge 2050
(Partially updated in September 2023)

As a responsible supplier of energy, we will work on the low carbonization and decarbonization of power sources andexpand the use of electric energy through electrification, etc., to contribute to the realization of carbon neutrality in 2050.

FY2030Power source

low carbonization phase (- 2030)

Low carbonization and decarbonizationof power sources

Invested 350 billion yen in FY2021 to FY2030 to promote low carbonizationand decarbonization of power sources
Maximum use of
nuclear power generation
Transition of renewableenergy to mainstay
power source

GX Leagueemissions targets

Further improvement of safety, continuation of safe andstable operations, and research on new reactors
Improvement of output and maximum use ofexisting hydroelectric power generation

See page 51

New power source development (Including overseas) + 500 MW
Phasing out of inefficient coal-fired
thermal power generation

Reduction of CO2
emissions for thermal
power generation

Use of high-efficiency coal-fired and
LNG-fired thermal power generation

Achieve benchmark index(Act on the Rational
Use of Energy (Energy Conservation Act)) in FY2030
Indicator A: 1.00 or higher
Indicator B: 44.3% or higher
Coal indicator: 43.00% or higher

Consideration of expanded use of woody biomass and ammonia co-firing technology
Consideration of hydrogen co-firing technology
Research on CCUS / carbon recycling technology

Reduction target
for CO2 emissions*in retail sector

Aim for

19.62 million tons-CO2(fiscal 2013 excluding FIT free-of-charge distribution)

50% reduction
in FY2030(compared to FY2013)* CO2 emissions produced within retail electricity sales,
as calculated based on the “Act on Promotion of Global Warming Countermeasures”

Promotion of electrification (switching from other heat sources),
promotion of low carbonization of private power generation and expansion of CO2-free billing plans

Further use ofelectric energy

Expansion of storage batteries and EV resources and the use of VPP
and digital technologies
Experimental introduction of hydrogen manufacturing
using CO2-free power sources

Further expansion of demonstration sc

Improvement of the accuracy of power generation predictions and expansion ofrenewable energy introduction based on Connect & Manage

Establishment ofan external environment aimed
at carbon neutrality
Based on Japan s Green Growth
Strategy through Achieving Carbon
Neutrality in 2050,
Clean Energy Strategy, etc.

17

Lower prices for CO2-free fuel (ammonia, hydrogen) and progress in termsof the installation and maintenance of infrastructure(Targets for 2030 = ammonia: higher 10 yen range / Nm3-H2; hydrogen: 30 yen/Nm3)
Advances in CCS-related technologies and maturation of the environment(Progress in terms of appropriate site surveys, and progress in technological development)
Reducing the cost of offshore wind power generation(Target for 2030 to 2035 = 8 to 9 yen/kWh)
Reform of economic and social systems aimed at 2030
(Clean Energy Strategy, GX League, etc.)

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

The realization ofcarbon neutrality in Shikoku
Decarbonization of
power sources

Further use ofelectric energy

FY2050Power source decarbonization phase (- 2050)

Solar power
generation

Wind power
generation

2050 target: +2000 MW

Detailed roadmap
to FY2030
See page 19

Consideration of expansion of co-firing rate of ammonia

Consideration of ammonia mono-fuel combustion technology

Consideration of expansion of hydrogen co-firing rate and mono-fuel combustion technology
Consideration and utilization of CCUS / carbon recycling technology

Aiming forcarbon neutrality
in 2050

Actualzero CO2
Ratio of non-fossil certificatesin the retail sector to electricity soldAchievement of 44% or morein fiscal 2030

Provision of composite services related to energy

cales
Expansion of the introduction of renewable energy,
optimization of transmission and distribution facilities and supply and demand operations
Further lowering of fuel prices andimprovement of supply stability(Target for 2050 = hydrogen: 20 yen/Nm3)(Establishment of related laws and regulations and social acceptability)

Popularization and expansion of offshore wind power
Reform of economic and social systems aimed at 2050

Shikoku Electric Power Group INTEGRATED REPORT 2023

18

本店

Shikoku Electric Power Group Value Creation(Reference) Individual Roadmaps to 2030
Shikoku Electric Power Group has designated the period up to 2030 as the phase for low-carbonization of powersources, and has drawn up roadmaps for renewable energy and thermal power generation up to 2030. Our Group ismaking concrete efforts in accordance with these plans.
Transition of renewable energy to mainstay power source

Based on the development roadmap, we are systematically improving the output of existing hydropower stations andexcavating new development sites for each power source.
Power source type2022

Existing hydropower

2025

To 2030

Improvement of output and maximum use of existing hydropower stations▼Commencement of operation of the Kurofujigawa power station(hydropower) (scheduled for 2024)

Hydropower

Discovery, planning and construction of new development sites

Development of new power sources▼Commencement of operation for the▼Commencement of operation for the Hazama Kami-ike andNagatani-ike Floating Solar Power Project (2022) Naka-ike Floating Solar Power Project (scheduled for 2025)

Development involving the leveraging of reservoirs, degraded farmland, and so on

Solar power▼ Acquisition of Bizen Kumonoue and Yumesaki Yumefurusato solar projects (2023)▼Acquisition of Phu Yen Solar Photovoltaic Power Generation Project, Vietnam (2023)

Purchase of existing power stations (inquiries for this can also be made via our website)▼Commencement of operations at Otoyo
wind power facility (scheduled for 2025)

Participation in onshore wind power projects and discovery of new development sites

Wind power

Replacement of existing onshore wind farms
Participation in offshore wind power projects

Biomass▼ Commencement of operations for Ozu Biomass project (scheduled for 2024)▼ Commencement of operations for Sakaide Biomass project(scheduled for 2025)▼ Commencement of sewage sludge fuel conversion project(scheduled for 2025)▼ Hirata Biomass
Start of operation
No. 1: 2022
No. 2: 2023

Participation in the biomass power generation project
Discovery of new development sites

Reduction of CO2 emissions in thermal power generation

We have positioned the period up to 2030 as the low-carbonization phase in order to improve the efficiency of thermal
power stations, and we are considering the co-firing of biomass and ammonia at existing power stations.

Item

Utilization of high-efficiency,
coal-fired thermal power

Power source low carbonization phase (up to 2030)
2022
Decommissioning offormer Saijo Unit No.1▼

Commencement of the operationof the new Saijo Unit No. 1▼

Replacement work

Ammonia co-combustion

Consideration of power generation
facilities such as fuel-receiving storage
facilities and boilers
Consideration to ensure the stability
and economic efficiency offuel procurement

Commencement of co-combustion of solid fuel comprisedof sewage sludge at the new Saijo Unit No. 1▼

Utilization of high-efficiency, coal-fired thermal power

Feasibility study and review phase
Expanding the usageof woody biomass- 20302025

Detailed study

Execution phase

Design, production and construction

Commencementof co-combustion

Consideration of collaborations with other companies

19

Hydrogen co-combustion

Consideration of introduction of co-combustion technology and consideration of supply chains

CCUS and other researchand implementation

Research on and consideration of the introduction of CO2 separation and collection, and carbon recycling technologies

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

Promotion of Digital Transformation (DX)
Shikoku Electric Power Group positions DX as a means to strengthen competitiveness and realize new value creationin its business activities. We are promoting the transformation of business models and processes throughenvironmental improvements and the implementation of initiatives to promote DX.

BX by "D"DX is defined as BX by "D" (= using digital technology and data to transform business model processes,
corporate culture, employee mindset, etc.), and efforts are being made at the Group level.

BX by "D" Business Transformation by "Digital & Data"

Salescapabilities

Operations

Business
processes

Facility
operations

DIGITAL

BUSINESS& DATATR A N S FO R M ATI O N

CLOUD

AI

BIG DATA

IoT

Sustained corporate value creation by realizing“enhancing competitiveness” and “creating new value”
through attainment of overwhelming business speed
and accurate understanding of customer needs

Roadmap for DX promotion

ShikokuElectric PowerDX Promotion
Project

ShikokuElectric Power
Transmission &Distribution Co., Inc.
DX PromotionGroup

A dedicated organization at each company supports environmental improvements
and implementation of initiatives by thesupervising division.

Phase 1 (- FY2023)

Development ofenvironments forthe promotionof DX

Phase 2 (FY2024 -)✓ Fostering awareness of transformation✓ Maximization of employee performance✓ Improvement of digital literacy
by continuing and expanding upon initiatives✓ Gradual development ofsystem infrastructure
To value creation
cycle through

BX by "D"Initiatives andpracticesleading to DX✓ Proactive initiatives
in pilot divisions

Existing
business
New business✓ Strengthen competitivenessby diversifying services andincreasing added value✓ Providing innovative services* See "Upgrading maintenance operations for power generation, transmission and distribution facilities" for details explanations of initiatives.

See page 40

Shikoku Electric Power Group INTEGRATED REPORT 2023

20

President's Message

We aim to achieve Medium-Term Management
Plan 2025 while restoring our businessfoundation and strengthening our risk
management and resilience.
Greetings
Shikoku Electric Power Group’s mission is to contribute to people’s comfortable, safe and secure
lifestyles, as well as to regional development, with a focus on energy. We pursue our business
operations with the aim of establishing “a multi-utility corporate group supporting work and life.”
The global energy situation changed drastically after Russia’s invasion of Ukraine. Accordingly,
Japan’s Cabinet approved The Basic Policy for the Realization of GX (Green Transformation), whichaims to bring about a decarbonized society based on the premise of stable energy supply. In May
2023, the GX Promotion Act and the GX Decarbonization Power Supply Act were enacted. In addition,
the recent rise in energy prices has led to growth of business models that provide new value, such as
off-site PPAs for renewable energy, local production and consumption of energy, and distributed energy
resource that incorporate demand-response from the consumer side.
Under these circumstances, as a responsible energy supplier and once again recognizing theimportance of S+3E and risk management and resilience in business management, Shikoku ElectricPower is accelerating efforts to consider low carbonization and decarbonization of power sources forrealizing GX, while supplying electricity stably. At the same time, we are making progress in responding
to distributed energy resource business, which is expanding in line with changes in society andcustomer needs.
We have defined fiscal 2023 as a "year in which we restore our business foundation by normalizing
management of our electric power business and restart efforts to achieve the targets of theMedium-Term Management Plan 2025." Accordingly, we have set out the following management
policies:
・Improving profitability in the electric power business・Expanding profits in businesses other than electricity
・Strengthening our platform for sustainable corporate value creation (continuing and deepening ESG
and SDGs)
We will strive to improve business performance while strengthening our risk tolerance, and we will
promote sustainable value creation for the future.
Based on our strong brand and credibility in the region, Shikoku Electric Power Group will contribute toregional development and the realization of a sustainable society as a corporate group that can bechosen by all. To that end, we would like to humbly ask for the continued understanding and support ofour stakeholders.

21

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Keisuke Nagai
Director and President

Shikoku Electric Power Group INTEGRATED REPORT 2023

22

President's Message

Q
A

Please tell us about the Business Operation Policy for fiscal 2023 and the challenges to achieve
Medium-Term Management Plan 2025.
In the electric power business, we are working to strengthen risk tolerance and improve
profitability in both power generation and retail.Meanwhile, in businesses other than electricity,
we are largely on track to achieve the goals of Medium-Term Management Plan 2025.

Under Medium-Term Management Plan 2025, Shikoku
Electric Power Group aims to achieve consolidated
ordinary profit of 35 billion yen by accelerating growththrough value creation in both the electric power and otherbusiness. In addition, we build a business structure thatallows us to sustainably secure half of our targeted profits
through each side.
In the electric power business, the transmission anddistribution business has remained relatively stable. On theother hand, in power generation and retail, we recognizethat strengthening risk tolerance and improving profitability
are ongoing challenges amid rising volatility in wholesale
electricity market prices due to concerns about supply
shortages nationwide and soaring fuel prices.
In the power generation business, the competitivenessof Ikata Unit No. 3 has been increasing amid soaring fuelprices. However, we would be exposed to significant
budgeting risks if these aging thermal power plants, which
continue to operate at a high rate, were to be suspended
due to trouble or other reasons, and this forced us topurchase alternative power from the market. Accordingly,
in fiscal 2023, we are strengthening our risk resilience bythoroughly implementing the repairs postponed under thestringent business environment of recent years, thereby
maintaining and improving the reliability of thermal power

Profit by segmentsupply. We will also utilize the increased supply capacity
resulting from the opening of the new Saijo Unit No. 1 to
maximize profits from wholesale by skillfully combining
direct sales with market sales.
Conditions were challenging in the retail business due tohigh fuel prices and other factors, but with the approval ofa new transitional rates (regulated retail rates) in May 2023,
we are now on the verge of normalizing our operations. In
fiscal 2023, we are striving to strengthen risk tolerance by
seeking sales volumes to match available supply capacity.
Under our newrate, we are working to further strengthen
relationships with customers through consulting activities
and other means of retaining customers and promoting
electrification.
Meanwhile, in businesses other than electricity, we havesteadily expanded businesses targeting general consumers
such as the IT/communication business and theconstruction and engineering business, and we can now
expect stable earnings. In the international business, we
expect to make approximately 80% of our profit target,
and we intend to continue expanding our business while
thoroughly managing risks based on our experience. In
businesses other than electricity, we are largely on track toachieve the goals of Medium-Term Management Plan
2025, and we will continue making steady efforts.

Key activity indicators[FY2022 result][Target for FY2025]

FY2020resultFY2022
resultTarget for FY2025[Target for FY2030](excluding water pumpingat
the Hongawa PowerPlant)

38%

54%

−
［55％］

Ikata Unit No. 3−

92%[Top level in Japan]

New development
for renewable energy

170 MW

300 MW−[500 MW]International business1.5
billion yen(excluding investment losses)
Others

8.9
billion yen
13.9

Othersbillion yen
International
businessbillion yen

4.0

billion yen

Equipment utility rate

7.0

35.0

billion yen

IT/communication
businessbillion yen

8.0

Total electricity sales(Excluding electricity
transmission and distribution)

Electric power business(21.7) billion yen
IT/communication
business

9.3 billion yen

Power generation and sales
business (28.9) billion yen
Transmission and distribution
business 7.2 billion yen*Before elimination of internal transactions

23−
28 billion kWh 31.3 billion kWh [30.0 billion kWh]Electric power business

Retail within the Shikoku region 21.4 billion kWh 22.1 billion kWh21.0 billion kWhApprox.

Retail outside the Shikoku region

0.5 billion kWh 1.2 billion kWh

1.0 billion kWh

710 MW

1,500 MW
[2,000 MW]

17.0 billion yen

Power generation and sales
business 11.0 billion yen
Transmission and distribution
business 6.0 billion yen

Shikoku Electric Power Group INTEGRATED REPORT 2023

Owned capacity within
the international business

890 MW

Shikoku Electric Power Group
Value Creation

Q
A

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

Recently, there has been a growing interest in corporate sustainability information.
Could you please tell us about your approaches to climate change and human capital?
With regard to measures against climate change, we are accelerating considerations into
upgrading our existing thermal power facilities by 2030. As for human capital, we are working topromote diversity and inclusion, and to develop and secure human resources.

As a responsible energy supplier, Shikoku Electric Group
recognizes that addressing climate change is a crucial
issue. We aim to become carbon neutral by 2050, basedon policies of low-carbonization and decarbonization of
power sources on the supply side, while further utilizing
electric energy on the demand side.
As a concrete approach, we have set an initial target of
reducing CO2 emissions from the retail sector by 50% infiscal 2030 compared to fiscal 2013. As part of thisapproach, we are promoting the maximum use of nuclear
power generation and expanded development of renewableenergy sources. Increased renewable energy means that
thermal power generation is playing a greater role as an
adjusting force, in addition to being a supply source. This is
why we intend to continue using thermal power generation
while working to achieve low carbonization anddecarbonization. At the end of June 2023, the Saijo New
Unit No. 1 was replaced with state-of-the-art high-efficiency
equipment and began operations. The unit co-fires woodbiomass and is also scheduled to co-fire solid fuelcomprised of sewage sludge starting in 2025, which is
expected to further reduce CO2 emissions. As for existing
thermal power, we are accelerating internal considerations
with the aim of expanding the co-firing of wood biomass
and introducing ammonia co-firing by 2030. In addition, in
cooperation with other companies, we are examining theCO2 emissions from the retail sector

introduction of hydrogen and ammonia and theestablishment of supply chains.
On the other hand, Shikoku Electric Power Group
recognizes that human resources are the greatest driver ofsustainable value creation. In order to maximize the value ofhuman resources, we are committed to diversity andinclusion, the development and securement of
future-leading human resources, and improving employee
engagement.
From the perspective of human resources strategy, it isimportant to maximize the performance of the entire
organization by securing and developing human resourcesin response to changes in the business environment andbusiness portfolio, and allocating people to the right places.
For this reason, in addition to systematically developing
human resources who will inherit the DNA needed tosupport stable electricity supplies, we are making efforts tosecure and developing human resources who will lead
growth businesses by generating attractive ideas andinnovation, and to create new value by promoting DX. We
also promote the career development and promotion of
female employees to managerial positions. Our aim is tocreate sustainable value by establishing work environments
where diverse human resources can play active roles andby promoting work style reforms.

Exchanging views with power plant staff(10,000 t-CO2)
2,000

1,962*1
1,500

1,000

Approx.

Reduction target

-40%

-50%

1,170*1［1,041*²］

500

0

2013

2022

Approx.
980

Target for
2030

(FY)

*1 Emissions excluding free allocation of FIT on the same basis as the fiscal 2030 target*2 Emissions including free allocation of FIT (values based on the Act on Promotion of
Global Warming Countermeasures)

Shikoku Electric Power Group INTEGRATED REPORT 2023

24

President's Message

Q
A

What is your approach to improving corporate governance and compliance?
Enhancing corporate governance is the foundation for sustainable value creation. We take a serious
view of the incident where information was viewed for other than the intended purposes. Accordingly,
we are working to enhance compliance awareness and strengthen internal control for conduct policy.

Enhancing corporate governance provides the foundation forsustainable value creation. At Shikoku Electric Power, the ratio ofoutside directors to directors is as high as 36%. The outside
directors include two women, and all five outside directors are
independent directors who meet the requirements of the Tokyo
Stock Exchange. The Personnel Committee is a voluntarycommittee chaired by an outside director, and the majority of its
members are outside directors. It deliberates on matters such as
the appointment and dismissal of the President, directors, andexecutive officers, and the hiring and dismissal of senior advisorsand executive advisors. The Compensation Committee, which
has a similar structure, deliberates on the level of compensation
for directors. In fiscal 2019, we introduced stock compensation
as an incentive to improve corporate value over the medium tolong term, and in fiscal 2023, we introduced performance-linked
compensation based on consolidated ordinary profit as anincentive to improve short-term performance.
Shikoku Electric Power believes that the most important role ofoutside directors is to monitor and supervise management from astandpoint that is independent of business execution. For thisreason, all outside directors are appointed as Audit andSupervisory Committee Members. In fiscal 2022, the Audit andSupervisory Committee met 18 times and received opinions onimportant matters related to business execution. The quality of
governance at Shikoku Electric Power Group has been improved
and new perspectives and ideas on our business management
have been expressed through the exchange of views anddiscussions with internal directors and executive officers at

Key initiatives to strengthen governanceregular meetings, in addition to Board of Directors meetings.
On the other hand, from a compliance perspective, we take aserious view of the incident in which customer information wasviewed for purposes other than intended, which was discoveredin February 2023. In this incident, Shikoku Electric Power
employees viewed customer information belonging to anothercompany managed by Shikoku Electric Power Transmission andDistribution Co., Ltd. for purposes other than disaster response.
The employees viewed the information to check the status ofcontracts in response to various inquiries from the customer.
Although there were no cases where information was viewed forsales purposes, both Shikoku Electric Power and Shikoku
Electric Power Transmission and Distribution Co., Ltd. havetaken measures to prevent recurrence in order to ensure
thorough awareness of compliance, and we have strengthened
internal control systems for conduct policies to restore trust.
Furthermore, in light of the fact that violations of the
Antimonopoly Act by electric power companies have become asocial issue, in April 2023, Shikoku Electric Power established
Rules on Contacting Competitors in order to prevent cartels,
bid-rigging, and other suspicious behavior. We set out rules on
the measures to be taken when compliance issues or problems
are seen in our contacts with competitors, as well as rules oninternal reporting. In order to raise awareness of complianceamong the directors and senior managers at our sales andplanning departments, we hold lawyer-led study sessions on
Antimonopoly Act to remind ourselves of the key points forpreventing cartels.

Outline of incident where customer information
was viewed for unintended purposes

2023: Introduction of performance-linked
compensation

2019: Introduction of stock compensation system

Actions under the
Code of Conduct

2020 : Establishment of Personnel Committee: Increase in the number of outside directors (from 4 to 5)

Customer

Shikoku Electric Power Group INTEGRATED REPORT 2023

This case25

Inquiry

Confirm
contract
In case of no contract
with Shikoku Electric

Carefully confirm thatthe customer is not undercontract with our company

2017: Transition to company with an audit and supervisory committee: Increase in the number of outside directors (from 2 to 4)
2015: Formulation of the Yonden Basic Policy on Corporate
Governance (in Japanese only): Establishment of Compensation Committee: Start to assess the effectiveness of the Board of Directors

Shikoku Electric
Shikoku Electric
Sales Division Customer Management
Systemclient management system
for wheeling services(available to view innormal circumstances)

Customer

Requested tocustomer
Customer reconfirms
the status of thecontract with his/herelectricity provider.

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

Actions to prevent recurrence of unauthorized access to customer information
In light of incidents such as the viewing of customer information managed by Shikoku Electric Power Transmission andDistribution Co., Ltd. for purposes other than authorized, both Shikoku Electric Power and Shikoku Electric Power
Transmission and Distribution Co., Ltd. are taking measures to prevent recurrence, strengthening their internal control
systems for conduct policy, and working to restore trust.

Initiatives to prevent recurrence
Measures taken by
YONDEN T&D

・Shikoku Electric Power employees are not permitted to access the client management system for wheelingservices* except in the event of disaster or other emergencies.
（We have implemented physical partitioning in the same system for some time.）
・Maintaining access logs to the client management system for wheeling services and analyzing them on aperiodic basis

Measures taken by
Shikoku Electric Power・Continuously raising employee awareness through implementing training on conduct policies anddialogs with employees by having the President and other sales division executives visit workplaces, etc.
・Conducting a comprehensive review of business manuals and reviewed and improving work flow

Strengthening the internal control system for conduct policies
Shikoku Electric has strengthened its internal control system for conduct policies. New initiatives included:
・Established the “Awareness Reform and Business Improvement Promotion Project” within the Sales Division topromote and oversee measures to prevent recurrence.
・Established the “Conduct Policy Compliance Project” to promote and oversee company-wide conduct policy
compliance initiatives
Established the “Conduct Policy Compliance Audit” within the Internal Audit Office to perform specialized audits ofcompany-wide conduct policy compliance.
Furthermore, by adding a framework for receiving advice and guidance from outside experts and other third parties,
we have established an objective and highly effective system and are firmly committed to preventing recurrence.
* YONDEN T&D has also implemented measures such as the establishment of a committee to oversee and evaluate company-wide efforts to comply with conduct policy and a
dedicated implementation organization. It has also assigned a director in charge of conduct policy compliance to the internal audit office, which performs internal audits.

Strengthening internal control functions at Shikoku Electric Power (New organizations and functions are marked in red)Compliance Promotion Committee(Chair: Director and President)［Oversee and implement company-widecompliance initiatives］

ReportingInternal
audit

Consultation

Internal Audit Office

Promote and supervise company-wide related to conduct
policy compliance (Monitoring, guidace, training, etc. on thestatus of implementation of recurrence prevention measures)

Conduct policy audit(Chief supervisor of
conduct policy audit)

Internal
Audit

Perform specialized audits ofcompany-wide conduct policy compliance

Advice and guidanceSales divisions
Awareness Reform and Business
Improvement Promotion Project［Promotion and supervision of measures topreventrecurrence in the sales divisions］
Promotion of improvement activities

Head office/branches/sales offices

Outside legal counsel
Audit
Audit

Supervision and guidance

Conduct Policy Compliance Project

Reporting

AdvicePowerdivisionsIndirectdivisions etc.

Reporting

Audit & Supervisory
Committee

Third-party validation(External experts etc.)

Adviceandguidance

Advice and guidance oncompany-wide conduct
policy compliance

Use of Federation ofElectric Power Companies
of Japan and Compliance
Promotion Division
Validationand(outside experts)

adviceShikoku Electric Power Group INTEGRATED REPORT 2023

26

President's Message

Q
A

How will you achieve management that is“conscious of the cost of capital and stock prices,” as required by the Tokyo Stock Exchange?
We believe it is important to raise near-term profitability while being conscious of capital costs
and asset efficiency, and to present a solid path for Shikoku Electric Power Group's sustainablegrowth into the future.

Our group has set ROA and ROE management targets. We
have been working to continuously secure profits above thecost of capital and reduce the cost of capital, with an eye
toward improving asset efficiency. At the same time, wehave been managing our business with the goal ofincreasing the efficiency of shareholders' equity, while
maintaining a sound financial platform. We believe thismeets the requirements of the Tokyo Stock Exchange forlisted companies to be managed with awareness of the costof capital and stock prices.
In recent years, we have faced difficult businessconditions due to the effects of high fuel prices and other

Q
A

What is your future capital policy and shareholder returns policy?
We aim to achieve an annual dividend of 50 yen per share by fiscal 2025, the final year of our
Medium-Term Management Plan, while steadily improving our financial position.

Regarding shareholder returns, our basic approach will be
to issue stable dividend payments and determine dividendlevels based on overall consideration of such factors as
business performance, our financial position, and the
medium-to long-term outlook for the operating environment.
Our consolidated shareholders’ equity ratio was 18.3% at
the end of fiscal 2022 due to a deterioration in our financial
position, reflecting recent business conditions. However,from fiscal 2023, we will move to a phase whereinterest-bearing debt will decrease and our financial position
will improve, as operating cash flow recovers due to thenormalization of our electric power business management,
and free cash flow becomes profitable due to the conclusionof large-scale investments in the electric power business.
To this end, we intend to provide stable dividends whilesteadily improving our financial structure. We aim to realize
an annual dividend of 50 yen by achieving consolidated
ordinary profit of 35 billion yen by fiscal 2025, the final yearof the Medium-Term Management Plan, and by ensuring weachieve our target of realizing half of our profits from theelectric power business, and half from businesses otherthan electricity.

27

factors. However, in the electric power business, we havebeen able to normalize our business operations by carryingout a rate revision, while seeking the understanding of ourcustomers. Going forward, we believe it will be important toincrease profitability while restoring our business bases inboth power generation and retail. We will also need to firmly
chart a path for our group's sustainable future growth, in
conjunction with strongly-performing businesses other thanelectricity. We will continue to meet the expectations of ourshareholders and investors, while remaining conscious of
capital costs and asset efficiency.

Shikoku Electric Power Group INTEGRATED REPORT 2023

To that end, we would like to humbly ask ourshareholders and investors for their continued
understanding and support of our Group’s businessactivities.

Value Creation throughBusiness Activities■ Based in the Shikoku region, our Group is conducting business operations aimed at the sustainable improvement of corporate
value as a multi-utility corporate group that supports customers’ lifestyles.
■ When conducting business management, we will establish targets and policies for the electric power business and businesses
other than electricity, and work collectively as a Group to realize them, based on our group vision, which prepares us for fiscal
2030.

Electric power business
P.31
P.37
P.39

Electric power generation
Sales
Transmission and distribution

Businesses other than electricity
P.42
P.45

Expansion of growth businesses
New business and services

Shikoku Electric Power Group INTEGRATED REPORT 2023

28

Value Creation through Business Activities

Electric power businessIn the electric power business, which is our core business, we will work to achieve stable power supplies and GX,
while improving profitability in each of the fields of electric power generation, electricity sales, and transmission and distribution.

Business Operation Policy
renewable energy, thermal power,
Electric power generation (nuclear,and supply-demand management)

See pages 31—36

We are working to strengthen our business foundation while promoting low
carbonization and decarbonization of our power supply facilities.
・Safe and stable operation of nuclear power plants
・New development of renewable energy
・Promotion of stable operations, low carbonization and decarbonization at thermal power plants
・Stable fuel procurement and pursuit of the most economical supply-demand management

Sales (retail and wholesale)See pages 37—38

For retail sales, we will work to further strengthen relationships withcustomers and promote electrification under new pricing plans. We will
maximize profits in wholesale by taking into account trends in fuel prices andwholesale electricity market prices.
・Strengthening relationships through account sales in retail, and through consulting activities
・Improving customer satisfaction in retail sales and promoting residential electrification
・Maximizing profits in wholesale
・Expanding profit opportunities through solar PPA business,etc

Transmission & distribution
See page 39

We will make the necessary investments to maintain supply reliability consistent
with improving cost efficiency while making maximum use of renewable energy
sources such as solar power, which are becoming more widespread.
・Maintaining supply reliability and improving cost efficiency
・Measures to maintain supply-demand balance

29

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

President's Message

Financial / Corporate Information

Targets

See pages 31—40

Electric power generation

Sales

Power generation utilization ratio (excluding pumping)

Total electricity sales *(excluding sales by Shikoku Electric Power Transmission
and Distribution Co., Ltd.)* Domestic and overseas retail electricity sales + wholesale electricity sales

54%

38%

［92.4％］

2020
result2022
result［0％］55%[top level in Japan]

billion kWh

2020
result2022
resultbillion kWh

2030target(FY)

Unplanned shutdown rate of thermal power plants*

21.4

billion kWh2022
result2023
target(FY)

22.1

billion kWh

21.0billion kWh2022
result

300MW

(FY)

We plan on minimizing
the impact of contract
switching, etc.

Transmission & distribution

7MWh［0.4 min/year/house］［

2030
target2025
targetAnnual power outage*

500MW

2022
result2020
resultTemporarily increased due to changes
in the business environment broughtby high energy prices, etc.

Development of renewable energy in Japan and overseas

2020
result(FY)

0％* Percentage of unplanned shutdowns, excluding for periodic inspections, etc.

170MW

2030
targetElectricity retail sales within the region

7.0%

Average results for2012 to 2021

30.0

billion kWh

Temporarily increased due to changes in the businessenvironment brought by high energy prices, etc.

* Figure in brackets [ ] is for Ikata Unit No. 3

1.2%

31.4

28.0

(FY)

Average results for2017 to 2021

6MWh

Less than7MWh

0.4 min/year/house］［less than 0.4 min/year/house］

2022
result2023~2027
target(FY)* Annual power outages excluding natural disasters and work outages

Shikoku Electric Power Group INTEGRATED REPORT 2023

30

Value Creation through Business Activities

Electric power business[power generation]

Approach to the Power Generation Mix
Approach to the Power Generation Mix
Under the 6th Strategic Energy Plan (approved by the Cabinet in October 2021), Japan has set out targets of “achieving
net-zero by 2050” and “reducing its greenhouse gas emissions by 46 percent in fiscal year 2030 from fiscal year 2013
levels” (NDC: Nationally Determined Contributions). In February 2023, in light of the changing international political situation,
the Cabinet approved the Basic Policy for the Realization of GX, which aims to realize a decarbonized society based on theprinciple of ensuring a stable supply of energy; related bills were enacted in May of the same year.
In light of this national policy, we have set a goal of reducing CO2 emissions from the retail sector by 50% in fiscal 2030
from fiscal 2013 levels. In order to achieve a stable supply of electricity and realize GX, we aim to establish a well-balanced
power generation mix that is not overly dependent on specific power sources.
Fiscal 2030 power generation mix
Renewable energy (including FIT portions)

NuclearGas, coal

Renewable energy, nuclear: approx. 50%

Company
outlookApprox. 30%

Approx. 20%

Oil

Other (wholesale transactions, etc.)

Fossil power sources: approx. 50%

Aiming for the optimum gas/coal ratio to halve CO2

We will work on further expansion of renewable energy<Reference> FY2030 energy mix in Japan’s long-term energy supply and demand outlook [6th Strategic Energy Plan]
NuclearRenewable energy

Renewable energy, nuclear, hydrogen and ammonia: approx. 60%

National
goals

36~38%

20~22%

1%

Hydrogen, ammonia

Coal

Gas

Oil

Fossil power sources: approx. 40%

20%

19%

2%

Positioning
Usage policies

Usage policies at
Shikoku Electric PowerJapan’s 6th Strategic Energy Plan

Utilization policy for each power source
Renewable energy

Nuclear

Gas

Coal

Oil

・Decarbonization andpromising power sourcesthat can contribute to energy
security

・An important baseload powersource that contributes to thestability of the long-term
energy supply and demand
structure

・The lowest CO2 emissions ofany fossil fuel・An important power sourcethat has high CO2 emissions,but also highly stable fuelsupply and excellent
economic characteristics

・Despite high geopolitical risks
associated withprocurement, as a powersource has excellent
transportability and storage
characteristics

・Thorough implementation ofmainstay power supply
based on “S+3Es”
・Encouraging maximum
introduction, while reducing
the burden on the public andcoexisting with local
communities
・In addition to actively
pursuing new developments
in Japan and overseas,
expand introduced capacity
by promoting theenhancement of existinghydropower output

See pages 33-34

・A power source that plays acentral role in adjusting
renewable energy output

・Also expected to continue
playing a role as a adjusting
power source for renewableenergy・Aiming for sustainable use on
the scale required, on thebasic premise of ensuringsafety while reducing
dependence as much as
possible

・Reducing the kWh ratio in the
power generation mix on thebasic premise of stablesupply・Reducing the kWh ratio in the ・Used during emergencies
when there is no alternative
power generation mix on the
power source
basic premise of stablesupply・Continue to use effectively asa core power source that
supports stable and low-cost
power supply, on the basic
premise of ensuring safety

・Continue to use LNG for its
supply and adjustment
capacity, centered on
Sakaide Power Station Units
No. 1 and No. 2, which were
replaced with LNG combined
cycle systems

・Use to a certain extent for its
supply and adjustment
capacity, while improving
efficiency and reducing
environmental impacts,
including replacing Saijo Unit
No. 1

See page 32

・Consider handling based on
our ability to makeadjustments and our need forsupply capacity when power
supply problems occur

See page 35* With regard to hydrogen and ammonia power generation, the government has stated that Japan will “accelerate social implementation by 2030.” Shikoku Electric Power will also consider the use of
co-firing in thermal power generation.

31

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Initiatives for the Safe and Stable Operation of Nuclear Power Plants
Appropriate implementation of operational
management and maintenanceDuring operation, Ikata Power Plant conducts operational
monitoring and patrols of facilities 24 hours a day.
It suspends operations at least once every 13 months,
and conducts statutory periodic inspections. During
statutory periodic inspections, approx. 2,500 workers, up
to 1.5 times the normal number, work on the plantpremises to carry out intensive checks on whether thereactor itself, fuel handling equipment, and reactor storage
and cooling equipment meet the statutory technicalstandards through disassembly inspections and test runs.
By implementing planned operation management andmaintenance in this way, we are able to continue safe andstable operation.

Periodic inspection at Unit No. 3 of Ikata Power Plant

Lifting the high pressure turbine

Loading fuel into the reactor

Safe decommissioning of Units
No.1 and No.2 at Ikata Power Plant
We are in the first phase of decommissioning
work for Unit No. 1 at Ikata Power Plant (thepreparation period for dismantling work). All
spent fuel is being transported to the spent fuelpit at Unit No. 3, and we are dismantling andremoving equipment outside the radiation
control area. The amount of dismantled waste
and the state of contamination are being
investigated in the radiation control area. Basedon the results, a dismantling plan is being
considered in preparation for implementation of
the second phase of decommissioning work.
We are decommissioning Unit No. 2 approx.
three years later than Unit No. 1. In order toimprove efficiency and reduce costs, dismantling
and removal of equipment outside the control
area is being carried out at the same time as for
Unit No. 1 equipment as far as possible.

Ongoing training to prepare forserious accidents
In order to enhance the proficiency of our accident
response personnel, we repeatedly conduct "task by task
training" for each individual response procedure and"comprehensive training", which covers all related areas
together. In the comprehensive training, participants aretrained using an “unpresented scenarios” approach toconceal the events that occur. This improves their skills in
handling changing situations calmly and appropriately.
In order to be prepared for a possible nuclear disaster,
twelve Japanese nuclear operators, as well as fiveelectric power companies from western Japan, haveconcluded agreements to provide mutual support for
dispatching personnel and leasing materials andequipment, etc. They are strengthening their disaster
response systems and conducting joint training, etc.
Implementing comprehensive training

Fire extinguishing training in preparation
for fire disasters

Handling accident controls at the
emergency response center

Decommissioning work process<Phase 1> Preparation for disassembly[From fiscal 2017 until around fiscal 2026]
Carrying fuel out of spent fuel pits
Disassembly and removal mainly of
secondary systems (pumps, tanks, etc.)

Disassembly andremoval ofequipment outside
the control area

Carrying out
of fuel<Phase 2> Disassembly and removal of equipment from areas surrounding the reactor[until around fiscal 2041]
Dismantling and removing primary systems (pumps, tanks, etc.)<Phase 3> Disassembly and removal of reactor equipment, etc.
[until around fiscal 2049]
Dismantling and removing reactor vessels, steam generators, etc.
<Stage 4> Disassembly and removal of buildings and structures, etc.
[until around fiscal 2056]
Disassembly and removal of containment vessel and reactor auxiliary building, etc.
Note: The work plan for Unit No. 1 is shown in brackets [ ].
The plan for Unit No. 2 will follow three years behind that of Unit No. 1.

Shikoku Electric Power Group INTEGRATED REPORT 2023

32

Value Creation through Business Activities

Electric power business[power generation]

New development of renewable energy
Promoting the development of new
power sources

Targets and progress in new development of renewable energy

Our Group is aiming to develop 500 MW of renewableenergy in Japan and overseas by fiscal 2030 and 2,000
MW of renewable energy by fiscal 2050. The entire Groupis working together in unison on the development ofvarious projects in accordance with our development
roadmap for each power source, leading up to fiscal 2030.

(10 MW)200
50
30

See page 19

Newly developed renewable energy capacity was approx.
300 MW at the end of fiscal 2022 (up approx. 70 MW fromthe previous fiscal year). As a result, our group's
cumulative renewable energy capacity has increased toapprox. 1,420 MW.

23
OverseasJapan
Biomass
Hydropower
Wind power
Solar power

7
3
4
3

6
3
4
3
7
March 31, 2022

13
March 31, 2023

FY2030 target

FY2050 target

Note: 1.All projects are recorded when the investment decision is made.
2.Hydropower includes power increases that have taken place since fiscal 2000.

Examples of initiatives
Solar power generation

Biomass power generation

In March 2023, we acquired existing solar power plantbusinesses (60 MW in total) in Okayama and Hyogo
prefectures jointly with Prominet Power Co., Ltd., asubsidiary of Tokyo Gas Co., Ltd.

At Fukushima Hirata Village Biomass Power, which we
operate in Fukushima Prefecture along with Okumura
Corporation and others, commercial operation of Unit
No. 1 was launched in May 2022, followed by Unit No. 2
in April 2023. (Total owned capacity: 1.5 MW)

Bizen Kumonoue Solar Power Plant

Fukushima Hirata Biomass
Power Unit No. 1

Yumesaki Yumefurusato Solar
Power Plant

Wind power generation

Hydropower generation

Output was increased by a total of 34 MW (as of theend of fiscal 2022) by replacing the existing power
plant facilities with high-efficiency water turbines.
In Kumakogen Town,
Ehime Prefecture, weare building a newhydroelectric power
plant, Kurofujigawa
Power Plant (output 1.9
MW).
Illustrative image of the panorama of
Kurofujigawa Power Plant

33

Fukushima Hirata Biomass
Power Unit No. 2

Shikoku Electric Power Group INTEGRATED REPORT 2023

At Mihara Village, Hata County, in Tosashimizu City, Kochi
Prefecture, we are carefully proceeding with environmental
assessment procedures for the construction of the
Imanoyama Wind Power
Plant, which will become
the largest scale onshore
wind power plant in Japan.
In Otoyo Town, we arebuilding a wind power plantwith an output of 0.9 MW.
Illustrative overview of Otoyo Wind
Power Plant

Shikoku Electric Power Group
Value Creation

President's Message

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

Financial / Corporate Information

Effective utilization of pumped-storage power plants and maintenance of facilities
large-scale disassembly inspection of Unit 1 at Hongawa
Power Plant in fiscal 2022, we collected and analyzed
data on the status of the facilities and worked to identify
the appropriate inspection and replacement cycle for thefacilities.

Pumped-storage power plants, which function to store
electricity and adjust supply and demand, are becoming
increasingly important along with the sharp increase insolar power generation.
Previously at the Hongawa Pumped Storage Power
Plant (615 MW for Units No. 1 and No. 2 combined), water
was mostly pumped using nighttime electricity (with asingle unit in operation) to prepare for the generation ofelectricity during the peak hours of the daytime. However,in recent years, in order to create demand to absorb
surplus solar power generation during the daytime, wehave switched to operation using two units to pump waterand generate electricity from the evening onwards. The
number of annual operations has increased to about 1,000,
which is approx. four-fold increase on ten years ago.
For this reason, proper maintenance of facilities underhigh levels of operation has become important. During theDisassembly inspection of Unit 1 at Hongawa Power Plant (overhaul)

Hanging the generator rotor

Issuing green bonds
With the aim of realizing a sustainable society, Shikoku Electric Power has been promoting efforts to achieve carbon
neutrality by 2050. From the viewpoint of diversifying our financing, in 2022 we issued the first Shikoku ElectricPower Green Bond, a corporate bond that limits the use of funds to projects that improve the environment, such as
the development of renewable energy sources.
At the time of the initial issuance, we received an evaluation from DNV Business Assurance Japan Co., Ltd., athird-party evaluation organization, confirming that our financing conforms to the principles of green finance.

Overview of issuing of Shikoku Electric Power green bonds

Part 1

Issue date

Term

Issue amountInterest rate

Use of funds

October 25, 2022

10 years

10 billion yen

0.889% per annum

Development, construction, operation andrenovation of renewable energy sources

Appropriation of funds (as of March 31, 2023)

Environmental improvement effects (as of March 31, 2023)

Amount to be raised

10 billion yen

Generation type

Amount of renewableenergy development*1 (MW)Amount of CO2 emission
reductions*2 (1,000 tons)

Appropriated amount

10 billion yen

Hydropower

19.3

16,714Wind power

58.8

-

Biomass

28.6

1,950

Refinancing
Unappropriated balance

9.5 billion yen
None

Solar power

14.4

35

Total

121.1

18,699*1 Amount of renewable energy development includes projects already in operationand projects under construction.
*2 Calculated using power generation records and CO2 emission factors forrenewable energy in development projects that have already been launched.

Shikoku Electric Power Group INTEGRATED REPORT 2023

34

Value Creation through Business Activities

Electric power business[power generation]

Promotion of stable operations,low carbonization and decarbonization at thermal power plants
Efforts for stable operation
Shikoku Electric Power's thermal power plants continue to operate at high levels, in part due to the recent rise in the risk oftighter supply and demand nationwide. For this reason, we strive to ensure stable operation at each power plant by
operating and maintaining facilities, while paying close attention to operational monitoring, including careful daily inspections
and patrols by power plant personnel.
We are working to raise the sensitivity for detecting
Inspecting and patrolling thermal power plants
abnormal signs by creating lists and sharing information
about past cases of problems at all power plants. We arealso introducing a system that combines accumulated
operational data with AI and sensors to detect abnormal
signs at an early stage.
If any abnormal signs are observed in the facilities, repairs
are made as soon as possible when operations are
stopped on holidays due to low electricity demand, toInspections surrounding a steam turbine
Visual inspection of a condenser
avoid sudden operational suspensions arising.

Promotion of low carbonization and decarbonization at thermal power plants
As renewable energy increases, in addition to its previous role as a power supply source, thermal power generation isincreasingly playing a role as an adjustment capacity. This is why we intend to continue using thermal power generation
while working to achieve low carbonization and decarbonization. Shikoku Electric Power has defined the period to 2030 as
our "low-carbonization of power sources phase." In June 2023, operations were launched at new Unit No. 1 of Saijo Power
Plant, which has been newly replaced by a state-of-the-art, high efficiency, ultra supercritical pressure unit. In order toreduce CO2 emissions at the unit, there are plans to newly introduce co-firing of wood biomass, as well as sewage sludge
solid fuel.
With regard to existing thermal power, we are accelerating the study of related equipment technologies with the aims ofintroducing ammonia co-firing and expanding the use of biomass during the 2020s. At the same time, we are actively
looking into cooperation with other businesses, including building supply chains, as part of our efforts to introduce ammonia
and hydrogen fuels.

Cooperation with other businesses

Investigations into cooperation with building and expanding hydrogen and ammonia supply chains
We are discussing cooperation on the joint procurement of hydrogen and ammonia for domestic power plants andestablishing means of transportation and storage with JERA Co., Inc., Kyushu Electric Power Co., Inc., The Chugoku ElectricPower Co., Inc., Tohoku Electric Power Co., Inc., Hokuriku Electric Power Company, and Hokkaido Electric Power Co., Inc.,.

Investigation into introduction and utilization of fuel ammonia using Namikata Terminal at Imabari City
We are considering converting the existing LPG tank at Namikata Terminal in
Imabari City, Ehime Prefecture, into an ammonia tank to handle
approximately one million tons of ammonia per year by 2030 in collaboration
with Taiyo Oil Co., Ltd., Taiyo Nippon Sanso Corporation, Mazda Motor
Corporation, Namikata Terminal Co., Ltd., and Mitsubishi Corporation (thelocal governments of four local cities and Ehime Prefecture are also
participating as observers) Looking ahead, we plan to go into further depth
on legal and regulatory issues and measures to utilize the terminal, etc.
Overview of Namikata Terminal

35

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

Financial / Corporate Information

Initiatives in fuel procurement and supply and demand management
Pursuing maximum profits in supply anddemand management

Stable fuel procurement
Amid increased volatility in fossil fuel prices and thewholesale electricity market due to changes in theinternational energy situation, we are working to securestable volumes by further diversifying our suppliers andprocurement methods, while paying attention tocompatibility with economic efficiency. We also conduct
risk management on the procurement side by arranging
shipping early and properly managing inventories.

When formulating our supply and demand plans, it isimportant to properly assess the impact of changes inelectricity demand, wholesale electricity market conditions,and amount of renewable energy generation.
Shikoku Electric Power uses an AI-powered supply anddemand planning system to analyze multiple scenariosand optimize fuel consumption and the starting andstopping of generators, thereby achieving the mosteconomical operation and reducing supply-demand costs.

Examples of initiatives

Coal・Conclusion of long-term contracts with highly
reliable suppliers
・Procuring unbranded spec coal from YN Energy,
an Australian subsidiary with a shortprocurement lead times
・Increasing trial procurement of new coal brands

LNG

・Stable procurement of the majority of annual
consumption under long-term contracts
・Spot procurement based on market trends andother factors

Oil

・Maintaining a system to secure a certain amountof supply capacity and non-international coastal
trading vessels through annual contracts in order
to cope with increased operations

Illustration of supply and demand planning system
Create scenario

AI analyzes weather information,
electricity demand, and other data
to create multiple scenarios
Formulating a power generation plan

Formulate a power generation
plan using simulation on the digital twin

Calculating expected return

Calculate the expected revenue ofeach power generation plan to achieve
the most economical operation

Strengthening procurement of materials and equipment(initiatives applicable to power generation, as well as transmission & distribution)
A Procurement Review Working Group has been established for eachtechnical department to work together with the Materials Department tostrengthen our ability to procure materials and equipment and to reduce
procurement prices, thereby achieving the following.

・Improving efficiency at the design stage by reviewing specifications
・Continuously examining ways to improve efficiency at the procurement
stage by coming up with new innovations for placing orders.
In addition, in order to further strengthen these efforts, the Procurement
Solution Team was established within the Materials Department as apermanent organization made up of a mix of members of technicaldepartments and the Materials Department. The Materials Department isalso involved in upstream processes, including the construction concepts
and schematic design stages, which were previously handled only by thetechnical departments. This has deepened and accelerated the review of
specifications and the development of new business partners.

Purpose of establishing the Procurement Solution Team
Upstream

Procurement process

Downstream

Specification certainty
Scope for cost savings
Technical
departments

Construction
concepts

Cooperative
systemProcurement Review Working Group(held regularly)

Materials
Division

Procurement Solution Team(permanent organization)

SchematicdesignDetailed
designSpecification
decision

Innovations inordering methods

Contract
procedures

Shikoku Electric Power Group INTEGRATED REPORT 2023

36

Value Creation through Business Activities

Electric power business[electricity sales]

Strengthening relationships with customers in retail sales andpromoting electrification
Retail sales to corporations

Retail sales to households

Proposals to customers through account sales, etc.

Improving customer satisfaction

We are strengthening our relationships with our customers
by assigning dedicated staff to corporate customers of acertain size or larger, and by promoting account sales,through which we offer pricing plans and make technicalproposals based on electricity usage and customer needs.
When we cannot assign dedicated staff to acustomer, we offer proposal sales through our partnercompanies with strong sales bases in the Shikoku region,
and we also use direct mail.

Shikoku Electric Power offers a range of electrification
options and CO2-free sales plans to match customers'
lifestyles and needs. We offer family discounts and thank-you
discounts (loyalty discounts), as well as bundle sales ofelectricity and products from partner companies.
In addition, in order to improve customer satisfaction,
points are refunded to online members and cashback
campaigns are provided regularly for EcoCute and IH buyers.
Shikoku Electric Power has been evaluated for its efforts
in offering above plans and providing energy-savings
information via the Web. In recognition of these efforts, we
received the highest rating of “Five Stars” in the Energy
Conservation Communication Ranking System* of the
Agency for Natural Resources and Energy.

・Listening to customers
・Discovering and looking
deeply at individual needs

Dedicated staff

・Proposing improvements
through energy
consultations, etc.

Strengthening
relationships
with customers
Acquiringnew customers

Developing demand and strengthening
relationships through consulting activities

Promoting spread of all-electric houses

In commercial fields, we offer electrification proposals to
end users, such as medical and welfare facilities andschool lunch cooking facilities with high heat demand, as
well as sub-users such as design offices, in order todevelop new demand while highlighting the convenienceand safety we can offer.
In industrial fields, we are working to strengthen
relationships with customers and expand profit
opportunities by proposing solutions for energy-saving
and CO2-saving measures, and achieving cost reductions
and productivity improvements by converting existing heatsources to electricity.

Percentage of total households in Shikoku*

Others16%
11

Facility
maintenancemeasures%7

In cooperation with sub-users such as homebuilders andbuilding contractors, we are continuously promoting theelectrification of houses by approaching customers whoare considering new construction or renovation, and we
appeal to the comfort, convenience and economy ofall-electric houses, as well as to environmental aspects,
such as carbon neutrality.
As a result, the ratio of all-electric housing in new
detached houses in Shikoku continues to exceed 70%,
and the percentage of all-electric housing among all
houses was approx. 26% at the end of fiscal 2022.

Number of all-electric house contracts (10,000 units)

State of solution proposals in industrial fields

Environmental
measures%* A system operated by the Agency for Natural Resources and Energy to annually
evaluate and publicize the level of information and services provided by energy retailers
to consumers about energy conservation

Number of
proposals

936(FY2022)

Energy saving
measures23%

63%

Load equalization
measures
%

3

40
37

2018

41

26%

42

39

2019

2020

2021

2022

(FY)

* 1.6 million households (as of October 1, 2018 according to a housing and land surveyof Japan that was conducted by the Ministry of Internal Affairs and Communications)37

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

Financial / Corporate Information

Maximizing revenue in wholesale
Wholesale initiatives
In recent years, the volatility of wholesale electricity market
prices has increased due to tight electricity supply anddemand conditions across Japan. Accordingly, inwholesale, we conduct direct trading with equal treatmentof subsidiary retailers and third-party retailers, taking into
account trends in electricity supply and demand, fuelprices, and wholesale electricity market prices, and we
conduct spot sales onJEPX.
In addition to the capacity market, we are actively
utilizing new markets such as the base load market, thesupply-demand adjustment market, and the non-fossil
value trading market to maximize profits.

Trends in wholesale electricity sales(100 million kWh)

69
44
2018

2019

79

81

2021

2022

60

2020

(FY)

Note: Excluding sales by Shikoku Electric Power Transmission and Distribution Co., Ltd.

Expansion of profit opportunities
Promotion of solar power PPA businessSupport for customer decarbonization

With regard to solar PPA, the number of inquiries has
been increasing as a result of increasing momentum
behind decarbonization, the need to strengthen resiliencein the event of disasters, and the promotion of local
production and consumption of energy.
Shikoku Electric Power Group is promoting on-siteand off-site solar PPA business in Shikoku and elsewherefor corporations and local governments using highvoltage. The business is being led by Sun Trinity, a joint
venture established with Sumitomo Corporation For thisbusiness, Sun Trinity installs and operates solar power
generation facilities to sell electricity and environmental
value to customers. This has the advantage of eliminating
customers’ initial investment and management costs.

Local governments and companies are rapidly
formulating action plans for decarbonization andintroducing renewable energy. Shikoku Electric PowerGroup supports decarbonization efforts by conducting
consultations on the introduction of solar power
generation and storage batteries, energy conservation
measures, and energy switching, based on regional
characteristics and individual companies’ circumstances.
In April 2023, a project in Kitagawa Village, Kochi
Prefecture, for which we supported the development of adecarbonization plan as a co-sponsor, was adopted as adecarbonization priority area for the Ministry of theEnvironment.

Case Study[Okami Power Plant, Hiratsuka City, Kanagawa Prefecture](Introduced facility: THE OUTLETS SHONAN HIRATSUKA)

Project overview at Kitagawa Village

Decarbonizing the entire village by utilizing abundantpotential to introduce renewable energy
Achieve net-zero CO2 emissions from electricity
consumption in the consumer sector by fiscal 2030

<Major initiatives to decarbonize
electricity in the consumer sector>
Introducing small hydroelectric power generation
Introducing solar power generation andstorage batteries at public facilities
Realizing ZEB for public facilities and
ZEH for detached houses* ZEB and ZEH: Buildings that aim to achieve a zero energy consumption
balance by introducing energy savings and renewable energy

Shikoku Electric Power Group INTEGRATED REPORT 2023

38

Value Creation through Business Activities

Electric power business[Transmission & distribution]

Efficient facility formation and operation in the power transmission
and distribution business
Maintaining supply reliability andimproving cost efficiency

Measures to maintain supply-demandbalance

At Shikoku Electric Power Transmission and Distribution Co.,
Ltd., we evaluate the probability of failure and the degree of
impact based on the results of patrols and inspections utilizing
new technologies, etc., as well as the evaluation ofdeterioration conditions, in order to prioritize the renewal of
facilities constructed during periods of high growth, demand
for which is expected to increase in the future. We are alsoable to level out updated quantities based on the capacity tocarry out construction.
Furthermore, when expanding transmission anddistribution facilities, we have determined the details and scopeof work based on future demand trends, prospects forrenewable energy capacity linked to the electric power system,and the economics of investment, and we have consolidated
and slimmed down facilities as far as possible in order to bothmaintain supply reliability and improve cost efficiency.
Renewal flow for aging facilities(1) Patrolling and inspection
Checking the deterioration status of equipment using visualinspections, drones, etc., and creating databases
Drone

TabletIncreasingly reflecting
technological innovation

Creating
a database

Patrolling and inspection

The introduction of solar and wind power generation in the
Shikoku region has been expanding since the introductionof the FIT system in 2012. As of the end of fiscal 2022, theinstalled capacity of solar power and wind power had
increased to 3,610 MW. Including applied-for but as yet
unconnected capacity, the total was 4,380 MW.
As a result, supply capacity exceeds demand in thespring and autumn, when electricity demand is relatively
low. However, based on the priority power supply rules of
the Organization for Cross-regional Coordination ofTransmission Operators, Japan, we maintainsupply-demand balance while utilizing solar power andother electricity as much as possible.
For example, at shown in the below profile for 11:00
AM to 11:30 AM on May 3, 2023, when solar and wind
power output accounted for the largest share of demand
to date, based on the priority power supply rule, it waspossible to adjust supply and demand in the Shikoku Area
by taking the following steps:(1) Suppress thermal power output to as low as
possible (770 MW in (a) below) and create demandby operating pumped storage power plants (610
MW in (b) below);(2) Maximize power transmission outside Shikoku
utilizing interconnection line (680 MW in (c) below)(3) Suppress the output of biomass power generation(80 MW in (d) below), and if there is still any surplus;(4) Suppress the output of solar and wind power (620
MW in (e) below).

Future●● Equipment
risk amount(3) Formulation of facilities renewal plan
Leveling out the updated quantity based on the capacity to carryout construction, and formulating the facilities renewal plan

Year of renewal

39

Level out

Level out

(10 MW)<Supply capacity>ⓒTransmission outside
the Shikoku region 68ⓑOperation using water
pumping mode 61

After leveling out
Updated quantity

Updated quantity

Before leveling out
Capacity tocarry out
construction<Demand>Equipmentrisk amount

Probability of breakdown

Cannot be handled
because it exceeds
construction capacity.

Composition of demand and supply capacity on May 3(11:00 AM to 11:30 AM)

Solar power andwind power 271ⓓBiomass 8
Area electricity
demand 222ⓐThermal 77
Hydropower 57

Year of renewal

Shikoku Electric Power Group INTEGRATED REPORT 2023

Suppression to minimum output ⓔOutput suppression 62

Current status

Increased demand

Assessing the amount ofequipment risk based on
the data, and calculating
the amount ofequipment renewal
required over the
medium to long term

Failure impact(2) Calculating updated quantities based on risk assessment

Shikoku Electric Power Group
Value Creation

President's Message

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

Financial / Corporate Information

Use of digital technology (DX)Upgrading maintenance operations for power generation,transmission and distribution facilities
Using drones to save labor and shorten the
duration of inspections

Upgrading maintenance operations using
local 5G (demonstration test)

The use of aerial drones to inspect power generation
facilities has eliminated the need to install large-scaleinspection scaffolds, saving labor and shortening
inspection periods. We are also piloting an water drone
for dam sedimentation surveys and an underwater drone
for inspecting long-distance waterways. We aim to startpractical operation in fiscal 2024.
Drones can be used during ordinary patrols andinspections of power transmission and distribution
facilities, but also in times of disasters, such as heavy
rains when roads have been
cut off, to quickly and safely
check the site, thereby
contributing to the early
restoration of facilities andthe elimination of power
outages.
One of the aerial drones we use

We are conducting demonstration tests on a systemthat remotely monitors and controls power facilities byconnecting a number of cameras, sensors, microphones
and other devices via local 5G at substations and otherfacilities.
The use of local 5G will enable high-security, real-time,
high-speed, large-capacity communications. This meansthat by carrying out demonstration experiments, we willaccumulate a range of knowledge and know-how andupgrade our facility maintenance operations.
Upgrading equipment maintenance operations
Substations, etc.
Local 5G
base station
Surveillanceand cameras

Local 5G
base station
Data

Data

5G

OfficeServers
and Al servers

Instruction

Instruction

Smartglasses

Using AI to predict dam inflow
When releasing dams, in the past we used to predict theamount of inflow into the dam several hours ahead
based on weather data and the experience of theoperators to determine whether to release the dams.
However, this work has become more complicated dueto the increased frequency of local torrential rainfall in
recent years. In this way, we are using AI to predictchanges in the amount of inflow into the dam several
hours ahead in order to improve this work and increase
our ability to respond to heavy rain disasters, etc.
Illustration of the prediction method<Actual><Forecast>・Operation of
the robot
・Remote monitoring
・Giving instructions
to site workers

Patrols
and robots

Using smart meters to service communication lines for IoT

Shikoku Electric Power Transmission and Distribution Co.,
Ltd. is making use of its own infrastructure and creating newvalue through DX by using the platform provided by its highly
stable and reliable smart meter system used for meterreadings, etc. It provides communication line services for IoT
that enable monitoring and control of remote meter readings,
such as gas and water meters, as well as sensor equipment.

Communications link service for IoT (example)

Dam inflow
Metering,
monitoring
and control

Forecast inflow

LP gasCity gas

Water supply

Rainfall forecast
RainfallInventory
management,
space
management△
Now
AI used to consider
causal relationshipTime
Using analytical models
to predict dam inflow

Smart metersystemVending
machines

Toilets

Parking lots

Other
Disaster prevention(water level sensor, etc.)

Crime prevention(door opening/closing sensor, etc.)

Looking after
loved ones

Shikoku Electric Power Group INTEGRATED REPORT 2023

40

Value Creation through Business Activities

Businesses other than electricity
We will work to expand our growth businesses, mainly in IT/communication and international
business, and to expand new business and services with a focus on distributed energy.

Business Operation Policy

See pages 42-45

With regard to businesses other than electricity, we are expanding our business and market areas
with a focus on the IT/communication and international businesses, which we consider to be
growth areas. We aim to steadily increase profits while paying close attention to risk management.
・Expanding optical communications business for individuals, data center and cloud business in the
IT/communication business, etc.
・Acquiring and developing new projects in the international business・Steadily expanding profits in the construction and engineering business, and the gas sales business, etc.
・Creating new businesses and services utilizing distributed energy resources

Targets
IT/communication (ordinary profit)

6.9

9.3

billion yen

billion yen

International business (ordinary profit)

8.0

billion yen

0billion yen*

1.4

2020
result2022
result2025
targetbillion yen
2020
result2022
result2025
target(FY)

4.0

billion yen(FY)* Excluding investment losses

Other business [construction and engineering, etc.](ordinary profit)

7.2

8.9

billion yen

billion yen

2020
resultInternational business (owned capacity)

7.0

1,500MWbillion yen

2022
result2025
target

(FY)

710MW

890MW*

2020
result2022
result2025
target(FY)*Of owned capacity, approx. 410 MW is already in operation.

41

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Business Management that
Increases Sustainability

Value Creation throughBusiness Activities

President's Message

Financial / Corporate Information

WWW

Special website for international business - “For the Next Generation”
https://www.yonden.co.jp/english/profile/international_business/

IT/Communication
Based on our strengths in technologies and human resources, which we have cultivated within the electric power businessin the fields of information and communications, Shikoku Electric Power Group is working to expand its opticalcommunications businesses, data center and cloud computing businesses, etc. primarily through STNet, a group company.
We are moving forward with the provision of ICT infrastructure to support business and provide services that enable people
to live comfortably in the Shikoku region.

(Pikara Hikari Network), opticalcommunications business for individuals
STNet Co., Ltd. provides the Pikara Hikari Network service
for individuals, mainly in major cities in Shikoku. We
expanded our service area and began operations in
Niihama and Saijo cities in Ehime Prefecture in November
2022, and in ShikokuChuo City in March 2023, thereby
covering areas with high load densities across Shikoku.
In addition, sales of the ultra-high-speed Pikara Optical
Net 10 Gigabit Plan, which offers a maximum transmission
speed of 10 Gbps, have led to an increase in new
subscriptions and switching from the previous 1 Gigabit
Plan. We have supported a balance between a reliablecommunication environment and reasonable prices. For
example, in the RBB TODAY Broadband Awards*, weachieved the highest customer satisfaction rating in the
Shikoku region.
* The RBB TODAY Broadband Awards are hosted by IID, Inc. to select telecommunications
carriers offering high customer satisfaction levels, based on user surveys.

“” data center for
corporations and cloud business
STNet is expanding its data center and cloud business forcorporations, taking advantage of the progress being seen
in terms of digitalization, the transition to cloud computing,growing demand for DX, and similar developments.
Located in Takamatsu City, Kagawa Prefecture, thePowerico Data Center (one of the largest data centers inwestern Japan), offers the strengths of a great location
with a low risk of natural disasters, highly reliable facilities,
and proposal-based operational services which cater tocustomer needs. The customers making use of this facility
are mainly located in the Tokyo metropolitan area andShikoku area, and consist of IT companies, financial
institutions, and local government organizations, etc.
In response to the growing need for cloud services, italso offers ST-WAN Direct Connect, a service that enables
users to use a dedicated network to connect Powericoand MegaCloud.
Customer attributes in the data center business(end of fiscal 2022)

RBB TODAY Broadband Awards 2022 achievements(1) By head office location

Chukyoarea
7%
Shikoku
34%

Ranked No. 1 in customer satisfaction
among Shikoku Area carriers

The percentage of customers indicating
their intention to renew
their contracts with us ranked
No. 1 among carriers nationwide

Tokyo
metropolitan
area

54%

Customer base

Internet

35

34
32

Financial
Manufacturing
institutions
16%
Local
20%
governmentorganizations
19%

Security and communication
quality are issues

Solving issues using cloud connectivity

30

30

22%

Mega
Cloud

36

(10,000s contracts)

IT

Others23%

Image supplied by ST-WAN Direct Connect
Conventional internet use

Trend in the number of Pikara Hikari Network contracts(2) By industry

Others 3%

Kansai area 2%

27

Use of ST-WAN Direct Connect

25

Customer baseConnect with reliable andstable communication quality
Dedicated network(cloud connectivity)

20
2018

2019

2020

2021

2022

Mega
Cloud

(FY)

Shikoku Electric Power Group INTEGRATED REPORT 2023

42

Value Creation through Business Activities

Businesses other than electricity[Expansion of growth business]

International BusinessWe have positioned our international business as one of our growth fields and are actively promoting the development anddiscovery of new IPP* projects based on projects with long-term electricity sales contracts, while thoroughly managing risks.
In order to further expand our business, we are considering participation in business areas such as regional heating
supplies and storage batteries, where we can utilize our group's technologies and experience.
* Independent Power Producer

State of business participation (June 30 2023)
Since participating in our first IPP project in Qatar in 2008, we haveworked mainly on thermal power generation in the Middle East. In
recent years, in order to diversify our risk, we have expanded ourbusiness areas into Asia, Europe, and the United States. At thesame time, we have focused on the acquisition of renewable energy
projects where market expansion is expected. As a result, our total
owned capacity at the projects in which we participate is currently
920 MW (as of June 30, 2023).
We will continue to expand profits by increasing the number ofprojects we acquire, as we work towards realization of our targets
for owned capacity of 1,500 MW by fiscal 2025, and 2,000 MW by
fiscal 2030.

Business portfolio
Renewableenergy90

Expansionof power
source types

ThermalPowersourcetype

510
Business
area

MW

Area
expansion

Middle
East

MW

320

MW

Asia, Europe,
United States, etc.

* Figures are for owned capacity (as of June 30, 2023)

State of main business participation

43

ThermalRenewable energy

Owned capacity: 830 MW (fully operational: 650 MW)

Owned capacity: 90 MW (fully operational: 60 MW)

Examples of projects we are involved in:
Hamriyah Gas-Fired Thermal Power Generation Project, UAE

Example of a project we are involved in:
Phu Yen Solar Photovoltaic Power Generation Project, Vietnam

Output: 1,800 MW (Shikoku Electric Power’s share: 270 MW)

Output: 214 MW (Shikoku Electric Power’s share: 32 MW)This is a combined cycle natural gas-fired thermal
power plant with high-efficiency gas turbine that
became fully operational in May 2023. Under along-term power purchase agreement with the
Sharjah Electricity & Water Authority (“SEWA”) in the
UAE, we will sell the total volume through to 2046.

This solar photovoltaic power generation project was
launched in Vietnam in 2019. A long-term powerpurchase agreement of Vietnam Electricity until 2039
made Shikoku Electric Power expect stable earnings
and participated in the business in May 2023.

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Special website for international business - “For the Next Generation”
https://www.yonden.co.jp/corporate/yonden/international_activities/

Construction and engineering business, gas sales, etc.
Shikoku Electric Power Group has also received orders for the construction and operation of renewable energy-related
facilities and the construction of facilities for government agencies and the private sector in various parts of the country,
which we have done by leveraging our technical capabilities in construction and engineering (developed through electric
power-related construction). We also operate gas sales and nursing care businesses.

Construction and engineering business
Yonden Engineering Company, Inc. is engaged in EPC(engineering, procurement and construction) and O&M(operation and maintenance) projects for wind, biomass andsolar photovoltaic power generation in various parts of Japan.
Recently, we have been steadily increasing orders forconstruction work for substations with storage batteries(output 240 MW/capacity 720 MWh) at a “specified zone forconcentrated wind power preparation” located in northern
Hokkaido, and for electrical construction at Kawaminami Wind
Farm (capacity 80 MW), which is located in the same area.
YONDENKO CORPORATION is further consolidating its
business base in the Tokyo metropolitan area and the Kansai
region through M&A. It is proactively working to acquire moreorders and striving to expand upon its business domains.
In addition, Yonden Consultants Company,
Incorporated, is using its strengths as a comprehensive
consulting company to expand orders in the Shikoku region,
centered on the design of roads and river structures, etc. forgovernment agencies.

Gas sales business
Shikoku Electric Power Group has identified the need to switchfrom oil and coal to cover heating demand in the Shikoku
region, and is promoting the sale of liquefied natural gas (LNG)
to meet this need.
Specifically, we sell gas via gas pipelines and lorries at the
Sakaide LNG terminal in Kagawa Prefecture. At the Niihama
LNG Terminal in Ehime Prefecture (operation launched in2022), gas sales have been launched to Sumitomo Chemical's
Ehime Works, and gas pipelines to the neighboring city of Saijo
are being gradually expanded to customers along the line. In
addition, in ShikokuChuo City, Shikoku Central Energy Co.,
Ltd., in which we have jointly invested with Osaka Gas Co.,
Ltd., etc. sells to industrial customers through gas pipelines.

Niihama LNG Terminal

Northern Hokkaido’s Kitatoyotomi Substation,
which is equipped with storage batteries

Nursing care business
Kawaminami Wind Farm turbine site

Through its subsidiaries, Yonden Business Co., Inc. operates
Yonden Life Care, a fee-based nursing home for the elderly(three facilities in total in Shikoku) and provides nursing careservices. It is expanding its nursing care business to meet theneeds of an aging society.
Utilizing the know-how we have accumulated through ourbusiness, in fiscal 2023 we opened Grace Base Takamatsu, a
new residential facility for the elderly with additional services*that utilizes our unused land.
* The housing has an accessible structure, and the facility offers care and medical services etc.
to support the elderly.

Shikoku Electric Power Group INTEGRATED REPORT 2023

44

Value Creation through Business Activities

Businesses other than electricity[Expansion of new businesses and services]

Distributed Energy Business
Shikoku Electric Power Group is promoting the further utilization of electric energy to achieve carbon neutrality in 2050. In
addition to the promotion of electrification that we have undertaken thus far, we are working to create new businesses andservices by focusing on distributed energy resources, which are expanding as a result of the technological innovations andchanges being seen in society and customer needs. This is something we are doing based on the perspective ofadvancement and diversification of energy use.

Business development policy

Demand Response (DR)As energy resources on the consumer side are expected
to expand and the forms of transactions are expected toexperience diversification, we are gradually upgrading ourbusiness by integrating our Group's resources with thetechnologies and knowhow of our partner companies.
Ultimately, we are working on the distributed energy
business with the development of energy-related
multiservice in mind.

STEP3
STEP2
STEP1
Expansion ofstorage batteries
and EVs

Use of VPP
and digitaltechnologies

Provision ofcomposite
services related
to energy

Accumulation of knowledge related to
distributed energy business, etc.

Initiatives that we are currently
prioritizing and investigating*1

PV-related

EV-related

VPP-related● Nationwide solar PPA business centered on Sun Trinity
LLC, a joint venture with Sumitomo Corporation● Off-site PPA*2 power generation forecasting andimbalance settlement agency services● EV-ery Charge, an EV charging service for
condominiums, local governments, and corporations● One-stop provision of EV leases, chargers and CO2-freeelectricity● Profitability in the capacity market, supply-demand
adjustment market, etc., by utilizing resources such as
customer-owned power generation facilities and storage
batteries*1 PV (Photovoltaic power generation), EV (Electric vehicle), VPP (Virtual power plant)*2 Off-site PPA is a system that supplies electricity from renewable energy sources installed in
not-demand site to demand site via a general power grid.

45

Shikoku Electric Power Group INTEGRATED REPORT 2023

Incentivized DR is a system that aims to improve the balance
between electricity supply and demand by requiring customers
to reduce their electricity consumption on dates and times
specified by our company, while also compensating
customers for the amount of reduced electricity use. Both
Shikoku Electric Power and our customers will benefit fromthese initiatives, and we plan to continue developing them.
Incentivized DR contract

Shikoku ElectricPower Co., Inc.

・Stable supply
・Expansion of renewableenergy・New revenues from theelectricity bmarket(1) DR request(2) DR response(3) Compensation paid

Customers
・Social contribution
・Energy savings
・New revenue from
DR compensation

Storage battery business
In June 2023, in collaboration with CHC Japan K.K., weestablished Matsuyama Mikan Energy LLC in Ehime
Prefecture as a company that will execute the storage
batteries business.
As part of this business, a power storage plant (rated
output 12 MW/rated capacity 35.8 MWh) will be constructedadjacent to Shikoku Electric Power’s Matsuyama Solar
Power Plant, and revenues will be obtained from the
supply-demand adjustment market and other sources.
Operation is scheduled to begin in fiscal 2025.
Efforts to build a hydrogen supply chain model
We have concluded cooperation agreements with Ehime
Prefecture and Miura Co., Ltd., and are working on
Shikoku’s first ever hydrogen supply chain model
construction project on the premises of the Matsuyama
Solar Power Plant. For this project, hydrogen will be
produced using CO2-free electricity generated at the
Matsuyama Solar Power Plant and supplied to Miura Co.,
Ltd’s hydrogen boilers, thereby accumulating know-how
on green hydrogen production and hydrogen utilization.

Business Management that Increases
Sustainability(ESG Initiatives)■ We will aim to increase corporate value by identifying ESG issues closely linked to business activities and promoting
sustainable value creation, while fulfilling our social responsibilities under the “Sustainability Promotion Council”
chaired by the President of Shikoku Electric Power.

P.47

Initiatives that Increases Sustainability

P.48

E : Responding to environmental issues

P.55

S : Coexisting in Harmony with Communities and Fostering Employee Motivation

P.61

G : Enhancing Corporate Governance

Shikoku Electric Power Group INTEGRATED REPORT 2023

46

Business Management that Increases Sustainability

Initiatives that Increase Sustainability
WWW

Yonden Group Action Charter
https://www.yonden.co.jp/corporate/csr/policy/index.html
Sustainability Promotion System
https://www.yonden.co.jp/corporate/csr/management/index.htm

Yonden Group Action Charter
In order to promote the creation of sustainable value through business activities, we will extensively fulfill our Group’s social
responsibilities by strengthening relationships of trust with stakeholders and by performing transparent and open business activities
based on the “Yonden Group Action Charter.”GlobalEnvironment

Customers

Our Group
Shareholders
and Investors

Regional
Society

Employees

Suppliers

ESG Promotion System
We have established a “Sustainability Promotion Council” chaired by the President of Shikoku Electric Power and vice-chaired by
the President of Shikoku Electric Power Transmission & Distribution Co., Inc., to build a system that will supervise and promote
ESG-related initiatives across the entire management hierarchy.

Sustainability Promotion Council

E

S

Group
Companies

G

SocialEnvironment

Environmental
Management
Committee

GovernanceSocial
Co-Creation
Committee*2

Yonden Group
Environmental
Council*1*1 Promoted jointly by Shikoku Electric Power and each Group company*2 Held jointly with Shikoku Electric Power Transmission & Distribution Co., Inc.

47

Shikoku Electric Power Group INTEGRATED REPORT 2023

Compliance
Promotion
Committee

Shikoku ElectricPowerGroup
Compliance
Promotion Council*1

All, stakeholders involvedin business activities

ShikokuElectricPower

Two-way communication activities(Chair: President of Shikoku Electric Power, Vice Chair: President of
Shikoku Electric Power Transmission & Distribution Co., Inc.)

Business Management that Increases Sustainability

E

Responding to Environmental Issues

Environment

Our Group is devoted to preserving the planet and local communities, and ensuring a bright future for all.
For this reason, we actively pursue climate change measures and environmental conservation activities,
and work continuously to reduce our environmental footprint.

Initiatives towards Climate Change Problems
We strive to grasp changes in social needs and risk factors and reflect these in business management from an ESG
perspective in order to increase the effectiveness of efforts aimed at the sustainable creation of corporate value. As part ofthese efforts, we expressed our support for the recommendations of the TCFD* in September 2019, and we will enhance
our climate change-related information disclosures to fulfill our responsibility to explain such matters to stakeholders.
* Abbreviation for the Task Force on Climate-related Financial Disclosures. The Financial Stability Board (FSB), which is comprised of financial authorities from major countries, was establishedin December 2015 in response to a request provided by G20 Finance Ministers and Central Bank Governors. In June 2017, the TCFD issued recommendations on the disclosure of
information concerning climate-related risks and opportunities.

Governance
Governance and promotion framework for measures against climate change

Addressing climate change is an important management issue. The Sustainability Promotion Council, the Environmental
Management Committee (chaired by the General Manager of the General Planning Division), and the Carbon Neutrality Promotion
Committee (chaired by the President) are taking the lead in promoting measures against climate change.
Items positioned as particularly important within the deliberation process of each committee are submitted to higher-ranking
committees for discussion (including the Board of Directors). The results of these discussions are incorporated into the
management plans for each fiscal year to improve and enhance the initiatives being undertaken.
Shikoku Electric Power

Shikoku ElectricPower Transmission& Distribution
Co., Inc.

Higher-ranking committees such as the Board of Directors
Items positioned as particularly important

Deliberation / Adjustment

Deliberation / Adjustment
Important issues

Matters related topolicies on initiatives
aimed at carbon neutrality

Corporate
Planning
Department

Environmental
Management
Deliberation / Adjustment
Committee
Indicators / targets and information
disclosure related to measuresagainst climate change

Companywide plan drafting (P) [Reflection of risk management]
Inspection (C) / Revision (A)Companywide plan dissemination
Divisions,
Branch Offices,Power Stations,etc.

Internal Audit
Division

Environmental
Committee

Formulation ofdetailed plans (P)Concentration of activities
Inspection (C) / Revision (A)Implementation (D)Shikoku Electric Power Group INTEGRATED REPORT and
Yonden Group Environmental Data Book (in Japanese only)

Sustainability Promotion Council(operated by the Shikoku Electric Power and Shikoku Electric Power Transmission & Distribution Co., Inc.)

Collaboration

Enhancement of information disclosures

Carbon Neutrality Promotion Committee

Internal audit (C)Environmental
Management Committee

Deliberations that are focused on setting targets for measures against climate change, on assessing
and managing the status of the achievement of the targets, and on enhancing information disclosure

Carbon Neutrality
Promotion Committee

Various initiatives in both supply and demand to achieve carbon neutrality in 2050
Focused discussion on policy
See pages 17-19

Performance-linked remuneration system in consideration of climate change measures
See page 63 for directors, etc.
Shikoku Electric Power will introduce a new “performance-linked remuneration system”
In order to promote low carbonization and decarbonization, the status of initiatives to address climate change will be reflected in remuneration.

Shikoku Electric Power Group INTEGRATED REPORT 2023

48

Business Management that Increases Sustainability

Responding to Environmental Issues

Risk management
We are well aware of the importance of climate change-related risk management. Every year, the management teamconducts checks and reviews after extracting climate change-related risks with the potential to significantly impact
management, comprehensively taking into account factors such as the probability of the occurrence of risk, and their impact
on earnings and expenses (cost increases, etc.). We strive to prevent the occurrence of risks and reduce their impact on theoperation of our business by incorporating the results into our business plans for the following fiscal year.
See page 65

Note: Our climate change-related risk management system is integrated into our company-wide risk management system.

Strategy
We will continuously evaluate and confirm the kinds of impacts that climate change-related risks and opportunities will haveon our business operations under certain future scenarios, formulate the required measures based on the results, and thenmove on to execution of those measures.

Scenario selection
We selected a scenario in which no additional measures
beyond current measures are taken to control
temperature rise (4°C Scenario*1) and a scenario in whichfurther measures are taken (1.5 °C Scenario*2) after fully
achieving the currently announced measures, and thenassumed a future of the electric power business undereach scenario.

Changes in global average temperature, using
1850 to 1900 as a baseline(°C)
5

SSP5-8.5

4

SSP3-7.0

3

SSP2-4.5

2

SSP1-2.6
SSP1-1.9

1*1 See the Stated Policies Scenario (STEPS) presented by the International Energy
Agency (IEA) and SSP5-8.5, etc. of the IPCC Sixth Assessment Report*2 See The Net Zero Emissions by 2050 Scenario (NZE) presented by the International
Energy Agency (IEA) and SSP1-1.9, etc. of the IPCC Sixth Assessment Report

0
–1
1950

2000

2015

2050

2100 (Year)

Source: IPCC AR6 WG I

Future image of the electric power business
Item

1.5°C Scenario

4°C Scenario

Energy policy• Rapid change in policies aimed at decarbonization(promotion of the development of renewable energy, nuclear
energy and hydrogen energy)• Gradual change of policies aimed at decarbonization (thermal
power is maintained while introducing renewable energy as anextension of current policy in consideration of stable supply andeconomic factors)

Other policies• Introduction of carbon taxes and emission trading schemes
advance rapidly• Introduction of carbon taxes and emission trading schemes
advance gradually• Technological innovation in low carbonized anddecarbonized power generation progress rapidly• Technological innovation in low carbonized and decarbonized
power generation progress gradually• Fossil fuel use declines and fuel prices fall

• Fossil fuel use gradually declines and fuel prices gradually fall, but
prices increase for some fuel types

Energy demand• Increasing electrification in an effort to decarbonize, thereby
increasing demand for electricity• A lack of societal momentum toward decarbonization and a lack ofprogress in terms of electrification reduces demand for electricity

Customer needs• The need for low carbonized/decarbonized powersignificantly increases• The need for low carbonized/decarbonized electricity increases
to a certain extent

Unusual weather• Typhoons and other disasters occur, but the extent of thedamage caused is not much different than the current situation• Typhoons and other disasters become more intense, withdamage becoming more severe than seen currently

Policies

Technology

Low carbonization anddecarbonization technologies

Fuel priceFossil fuels

MarketDisasters

49

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

Risks and opportunities
Climate change-related risks and opportunities were identified for the 1.5°C Scenario, and the 4°C scenario. We conducted
an evaluation and confirmation of the major factors which will affect our company’s business in the future. As a result, wewere able to confirm that while there is a possibility of increased costs due mainly to the “expansion of the ratio of non-fossil
power sources / strengthening of regulations on thermal power sources” and the “introduction of a carbon pricing” undereach scenario, on the other hand, we can also expect improvements in profitability due to “improvements in the value of
non-fossil power sources” and the “development of electrification / expansion of needs for low carbonized / decarbonizedelectricity.”
We also considered measures serving to minimize risks and maximize opportunities. Each of these measures has been
incorporated into the Group’s Medium-Term Management Planand we will contribute to the realization of a sustainable
society through the steady implementation of these measures.
Key risks, opportunities and measures extracted from each scenario
Impact period*

Classification

Transition risks
Physical risks

Main measures

Short/
Medium/Long• Cost increases due to the expansion of the ratio of
non-fossil power sources and the strengthening of
regulations on thermal power sources

Introduction of carbon pricing

Short/
Medium/Long• Increase in costs resulting from the introduction ofcarbon pricing• R&D and introduction of new technologies such ashydrogen / ammonia power generation• Further expansion of the introduction of renewableenergy power sources• Advocacy and involvement in energy policy

MarketDecrease in electricity sales

Short/
Medium/Long• Reduced electricity sales due to the spread of distributed powersources• Reduced acceptance of sales contracts with low environmental
value derived from thermal power sources, resulting in reduced
electricity sales• Consideration of profit opportunities throughbusiness utilizing distributed power resources• Promotion of low carbonization / decarbonization of
power sources

Reputation

Lack of information disclosure

Short/
Medium/Long• Decline in investor appetite, reputational damage
resulting in higher funding costs, lower stock price, anddivestment• Appropriate disclosure of information to
stakeholders

Chronic

Increased chronicity ofunusual weather

Short/
Medium/Long• Lack of supply and adjustment capacity due to severe
weather conditions, etc.
• Reduced hydropower generation due to a decrease in theflow rate associated with changes in precipitation patterns• Securing supply and adjustment capacity throughthe further utilization of electric energy, etc.
• Improved power generation efficiency and optimized
operations

AcuteIntensification ofnatural disasters

Short/
Medium/Long• Large increase in the cost of recovery from typhoons
and other natural disasters• Strengthening of disaster countermeasuressystems, including the strengthening ofcooperation with local governments and relatedorganizations (Reference (1))

Improvements inthe value of non-fossil
power sources

Short/
Medium/Long• Increased advantages of nuclear power stations• Increased profits due to the expanded generation ofrenewable energy• Continuation of the safe and stable operation of
nuclear power stations (Reference (2))• Increased investment in renewable energy sources

R&D progress for
new technologies

Medium/Long• Commercialization of hydrogen utilization technologies,
etc. through progress in R&D• Conducting joint R&D and demonstration tests
with manufacturers and other electric powercompanies

Development ofelectrification and increased
needs for low carbonized/
decarbonized electricity

Short/
Medium/Long• Increased electricity sales due to greater needs forelectrification• Increased electricity sales due to greater needs for low
carbonized / decarbonized electricity• Further expansion of the introduction of low
carbonized / decarbonized power sources,
promotion of electrification.
• Offering of CO2-free pricing contracts, etc.

Increasing need tosecure supply andadjustment capacity

Short/
Medium/Long• Rising market prices due to a lack of supply andadjustment capacity nationwide• Securing supply and adjustment capacity basedon the optimization of supply facilities

Increasing need fordisaster prevention
and mitigation

Short/
Medium/Long• Strengthening trust relationships with customers andsociety and improving corporate reputation throughdisaster-resilient business operations• Further enhancing disaster countermeasures bystrengthening equipment measures and increasing
cooperation with local governments and relatedorganizations

Policies andregulations

Energysources

Opportunities

Details of risks and opportunities

Expansion of the ratio of
non-fossil power sources/
strengthening of regulations
on thermal power sources

Products/
services

Resilience* Short-term / medium-term: Up to 2030; Long-term: Up to 2050

Major financial impact (Reference)

Major impact assessment for fiscal 2030 in each scenario
Risks
Expansion of the ratio of
non-fossil power sources/
strengthening of regulations
on thermal power sources
1.5℃
4℃

Introduction ofcarbon pricing

Decrease inelectricity sales

1.5℃

1.5℃

4℃

(1) Responses to increasingly
severe natural disasters

Opportunities

Cost of recovery from the July 2018 floods in Japan

Approx. 3 billion yen

4℃
1.5℃

4℃

Improvements ofthe valueof non-fossil powersources

1.5℃

4℃

Development ofelectrificationand increasedneeds forlow carbonized/
decarbonized electricity(2) Safe and stable operationof nuclear power
Improvement of the earnings and expenses after one
month of safe and stable operation at Ikata Unit No. 3*

Approx. 10 billion yen* Effects in terms of improved earnings and expenses related tosupply and demand, as estimated based on fiscal 2022 results

Shikoku Electric Power Group INTEGRATED REPORT 2023

50

Business Management that Increases Sustainability

Responding to Environmental Issues

Transition plan: Carbon Neutral Challenge 2050
Our Group has set up a challenge of becoming carbon neutral in 2050 as a long-term priority within its Medium-Term
Management Plan.
With this in mind, based on the measures serving to address climate change-related risks and opportunities incorporated
in our Medium-Term Management Plan. We have formulated a roadmap and are promoting specific initiatives concerning the“low carbonization / decarbonization of power sources,” and the “further utilization of electric energy” with a view to fiscal
2030 and even further ahead to fiscal 2050, also taking the environmental conservation and other factors into account.
See pages 17—19

Indicators and targets
We have set targets for various climate-related indicators, including CO2 emissions from the retail sector. We will work to minimize
climate change-related risks and maximize opportunities by promoting initiatives that are aimed at achieving these targets.

Halve CO2 emissions from the retail sector by fiscal 2030 in comparison to fiscal 2013
Shikoku Electric Power is promoting the “low carbonization /decarbonization of power sources” by maximizing theutilization of nuclear power, making renewable energy a main
source of power, improving the efficiency of thermal power
generation, and expanding upon the introduction ofrenewable energy, as well as the “further use of electricenergy” based on initiatives such as promoting electrification,
including in the industrial and transportation sectors. By
doing so, we aim to reduce CO2 emissions from the retailsector by half in fiscal 2030 compared to fiscal 2013.
Note: CO2 emissions from the retail sector in recent fiscal years

See page 75

CO2 emissions from the retail sector(10,000 tons-CO2)
2,000
1,500

1,962*1

1,000

1,170*1［1,041*²］500
0Approx.
-40%

2013

2022

Reduction
target-50%
Approx.
980
Target for
2030

(FY)

*1 Emissions excluding free allocation of FIT on the same basis as the fiscal 2030 target*2 Emissions including free allocation of FIT (Value based on the Act on Promotion of
Global Warming Countermeasures)Greenhouse gas emissions throughout the supply chain
In fiscal 2022, greenhouse gas emissions throughout the
supply chain amounted to 14.44 million t-CO2. We will
work to reduce emissions in order to achieve the targets
newly set in the GX League, which we joined in April 2023.
* Greenhouse gas emissions in recent fiscal years

See page 75

Emissions throughout the supply chain in FY2022*1

Emissions volume[10,000 tons-CO2]

Scope 1*2

Scope 2*3

Scope 3*4

809

0

635

Scope 3 breakdown

51

Emissions volume[10,000 tons-CO2]

Capital goods

14.1

Fuel and energy-related activities

590.0

Investments

27.4

Other

3.3

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power’s targeted emissions in the GX League*5
Criteria

Targets

Emissionsvolume[10,000 tons-CO2]

FY2013

FY2025

Total for FY
2023-FY2025

FY2030

Scope 1

1,221

950

2,850

850

Scope 20.04650.02400.07200.0240*1 Calculated for Shikoku Electric Power and consolidated subsidiaries (excluding
companies with negligible emissions) in reference to documents such as the “Basic
Guidelines for Calculating Greenhouse Gas Emissions through the Supply Chain (ver.
2.5)” (Ministry of the Environment / Ministry of Economy, Trade and Industry)*2 Direct emissions from the use of fuel for in-house power generation, etc. In addition,
emissions in fiscal 2022 decreased significantly from 9.66 million t-CO2 in fiscal 2021
as a result of the shutdown of Saijo Power Plant Unit No. 1 due to its replacement.
*3 Indirect emissions associated with the use of electricity purchased from othercompanies at our places of business (offices), etc.
*4 Indirect emissions contained in electricity purchased from other companies (forelectricity sales), etc.
*5 Shikoku Electric Power’s emissions are calculated based on the GX League rules.

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Ratio of non-fossil certificates held by the retail sector in
relation to the amount of electricity sold*1
Achievement of 44% or more in fiscal 2030*2

Zero power plants that are inadequately
prepared for conceivable flood risks

In order to respond to opportunities such as the increasingneed for low carbonized / decarbonized electricity, we will
aim to increase the ratio of non-fossil certificates held by
the retail sector in relation to the amount of electricity sold(equivalent to the ratio of non-fossil power sources derived
from the Act on Sophisticated Methods of Energy Supply
Structures*1) to 44% or more in fiscal 2030*2.
We will also proactively work on continuing the safe andstable operation of nuclear power plants, which are
non-fossil power sources, increasing the output ofhydropower plants, and similar efforts.

We have conducted risk assessments of power plants inrelation to conceivable floods based on past disasters andother factors. As a result of these assessments, we havecompleted the construction works for countermeasures at
power plants requiring countermeasures.
We will continue to make efforts to prepare for risks,
including responding to disasters which had not beenpreviously anticipated. This is something we will do byimplementing “hard” measures, as well as “soft” measures
such as disaster drills.

Ratio of non-fossil certificates held by the retailsector in relation to the amount of electricity soldFY2022

Non-fossil certificates(with renewable energy designation)

6%

Non-fossil certificates(without renewable energy designation)

13%

Allocation of surplus non-fossil
value (free allocation of FIT)
No non-fossil value

12%

69%

*1 In order to promote the effective use of non-fossil power sources, such as renewableenergy and nuclear power, the Act on Sophisticated Methods of Energy Supply
Structures (Act on the Promotion of Applicable Environmental Use of Energy Sources
and the Effective Use of Fossil Energy Materials by Energy Suppliers) sets a target for
the ratio of non-fossil power sources for electricity retailers, etc.
Ratio of non-fossil power sources in recent fiscal years

See page 75

Achieve benchmark index (Act on the Rational Use ofEnergy (Energy Conservation Act)) in FY2030*1(Indicator A: 1.00 or higherIndicator B: 44.3% or higher
Coal indicator: 43.0% or higher)*2
The thermal efficiency of thermal power plants declines
gradually as a result of operating time and the deteriorationof facilities, etc. We implement daily equipment inspections,operational management and equipment upgrades asappropriate to make efforts to maintain the thermal
efficiency of existing thermal power plants. We are also
working on improving the efficiency of thermal power
generation by promoting the replacement of aging thermal
See page 35
power facilities.
Through these efforts, we aim to achieve thebenchmark indicator targets of the Act on the Rational
Use of Energy in fiscal 2030.

*2 Notification of the Ministry of Economy, Trade and Industry “Judgment Standard forElectricity Utilities Concerning the Applicable Environmental Use of Energy Sources”
requires that, in fiscal 2030, 44% or more of the electricity supplied by electricity
retailers be derived from non-fossil power sources.

Investments aimed at low carbonization / decarbonizationof power sources Cumulative total for the 10-year
period from fiscal 2021 to fiscal 2030 350 billion yen
In order to respond to climate change-related risks andopportunities, we will invest a cumulative 350 billion yen overthe 10-year period spanning from fiscal 2021 to fiscal 2030 topromote low carbonization / decarbonization of power sources.
Result in FY2021 to FY2022
Amount of investments related to low carbonization /decarbonization of power sources

Approx. 120 billion yen

Introducing internal carbon pricing
Shikoku Electric Power has introduced an internal carbon priceand is using this to make investment decisions in order toaccelerate capital investment for low carbonization /decarbonization, such as renewable energy development.

FY2020

FY2021

FY2022

Indicator A

1.02

1.02

1.04

Indicator B (%)

43.1

42.1

43.5

Coal indicator (%)*3

−

−

39.43

*1 Under the Act on the Rational Use of Energy and Non-Fossil Energy Conversion, etc,
an index (benchmark index) is set for each specific industry and field so that energy
saving conditions among business operators in that industry can be compared.
Indicator A: Indicator of the rate of accomplishment of targets for power generation
efficiency by fuel source
Indicator B: Indicator of overall thermal power generation efficiency
Coal indicator: Indicator of coal-fired power generation efficiency*2 According to a notification of the Ministry of Economy, Trade and Industry “Standards of judgment for business operators using energy at factories,” - the target
level in fiscal 2030 for Indicator A is 1.0 or more, while for Indicator B is 44.3% or
more, and for the Coal indicator is 43.0% or more.
*3 Reported based on results for fiscal 2022 in line with revisions to the Act on the
Rational Use of Energy (Energy Conservation Act)

Developing new renewableenergy throughout the Group:
500 MW by fiscal 2030 2,000 MW by fiscal 2050
Note: Results up to the end of ﬁscal 2022

See page 33

Shikoku Electric Power Group INTEGRATED REPORT 2023

52

Business Management that Increases Sustainability

Responding to Environmental Issues

Advancing Environmental Preservation Activities
Our Group is continuously working to reduce the environmental impact of our business activities and to conserve the environment incooperation with local communities.

Prevention of air pollution

Promotion of recycling

In order to reduce the emission of sulfur oxides (SOx) andnitrogen oxides (NOx) by thermal power plants into theatmosphere, we are taking measures such as using fuels withlow sulfur content, installing flue gas desulfurization anddenitrification equipment, and implementing the thoroughmanagement of combustion.
We have also undertaken the planned replacement of theaging oil-fired thermal power facility at the Sakaide Power
Station with an LNG combined cycle, and curbed of the amountof power generated by oil. As a result, the intensity of SOx andNOx emissions has remained at low levels in recent years.

Result in fiscal 2022
Intensity of SOx emissions
Result in fiscal 2022
Intensity of NOx emissions

Intensity of SOx and NOx emissions from thermal power plants

Recent cases of utilization

Coal ash was used for the Yoshinogawa Sunrise Bridge(Opened in March 2022) in Tokushima Prefecture.

Source: NEXCO West Japan (“E55 Tokushima Nanbu Expressway,
Tokushima JCT - Tokushima Okinosu IC”)

Intensity of SOx emissions
Intensity of NOx emissions

0.6

Average NOx in major countries*

0.5
0.4
0.3

Average SOx in major countries*

0.2
0.1
2018

2019

2020

2021

2022

(FY)

* Derived from 2019 data of four major countries (Germany, United Kingdom, USA, and France)

Intensity of SOx and NOx emissions in major countries（g/kWh）(thermal power plants)
ShikokuElectric Power

Result in fiscal 2022
Coal ash recycling ratio

99.6%

Recycling of remains of demolished structures
All of the old and replaced copper and aluminum wires arerecycled as new wires, etc.
All of the removed concrete columns are pulverized,
separated from the reinforcing bars, and then reused as
construction aggregate (roadbed material for road paving).

Recycling status of power lines and concrete pillars

SOｘ

0.1

(FY2022)0.3

Germany (2020)

0.3

United Kingdom

NOｘ

0.8

0.1

0.6

(2020)

Power lines before recycling

Recycled power lines

Concrete pillars before recycling

Recycled construction aggregates

0.3
0.3

USA (2020)

0.1

France (2020)

0.0

0.5
0.2

0.4

0.6

0.8

1.0

* Compiled based on the website of the Federation of ElectricPower Companies of Japan (“Energy and the Environment”)

53

Coal ash generated at coal-fired power plants is used as a raw
material for cement and as a concrete admixture in various
applications, such as bridges, roads, and the exterior walls ofbuildings. Almost all of it is recycled.

0.1g/kWh
0.3g/kWh(g/kWh)0.0

Coal ash recycling

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Initiatives toward Environmental Issues (in Japanese only)
https://www.yonden.co.jp/energy/environment/index.html
Yonden Group Environmental Policies (in Japanese only)
https://www.yonden.co.jp/energy/environment/policy/index.html
Yonden Group Environmental Data Book (in Japanese only)
https://www.yonden.co.jp/energy/environment/data/index.html

Conservation of biodiversity
Amid growing interest in biodiversity and nature, theTaskforce on Nature-related Financial Disclosures (TNFD) wasestablished in June 2021. The TNFD is developing aframework for assessing and disclosing risks andopportunities related to nature, and its final recommendations
will be published in September 2023.
The dependence on nature of corporate activities, and theimpact of such activities on nature, can be seen as risks andopportunities related to nature. Shikoku Electric Power willcontinue to monitor TNFD trends and work to contribute tobuilding a nature-positive society.

Inspection and maintenance of nesting
towers (Seiyo City)

Oriental stork flying into the area
(Seiyo City)

Initiatives at electric power stations
To minimize the impact on river environments and to comply
with laws and regulations concerning the amount of water
intake, we have implemented measures for hydroelectric
power plants, including:・Installation of equipment able to take in water with low
turbidity and return it downstream after use for power
generation
・Discharge of maintenance flow to improve theenvironments downstream from dams
・Removal of driftwood and dust from reservoirs to use as
biomass fuel, etc.

Environmental conservation activities together
with the community
We are working throughout the year with local
communities around Shikoku on environmental
conservation activities (such as clean-ups and forest
preservation activities) mainly through “Environment
Month”, which is sponsored by the Ministry of theEnvironment.
Shimanto Yonden Forest activities

At thermal and nuclear power plants, we are working to
reduce the amount of water required for power generation,
while at the same time strictly complying with laws,
regulations and other standards when discharging
wastewater. In addition, when it comes to the seawater used
to cool steam etc., the temperature differences between theintake and discharge water is controlled in accordance withagreements with local governments.
When constructing power plants, environmental
assessments are carried out to predict and evaluate theimpact of construction work and the operation of power
plants on the surrounding area in advance, and the results arereflected in environmental conservation measures.

At our Kochi Branch office, employees are participatingin Kochi Prefecture’s Forest Development Project inCollaboration with Environmentally Advanced
Companies. In the agreed forest (in Shimanto Town)
named Shimanto Yonden-No-Mori, they are carrying out
forest preservation activities such as tree planting andcutting the undergrowth, together with the local
authorities and people of the area.

Conservation activities for the oriental stork
From the viewpoint of conserving biodiversity, we are working
to protect the Oriental stork, a bird designated as nationallyprotected species. We are donating nesting towers to local
governments and also working to preserve the habitats of the
Oriental stork by continuously undertaking efforts such as the
conducting of inspections and maintenance using aerial work
platforms.

Forest preservation activity

Shikoku Electric Power Group INTEGRATED REPORT 2023

54

Business Management that Increases Sustainability

S

SocialCoexisting in Harmony with Communities

Our Group works positively on coexistence with the Shikoku region, where our business is based, and support
for its invigoration, under the corporate philosophy of “living in the community, moving forward with thecommunity, and prospering with the community.”

Enhancing communication with local communities
Dialogue and exchange activities
with surrounding communities
Our Group conducts its business as a corporate group rooted
in the community. We believe that it is important to gain theunderstanding and support of members of local communities
by engaging positively in dialogue and exchange activities
with regional communities.
In fiscal 2022, we conducted relationship-building
activities with local residents in various regions of Shikoku,
including social contribution activities, such as electricalfacility inspections and clean-up activities.

Positive disclosure of nuclear
information and dialogue activities
Information disclosure using the Ehime method
In 1999, we were the first power company in Japan to
introduce a notification system, through which we notify
Ehime Prefecture and Ikata Town immediately of all events
other than normal operations that occur at the Ikata Power
Plant, and we have continued to operate this system eversince. This kind of highly transparent information disclosure,known as the “Ehime method,” contributes significantly to thebuilding of relationships of trust with local communities.
Notifications to Ehime Prefecture and Ikata
Town based on safety agreements(Unit: number of notifications)Cleaning the Ryoma Sakamoto Statue[Katsurahama, Kochi Prefecture] (Kochi
Branch & Yondenko Corporation)

Tokushima Machinaka Hana Road Project“Hana Planting Association” (Tokushima
Branch & Yonden T&D Tokushima Branch)

FY

2018

2019

2020

2021

2022

Class A

5

6

3

7

7

Class B

3

4

2

4

4

Class C

14

20

13

17

18

Total

22

30

18

28

29

* Overview of public notifications in Ehime Prefecture
Class A (Trouble, etc., that needs to be reported to the government): Immediate public notification
Class B (An abnormal situation at a facility, etc., has occurred within the radiation
control area): Public notification within 48 hours
Class C (Events other than classes A and B above): Public notification is given on the10th of every month for all events in the preceding month

Energy education for children

Visiting-for-dialogues activities

In order to increase children’s interest in energy andenvironmental issues and have them gain a correctunderstanding of these issues, we have been conducting“Delivery Energy Classes” based on the needs of educatorsand children throughout Shikoku. The classes are forelementary and junior high school students, who will be
responsible for our future.
In fiscal 2022, in response to the needs of each school, in
addition to the “Delivery Energy Classes”, which makeeffective use of power generation models and videos, we also
conducted online tours of our company facilities, which havebeen well received.

Since starting visiting-for-dialogue activities in 1988, ouremployees have made individual visits to approximately 27,000
households in Ikata Town and Yawatahama City within a 20 km
radius of Ikata Power Plant. They continue to conduct activities,
including giving explanations on safety measures etc. at the power
plant, and to engage in dialogue activities to listen to opinions inperson. Over the past three years, the COVID-19 pandemic hasmeant that employees were unable to do any individual home
visits. However, we distributed leaflets to all homes and received
opinions through postcards and other means.
We will continue to listen carefully to the opinions of local
residents in order to further improve the safety of Ikata Power Plant.
Range of visiting-for-dialogues activities

Within a 20-km radius
Within a 10-km radius

Ikata Power Plant
Delivery Energy Class

Online tours

Ikata Town

Ozu City
YawatahamaCity

Seiyo City

27,000 households
eligible for visits
55

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Let’s Think About Energy
https://www.yonden.co.jp/energy/learn/index.html
Yonden Cultural Foundation (in Japanese only)
https://ycf.or.jp/
Agricultural Initiatives of Shikoku Electric Power Grouphttps://www.yonden.co.jp/cnt_yonden-agri/

Efforts to resolve local issues
Creating a flourishing region ,working to increase the non-resident population
Shikoku Electric Power Group is working with othercompanies to revitalize the Shikoku region, promote tourism,and expand the number of visitors, etc.
For example, the SHIKOKU-KE SUPPORTERS CLUB(established by 23 companies and organizations in 2021 withthe aim of revitalizing the Shikoku region) conducts events
such as the Pilgrimage Walk to inspect the Shikoku
Pilgrimage (approximately 5,600 participants) and the
Marugame Nigiwai (Activity) Project (approximately 7,700
participants). We are also working on various activities torevitalize Shikoku, such as creating a calendar to introduce
Shikoku's festivals online, and plan to sell souvenir sets
combining products from Shikoku’s four prefectures.
As of the end of fiscal 2022, the number of companies
and organizations supporting the club has increased to 104,
and the club’s circle of activities is expanding.

One-day Welcome Pilgrimage Walk

Development of business that targets
on the resolution of local issues
We resolve regional issues leveraging the Group's technology,know-how and credibility, and this advances the creation anddevelopment of our new businesses.

AgribusinessWe are working on agribusiness that will contribute to therevitalization of agriculture in the Shikoku region by utilizing
human resources and connections with local communities
possessed by Shikoku Electric Power Group.
Agribbon Corporation (Kagawa Prefecture), a groupcompany, contributes to the maintenance of production areas
by growing the rare and valuable strawberry “Nyoho” andjointly shipping it in cooperation with local producers.
Group company Aitosa Corporation (Kochi Prefecture)develops and sells “sixth sector” products that use “Shishito
peppers”, a leading local product. Aitosa also develops“smart agriculture” technologies, leveraging robots, AI, andthe IoT, and is working to establish efficient cultivation
methods and save labor in production operations.

Festivals Online Calendar leaflet

Support for the arts, culture, and sports
Yonden Cultural Foundation supports improvements in art
and culture in the Shikoku region and the realization ofprosperous and comfortable local communities. Activities
include scholarship support for students from Shikoku who
aspire to become artists, honoring outstanding artists
associated with Shikoku, holding concerts and art exhibitions
by scholars, and providing support for the dispatch ofmusicians.
Shikoku Electric Power Group also supports professionalsoccer and basketball teams in the region to promote
regional sports.

Hometown concert by scholarship students in Shikoku"Nyoho" strawberries harvested by Agribbon"Shishito Miso" made using
Aitosa's shishito peppers

Operation of emergency medical service helicopters
SHIKOKU AIR SERVICE CO., LTD., a member of the Group, operates
emergency medical service helicopters in Kagawa and Kochi prefectures
as part of its aircraft business. The importance of emergency medical
service helicopter operations has increased, as evidenced by theconclusion of wide-areacooperation agreements
among the four prefecturesof Shikoku, etc. The safeand reliable operation of
emergency medical service
helicopters contributes tolocal disaster response andEmergency medical service helicopters owned
emergency medical care.
by SHIKOKU AIR SERVICE CO., LTD.

Shikoku Electric Power Group INTEGRATED REPORT 2023

56

Business Management that Increases Sustainability

S

SocialFostering Employee Motivation

Shikoku Electric Power Group wants all of our employees to be motivated to work and feel satisfaction
with their work. To this end, we strive to develop an open-minded and lively workplace environment.

Implementing human capital management
Based on the belief that “people” are the greatest driving force (greatest asset) for promoting sustainability, we are working to create
vibrant work environments in which employees can engage in work with a sense of fulfillment and achievement, and maximize theirabilities. We define the “promotion of diversity and inclusion” and “promoting the acquisition and development of future-leading
human resources” as key human capital issues.
Note:The following measures focus on the efforts of Shikoku ElectricPower and Shikoku Electric Power Transmission & Distribution Co., Inc.

Promotion of diversity and inclusion
We respect the personalities, diverse sense of values and lifestyles of our employees. Capable and motivated employees areprovided with opportunities to exercise their abilities and they are promoted to higher ranks, regardless of gender etc.

Support for balancing work with childcare andnursing care
We are developing and enhancing various support systems so that
employees who are raising children or caring for family members
can balance their work and family lives regardless of their gender.
In addition, from the viewpoint of promoting understanding anddissemination of our systems, we have established a dedicatedconsultation office and distributed a “Work-Life Balance Support
Handbook”. We also promote awareness among managers andfoster a workplace culture that makes it easy to use our systems.
In recognition of these efforts and as a company engaged insupporting child-rearing, Shikoku Electric Power has received theKurumin certification* from Kagawa Labor Bureau four times. In
recent years, we have also received many favorable comments in
our recruiting activities from students, who have described ourworking environment as one that encourages women to remain inlong term work. The number of female hires has also been
increasing, particularly within our corporate section.
* Kurumin certification is granted to companies that meet certain criteria and achieve
the targets specified in the General Employers' Action Plan based on the Act on the
Promotion of Measures Supporting the Growth of the Next Generation(Next-Generation Act).

Under our General Employers' Action Plan, which is based on
the Next-Generation Act and which we are implementing until
fiscal 2025, we have set goals for increasing the rate of male
employees taking childcare leave so that they can balance workand family life, regardless of gender. We also aim to support
male employees' participation in housework and childcare.

Promoting the careers of female employees
In the electric power business, there are many organizations
with a high percentage of male employees and few female
managers. This is because most of the workplaces are power
plants, transmission and distribution sites.
For this reason, we will actively work to expand therecruitment of women and make efforts to systematicallydevelop and actively promote female managers throughcareer development support, etc. based on the following
targets.
・5.0% ratio of female managers by the end of fiscal 2025*(result in fiscal 2022: 3.5%)
・In the medium to long term, aim for a similar ratio to that for
female employees.
(The ratio of female employees in fiscal 2022 was 9.2%.)* Combined total for Shikoku Electric Power and Shikoku Electric Power Transmission& Distribution Co., Inc.

We are currently working towards
these goals.
In April 2023, Shikoku Electric Powerwas awarded "Eruboshi” certification*
as a company that has excelled inpromoting women’s careers.
*Certification is granted to companies that meetcertain standards and have excellent performance inpromoting women's careers, based on the Act on
the Promotion of Women's Active Engagement inProfessional Life.

Supporting women’s careers!
“Eruboshi” certification mark”

Efforts to promote women's careers
Topics Covered

Certified in 2020
Kurumin
Supporting childcare“Kurumin” certification mark57

An employee on childcare leave

Shikoku Electric Power Group INTEGRATED REPORT 2023

Planned development
and deploymentof people

With the aim of promoting female employees with highaptitudes and motivation to management positions, we
promote the systematic development and placement offemale employees with an emphasis on individual
characteristics, in cooperation with our divisions.

Conducting follow-up
interviews after promotion
to management positions

HR staff conduct follow-up interviews to eliminate feelings ofburden and anxiety while checking on status in terms ofbusiness performance.

Holding of seminars
and encouragementof attendance

Encourage employees to attend seminars aimed atenhancing their business skills, increasing their motivation,and improving their management skills.

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Employment Information (in Japanese only)
https://www.yonden.co.jp/corporate/recruit/index.html
YONDEN MOVIE SITE (in Japanese only)(videos used to introduce viewers to business activities)
https://www.yonden.co.jp/cnt_movie/index.html

Active use of seniors
We give specialist certifications to skilled technicians at theforefront of their fields and personnel with highly specialized
knowledge, offering career opportunities in specific fields.
We are also working to maintain and improve ourtechnical capabilities in the field, and improve our ability topass on technological knowhow to future generations,through the use of employees rehired after retirement withextensive work experience.

Promoting employment of the challenged (People
with disabilities)
We established Yonden Plus Corporation (a special subsidiarycompany for people with disabilities) based on the perspectiveof providing positive support for the independence and social
participation of individuals with disabilities. In doing so, we
help to expand employment opportunities for individuals withdisabilities. As a result, our employment rate for individuals
with disabilities is 2.7% (as of June 2023)*, which is higher
than the statutory employment rate (2.3%).
* Total employment rate at four companies, including Shikoku Electric Power andShikoku Electric Power Transmission and Distribution Co., Inc.

Development of a comfortableworkplace environment
We have established an organization for reforming working
styles, which is headed by the Senior Corporate Officer of the
Employee Relations & Human Resources Department. We
operate hourly leave system, flexible work, open plan offices
where employees are free to sit where they choose, and casual
dress codes based on the diverse lifestyles and needs of
employees.
In order to prevent health problems caused by long working
hours, we ensure a minimum of 10 hours of rest (“interval”)
between closing time and the starting time the next day.
Main systems enabling flexible working styles
Item
Hourly leave system
Sliding shift system

Improving employee engagement
It is important for employees to increase employee
engagement in work, with a sense of fulfillment andachievement, and to display their full potential.
For this reason, we share Shikoku Power Company’s
direction with our employees by disseminating informationfrom the management and by holding meetings to exchange
opinions in the workplace. We also strive to provide various
opportunities for active participation and growth, and to foster
a comfortable work environment based on the opinions of
employees.

Conducting employee engagement surveys
An employee awareness survey is conducted once every
three years with the aims of tracking employees'
understanding of management issues, their willingness totake on new challenges, and the state of organizational vitality
over time, and reflecting this in our personnel and labor
policies. The most recent survey (fiscal 2021) confirmed that
employees feel a sense of satisfaction at work and pride inworking for Shikoku Electric Power.
In addition, we conducted an engagement survey
targeting young employees up to the fifth year of
employment, focusing on aspects such as job satisfaction
and work environment. Based on the survey results, theEmployee Relations & Human Resources Department
conducted individual interviews, allocated personnel totraining based on individual characteristics and aptitudes, andprovided opportunities for employees to challengethemselves. Our retention rate for recent graduates after three
years was 97.5%.
Since fiscal 2023, we have expanded the scope of thisengagement survey to include all employees. Improving thevitality of our organization in this way will lead to a sustainable
increase in our corporate value.

Topics Covered
System through which employees are able to acquire
paid leave on an hourly basis
Starting and finishing times can be brought forward or
put back in 10 minute increments

Flextime system

Employees can set their starting and finishing times
flexibly on a daily basis

Proactively promoting
the acquisitionof consecutive leave

Promotion of consecutive days of leave to encourage
employees to enjoy leisure time and come back towork physically and mentally refreshedTelecommuting
and satellite work systems

Employees can work at home or at other offices

Office casual

Development of an atmosphere that increases
motivation and encourages innovative thinking

Excerpt from the results of the employee awareness survey (fiscal 2021) *1■ Company average● Average at other companies *2
You feel satisfied
with your current job
You are satisfied
about working at the Company
You are proud
about working at the Company(Score) *3

2.5

3.0

3.5

4.0

4.5

3.73
3.53
4.06
3.64
4.06
3.74

*1 The next survey is scheduled for fiscal 2024.
*2 Average at other companies: Average of 80 companies with 1,000 or more employees using survey contractors.
*3 Scores out of 5

Shikoku Electric Power Group INTEGRATED REPORT 2023

58

Business Management that Increases Sustainability
Fostering Employee Motivation

Developing and securing human resources to open up the future
Passing on our DNA to support
the stable supply of electricity

Human resources development
based on the growth strategy

Education and training
With regard to human resources development, we are effectively
combining the following three measures:
・Making daily education (OJT) at each workplace fundamental
・Group education (OFF-JT) implemented through efforts such as
required training, supervisor recommended training, andoperational training for each department
・By focusing on individuals’ motivation and willingness, we are
effectively combining self-development support to increase
motivation and the drive to take on challenges, and we areworking to make young and mid-career employees capable as
early as possible.
In addition, based on practical education programs developedby each technical department, we are systematically acquiring andpassing on knowledge of the technical capabilities required for the
maintenance and operation of electric power technology, as well
as related laws and regulations. We are steadily passing on our
DNA of “strength in the field” and “a sense of mission” to support
stable power supply and customer service.
Education systems
OJT

Daily training / Work process improvement support (proposal system), etc.

Securing and developing human resources topromote growth businesses
We have established a new “Business Development Course” torecruit people with a certain level of work experience, which we will
adopt from our regular hiring campaigns from fiscal 2024
onwards, and we will make efforts to secure people with a highaptitude and motivation to take on challenges in growth fields,
alongside ongoing efforts to hire staff with a certain level ofworkplace experience. In addition, we flexibly assign people withmotivation, ability, and aptitude across our divisions in order topromote our growth businesses.
In order to promote the growth of talented human resources,in addition to business communication training to strengthenbusiness performance inEnglish and acquire overseas
business skills, we are also
expanding opportunities foroutside employment, such as
internships at overseas
companies and work
experience at venture
Business communication training
companies.

Group Training

Newer employee
training
New recruit
training

Voluntary Education
Programs

Training throughdispatch outsideof the Group
Division-specific drills

Mid-career
employee training

Cross-industry
exchange training

Special training
for new managers

Work
Topic-Based
Process
Training
Training

Elective training

Manager
assessment training

Training for
new employee trainers

General Employees

Managers

Businessleader training

Supervisor Recommended
Training

Training through dispatch
within Japan and overseas

RequiredTraining

e-Learning, correspondence courses, support for acquisitionof officially recognized certifications, etc.

Initiatives for DX human resources development
In order to nurture DX human resources, we have established the“Yonden DX Learning Program”, and we have developed an
education system that enables trainees to acquire the knowledge
and skills needed at each individual level.
In addition, we have established an internal DX portal website
to improve DX literacy among employees by providing content,
including introductions of internal and external DX case studies
and explanations of new digital technologies.

Training levels for DX human resources

DX Expert (Advanced)

Position and aptitude development

Creating and driving DX

DX Promoter (Intermediate)
Practicing DX

Expanding the scopeof implementation

DX Adapter (Beginner)

Understanding basic knowledge,
and participating/cooperating with DX

DX business human resources
New recruit training

59

Special training related to safety and health for low-voltage electricity

Shikoku Electric Power Group INTEGRATED REPORT 2023

(DX leaders, DX designers, etc.)

Expanding the scopeof implementation

Digital technology
human resources

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Basic policy of materials procurement information
https://www.yonden.co.jp/business/supply/policy/index.html

Initiatives as a company that respects people
Raising awareness of respectfor human rights
Our company's corporate philosophy is to be “A Company that
Respects People,” and we have declared respect for human rights
in our business activities in the Shikoku Electric Power Compliance
Guidelines (in Japanese only). We are promoting group-wide
efforts to create a society in which each person's human rights
and character are respected, so that people can live and work in ahumane and prosperous manner.

Human rights education and harassment
prevention
We have established a “Human Rights Education Promotion
Committee” to instill a high level of human rights awarenessamong employees. We hold group training at each workplace
based on the policies set by this committee. In addition, we haveestablished the Yonden Group Liaison Committee for the
Promotion of Human Rights Enlightenment to promote humanrights across our group.
As part of efforts to prevent harassment, we have set up aharassment consultation desk to protect the privacy of consulting
individuals. We are working to create a healthy workplaceenvironment by developing a system for fair and impartial
responses to be undertaken.

Respect for human rights
in the supply chain
In accordance with our “Basic Policy on Procurement ofMaterials”, we conduct procurement activities that take account of
human rights in supply chains by requiring suppliers to comply
with laws and regulations related to labor and human rights, andto ensure safety during work.
In addition, we are promoting fair and free trade under the“Declaration of Partnership Building”, which aims for coexistence
and co-prosperity on an equal footing with our suppliers.

Stringent occupational healthand safety measures
Led by the “Yonden Group Safety Committee”, we aim for zeroindustrial accidents across Shikoku Electric Power Group, and wework to promote safety, including at Group companies andaffiliated companies.
In addition, we have designated July of every year as the
Yonden Group Safety Reinforcement Period. We use this period as
an opportunity to raise safety awareness among the entire Groupand implement activities such as safety patrols and lectures.
Number of occupational accidents requiring time off from work (Fiscal 2022)
Shikoku Electric Powerand Shikoku Electric Power
Transmission & Distribution Co., Inc.

Subcontractors

Total

Occupational
accidents

2

13

15

Traffic accidents

0

0

0

Total

2

13

15

Initiatives aimed at health and productivity management
Under our “Declaration on Health Management”, we are working
to reduce the risks of lifestyle-related diseases such as obesity andsmoking through individual health guidance. In addition, as amental health support measure, we are working to prevent illness
and create comfortable working environments for our employees
by providing care from professional occupational physicians andoccupational health staff.
In recognition of such initiatives, Shikoku Electric Power andShikoku Electric Power Transmission &Distribution Co., Inc. have been recognized
for four years in a row as an “Excellent
Health Management Corporation”* by the
Ministry of Economy, Trade and Industry.
* This is a system to honor corporations engaged
in strategic “health management” for theiremployees from a management perspective.

Excellent HealthManagement Corporation
Heath and productivity

Numerical targets for reducing lifestyle disease risks
Fiscal 2023 target

35.1

0

Ratio of obese employees

17.8
Shikoku ElectricPower and Shikoku
Electric Power
Transmission &Distribution

10

25.0

Nationwide

20

32.1

29.3

30

Shikoku Electric Powerand Shikoku Electric Power
Transmission & Distribution○ Compliance with laws and social norms
・Laws, regulations and social norms related to labor andhuman rights that must be observed in order to fulfill
social responsibilities○ Ensuring safety
・Preventing industrial accidents and ensuring safe andhygienic work environments○ Consideration for the environment○ Ensuring appropriate prices and quality, etc.

(%)
40

Nationwide

Requests to suppliers based on the Basic Policyon Procurement of Materials (excerpt)

16.0

Ratio of smoking employees

Source: Nationwide figures are for men aged 20 to 60, “2019 National Healthand Nutrition Survey”, Ministry of Health, Labor and Welfare* Combined ratio for Shikoku Electric Power and Shikoku Electric Power Transmission &Distribution Co., Inc. (fiscal 2022)

Shikoku Electric Power Group INTEGRATED REPORT 2023

60

Business Management that Increases Sustainability

G

Governance

Enhancing Corporate Governance

We are working to strengthen governance, secure management transparency through dialogue withshareholders and investors, and promote compliance to improve corporate value.

Basic Policy on Corporate GovernanceOur fundamental mission is to “contribute to the development of local communities by providing our customers with a stablesupply of low-cost, high-quality electricity”. Based on this mission, we are advancing efforts aimed at impartial, quick andbold decision-making, and achieving sustainable increases in corporate value, while taking into consideration the “keyprinciples that contribute to effective corporate governance” stated in the “Yonden Basic Policy on Corporate Governance”
and Japan’s Corporate Governance Code.

Yonden Basic Policy on Corporate Governance: Basic Views on Corporate Governance
1. We will substantially ensure the rights and fairness of our shareholders.
2. We will cooperate with our various stakeholders in an appropriate manner.
3. We will actively disclose information promptly and fairly in an effort to ensure transparency.
4. We will reinforce business execution and management supervisory functions under a corporate governance systemwith an Audit & Supervisory Committee.
5. We will engage in constructive dialogue with our shareholders and other investors.

Message from outside director

The aim of corporate governance is to realize the “development ofcompanies, investors and the economy as a whole” by handling the“sustainable growth of the company and improvements in corporate
value over the medium to long term”.
In other words, the aim is to identify the social issues and changes incustomer needs that result from changes in the environment and social
structure within a timeframe. Through communication and collaboration
with stakeholders, such as shareholders, customers, employees, andlocal communities, the company will quickly and decisively practice“attack and defense” while being aware of transparency and fairness,and then grow and develop alongside our stakeholders.
At Shikoku Electric Power, efforts have been made to strengthen
governance, including the formulation of the “Yonden Basic Policy on
Corporate Governance” in 2015 and the subsequent transition to acompany with an Audit and Supervisory Committee. In the current fiscal
year, a “performance-linked compensation system” for directors, etc.
has been introduced after deliberation by the Compensation Committee.
At a time when transitioning to a decarbonized society is a major
theme, there are strong expectations for Shikoku Electric Power Groupto strengthen and stabilize its management and financial bases, and touse this as a platform for securing the necessary power sources andstable electric supply to industries and households in Shikoku inaccordance with each stage of transition to a decarbonized society. In
addition, with decarbonization, the need for electricity-related support
from industry is expanding, and it is important to respond firmly to thiswith the technologies and knowledge possessed by Shikoku ElectricPower Group. In addition, the comprehensive strengths and humanresources of the Shikoku Electric Power Group have an extremely
important role to play and expectations to meet for ensuring the61

Shikoku Electric Power Group INTEGRATED REPORT 2023

Iwao Otsuka

Director Audit &Supervisory Committee
Membersustainability of Shikoku, where there is a declining population, dwindlingbirthrate and aging society. Going on the “offensive” to enhancesustainability will lead to the growth and sustainability of the Shikoku
region, as well as growth and increased value for Shikoku Electric PowerGroup. As an outside director, I will be asked to makerecommendations based on my experience of managing a regionalbank in Shikoku.
On the other hand, the occurrence of a case where customer
information is used for purposes other originally intended shows that
there is a problem in “defense” . The outside directors have held
discussions with the management based on their knowledge at theBoard of Directors and the Audit and Supervisory Committee. We haveexamined the causes and problems, as well as the organizational
culture, including the level of awareness among officers and employees,
and worked to develop systems to prevent recurrence. In the future, I
will work to further strengthen my supervision as an outside director inorder to enhance internal control systems and improve transparency.
As a power company and leading company in Shikoku, theresponsibilities and roles of the Shikoku Electric Power Group are heavy
and significant. As an outside director, my responsibilities are extremely
high, too. With this in mind, I plan to contribute to the “attack anddefense” of the Shikoku Electric Power Group.

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

The Yonden Basic Policy on Corporate Governance (in Japanese only)
https://www.yonden.co.jp/corporate/ir/policy/governance.html
Corporate governance report (in Japanese only)
https://www.yonden.co.jp/corporate/ir/library/governance.html

Corporate Governance System[1] Board of Directors (Chair: Hayato Saeki)[3] Personnel Committee (Chair: Fujiko Takahata [Outside director])• Comprised of 14 members, including 5 outside directors(including 2 women)• Supervises decision-making related to the execution ofimportant business operations and the performance of
directors’ duties• Comprised of 5 outside directors and 2 internal directors• Deliberates on matters concerning the appointment anddismissal of the representative director, other directors andcorporate officers, and the appointment and dismissal ofsenior advisers and executive advisers[2] Audit and Supervisory Committee (Chair: Hiroshi Kawahara)[4] Compensation Committee (Chair: Ryohei Kagawa [Outside director])• Comprised of 5 outside directors (including 2 women) and 1
internal director• Exchanges opinions and provides advice on management
through attendance at important meetings of the Board of
Directors and regular meetings with representative directors• Audits the execution of duties by executive directors
through inspection and investigation of important
documents• Comprised of 5 outside directors and 1 internal director• At the request of the Board of Directors, the Compensation
Committee deliberates on the amount of director
compensation and the details of shareholder meeting
proposals related to director compensation, then reports its
findings to the board.

General meeting of stockholders
Appointment / Dismissal

Appointment / Dismissal

Audits,etc.

Directors(excluding directors who are Audit &Supervisory Committee Members)

Reports

Appointment /Dismissal /Supervision[2] Audit and Supervisory Committee(directors who are Audit andSupervisory Committee Members)

AuditsAudit & Supervisory
Committee Office(deliberation on important issues)

Sustainability Promotion
Council

Instruction(Representative Director)

Instruction
Reports

・Environmental Management Committee・Social Co-creation Committee
・Compliance Promotion Committee
Compliance consultation office(Internal: General Affairs Dept.: External: Lawyer)

Reports

Instruction

Reports

Reports

Director and President[5] Board of Managing Directors

Collaboration

AuditsIndependent
Accounting Auditors[4] Compensation
Committee[3] Personnel
Committee[1] Board of Directors

Inquiry

ReportAppointment / Dismissal[6] Internal Audit
Division

Operations Division
Regulation

Internal
Audit

Group Companies[5] Board of Managing Directors[6] Internal Audit Office• Comprised of the Director and President, and the Executive
Officers in charge of HQs and divisions.（Furthermore, theChairman of the Board and Directors who are Audit &Supervisory Committee members can also attend thesemeetings.）• Deliberates on matters to be submitted to the Board of
Directors and on important matters related to businessexecution• The Internal Audit Office conducts internal audits of theimplementation status of the management cycle under theGroup’s management plans for each fiscal year, which
describe the Group’s basic policies and plans, as well as ofappropriate business execution and effective business
management based on the responsibilities and authority ofeach job grade.

Shikoku Electric Power Group INTEGRATED REPORT 2023

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Business Management that Increases Sustainability
Enhancing Corporate Governance

Enhancing Corporate Governance
Composition of the Board of Directors
and nomination policy
It is important for the Board of Directors to conduct full deliberations andmake prompt and rational decisions based on diverse opinions.
For this reason, Shikoku Electric Power has built its Board of
Directors so as to establish a proper balance of the insight,
experience and abilities needed for business management acrossthe board as a whole, while maintaining diversity and an
appropriate size by appointing executive directors from a variety offields and backgrounds and multiple independent outside
directors, after first identifying the skills they should be equippedwith in consideration of matters such as management strategy.
The Board of Directors nominates candidates for Director who
meet the following criteria. Prior to their nomination, candidates
are deliberated by the “Personnel Committee.” Following this:• Explanations about candidates for director (excluding
members of the Audit & Supervisory Committee) must be
given at a meeting of the Audit & Supervisory Committee• The consent of the Audit & Supervisory Committee must be
obtained for candidates for director who are members of the
Audit & Supervisory Committee.
* The number of directors (excluding directors who are members of the Audit &Supervisory Committee) must not exceed 13 and the number of directors who aremembers of the Audit & Supervisory Committee members must not exceed seven.

Standards applied to candidates for director[1] Candidates must excel in character, insight and ability,and have a high sense of ethics and law-abiding spirit[2] Candidates must understand our fundamental mission
and corporate philosophy and be able to contribute to
the sustainable improvement of corporate value andregional development[3] Candidates must be able to adequately carry out
management decision-making and supervision from acompany-wide perspective as a constituent member ofthe Board of Directors[4] Candidates must meet the statutory qualification
requirements for directors

denotes the fact that it is optional

Directors(excluding members of
the Audit & Supervisory
Committee)
Director Audit &Supervisory
Committee Member

denotes designation by law

Personnel
Committee

Audit & Supervisory
Committee

Deliberation

Decision-making
on appointments, etc.
Statements of opinion
at General Meetingof Shareholders

Compensation for directors is determined by a comprehensive
assessment of several factors, including business performance,
content and execution of duties, and compensation levels of otherbusinesses, with particular focus on listed companies. In doing so,
we aim to provide appropriate compensation in light of eachdirector’s responsibility to realize our mission and to facilitatesustainable improvement of corporate value.
The specific levels of compensation are determined by the
Board of Directors based on reports provided by theCompensation Committee and within the limits determined byresolutions issued at General Meetings of Shareholders.
Directors’ compensation<Directors (excluding members of the Audit &Supervisory Committee)>・Monthly compensation [approximately 70%]
・Performance-linked compensation [approximately 10 to20%] (short-term performance improvement incentive)
Consolidated ordinary profit and dividends are set as standard
indicators, and the amount paid is determined by taking into accountthe status of ESG initiatives.

・Stock compensation [approximately 10%] (incentive toincrease corporate value over the medium to long term)<Directors who are members of the Audit & Supervisory Committee>
・Monthly compensation [100%]Compensation amounts (FY2022)(millions of yen)

Total amount by type of compensation, etc.

Executiveclassification

Total
amount ofcompensation,etc.

Director(excluding membersof the Audit &Supervisory Committee)

280

250

Director
Audit & Supervisory
Committee Member(internal)

28

28

1

Outside Director

43

43

5

Number of
Bonuses
Stock
Monthly(results-linked compensation eligible directors
compensation(non-monetarycompensation,[annual amount]compensation, etc.)
etc.)

ー

29

10

Note:Including the total amount of compensation paid to directors retiring from their positions at theGeneral Meeting of Shareholders held in June 2022 and the number of such directors.

Process for nominating director candidates
Organization
Subjects

Approach to directors’ compensation

Board of Directors

Resolution

Consent(Reference) Maximum monthly compensation of directors[total for all directors](millions of yen)
Executive classification

Maximum monthly
compensation

Stock compensation

Directors(excluding members of
the Audit & Supervisory
Committee)

456[Annual amount]・160 million yen over threefiscal years
・50,000 points annually*

Directors
who are members of
the Audit & Supervisory
Committee

10[monthly amount]* 1 point = 1 share

63

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Fiscal 2022 report (in Japanese only)
https://www.yonden.co.jp/corporate/ir/library/report.html
Corporate governance report (in Japanese only)
https://www.yonden.co.jp/corporate/ir/library/governance.html

Evaluation of the effectiveness of theBoard of Directors

Evaluation of the effectiveness of the Board of Directors(summary of questionnaire survey in fiscal 2022)<Reasons why effectiveness was judged to beappropriate>• The Board of Directors as whole has a good balanceof insight, experience and abilities, while ensuring
diversity and an appropriate size.
• By appointing outside directors as the chairs ofvoluntary committees (Personnel Committee andCompensation Committee), a system has been
established to ensure independence and a checking
function for the Board of Directors, thereby improving
the governance function.
• Adequate time for discussion at the Board of Directors
meetings is ensured by preparing more detailedadvance explanations of proposals.
<Requests and future issues>• Further enhance opportunities for outside directors toshare information and exchange opinions

To ensure the effective functioning of internal controls so that
day-to-day business operations can be executed appropriately andefficiently, it is important for us to maintain a sound corporate
culture, identify chains of authority and responsibility, and develop
systems to manage risks. It is also important for us to check thestate of operation of such mechanisms regularly and make
improvements.
Having recognized the importance of winning the trust of society
at large, the Board of Directors passed a resolution setting out the
System for Ensuring Sound Business, which is our basic policy oninternal controls, so that we can conduct business activities that arelegal, appropriate, and efficient. Going forward, we will implementbusiness management in accordance with this policy.
Further, we will disseminate this policy continuously to gain theunderstanding of all our Directors and employees, in order tostrengthen our initiatives for enhancing our internal control systems.

Strengthening the internal control systemfor conduct policy
In response to the use for unintended purposes ofcustomer information managed by Shikoku Electric Power
Transmission and Distribution Co., Inc., we arestrengthening our internal control systems for conduct
policy in order to prevent recurrence and restore trust.
See page 26

New internal control systems for conduct policy
NameInternal

We conduct an annual questionnaire survey among all
directors on the effectiveness of the Board of Directors, andevaluate the composition, governance and management of
the Board of Directors based on the results.
Based on the results of the questionnaire in fiscal 2022,
our company considers that the effectiveness of the Boardof Directors has been appropriately ensured. In addition, athird -party law office have expressed the view that ourquestionnaire items, evaluation results, and future actions
are appropriate.
We will continue to optimize governance based on theopinions of directors and strive for further improvements inthe effectiveness of the Board of Directors.

Appropriate internal controls

Project teamfor conduct
policy compliance・Supervising the whole company
・Promoting and supervising company-wide
activities related to conduct policy(monitoring and guidance of sales departments,
company-wide education on conduct policy, risk
review, and rule design)

Awareness
Reform and Business
improvement
Promotion Project・Supervising sales departments
・Promotion and management of recurrence
prevention measures at the sales departments(training on conduct policy, inspection of businessflows, etc., workplace patrols, etc.)

Conduct policy audit

・Established at the Internal Audit Office・Perform specialized audits of company-wide
conduct policy compliance

Third-party checks

・Audits by external experts
・Advice and guidance on overall company-wide
activities related to conduct policy compliance

Attendance rate

Board of Directors

11

98.7%

Audit & Supervisory
Committee

18

97.7%

OutsideFrequency and attendance rates of meetings of the Board of
Directors and Audit & Supervisory Committee (FY2022)
Number of meetings held

Role

Shikoku Electric Power Group INTEGRATED REPORT 2023

64

Business Management that Increases Sustainability
Enhancing Corporate Governance

Establishment of rules on managing
contact with competitors
In light of the fact that violations of the Antimonopoly Law
by electric power companies have become a social issue,
in April 2023, our company established the Rules on
Contacting Competitors in order to prevent cartels,
bid-rigging, and other acts that could lead to suspicion.
Also, we set out rules on measures to be taken when
there are matters or problems observed in our contact
with competitors, as well as rules on internal reporting.
In addition, for directors and senior managers of oursales and planning departments, we hold study sessions
with lawyers specializing in anti-monopoly law in order toremind ourselves of key points for preventing cartels.

Approach to cross-shareholdings
The shares that we hold are limited to those of companies
which contribute to the sustainable improvement of
Shikoku Electric Power Group’s corporate value in termsof the efficient operation of electric power business, etc.
In addition, the rationality of our holdings in listedcompanies is verified each year in consideration of
profitability and other factors, while taking into accounttheir importance in terms of business operations andcapital costs. The results are then reported to the Board of
Directors. Stocks that have reduced meaning are thenquickly sold.
On the other hand, in order to strengthen business
relationships and build cooperative relationships for new
businesses, in fiscal 2022 we increased the number ofunlisted stocks we hold.

Shareholdings (end of FY2022)(billions of yen)
Difference against previous year

Numberof stocks

B/S recorded
amountListed stocks

2

7

▲6

▲26

Unlisted stocks

68

284*

1

▲4

Number of stocks B/S recorded amount* In relation to nuclear power, we hold stocks of 0.3 billion yen in one listed company,
and 26.5 billion yen in stocks in 9 unlisted companies, for a total of 26.9 billion yen in
10 companies. Of that amount, 25.6 billion yen is accounted for by our stocks inJapan Nuclear Fuel Limited. Japan Nuclear Fuel Limited’s business plays an importantrole in the nuclear fuel cycle, and we have made this investment owing to its necessity
for the stable operation of our nuclear power plants.

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Shikoku Electric Power Group INTEGRATED REPORT 2023

React to Risks and Opportunities
Risk management system
In light of social issues, including climate change, thebusiness environment, and management resources, risks
that may have a significant impact on business operations
are checked and reviewed annually by the management inaccordance with the “Risk Management Rules”. The
results are reflected in the following fiscal year's
management plan to prevent and reduce risks. We also
work to create new value by taking advantage ofopportunities that arise as a result of changes.
For risks that cut across the entire Group, we set up
expert committees as necessary and address such risks in
an appropriate manner based on comprehensive
assessments. For emergency situations brought about by
natural disasters or other circumstances, we haveestablished individual rules and manuals and clarified the
management structure so that damage is minimized andrecovery expedited.
Moreover, we share information appropriately by
establishing a “crisis hotline” as a helpdesk that swiftly
gathers crisis-related information to make all employees
fully aware of the importance of crisis management.

The PDCA of risk management[Management level(Plan)]
Discuss among
management and reflectin management plans[Divisions, etc. (Do)][Divisions, etc.
(Action)]Monitoring of businessexecution risks andopportunities

Evaluation and prioritizationof risks and opportunities[Divisions, etc.
(Check)]Recognition ofrisks andopportunities

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Key risks and opportunities[→ specifies how we will respond]

Major events［1］Changes in energy policy
or electric power businesssystems［2］Strengthening
environmental regulations

Assumed opportunity

Assumed risk
• Strengthening of rules based on reviews of policies and systems→ Grasping the state of discussions at state councils,
dialogue with policy authorities, etc.

• Operating restrictions on thermal power generation and increased
power generation costs, etc. due to the strengthening of
regulations→ Analysis and responses to risks and opportunities
based on climate change scenarios

Electric power businessSee pages 49-52［3］Changes
in the environment
surrounding nuclear
power business• Increase in the cost of alternative thermal fuels associated withlong-term shutdowns due to lawsuits, changes in laws, etc., andincrease in capital investment associated with additional
measures, etc.
→ See “Improvement of safety at the Ikata Power Plant, continuationof safe and stable operation, etc.” on the right• Review of state systems related to the nuclear fuel cycle, etc.
→ Grasping the state of discussions at state councils, dialogue with
policy authorities, etc.

• Significant fluctuations in fuel prices and exchange rates→ See “Stable fuel procurement” on the right［4］Market trends• Decline in retail electricity sales volumes and unit prices due tomarket competition, and decline in wholesale unit prices due toincrease in FIT electricity→ See “Expansion of profit opportunities” on the right• Decline in grid power demand etc., due to population decline,
energy saving, the spread of storage batteries, and so on→ Refer to “Creation of new services and business” on the right• Profit opportunities arise due to reviews of policies and systems→ Grasping of the state of discussions at state councils, etc.

• Expansion introduction of renewable energy→ New development and expanded
See pages 33-34
introduction of renewable energy• Improvement of the efficiency of supply facilities→ Higher efficiency of thermal power generation

See page 35• Promotion of electrification and progress with energy saving→ Promotion of electrification consulting, solar PPAs,
and decarbonization support
See pages 37-38
for local communities• Improvement of safety at the Ikata Power Plant,
continuation of safe and stable operation, etc.
→ Implementation of safety measures in preparation
for serious accidents and other such occurrences→ Thorough information disclosure, and communication
with society through dialogue with local residents

See pages 32 and 55• Stable fuel procurement→ Diversification of suppliers and diversificationof procurement methods

See page 36• Expansion of profit opportunities→ Expansion of sales areas and diversificationof sales methods and channels→ Maximizing profits by utilizing multiple markets

See pages 37-38• Creation of new services and business→ Promotion of solar PPA
and distributed energy businessSee pages 38, 45, etc.

In common

Businesses other than electricity［5］Facility andoperations-related trouble,etc.

［1］Businesses other thanelectricity［1］Compliance• Damage to facilities or the occurrence of operating trouble due toa large-scale natural disaster or aging of supply facilities→ See description on the rightSee page 65• Changes in the market environment or materialization of country
risk in an individual business→ Identifying and managing risks assumed in business operations• Structural changes in energy business associated with the spreadof distributed power sources and technological innovation→ See “Rise of new needs in the energy business” on the right• Decline of social credibility associated with the violation of laws andregulations, etc.
→ Raising awareness of compliance among the officers andemployees, and strengthening internal control systems

See pages 26, 67, etc.

• The appropriate inspection of supply facilities, maintenance andenhancing the recilience→ Safe operation for thermal and hydroelectric power,
optimization of transmission and distribution facilities, handlingof hardware and software aspects in terms of readiness fordisaster occurrences, etc.

See pages 33, 34 and 39• Response to changes and opportunities in the market environment• Trends in digitization and DX→ Expansion of IT/Communication businessSee page 42• Increase in global energy demand→ Expansion of international businessSee page 43• Rise of new needs in the energy business→ Initiatives for DX and distributed energy businessSee page 45, etc.

• Increased need for enhanced governance and transparency→ Enhancing and strengthening corporate governanceSee pages 63-64

Shikoku Electric Power Group INTEGRATED REPORT 2023

66

Business Management that Increases Sustainability
Enhancing Corporate Governance

Promoting Compliance
We have established the “Shikoku Electric Power Compliance Guidelines,” which establish specific rules to be observed by
officers and employees, including legal compliance and respect for social norms as well as the building and maintenance of soundrelationships with stakeholders. We make efforts to raise awareness and promote implementation of these guidelines.
We have also established the Shikoku Electric Power Group Compliance Council, which combines the Compliance Promotion
Committees of each Group company, through which we make thorough efforts to ensure compliance across the Group.

Implementation of ongoingcompliance education

Protection of personal information

Every year, we implement e-learning training for all
employees, based on various potential work-related
compliance issues. In fiscal 2022, 100% of employees
undertook this training.
In addition, we regularly conduct training for personnel
in charge of on-site offices to share actual case studies ofcompliance violations and raise awareness of laws andinternal regulations related to operations. We also provide
compliance training that takes advantage of theopportunities for training at different job grades.
Furthermore, in response to an incident in whichcustomer information managed by Shikoku Electric Power
Transmission and Distribution Co., Inc. was used forunintended purposes, we have decided to provide training
on conduct policy to a wide range of people, with a focus
on the sales departments.
Through these efforts, we will work to instill and establish
compliance awareness among our employees.

The Confidential Information Security Committee promotes
company-wide efforts to protect personal information. In addition,
under our “Basic Policy on the Protection of Personal
Information,” we make thorough efforts to implement the proper
management of personal information, including that of customers,by disclosing the purposes of use of personal information, etc.,
establishing internal rules, and conducting education andawareness-raising activities among the employees.

Protection of intellectual property rights
Our Group owns and utilizes intellectual property rights, such as
patents, in fields such as energy, information andcommunications, electronics, construction engineering,
agriculture, and other fields. In addition, in order to avoid
infringing upon the intellectual property rights of third parties inour business activities, we provide training on legal systems andcases of infringement concerning patents, etc. mainly for staff incharge of intellectual property, including at group companies.

See page 26

Compliance consultation office
We have established a Compliance Consultation Officeat the General Affairs Department and an outside law
office as a contact point to receive consultations frominside and outside the Group regarding actions that
violate laws or corporate ethics.
In addition, the Audit & Supervisory Committee has
also established an internal contact point to receive
reports on violations of laws, regulations and corporate
ethics directly involving Directors.
Each contact point implements surveys as required
and responds appropriately.

Overview of Shikoku Electric Power’s Compliance Consultation Office

Number of consultations with compliance consultation office
FY

2018

2019

2020

2021

2022

Number of
consultations*

9

6

2

4

6

* This is the total for Shikoku Electric Power Company and Shikoku Electric Power
Transmission & Distribution Co., Inc. since fiscal 2020.

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Shikoku Electric Power Group INTEGRATED REPORT 2023

• Checks details of consultations• Pursues corrective measures and implements
measures to prevent reoccurrence if required, etc.

Compliance
Promotion
Committee
Reports

Advisees• Our directors andemployees• Our Group’s
directors andemployees• Outside parties

Phone, fax, post

Consultation office

Dedicated intranet, internet(Whistleblowing
Reception Counter)• Illegal or unethical behavior
in our Company or Group

General Affairs
Dept.,
Legal GroupPost

Law office** Matsumoto Law Office
Imon Takamatsu Building, 5th Floor, 1-2-5 Kotobukicho, Takamatsu-city(in principle, limited to posted documents)

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Shikoku Electric Power Compliance Guidelines (in Japanese only)
https://www.yonden.co.jp/corporate/compliance/guideline/index.html
Confidential Information Security Policies (in Japanese only)
https://www.yonden.co.jp/corporate/privacy/index.html
Yonden Basic Policy on Investor Relation (in Japanese only)
https://www.yonden.co.jp/corporate/ir/policy/irpolicy.html
Investor Relations
https://www.yonden.co.jp/corporate/ir/index.html

Ensuring of Information Security
Promotion of security measures
At Shikoku Electric Power Group, massive quantities of
information, including personal information, are processedusing computers. We have established the “Yonden Group
Information System Security Guidelines” and we implement
information management measures to ensure security
because of the potential for this computer processing tohave a major impact on our customers, such as
information leakage or alteration, system crashes, etc.
Information security measures

Enhancement of IR Activities
Constructive communication
with shareholders and investors
Based on the “Yonden Basic Policy on Investor Relations,”
we focus on ongoing communication between
shareholders and investors with Shikoku Electric Power’s
management and IR personnel. We hold company
briefings and individual meetings as needed, while alsoutilizing online meetings.
Through such dialogue, we explain our management
policies and business operations. Sharing the opinions
and requests received in these discussions among
management and using them in business management isleading to sustainable value creation.

Physical measures•Implementation of crime prevention and disasterprevention measures, such as entry and exit
management at data centers
Technical measures• Antivirus software, data encryption, network
monitoring and blocking of unauthorized access
System and human-based measures• Establishment of rules such as “Information System
Security Management Standards”• Employee education on the importance of ensuring
security and PC use

Further, in order to respond to increasingly sophisticated andcomplex cyber-attacks, we have established a management
system headed by the director in charge of Information Systems
Department. Moreover, we have established a Security Incident
Response Team (SIRT) to collect security information andimplement various measures on an everyday basis. In the event a
security incident does occur, we will strive to ensure that the
SIRT plays a central role in grasping the situation and restoring
operations quickly.
In addition, we are working to further improve security levels
by incorporating the latest information and technologies throughactivities such as those of the Japan Electricity Information
Sharing and Analysis Center (ISAC) (an organization that sharesinformation and provides analyses concerning cyber-attacks andcountermeasures among electric power business operators).
As a result of these security measures, the number of criticalsecurity incidents occurring during fiscal 2022 was zero.

Company briefing for analysts and institutional investors in May 2023
(online participation was also used)

Prompt and appropriate information disclosure
We provide stakeholders with management targets andfinancial information related to business operations in atimely fashion, and publish ESG-related non-financial
information, such as the Task Force on Climate-related
Financial Disclosures (TCFD) and environment-relateddata, as appropriate.
In addition, we have established the “Rules for Timely
Disclosure of Corporate Information” based on the
Securities Listing Regulations, and we conduct timely
disclosures promptly if any matter subject to disclosure
arises.

Shikoku Electric Power Group INTEGRATED REPORT 2023

68

Business Management that Increases Sustainability

Enhancing Corporate Governance

List of Directors
Director
Attendancein fiscal 2022

Name

Hayato Saeki
Chairman of the Board

Main expertise, experience, etc./
fields of particular strength

C

Board of Directors
11 meetings/11 meetings●

Board of Directors
11 meetings/11 meetings

●

F

L

T

Significant concurrent
positions

M

I

E

●

●

●

Chairman, Shikoku Economic Federation●●

Chairman, Shikoku Productivity Center

HR

Keisuke Nagai
Director and President●

HR

Hisashi Shirai
Director and Executive Vice President
General Manager
of Business Development Division,in charge of Accounting & Finance Dept.,
Purchasing & Materials Dept.,
and Information Systems Dept.

Board of Directors
11 meetings/11 meetings

●

●

●

━

New election

Noriyuki Kawanishi●

Director and Executive Vice President
Division Manager of Nuclear Power Division,in charge of Civil & ArchitecturalEngineering Dept.

●━

Yoshihiro Miyamoto
Director and Senior Corporate Officer
General Manager of General Planning Division,in charge of Renewable Energy Dept.
and Public Relations Dept.

Seiji Miyazaki
Director and Senior Corporate Officer
Division Manager ofMarketing & Customer Relations Division,in charge of Tokyo Branch Office

Masahiro Ota
Director and Senior Corporate Officer
Division Manager ofThermal Power Division

Board of Directors
11 meetings/11 meetings●●

Board of Directors
9 meetings/9 meetings

Board of Directors
9 meetings/9 meetings●●

Director of STNet, Incorporated●●

Director of SHIKOKU INSTRUMENTATION CO., LTD.

●●

Director of Sakaide LNG Company,
Incorporated

New election

Kenzo Suginouchi
Director and Senior Corporate Officer
In charge of General Affairs Dept.,
Siting and Environment Dept.,
Employee Relations & Human Resources Dept.,
General Education & Training Center,
and General Medical Services Center

●

●

●

Director of Yonden Engineering Company,
Incorporated
Director of Yonden Business Co., Inc.

Compensation
Note: Concurrent positions, etc. at companies subject to consolidated accounting

69

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information(As of the end of June 2023)

Director Audit & Supervisory Committee Member
Attendancein fiscal 2022

Name

Hiroshi Kawahara
Director
Audit & Supervisory Committee Member
Chairman of the Audit & Supervisory
Committee

Ryohei Kagawa
Director
Audit & Supervisory Committee Member
Independent

refers to an Outside Director

Main expertise, experience, etc./
fields of particular strength

CF

Board of Directors
11 meetings/11 meetings
Audit & Supervisory Committee
18 meetings/18 meetings

L●

Board of Directors
11 meetings/11 meetings
Audit & Supervisory Committee
18 meetings/18 meetings●

Board of Directors
10 meetings/11 meetings
Audit & Supervisory Committee
16 meetings/18 meetings●

Board of Directors
11 meetings/11 meetings
Audit & Supervisory Committee
18 meetings/18 meetings●

Board of Directors
11 meetings/11 meetings
Audit & Supervisory Committee
18 meetings/18 meetings

●

●

T

M

I

Significant concurrent
positions

E

Corporate Auditor of Shikoku Electric Power
Transmission & Distribution Co., Incorporated
Corporate Auditor of STNet, Incorporated
Corporate Auditor of Yonden Engineering Company,
Incorporated
Director and Audit & Supervisory Committee Memberof YONDENKO CORPORATION●●The Hyakujushi Bank, Ltd.
Director, Vice President and CCO

Personnel

Compensation (Chair)

Fujiko Takahata
Director
Audit & Supervisory Committee Member
Independent●●

President and Director of Tokiwa Co. Ltd.

●

Director and Chairman of Iyogin Holdings, Inc.
Director and Chairman of The Iyo Bank, Ltd.
Corporate Auditor of Shikoku Railway Company●

Director and Chairman of Ujiden Chemical Industry Co., Ltd.
President of Kochi Chamber of Commerce & Industry

Personnel (Chair)Compensation

Iwao Otsuka
Director
Audit & Supervisory Committee Member
Independent●●

Personnel

Compensation

Shoichi Nishiyama
Director
Audit & Supervisory Committee Member
Independent●

Personnel

Compensation

Yachiyo Izutani
Director
Audit & Supervisory Committee Member
Independent

Board of Directors
11 meetings/11 meetings
Audit & Supervisory Committee
18 meetings/18 meetings

●

●

●

Personnel(Reference: Major past experience)
Japan Broadcasting Corporation (NHK)Head of Work Life Balance Promotion,
Human Resources (NHK)Director of Announcers’ Office (NHK)Director and President of NHK Culture Center, Inc.
(currently resigned from all positions)Compensation

C Corporate Management & Business Strategy

F Finance & Accounting

T Technology & Research and Development

M Marketing & Public Relations

I International Business & Business Development

E Environment & Society

L Legal & Risk Management

Independent
Personnel
Compensation

Selection of skills matrix (major specialization, experience, etc./ fields of particular strength)
At Shikoku Electric Company, the following set of skills has been chosen
for members of the Board of Directors:
・Skills generally required of members of the Board of Directors
・Skills deemed necessary in light of medium-term management policies
The decision to appoint a member is then taken by the Board of Directors after deliberationby the Executive Personnel Committee.

Independent Director(Notification as an Independent
Director Specified by the Tokyo Stock Exchange)

Executive Personnel Committee
Compensation Committee

Internal directors

Outside directors

64.3％

35.7％
9

Number of
Directors:

5

14

Shikoku Electric Power Group INTEGRATED REPORT 2023

70

Financial / Corporate Information

P.72

Main Data on Electric Power Business

P.73

10-Year Financial Summary

P.75

Main ESG Data

P.77

SASB Standards INDEX

P.79

Management Discussion and Analysis (Consolidated)

P.81

Corporate Data and Stock Information

WWW

Please see the Securities Report for details of the Consolidated Financial Statements and Notes.
https://www.yonden.co.jp/corporate/ir/library/securities_report.html

71

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

Business Management that
Increases Sustainability

Financial / Corporate Information

Financial / Corporate Information

Main Data on Electric Power Business(fiscal year/million kWh)FY2018FY2019FY2020

FY2021

FY2022

Total Electricity Sales

27,94429,85527,857

31,67532,752

Lighting

8,539

8,169

8,210

8,035

7,686

Power

14,757

14,226

13,777

14,53015,727Wholesale

4,648

7,460

5,870

9,110

9,339

Electricity Supplied *1

29,541

31,407

29,762

33,46634,487

Nuclear

3,191

5,651

0

2,362

6,903

Renewable Energy *2

2,194

2,325

2,394

1,983

1,791

Renewable Energy (Purchased Power) *2

4,829

5,035

5,898

6,257

6,140

Coal

7,064

6,167

7,113

7,677

5,911

Gas

3,299

3,679

4,038

3,132

3,403

Oil

913

302

609

1,810

1,819

8,051

8,248

9,710

10,245

8,520

Other (Purchased Power, Wholesale Exchanges, Etc.)(Thousands)

Number of Customers

2,760

2,700

2,621

2,561

2,546

Lighting

2,449

2,402

2,347

2,295

2,283

Power

312

297

274

266

263
(%)

Nuclear Power Plant Capacity Factor

42.8

75.4

0.0

31.6

92.4

Flow Rate

98.2

105.1

98.9

84.7

73.6
(Name)

Number of Employees *

3

4,489

4,409

4,374

4,309

4,263

*1 Net actual generation amount excluding electricity used on site
*2 “Renewable energy” as referred to in this document includes electricity that does not use non-fossil energy certificates and does not have value as renewableenergy or CO2 zero emissions value, as well as FIT electricity, part of the procurement cost of which is covered by a levy borne by users.
*3 From fiscal 2020 onwards, the total figure for Shikoku Electric Power Company, Inc. and Shikoku Electric Power Transmission & Distribution Co., Inc.

Shikoku Electric Power Group INTEGRATED REPORT 2023

72

Financial / Corporate Information

10-Year Financial Summary
This report covers Shikoku Electric Power Co., Inc. and companies included in the scope of consolidated financial statements.

FY2013

FY2014FY2015FY2016FY2017636,332

664,286

654,013684,537

731,775

Electric

551,148

578,983

574,246602,243

642,495

Other

85,18485,302

79,767

82,29389,279633,617635,292

629,311664,528

702,510

Electric

554,653

556,858

559,685589,589

621,899

Other

78,96478,43369,62574,93880,610Operating Profit

2,715

28,99324,70220,00929,265

Ordinary Profit *4

8,161

34,486

31,06624,48535,621

Income before Income Taxes(426)

22,86418,906

15,68928,032(3,289)10,333

11,147

11,34919,675

Total Assets

1,397,277

1,401,189

1,401,750

1,301,267

1,330,226

Total Equity

287,439

300,897

286,177

303,879

312,564

Interest-Bearing Debt

737,449

711,832

719,754707,756

683,249

Cash Flows from Operating Activities

65,734

100,164

91,73981,739123,512

Cash Flows from Investing Activities(71,700)(55,164)(88,542)(60,379)(81,955)

Cash Flows from Financing Activities

2,725(25,650)

3,699(16,186)(31,757)

Term-End Balance of Cash and Cash Equivalents

11,10930,54437,441

42,51852,218

(16)

50

54

55

96

0

20

20

20

30

1,394

1,460

1,388

1,474

1,517

Return on Assets *5

0.6

2.5

2.2

1.8

2.7

Return on Equity *

(1.1)

3.6

3.8

3.9

6.4

Shareholders’ Equity Ratio

20.6

21.5

20.4

23.3

23.5

Interest-Bearing Debt Ratio

2.6

2.4

2.5

2.3

2.2

Dividend Payout Ratio *7

̶

39.9

36.9

36.3

31.4

Financial Performance
Operating Revenues

Operating Expenses

Net income Attributable to Owners of the Parent
Financial Position

Cash FlowsPer Share of Common StockEPS (Earnings per Share)
Cash Dividends Applicable to the Year
Total Equity
Financial Indicators

6*1 US$ amounts are translated from yen at the rate of ¥134 = US$1
*2 As a result of the application of the Accounting Standard for Revenue Recognition in fiscal 2021, operating revenue decreased by 159.4 billion yen from the level before application of the standard.
*3 As a result of the application of the Accounting Standard for Revenue Recognition in fiscal 2021, electric power business operating revenue decreased by 151.2 billion yen from the level before application of the standard.
*4 Ordinary profit + interest expenses*5 (Ordinary profit + interest expenses) / total assets (average for period)*6 Net income attributable to owners of the parent for fiscal year under review / shareholders’ equity (average for period)*7 Figures for fiscal 2013 and fiscal 2021 to fiscal 2022 cannot be calculated due to the recording of net losses."73

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information(millions of yen)(thousands of US$*1)

FY2018FY2019FY2020

FY2021

FY2022

FY2022

737,274

733,187

719,231641,948 *2

833,2036,217,932

639,601

631,479

616,375

535,241 *3

735,069

5,485,589

97,673

101,708

102,855

106,707

98,133732,335

711,544

701,899

712,774

655,466

845,4896,309,619

623,640

611,308

621,147

560,663760,611

5,676,201

87,90490,591

91,626

94,80384,877

633,41025,72931,288

6,456(13,517)(12,285)(91,679)

32,12534,06910,863（6,535)(16,330)(121,865)

25,14526,1805,188(7,091)(21,669)(161,708)

16,99518,092

2,999(6,262)(22,871)(170,679)

1,353,941

1,373,640

1,430,424

1,500,744

1,612,025

12,030,037

321,189

326,648

327,953

315,297

298,3122,226,208

704,261

717,062771,672

860,290948,292

7,076,805

54,507

107,313

52,29349,841

36,086269,298(82,400)(99,946)(89,331)(125,102)(91,600)(683,582)

14,541

6,318

48,31082,261

84,829633,052

40,68154,28965,44472,928105,904

790,328
(yen)

(US$）

83

88

15

(30)

(111)

(0.82)

30

30

30

30

0

0.00

1,550

1,578

1,583

1,521

1,438

10.73
(％)

2.4

2.5

0.8

(0.4)

(1.0)

5.4

5.6

0.9

(2.0)

(7.5)

23.6

23.6

22.8

20.8

18.3

2.2

2.2

2.4

2.7

3.2

36.4

34.1

205.8

̶

̶

Shikoku Electric Power Group INTEGRATED REPORT 2023

74

Financial / Corporate Information

Main ESG Data

Major Item
CO2emissionvolumePromotion of
measuresagainst climatechangeUnit

Item
Excluding FIT
free-of-charge distribution *1
Including FIT
free-of-charge distribution *2

FY2021

FY2022

1,297

1,024

1,372

1,312

1,170

1,230

914

1,252

1,186

1,041

E (Environment)

0.528

0.408

0.569

0.526

0.447

Ratio of non-fossil fuel power sources *3

%

30

39

24

30

31

−

739

854

966

809

−

0

0

0

0

−

669

648

721

635

Greenhousegases throughout
the whole supply
chain

Scope 1*4
Scope 2*

5

10,000 tons-CO2

Scope 3*6
Indicator A

−

1.04

1.03

1.02

1.02

1.04

Indicator B

%

42.8

43.1

43.1

42.1

43.5

Coal indicator

%

−

−

−

−

39.43

10 MW

272

303

321

340

361

8

%

95.5

88.7

99.0

96.9

97.5

Coal ash recycling ratio

%

99.8

99.8

99.7

99.8

99.6

Intensity of SOx emissions

g/kWh

0.1

0.2

0.1

0.1

0.1

Intensity of NOx emissions

g/kWh

0.4

0.4

0.3

0.4

0.3

0

0

1

0

0

2.70

2.67

2.68

2.69

2.67

%

85.8

83.2

86.5

86.3

85.8

Times

340

310

121

183

194

People10,081

10,195

3.945

5,413

6,242

Male

People

4,123

4,048

4,001

3,935

3,870

FemalePeople

366

361

373

374

393

22.5

22.6

22.4

21.9

21.2

19.3

19.4

18.7

18.2

17.2

People

73

74

89

92

103

People (%)

4
(5.2)

18
(19.6)

18(16.8)

20(17.9)

24(18.9)

%

2.7
(8.2)

2.6
(8.2)

2.8
(8.5)

3.1
(8.7)

3.5
(9.2)

%

11.8

12.3

12.4

13.4

14.8

%

−

−

−

−

68.2

Waste recycling ratio *Violations of environment-related
Cases
laws and regulations
Number of visits for dialogue
10,000 households
around the Ikata Power Plant *9
Level of trust in our company *10
Delivery Energy
Classes provided
to schools, etc.
Number of
employees

Number ofmeetings held
Number ofparticipants

S (Social)Male
Year(s)Years of service
FemaleFostering
employeemotivation*8

FY2020Kg-CO2/kWhSolar and wind power connection volume

Community
coexistence
activities

FY2019CO2 emission factor(including FIT free-of-charge distribution)*2

Thermal efficiency
benchmark forthermal power
plants *7

Advancingenvironmental
preservation
activities

10,000 tons-CO2

FY2018

Number of
new hires

Male
Female(Ratio)Ratio of female managers(female employee ratio)
Ratio of female managers against
the total number of female employees
Gender wage gap(full-time workers) *11(continued on next page)75

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Fiscal 2022 Securities Report (in Japanese only)
https://www.yonden.co.jp/corporate/ir/library/securities_report.html

Major Item

Ratio ofemployees taking
childcare leave
Number of paidvacation days *12

S (Social)

Fostering
employeemotivation *8

Unit

Item

Employeeturnover rate *13

Male%
FemaleMale

FY2019FY2020

FY2021

FY2022

0.6

0.6

3.3

5.7

9.6

100.0

100.0

100.0

100.0

100.0

16.3

15.8

15.9

16.5

17.2

15.8

14.7

15.8

15.9

16.1

0.3

0.3

0.3

0.2

0.5

1.9

0.8

0.0

1.9

1.9

Day(s)
FemaleMale%
FemaleRatio of employees with disabilities *14

%

2.1

2.2

2.4

2.5

2.6

Labor accident frequency rate
(employees only) *15

−

0.00

0.00

0.12

0.36

0.24

0 (0)

0 (0)

1 (0)

3 (0)

2 (0)

14 (1)

16 (0)

14 (0)

13 (1)

13 (1)

Number ofoccupational
accidents requiring
time off from work

Employees(number of fatal accidents)
Subcontractors(number of fatal accidents)

Cases

Ratio of obese employees

%

28.5

29.1

29.3

29.3

29.3

Ratio of smoking employees

%

19.5

18.8

19.1

19.0

17.8

Total number of Directors *16

People

17

15

15

14

14

People

4

4

5

5

5

People (%)

1
(5.9)

1
(6.7)

2
(13.3)

2(14.3)

2(14.3)

Number ofmeetings held

Times

11

11

11

12

11

Attendance rate

%

99.5

98.2

98.2

100.0

98.7

Number ofmeetings held

Times

17

18

17

19

18

Attendance rate

%

97.9

98.1

99.1

99.2

97.7

Percentage of employees receiving
compliance education

%

99.9

99.9

99.8

99.9

100.0

Number of consultations with theCompliance Consultation Office

Cases

9

6

2

4

6

Outside Director
Female Directors% of total number
of Directors

G (Governance)

Corporate
governance
Board ofDirectors

Audit &
Supervisory
Committee

Compliance *8

FY2018*1 The value obtained after excluding the FIT free-of-charge distribution from the value pertaining to retail sales based on the Act on Promotion of Global Warming Countermeasures(from the reflection of adjustments made under the feed-in tariff system) [same basis as the fiscal 2030 target of the Company]*2 Values pertaining to retail sales based on the Act on Promotion of Global Warming Countermeasures (reflecting adjustments made under the feed-in tariff system)*3 Indicator for retail sales based on the Act on Sophisticated Methods of Energy Supply Structures*4 Emissions associated with direct emissions (fuel use for own power generation) (includes CO2, SF6, N2O, and HFCs)*5 Emissions associated with the use of electricity purchased from other companies at our places of business, etc. (offices)*6 Emissions contained in electricity purchased from other companies, etc. (including investment emissions from fiscal 2021 onwards)*7 Indicators based on the Act on the Rational Use of Energy and Non-Fossil Energy Conversion, etc. (coal indicators are reported from fiscal 2022 results onwards following revisions to the Energy Conservation Act)
*8 Unless otherwise noted, calculated based on the total for Shikoku Electric Power and Shikoku Electric Power Transmission & Distribution Co., Inc.
*9 Due to the spread of COVID-19 infections in fiscal 2020 to fiscal 2022, this activity was switched to distributing leaflets instead of making door-to-door visits.
*10 Surveyed 2,000 men and women aged 18 to 69 living in Shikoku*11 The difference in wages between men and women is partly attributable to differences in the ratio of men to women in managerial positions and to differences in average age.
There is a 98% wage difference between men and women at the same position (section chief level).
In order to increase the ratio of female managers, we will promote talented and motivated women, and support them in balancing work and family life.
*12 Managing supervisors, etc. are excluded*13 Voluntary resignation only
*14 Employment rate for four companies in total, including Shikoku Electric Power and Shikoku Electric Power Transmission & Distribution, based on use of the “special subsidiary” system*15 Number of deaths and injuries per million total working hours (wherein operations are suspended for one day or more)*16 States after the General Meeting of Shareholders in June

Shikoku Electric Power Group INTEGRATED REPORT 2023

76

Financial/Corporate Information

SASB Standards INDEX
From the perspective of enhancing information disclosure in light of growing environmental awareness, we are disclosing
information based on “Electric Utilities & Power Generators,” a disclosure standard for the power industry prepared by the
Sustainability Accounting Standards Board (SASB).
* Sustainability Accounting Standards Board (SASB): A non-profit organization established in the United States in 2011
aimed at the preparation of disclosure standards for sustainability information

TOPIC (Environment)
Scope 1 greenhouse gas emissions

Unit
t-CO2

Percentage covered underemissions-limited regulations%

0% (No regulated market exists in Japan)

Percentage covered underemissions-reporting regulations

%

100%

Greenhouse gas (GHG) emissions
associated with power deliveries

t-CO2

Greenhouse
Gas Related〇 Short-term and long-term plans to

reduce Scope 1 emissions〇 Emissions reduction targets−〇 Analysis of performance against above

targets〇 Number of customers served in markets

subject to renewable portfolio standards (RPS) Cases/%〇 Percentage fulfillment of RPS target by market

Air
RelatedAir emissions of NOx, SOx, particulatematter (PM10), lead (Pb) and mercury (Hg)and the percentage of each in or nearareas of dense populationt.%

N/A (the RPS Act was abolished in Japan in 2012)
NOx: 3,728 t, 100%
SOx: 1,129 t, 100%
Figures not disclosed for particulate matter (PM 10), lead and mercury because themeasurement method recommended by the SASB standard has not been adopted
Total water withdrawn: [Fresh water] 7,881,166×10³ m³; 0%[Seawater] 4,224,702×10³ m³; 0%
Total water consumed: 1,717×10³ m³; 0%

Number of incidents of non-complianceassociated with water withdrawn and/or
quality permits, standards, and regulations

Cases

0 caseDescription of water management risks
and discussion of strategies and practices
to mitigate those risks−

Our company manages risks related to water resources by thorough observation ofwater withdrawn at hydroelectric power plants, temperature differences in water
withdrawn and discharges at thermal and nuclear power plants, and effluent standards.
Water stress in the Shikoku area was confirmed using the “WRI Aqueduct Water Risk
Atlas” tool. The level is “Low” (water stress of less than 10%) so it is assumed that therisk of drought and other events is low. Moreover, the maximum impact for fiscal 2040
was “Medium high” (water stress of 20 to 40%), indicating that the impact on ourcompany’s business will be limited.

Amount of coal combustion residuals(CCR) generated; percentage recycledt.%223,630t.99.6%

Total number of coal combustion residual(CCR) impoundments−

Not disclosed(We recycle coal ash thoroughly as described above and the proportion of landfill isabout 0.4% of the total)

Unit

Average retail electric rate for residential,commercial, and industrial customers

JPY/kWh

Typical monthly electric bill for residential
customers for 500 kWh and 1,000 kWh ofelectricity delivered per month

JPY

Number of electric power disconnections
for nonpayment of electric bills for(1) Household use, and(2) Percentage reconnected within 30 days

77

Part of Scope 1 and Scope 3 are GHG emissions related to retail sales reported
based on the “Act on Promotion of Global Warming Countermeasures.”
Shikoku Electric Power has set a goal of reducing CO2 emissions associated withretail electricity sales (excluding FIT free-of-charge distribution) in fiscal 2030 by 50%
from their level in fiscal 2013. Actual emissions for fiscal 2022 (excluding FIT
free-of-charge distribution) were 11.70 million tons (approximately 40% reduction
from the level in fiscal 2013).
We aim to achieve these targets in 2030 by means such as maximizing the use of
nuclear power generation, introducing and expanding the use of renewable energy,
and improving the efficiency of thermal power generation.
With regard to Scope 1, we will work to reduce emissions in order to achieve thetargets newly set in the GX League, which we joined in April 2023.
(Scope 1 emissions targets)
Fiscal 2025: (9,500,000t-CO2)
Fiscal 2023 to fiscal 2025: (28,500,000t-CO2)
Fiscal 2030: (8,500,000t-CO2)

10³m³.%TOPIC (Social Capital)

EnergyAffordability

10,410,000t-CO2

Total water withdrawn, total water consumed,
and the percentage of each in regions withHigh or Extremely High Baseline Water Stress

Water
Resources

Coal AshManagement

Topics Covered
8,090,000t-CO2

Cases/%

Topics Covered
Residential: 24.32[JPY]/kWh, Commercial: 19.93[JPY]/kWh, Industrial:
20.96[JPY]/kWh
500 kWh: 13,061 [JPY]
1,000 kWh: 27,211[JPY](1) 15,688 cases(excluding the number of disconnections based on specified retail service provisions)(2) None(If payment is not made after the due date has passed, the supply contract iscancelled based on the terms of electricity supply [low voltage].)

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

Value Creation throughBusiness Activities

President's Message

TOPIC (Human Capital)

Unit

Financial / Corporate Information

Topics Covered

Total recordable labor accident incident
rate (TRIR: number/ 200,000 work hours)%

Employees: 0.05% Subcontractors: 0.32%

Fatality rate of labor accident%

Employees: 0% Subcontractors: 0.02%

Near miss frequency rate (NMFR)%

Not disclosed(Although figures are managed at each workplace, total figures are notdisclosed because statistics are not kept for our Group as a whole.)

TOPIC (Business Model & Innovation)

Unit

Workforce
Health &SafetyTopics Covered

Percentage of electric utility revenues from rate
structures that are decoupled and contain alost revenue adjustment mechanism%

N/A

Percentage of electric load served bysmart grid technology%

Smart meter installation rate: 90.8%

End-Use
Efficiency& DemandCustomer electricity savings from efficiency
measures, by market

MWh

We disclose the following quantitative data instead of customer electricity savings:〇 Electrification and energy solutions services
・ Number of proposals of electrification and energy saving solution services: 13,031〇 Energy-saving related information provision services(https://www.yonden.co.jp/y-con/index.html)
・ Number of Yonden Concierge registrations: 566,920
Yonden Concierge is a service that provides customers with references to monthly
electricity rates and amounts used, electrification simulations and energy-saving
effect simulations, etc.

TOPIC (Leadership & Governance)

Unit

Number of nuclear power units

Units

1 unit (Ikata Power Plant Unit No. 3)

Description of efforts to manage nuclear
safety and emergency preparedness−

We implement various safety measures and training to ensure that nuclear accidents
do not occur, and we have prepared thoroughly so that even in the event that a
nuclear accident did occur, we could bring it under control quickly and appropriately.
In addition, we summarize and report regularly to the Minister of Economy, Trade andIndustry on the state of undertakings to prevent nuclear accidents and efforts aimed
at further enhancement of these measures.
(https://www.yonden.co.jp/energy/atom/safety/disaster_countermeasures/index.html)
We will continue to strive for improvements in our ability to respond to accidents byconducting improvement activities at all times, including the enhancement of training
and response equipment.

Number of incidents of non-compliancewith physical and/or cybersecurity
standards or regulations

NumberNot disclosed (because of the potential for new risks to occur as a result of disclosure)

System Average Interruption Duration
Index (SAIDI)

Minutes

Average annual interruption due to accidents: 35 minutes

System Average Interruption Frequency
Index (SAIFI)Frequency

Average number of power outages per year due to accidents, etc.: 0.23

Customer Average Interruption Duration
Index (CAIDI)

Minutes

Annual average recovery time for disruption due to accidents: 152 minutes

Nuclear
Safety &Emergency
Management

Grid
resiliency

TOPIC (Others)

OthersBusiness Management that
Increases Sustainability

Unit

Topics Covered

Topics Covered

Numbers of residential, commercial, andindustrial customers served

NumberResidential: 1,897,504; Low voltage excluding residential: 621,192
Commercial: 16,525; Industrial: 10,415

Total electricity delivered to residential,commercial, industrial, all other retailcustomers, and wholesale customers

MWh

Residential: 7,298,335 MWh, Low voltage excluding residential: 1,481,845 MWh
Commercial: 5,454,079 MWh; Industrial: 9,015,989 MWh
Wholesale: 9,338,907 MWh

Length of transmission and distribution lines

kmTransmission lines: 3,398 km (electric line length),
Distribution lines: 46,357 km (electric line length)

Total electricity generated, percentage bymajor energy source, percentage inregulated markets

MWh/%Electric supplied: 19,826,736 MWh
Power generation ratios: Thermal power (56%), nuclear (35%), hydroelectric power(9%), and renewable energy (0.02%)
Percentage in regulated markets: Not applicable.

Total wholesale electricity purchased

MWh

14,659,834 MWh (amount of purchased power)

Shikoku Electric Power Group INTEGRATED REPORT 2023

78

Financial / Corporate Information

Management Discussion and Analysis(Consolidated)

Fiscal 2022 Results
April 1, 2022 to March 31, 2023

Analysis of Business PerformanceElectricity Sales

Operating Results

Retail sales of electricity increased 3.8% year on year, to23,400 million kWh, and wholesaling of electricity
increased 2.5% year on year, to 9,300 million kWh. As aresult, total electricity sales were 32,700 million kWh, a
year on year increase of 3.4%.

Operating revenues increased 29.8% year on year to833.2 billion yen, due to an increase in the revenues
based on the Fuel Cost Adjustment System and therevenues from wholesale, etc..
Operating expenses increased 29.0% to 845.4 billion,
due to a sharp increase in fuel prices, despite an increasein the operation of Unit No. 3 at Ikata Power Plant, etc.
As a result, there was a 1.2 billion yen improvement in
operating losses year on year to an operating loss of 12.2
billion yen. Ordinary losses worsened by 10.4 billion yen toa loss of 22.5 billion yen as a result of recording
investment losses in overseas business, and loss
attributable to owners of parent worsened by 16.6 billion
yen to a loss of 22.8 billion yen.

Electricity Supply
Nuclear power generation increased significantly from theprevious year to 6.9 billion kWh due to an increase in thenumber of working days at Unit No. 3 at Ikata Power
Plant. In addition, own generated hydro power decreased
9.5% year on year to 1.7 billion kWh, and purchased
power decreased 11.2% year on year to 14.6 billion kWh.
As a result, own thermal power generation decreased
11.8% to 11.1 billion kWh.

(Reference) Fiscal 2022 Results by Segment and Change Factors (Before Elimination of Internal Transactions)Electric power businessElectric power
generation& sales
Transmission& distribution

IT/Communication

Energy business
Constructionand engineeringbusiness

OthersOperatingrevenues
Ordinaryloss
Operatingrevenues
Ordinary
profitOperatingrevenues
Ordinary
profitOperatingrevenues
Ordinaryloss
Operatingrevenues
Ordinary
profitOperatingrevenues
Ordinary
profit(100 million yen, %)FY2022(100 million yen)

Year-on-year difference(100 million yen)

7,090

2,008

39.5

▲289

112

−

2,662

464

21.1

72

▲33

▲31.3

455

9

2.1

93

12

15.5

・Increase in expenses in association with increases in purchased
power, etc.
・Increase in revenues from optical communications services anddata center operations, etc.
・Decrease in expenses due to changing the method ofdepreciation, etc.

257

▲7

▲2.8

・Decrease in sales volume in coal sales businesses, etc.

▲151

▲180

−

530

▲161

▲23.3

35

▲4

▲12.0

−

356

▲5

▲1.5

−

21

▲10

▲31.9

−

Change (%)

Main reason for difference with previous year
・Increase in the revenues based on the Fuel Cost Adjustment
System and wholesale sales revenue, etc.
・Improvement in supply and demand balance due to increased
operation of Unit No. 3 at Ikata Power Plant
・Increase in supply-demand adjustment revenue, etc.

・Increase in expenses associated with loss on investments ininternational businesses, etc.
・Decrease in contract work, etc.

Analysis of Financial Position
AssetsTotal Equity

Total assets stood at 1,612 billion yen, up 7.4% year on
year, due to increases in business assets, as well as
increases in cash and deposits and fuel stores.

Net losses and other elements contributed to a 5.4%
decrease year on year to 298.3 billion yen.

Liabilities
Liabilities amounted to 1,313.7 billion yen, up 10.8% year
on year, due to increases in bonds and loans, etc.

79

Shikoku Electric Power Group INTEGRATED REPORT 2023

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

WWW

Securities report (in Japanese only)
https://www.yonden.co.jp/corporate/ir/library/securities_report.html
Fact books
https://www.yonden.co.jp/english/ir/tools/fact.html

Analysis of Cash Flows
Cash Flows from Operating Activities
Revenue decreased 27.6% year on year, to 36.0 billion
yen due to net losses, etc.

Cash Flows from Investing Activities
Expenditures decreased 26.8% year on year to 91.6
billion, mainly due to a decrease in capital expenditures.

Cash Flows from Financing Activities
Net cash was 84.8 billion yen, up 3.1% year on year, due
to a net increase in the procurement of bonds and loans.
As a result, cash and cash equivalents at the end of fiscal
2022 increased 32.9 billion yen year on year to 105.9
billion yen.

Capital Investment
In power generation and sales business, the replacementof Unit No. 1 at the Saijo Power Plant and the constructionof the Kurofujigawa Power Plant resulting in a total of 48.3
billion yen (before elimination of intersegment
transactions).
In power transmission and distribution business,
facilities were renewed to maintain the supply reliability ofthe power network, resulting in a total of 28.2 billion yen(before elimination of intersegment transactions).
Consolidated capital investment for the entire Group,
which includes IT/communication, energy, constructionand engineering, and other business segments, totaled
87.3 billion yen (after elimination of intersegment
transactions).

Research and Development
Dividend Policy
Our basic policy for shareholder returns is to issue stabledividend payments. Dividend levels are determined basedon thorough consideration of such factors as businessperformance, financial condition, and the medium- tolong-term outlook for the operating environment.
We have decided not to pay dividends in fiscal 2022
due to large losses resulting from the high cost of fuel andother factors.

The Group works on R&D related to the supply and use ofelectricity aimed at the improvement of its technologicalcapabilities and competitiveness. In fiscal 2022, the R&D
expenses of the Group as a whole were 4.1 billion yen.
Major research projects were as follows.
(1) R&D for areas such as technologies for extending thelifespan of equipment used for R&D leading to elements
such as reduction in power supply costs, technologies
for increasing the functionality and efficiency ofoperation maintenance, and technologies for utilizing
coal ash, etc.
(2) R&D for dealing with the large-scale introduction ofrenewable energy in preparation for carbon neutrality, for
the utilization of distributed energy resources, for theutilization of hydrogen and other related technologies, etc.

Fiscal 2023 Outlook [Announced on May 30, 2023](April 1, 2023 to March 31, 2024)
Electricity Sales
Retail sales of electricity are expected to decrease 0.9% year
on year, to 23,200 million kWh, and wholesaling of electricity
is expected to increase 9.2% year on year, to 10,200 million
kWh. As a result, total electricity sales are expected toincrease 2.0% year on year, to 33,400 million kWh.

yen to 35 billion yen, ordinary profit is expected toincrease by 60.5 billion yen to 38 billion yen, and profit
attributable to owners of parent is expected to increase by
51.3 billion yen to 28.5 billion yen, due to an increase in
the revenues from retail resulting from rate revisions and adecrease in the cost related to demand and supply
resulting from a decrease in fuel prices, etc.

Operating Results
Operating revenues are expected to increase by 41.8 billion
yen year on year, to 875 billion yen due to an increase in
the revenues from retail resulting from rate revisions, etc.
Operating profit is expected to increase by 47.2 billion

Dividends
The interim and year-end dividends for fiscal 2023 are
expected to be 15 yen per share.

Shikoku Electric Power Group INTEGRATED REPORT 2023

80

Financial / Corporate Information

WWW

Corporate Data and Stock Information

Shikoku Electric Power Group Information (in Japanese only)
https://www.yonden.co.jp/corporate/yonden/group/index.html(As of March 31, 2023)

Shikoku Electric Power Organization Chart
https://www.yonden.co.jp/english/profile/organization.html

Principal shareholders (Top 10)

Corporate Data
Corporate name
URL
Location
Date of establishment
Paid-in capital
Number of employees

Shikoku Electric Power Co., Inc.
https://www.yonden.co.jp/
2-5, Marunouchi, Takamatsu,
Kagawa 760-8573, JapanMay 1, 1951
145,551,921,500 yen
8,030 (consolidated)
2,199 (non-consolidated)

Stock Information
Total number of sharesauthorized to be issued 772,956,066 shares
Total number of shares 207,528,202 sharesissuedNumber of shareholders 80,399
Stock exchange listing
Transfer agent
Independent auditors

Tokyo Stock Exchange
1-4-1, Marunouchi, Chiyoda-ku,
Tokyo 100-8233, Japan Sumitomo
Mitsui Trust Bank, Limited
Deloitte Touche Tohmatsu

Business year

From April 1 to March 31 of thenext year

General meeting ofstockholders

June every year

Number ofshares(Thousands)

Shareholding*(%)

The Master Trust Bank of Japan,
Ltd. (Trust account)

22,84411.01%The Iyo Bank, Ltd.

8,851

4.27%

Custody Bank of Japan, Ltd.
(Trust account)

8,235

3.97%

SUMITOMO JOINT ELECTRIC
POWER CO., LTD.

7,062

3.40%

The Hyakujushi Bank, Ltd.

6,858

3.30%

Kochi Prefecture

6,230

3.00%

Nippon Life Insurance Company

5,923

2.85%

Shikoku Electric Power Employee
Stock Ownership

4,789

2.31%

Meiji Yasuda Life Insurance Company

4,001

1.93%

The Shikoku Bank, Ltd.

2,749

1.32%

Name

* Excluding treasury stock

Share ownership distribution(By Region)
Hokkaido
418(0.5%)

Kinki
12,358(15.4%)

Share ownership distribution (By investor profile)
Local governmentorganizations, etc.
6,278,000(3.0%)
Treasury stock
5,000(0.0%)

Chugoku
2,901(3.6%)

Kanto
15,470(19.2%)

Securities
companies
1,969,000(1.0%)

Number of shares

Individuals
and others
80,895,000(39.0%)

Kyushu*1,900(2.4%)

Financial
institutions
69,265,000(33.4%)

Tohoku732(0.9%)

207,528,000
sharesOther
corporations
19,567,000(9.4%)

Foreigners
29,549,000(14.2%)

Shikoku
39,737(49.4%)* Including Okinawa Prefecture

Chubu/
Hokuriku
6,661(8.3%)

Overseas222(0.3%)

Monthly share price and trading volume(millions of shares)
25

(yen)
3,000
2,500

20

2,000

15

1,500
10

1,000

5

500
0

0

2018

2019

Share price (as of the end of the month)

81

2020
Trading volume (right scale)

Shikoku Electric Power Group INTEGRATED REPORT 2023

2021

2022

(FY)

Shikoku Electric Power Group
Value Creation

President's Message

Value Creation throughBusiness Activities

Business Management that
Increases Sustainability

Financial / Corporate Information

Shikoku Electric Power Group INTEGRATED REPORT 2023

82

Shikoku Electric Power CO.,Inc.
Seeking to be a force for happiness

https://www.yonden.co.jp/english/index.html