JERA GROUP CORPORATECOMMUNICATION BOOK 2021 (Integrated Report)

From Japan to the worldJAPAN’S ENERGY FOR A NEW ERAContents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Taking Energy into a New Era
MissionVisionTo provide cutting edge solutions
to the world’s energy issues

Global leader in LNG andrenewables, sparking the transition
to a clean energy economy

Through our global operations we bring the world’s leading energy solutions

As we look toward 2025, the energy solutions we offer will focus mainly on

to Japan, helping to solve the energy issues facing the country.

two businesses: the LNG value chain business and the large-scale renewable

We seek to establish new energy supply models for Japan while also offering

energy business.

energy supply models established in Japan to other countries that face

These businesses are complementary; renewable energy with variable power

similar energy issues, helping to solve the world’s energy issues.

generation output is complemented by flexible, clean LNG thermal power
generation. With demand expected to grow globally, particularly in Asia, we
aim to become a leader in these two businesses.

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Contents / Editorial Policy

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

1 Mission and Vision

21 Strategies

35 Corporate Governance

2 Contents / Editorial Policy

21 Business Environment Awareness andResponse

37 Directors and Officers

57 Financial and Corporate
Information

22 Business Strategies

38 Risk Management

57 State of Operating Results, Etc.

3 Value Creation

23 Establishing a Robust Management

40 Information Security and Human Rights

59 Consolidated Balance Sheet

3 JERA’s Origins

41 Compliance

60 Consolidated Statement of Income

5 Message from the Chairman
7 Message from the President
9 Value Creation Process
10 Value Creation Process(Decarbonization Strategy)

13 Financial and Non-Financial Highlights
15 JERA Zero CO2 Emissions 2050
17 Special Feature:

24 Digital Transformation (DX)25 Business Development Department
27 Optimization Department
29 O&M Engineering Department
31 Foundation for Value
Creation
32 JERA’s ESG

Society

11 Message from the CFO

Base to Support Business Strategies
Environment

4 JERA’s Business Model

GovernanceContents

Value Creation

33 JERA’s Priority Issues (Materialities)

Response to the TCFD
Recommendations

60 Consolidated Statement ofComprehensive Income

43 Environment

61 Consolidated Statement of Changes in
Net Assets

47 Human Resources

62 Consolidated Statement of Cash Flows

48 Diversity and Inclusion

63 Thermal Power Plants in Japan

49 Human Resources Development

64 Overseas Business and LNG Supplying

50 Work Style Reform: JERA Work Design
51 Safety and Health53 Coexistence with Local Communities
55 Stakeholder Engagement

Countries

65 List of Group Companies
66 Company Organization and Corporate
Outline56 Communication with Employees

Editorial Policy
About This Report
The JERA Group Corporate Communication Book was first published in FY2020 as atool for encouraging communication with our stakeholders.
The FY2021 report was published as an integrated report summarizing financial andnon-financial information about the strategies and foundations (ESG) to create andrealize the value of the JERA Group. This includes specific initiatives aimed at theachievement of “JERA Zero CO2 Emissions 2050” announced in October 2020.
Our intent with this report was to convey the diligence with which we are working toresolve social issues and enhance corporate value through the cooperation of every
department and the united efforts of all of our employees.
Note that this report was published after being reported by “the Sustainability
Promotion Committee,” which is under the direct control of the Board of Directors andis chaired by the president. Through this report, we hope to engage in discussion with
our stakeholders and welcome many opinions.
A Note Regarding Forward-Looking Statements
Forward-looking statements included in this report regarding the Group’s plans,
strategies, performance forecasts, and other matters are based on information available
at the time the report was created and include potential risks and uncertainties.
Accordingly, please be aware that actual future performance and the businessenvironment may differ from those presented in this report.

Scope of thereport/statistics

JERA Co., Inc., and Group Companies (All mentions of “the company,” “we,”and “our” in this report refer to JERA Co., Inc. unless otherwise noted)

Period covered by
the report

FY2020 (April 1, 2020 to March 31, 2021)
The report includes some of latest activities after this period.

Publication date(the report ofEnglish version)

November 2021 (Next publication scheduled for November 2022)

Guidelines forreference◦International Integrated Reporting Council (IIRC), International
Integrated Reporting Framework◦Guidance for Integrated Corporate Disclosure and Company-Investor
Dialogue for Collaborative Value Creation by the Ministry of Economy,
Trade and Industry (METI)◦GRI Sustainability Reporting Standards 2016/2018◦Environmental Reporting Guidelines, 2018 Version by the Ministry of
the Environment◦ISO 26000◦Task Force on Climate-related Financial Disclosures (TCFD), Final Report:
Recommendations of the Task Force on Climate-related Financial Disclosures

Publishingdepartment/contact
information

Finance Group, Finance and Accounting Department, JERA Co., Inc.
2-5-1 Nihonbashi, Chuo-ku, Tokyo 103-6125, Japan
25th Floor Nihonbashi Takashimaya Mitsui Building
Tel: +81-3-3272-4631 (Main)

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Foundation for Value
Creation: ESG

Financial and Corporate
Information

JERA’s Origins The Path to Business Consolidation
JERA was created by the consolidation of the fuel and thermal power departments of the Tokyo
Electric Power Company and the Chubu Electric Power Company with the concurrent aims ofcreating a global energy company capable of competing in the global energy market, providing astable supply of globally competitive energy, and enhancing corporate value.
JERA Co., Inc. was established on April 30, 2015 to form a comprehensive alliance between Tokyo Electric Power Company (as it was known then) and Chubu Electric Power Co., Inc. for their
entire supply chains from fuel upstream and procurement business to power generation.
With the aim of becoming a Japan-based global energy company, JERA proceeded to consolidate businesses in stages after its establishment, and with the April 1, 2019 consolidation of existing
thermal power generation businesses established a continuous value chain from fuel upstream and procurement business to power generation and electricity and gas wholesaling, earning its
status as an energy company with power generation capacity equivalent to half of Japan’s thermal power generation output and a fuel transaction volume among the world’s highest.

Completed the consolidation of value chains in April 2019 after expanding the scope of consolidation four years after establishment in April 2015

April 2015

October 2015

July 2016

June 2017

May 2018

April 2019

JERA
established

Fuel transportation andfuel trading businesses
consolidated

Fuel upstream andprocurement, overseas
power generation, andenergy infrastructurebusinesses consolidated

Joint-venture agreement
concluded to consolidate
existing thermal power
generation businesses

Absorption-typecompany split agreement
concluded to consolidate
existing thermal power
generation businesses

Existing thermal power
generation businesses
consolidated

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Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

JERA’s Business Model
Creating a global business entity and enhancing competitiveness with the aim of achieving a balance between a stable,
economical energy supply and enhanced corporate value
JERA owns businesses across the entire supply chains for fuel and thermal power, from fuel upstream business (gas field development) to fuel transportation and storage(fuel terminal operation) to power generation and wholesaling.
Thus, we will engage in borderless management of all businesses from fuel procurement to power generation and sales in three profit centers—business development,
optimization, and O&M* engineering—to establish a system capable of pursuing expertise and excellence and maximizing synergy in each business.
*O&M: Operation and maintenanceO&M Engineering Department

Optimization Department

Optimizationand trading

Optimization of energy flow

Fuel upstream development
and fuel procurement

Fuel transportation

Operation of power generation-related assets

Receiving and storage
terminals

Domestic and overseas
power generation

Electricity and gas sales

Expansion of asset scale and domain

Business Development Department

Business Development Department
Builds an optimal asset portfolio
and aims to increase profits by
expanding the scale and domainof the value chain through thedevelopment of new businesses
and restructuring of existing
assets.

◦Domestic power generation business◦Overseas power generation and value
chain business◦Renewable energy development business◦Fuel upstream, transportation,and long-term LNG procurementbusinesses

Optimization Department
Aims to achieve economically
optimal operation by consolidating
and controlling the entire flow ofenergy—from fuel procurement andtransportation to power generation,
electricity, and gas sales.

◦Short-term fuel procurementbusiness◦Fuel trading business◦Electricity and gas sales
business

O&M Engineering Department
Safely, affordably, andflexibly controls fuelreceiving and storage
terminals and thermal
power plants.

◦O&M engineering technology◦Rendering O&M engineering services to third
parties

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Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Message from the Chairman
JERA will, through the realization of JERA’s “Mission and Vision,” contributeto the development of a sustainable society in which the economy and theenvironment coexist, continuously enhance our corporate value and, inturn, aim to be a global company indispensable to people around the world.
JERA was established in April 2015 with the aim of creating a globally competitive energy company in Japan. As Japan’slargest power generator and a global energy company, we have established a “Mission and Vision” that lays out our concrete
initiatives for fulfilling our social responsibilities of continuing to support industries and fulfilling lifestyles by maintaining Japan’s
energy supply while at the same time working to resolve the world’s energy issues.

MissionTo provide cutting edge solutions to the world’s energy issues

VisionGlobal leader in LNG and renewables, sparking the transition to a clean energy economy
Responding to the issue of climate change is an urgent matter. We are an energy company with power generation capacity equivalent
to half of Japan’s thermal power generation output and a fuel transaction volume among the world’s highest, and recognizing theneed to reduce and eliminate global warming emissions, we are in position to provide proactive leadership in the realization of a lowcarbon society. In turn, we also bear a responsibility to resolve this issue through the application of optimum solutions.
Accordingly, we announced our JERA Zero CO2 Emissions 2050 roadmap in October 2020. Per this roadmap, we will takeon the challenge of achieving virtually zero CO2 emissions from our operations inside and outside Japan by 2050, a courseof action that is aligned with the Green Growth Strategy being pursued by the Japanese government.
Still, there are many hurdles to clear with existing technology. We engaged in in-depth discussions among management andexecutives, including outside directors, regarding the establishment and announcement of this roadmap. Through these
discussions, we affirmed that this challenge is embodied in our “Mission and Vision,” and that JERA should take the initiativein showing the world its dedication to zero emissions. As a result, the Board of Directors was unanimous in its decision toenact and announce JERA Zero CO2 Emissions 2050.
We recognize that it is not enough simply to announce the plan; we believe that its swift implementation is of the utmost
importance. In addition, this endeavor is not something JERA can accomplish on its own. We will require the cooperation ofmany companies across the industrial spectrum and all of our other stakeholders, both domestically and internationally. We
have a strong sense of duty and are well prepared to come together as a company to achieve zero emissions and contributeto the development of a sustainable society in which the economy and the environment coexist. Further, by continuously
enhancing our corporate value through these initiatives, we will aim to be a global company that is indispensable to people
around the world. You can expect JERA to continue to rise to the challenge.
Chairman
Chairman of the Board

Toshihiro Sano
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Message from the Chairman

Strengthening Governance Is a Fundamental and Priority Initiative for JERAThe basic principle of JERA’s corporate governance is to ensure an autonomous, independent
corporate culture and a management system capable of fair, swift decision-making. Through thisculture and management system, JERA maintains a strong and sound leadership and financial
structure trusted by the global energy market.
In discussing the importance of governance in JERA, it is essential to first understand the purpose
for which the company was established—in other words, JERA’s mission. As touched on at the
beginning, the mission of JERA is to benefit society through supplying globally competitive energy toJapan while competing successfully in challenging international energy markets as well as creatinga new era of energy. This is our mission, and the backbone for achieving this mission is JERA’s
governance. Accordingly, continuously strengthening governance is a fundamental and priority
initiative for JERA. We believe that we must remain firm and steadily adhere to the basic principle ofour corporate governance, no matter how much the business environment may change.

Focusing on Increasing the Effectiveness of the Board of Directors as Chairman
In an age of VUCA,* management issues are becoming more diverse and complex. Against thisbackdrop, the role of the Board of Directors is becoming increasingly important for JERA in orderto achieve growth, further consolidate our global position, and enhance corporate value. In turn, we
recognize that we must continue to increase the Board’s effectiveness.
In FY2020, the COVID-19 pandemic made gathering and holding meetings of the Board of Directors
difficult. Nevertheless, to continue to ensure the effectiveness of the Board’s discussions andsupervision of the execution of duties, we have worked to enhance deliberations and establish
supporting initiatives. Specifically, we worked to hold deep Directors’ discussions on fundamental
issues and adjust the selection of discussion topics for Board of Directors meetings so that
deliberations focus more on strategic and mid- to long-term items such as growth strategies andclimate change. In addition, we believe that sound Board of Directors decision-making requires
high-quality discussion based on thorough provision in advance of information and explanations
to directors. We have made efforts to enhance information provided to directors and worked toeliminate disparities in information between directors to create an environment enabling as many
opinions and questions to be presented as possible. Further, to evaluate the effectiveness of theBoard of Directors, we used surveys and other means to gather feedback from all directors, and the
directors deliberated steps for improving the Board’s effectiveness.

Vigorously Promoting Diversity and Inclusion and
Aiming to Be a Global Leader as “One Team JERA”
I assumed the office of chairman in April 2019, and since that time, I have consistently focused ondiversity and inclusion (D&I). D&I is essential to the realization of JERA’s “Mission and Vision.”
JERA was formed through the consolidation of the fuel and thermal power departments of theTokyo Electric Power Company and Chubu Electric Power Company, and inherited many assets
and human resources from these shareholders. The key differentiator that gives us competitive
advantage is maintaining a continuous value chain while encouraging independent creativity in eachprocess along the value chain. A deep integration of the elements of our value chain is critical tomaximizing the value of our business model and our unique assets, and the foundation of thisintegration is D&I.
Accordingly, we formulated a commitment to promoting D&I in November 2020. We will leverage
the special qualities of each and every one of our human resources—the company’s most valuablebusiness resource—and strongly support their individual growth. In addition, in pursuit of ensuring
the diversity of our Board of Directors, we have created a matrix of the expertise, skills, and otherattributes of the directors that we need, and are using it to investigate areas for reinforcement while
comparing it against the company’s medium-term and long-term strategies. I am well aware of
the reality that there are still too few women in decision-making roles and intend to promote active
participation by women at all levels in an effort to become a global organization where women can
exhibit their skills and flourish more than ever before.
The true integration I aim for is that of ouremployees’ awareness – “One Team JERA.”
Without true integration, we will never become
the kind of global leader we aim to be. To beamong the best in the world, we must breakfree from outdated values and stereotypes
and introduce a diverse, inclusive and global
mindset. By ensuring that this mindset takes
hold and endures in our employees, we willachieve true integration and the maximizationof the synergies that can be derived from ourvalue chain.

*VUCA: An acronym for Volatility, Uncertainty, Complexity, and Ambiguity.

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Message from the President
JERA’s “Mission and Vision” is Our Purpose and Our Value Creation Story
Our mission to provide cutting-edge solutions to the world’s energy issues. As a global leader in LNG and renewables,
JERA’s vision is to spark the transition to a clean energy economy. To realize this vision, we are proactively engaged in the
resolution of a variety of energy-related issues both domestically and overseas, and in turn are sustainably enhancing ourcorporate value.
In my view, JERA’s corporate value rests on our ability to resolve social issues through our business and contribute to thedevelopment of society, coupled with a corporate culture that is a shining beacon in which our employees can take pride. A
company that is truly needed by society and a highly valued presence will create further growth, and this is exactly the value
creation story that JERA envisions. “JERA Zero CO₂ Emissions 2050” announced in October 2020 is an integral part of our“Mission and Vision.” It is also a declaration of action to the world as we aim to become a global leader. In realizing JERA
Zero CO₂ Emissions 2050, we will fully leverage our strengths and assets and take a three-pronged approach.

Three Approaches of JERA Zero CO2 Emissions 2050
1	Complementarity between Renewable Energy and Zero CO2 Emission Thermal
Power Generation2	Establishment of Roadmaps Suitable for Each Country and Region
3	Adoption of “Smart Transition”
The key takeaway here is that we will be introducing renewable energy, and to support this introduction we will use existing
thermal power generation facilities while steadily reducing CO₂ emissions in stages. One of our most pressing issues at the
moment is the early establishment of technologies for zero CO₂ emission thermal power generation. Accordingly, we arebuilding a demonstration project for co-firing with ammonia, a promising fuel technology that does not emit CO₂, with startup planned for FY2024. We aim to commence full-scale operation by 2030. In addition to technical issues, we will take onother issues such as the challenges of improving the economics of decarbonization and developing a secure supply chain.
The achievement of a decarbonized society is a challenge shared by all humanity. As a global leader supporting the futureof energy, we will take the lead in realizing a decarbonized society and contribute to the formation of a sustainable society.
This is the first integrated report that we have compiled for the purpose of introducing our value creation and ESG initiatives
to our stakeholders. We look forward to dialogue with you and working together toward the sustainable development ofsociety.
President

Satoshi Onoda

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Message from the President

Achieving Target Income Levels Two Years Running, Focusing on DX to Achieve Business Plan

Strengthening Value Creation and ESG Initiatives Based on JERA’s Materialities

We are steadily moving forward with the business plan we formulated in April 2019, and we areworking to achieve consolidated net income targets of approximately 100 billion yen*1 from FY2019
to FY2021 and at least 200 billion yen*1 by FY2025.
In FY2020, despite the negative impacts of the COVID-19 pandemic, we achieved our target profit
level for the second consecutive year since FY2019 due to improvement in the cost competitivenessof our domestic power generation business, as well as favorable operating results at the Freeport
LNG project in the US throughout the year and strong performance by our fuel trading business.
We credit this to the JERA Group’s strengths in building a business portfolio in which we participate
throughout the fuel value chain from upstream to power generation and our ability to generate profit
from each link in the value chain.
As electricity and gas markets mature, new markets are created, and competition intensifies
domestically in Japan, JERA can create new business opportunities. In addition, the current draftof Japanese government’s Sixth Strategic Energy Plan lays out a path for energy policy to achievecarbon neutrality by 2050, and presents a composition of power sources unlike its precedents.
In response to these changes in the business environment, we are continuing to focus on improving
profitability throughout the entire value chain. We are doing this by strengthening our power supply
portfolio through replacement of facilities to boost efficiency of domestic power generation, reinforcing
our trading function by leveraging fuel procurement on a scale that is one of the largest in the world, andparticipating in upstream businesses. With regard to overseas business, we have steadily accumulated
results such as offshore wind power in Taiwan and investment in the largest independent power
producer in Bangladesh. There are also numerous new projects that we are currently developing, andwe will continue to carefully select superior business opportunities and seek further growth.
We are also focusing on DX*2 to achieve our business plan and realize growth. By making use ofcontinuously evolving information technology, we will build a new business model for the power
generation industry. JERA will evolve into a data-driven company, meaning a group of professionals who
can utilize the information, experience, and technologies that we have gathered from our strengths—oneof the world’s largest facility portfolios and the operational track record of that portfolio. We launched our
IT and Digital Transformation Project in July 2019, promoting DX as a companywide initiative.
One example is our Digital Power Station Project. Based on the DX vision formulated in October 2020,
this project will transform power plant operation through the use of digital technology. By combining
our unique Kaizen (constant improvement) capabilities with our technical prowess and the latest digitaltechnology, we build an all-in-one power plant facility and human workload package. This is why
we will create an advanced power station operation system harnessing data and AI with the aim of
improving the competitiveness of our power generation equipment and market responsiveness.
We will continue to steadily implement these initiatives and expand into new business domains.
In doing so, we will accelerate the shift in our business portfolio by changing the ratio of domestic
power generation business to overseas power generation business to fuel business from the current
6:2:2 to a ratio of 4:3:3 by FY2025. We will also pursue the maximization of synergies throughbusiness integration.

In order to grow sustainably while adapting flexibly to changes in the business environment amid
the increasing uncertainty of the modern world, it is important to fully understand and manage
the impact of the external environment on our business and the effects of our business activities
on society and stakeholders. Accordingly, in FY2020, we analyzed matters such as the external
environment and our business strategies in terms of both opportunities and risks to identify priority
issues (JERA’s Materialities). Currently, we are working on developing goals and KPIs* for the fivecategories and 22 issues that we have identified, while examining their relationship to corporate
value. In addition, of the issues which we have identified, there are those that require a realignment ofshared values across the Group and the establishment of a course of action for initiatives. For these,
we are formulating policies for each and strengthening initiatives. We are also working to improvedisclosure of ESG-related information.

*1 Excludes fuel cost adjustments.

*KPI: Key performance indicator.

Pursuing JERA’s Unique Approach to Value Creation
There are many countries in the world experiencing such remarkable growth that the supply of
power is unable to keep up. There are also many areas that remain non-electrified, and there
are many countries and regions that are in need of power generation facilities. JERA will not only
provide optimal, environmentally conscious power solutions to these countries and regions, but also
create jobs via the power facility construction process and, through the provision of technology andexpertise, cultivate human resources. In turn, these will serve as springboards for further growthand development of industries, communities, and societies. We believe that, in aiming to be a
global company, JERA is expected to contribute to the continued prosperity and happiness of thecountries and regions where we have business activities
and of the people who live there. JERA’s unique approachto value creation ties into Goal 7 of the SDGs—clean andaffordable energy—and leads to the achievement of othertargets while also enhancing corporate value.
This approach is one of the most exciting and rewarding
aspects of being an infrastructure company: thehappiness of our stakeholders is the driver and energy
for our further growth. Together with all our employees,with their hopes and dreams for the future, I will seek toenhance our value creation. I will aim to build a corporate
culture in which all our employees can be proud to work
for JERA and to make JERA a company that is truly
indispensable to society.

*2 DX: Digital Transformation

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Value Creation Process
The value creation process of JERA is a graphical representation of our vision to create value through the global expansion of the company’s business domains and the enhancement of value along its value chain.
We aim to balance maximizing the value we provide to society and our stakeholders with enhancing our corporate value through expanding the company’s business not only in Japan but also globally, and by
making the most of the entire value chain from upstream development of fuels to transportation, storage, power generation and sales, in addition to renewable energy.
Identifying issues and trends surrounding energy
Global Issues◦ Increased demand for energy in Asia
◦ Exit from coal and gas shift◦ Expansion of renewable energy◦ Escalation of climate change issues

Global Trends

Main Output

Fuel
upstreamdevelopment
and fuel
procurement

Economic Output

Fueltransportation

Receivingandstorageterminals

Power
generation

Electricity
andgas salesion◦Knowledge of LNG thermal power
replacement◦Trading expertise of JERAGM◦JERA O&M Way

ExpansIntellectual Capital

Global◦Consolidated employees: 4,907◦ Stagnation in demand due topopulation decline◦ Full liberalization of electricity andgas markets in Japan◦ Future Power Mix is Dim[JERA’s value chain]

Input (FY2021/3)
Human Capital

Issues unique to Japan◦ Innovation in renewable energy◦ Expansion of digitalization

Optimization and trading

Natural Capital◦Total Energy Consumption:
50.7 million KL (crude oil equivalent)

Financial Capital

Electricity
sales

Renewable energy development◦Invested Capital: 1,696.9 billion yen◦Interest-bearing liabilities:
1,613.2 billion yen

Manufacturing Capital◦Domestic power generations: 27 plants◦Overseas power generations:
13 countries
Over 30 projects

Social Capital◦LNG transaction volume among thelargest in the world◦Overwhelming presence in domestic
power generation business◦Flexibility of operations and contracts (optionality)

Improvement of value in the value chain
Business Strategies for Sustainable GrowthFoundation for Value Creation

Risk identification, management, and response

Strengthening of earning power

Digital Transformation (DX)

▶P21

▶P31

Corporate Governance▶P24◦Consolidated net income: 157.8
billion yen◦Financial strengthen rating: (S&P A-,
R&I A +, JCR AA-)

Reducing the burden on theenvironment

Main Outcome(JERA’s Value Creation)

・ Sustainable improvementof corporate value
・ Contribution to theestablishment ofsustainable societies
Economic Value
Investors / shareholders◦Promotion of replacement for highefficiency thermal power generations
with less CO2 emissions◦Efforts to shut down all inefficient
coal power plant◦Stable interest payments anddividends◦Enhancing IR and ESG Information

Promotion and expansion ofclean energy

Environmental and Social Values◦Creation of zero CO2 emission
thermal power: Proving tests of cofiring with ammonia and hydrogen at
actual power plants◦Expanding renewable energy
business: 1.2 GW

Stable energy supply

Global Environment◦Realization of zero-carbon society(P15)◦Development of renewable energy(P26)

Business partners/local community◦Domestic power generation output:
244.6 TWh
◦Safe, competitive, flexibly adjustable
operation of power plants andreceiving terminals◦Stable supply of energy (P28)◦Development of local community/
industries (P53)

Diversification of humanresources◦Active involvement/cultivation ofdiverse human resources (P48)◦Promoting work style reform (P50)◦Board of Directors: 1 woman 2
foreign nationals of 10 (all directors)

Employees

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Value Creation Process (Decarbonization Strategy)
JERA’s decarbonization strategy by 2050 consists of two pillars: (1) shift from the current thermal power generation centered on LNG to zero CO2 emission thermal power generation (transition) that does notemit CO2 during power generation, through promoting the introduction of greener fuels, and (2) develop and expand renewable energy such as offshore wind power. We aim to promote low-cost and speedy
decarbonization while maintaining a stable supply of energy.
We are a data-driven company that makes decisions swiftly and accurately on the basis of data, with the aim of achieving medium- to long-term growth. We will also promote the creation of new value through DX.

CO₂ emissions fromour businesses

MissionTo provide cutting edge solutions
to the world’s energy issues

Thermal power generation

Shut down inefficient coal power plants
Improvement of the efficiency
of LNG thermal power generation

Coal

LNG based
thermal power
generation

Zero CO2 emission
thermal power

2050
Zero CO2
emissionsIntroduction of co-firing withammonia and hydrogen*1

Increase the co-firing rate
Transition to use of 100% ammonia, without
other fuels, in thermal power generation

Energy Transition

Market trading of non-fossilized value

LNG
Expansion of renewable energy businesssuch as offshore wind power business

Renewable energy

Growth of floating offshore
wind power generation
Reduction of
CO2 emission
intensity

CO2 emitted from power plants thatcannot be exclusively ammonia-fired
as of 2050 will be offset using offset
technology or by CO2-free LNG

20%*

2

JERA Environmental Target 2030 for its Business in Japan

Period of action toward achieving zero CO2 emissions

Digital Transformation (DX)New value creation

Renewable energy

Period of ambitiously striving to achieve zero CO2 emissions*1 For co-firing with hydrogen, we are also considering the use of CO2-free LNG.
*2 We will achieve a 20% reduction compared to the emission intensity fromthermal power generation for Japan as a whole, based on the government’s
long-term energy demand forecast for FY2030.

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Message from the CFO
strengths inherited from Tokyo Electric Power and Chubu Electric Power while also combining themwith our own new measures as we move forward with these endeavors. In FY2020, we realized
synergy effects of about 45 billion yen (pretax; consisting of about 25 billion yen for increased costcompetitiveness and about 20 billion yen for our LNG trading business and other new profit sources)
relative to FY2018, reaching around half of our final goal in the second year of consolidation. I assess
post-consolidation business development to be progressing smoothly.

Strengthening Initiatives to Enhance
Sustainable Corporate Value, Advancing
Dialogue with Our Stakeholders

Domestic power generation business60

billion yen/year

Looking Back on Our Business Plan
In the business plan we announced in April 2019, we set targets for 2025 of consolidated net incomeof 200 billion yen (excluding time lags*) and a credit rating of A or higher. First, although there were
temporary factors such as losses related to the sale of LNG and COVID-19, consolidated net income
excluding time lags for FY2019 was 90.0 billion yen, and for FY2020, 111.6 billion yen. In FY2021,
as well, we anticipate consolidated net income of 120.0 billion yen, exceeding the 110.0 billion yen
presented in our business plan. I interpret this to mean that we are generally making steady progress
toward achieving the target. In addition, we are maintaining our target of at least an A in our credit ratingscurrently obtained from three agencies, and I believe we are sustaining a sound financial structure.
Furthermore, in the business plan, we set a goal of creating synergy effects at least 100 billion yen
per year within five years from the consolidation of existing thermal power generation businesses
in April 2019. With regard to the improved cost competitiveness in our domestic thermal power
generation businesses and the creation of new profit sources, we are fully leveraging the respective*Profits and losses due to the time difference between changes in fuel prices and their reflection in sales prices

Consolidated net income■ Business plan

200.0

■ Actual

120.0

150.0
100.0

100.0

90.0

100.0

111.6

110.0

(Forecast)

50.0
0

2019

2020

◦Expansion of gas and LNG wholesaling◦Optimization through integrated management of the entire value chain◦Apply global trading expertise to domestic thermal generation business◦Optimization of power source portfolio

Kazuo Sakairi(Billion yen)

◦Electricity and gas market trading, third-party sales◦Global-level O&M engineering business◦Streamlining through an O&M engineering model that iscompetitive in the global markets◦Streamlining through consolidated procurement of materials andequipment

Senior Managing Executive Officer, Director, Chief Financial Officer,
Finance and Accounting Department

200.0

New businesses/JERA’s existing businesses

2021

2025 (FY)FY2020 results: approx.

25

40

Synergy effects

100

billion yen/year

billion yen or more/year

within 5 years from integration

FY2020 results: approx.

billion yen◦Growth into a global energy company

20billion yen◦Engage in fair competition including
proactive leveraging of the market◦Provide customers with a stable supply of globally competitive energy◦Enhance the corporate value of both the TEPCO and CEPCO groups

Current Initiatives Aimed at Enhancing Corporate Value
In order to enhance corporate value, we established a system with three business departments to
respond to changes in both the domestic and global business environments. We also establishedmore than 10 strategic business segments as management units by business domain and region.
In the management of our portfolio based on these strategic business segments, for each segment,
we are engaging in repeated discussion among managers and directors. At the same time, we arealso formulating strategies, targets, and business and action plans; and periodically monitoring eachsegment’s state of progress and risks. Through these measures, we are building a management platformthat enables us to respond in a timely and appropriate manner to changes in the business environment.
Furthermore, we are engaging to achieve both high profitability and reliable financial soundness bydesigning and implementing financial discipline. These include evaluating investment standards forsecuring value creation investments (guideline rates are established by business domain and region,
after which EVA®* is calculated based on the ROIC for individual projects and monitored), maintaining anawareness of required capital through integrated risk management (p. 39), and periodically investigating
the optimal capital structure based on factors such as total risk exposure and credit ratings.
*Economic Value Added, a registered trademark of Stern Value Management Ltd.

*Excludes fuel cost adjustment time lags.

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Message from the CFO

Future Initiatives Aimed at Further Enhancement of Corporate Value
With developments such as decarbonization and the reforms of electric power systems, thebusiness environment surrounding JERA is changing at an unprecedented pace, both globally andlocally. To support swift and flexible management decision-making and business development amid
these circumstances, we are improving the sophistication of our business management, managerial
accounting, and financial and accounting systems by DX Project, which aims to transform into a
data-driven company, and expanding our global accounting and taxation structures.
Further, in such a business environment, I believe that diversity and professionalism, as well as
leadership that is able to integrate and direct them, are essential components to make JERA
competitive. Based on this belief, I place great importance on promoting the active participationof women, proactively engaging in mid-career recruiting, and transforming into a professionalorganization that responds nimbly to changes in the business environment. Taking the Financeand Accounting Department as an example, of the department’s current staff of approximately 110
people, about one quarter are women, and more than half are mid-career hires. Through an organic
blending of staff of various backgrounds and high-level expertise, with staff who have transferredfrom shareholders, we are realizing the creation of new value. We will continue to implement thisinitiative companywide.
In addition, in order to stay ahead of changes in the business environment and come up withappropriate measures, I believe it is essential that we consider not only organic growth but also
M&As to supplement business resources. Accordingly, we have established a special unit under thesupervision of the CFO, which is in charge of exploring, structuring, and executing M&A.
In addition to the above, from my position, I believe that financial strategy formulation and inculcation
are particularly important. In July 2021, the Financial Strategy Section was established under thesupervision of the CFO. This section is formulating financial strategies linked what JERA aims forbased on JERA’s “Mission and Vision,” as well as our business strategies rooted in JERA’s businesscharacteristics. Even amid the changing business environment, we will stably and sustainably create
corporate value by systematizing and actualizing our financial strategies and embedding them in our
initiatives. We will also present JERA’s unique business and foundation for growth to our stakeholders
and explain to them our corporate value creation process and long-term vision.

Financial Strategy Framework
Our financial strategy framework involves considering three main approaches. The first is “profitability,
efficiency, and growth management,” which leads to the creation of the EVA® that supports theenhancement of corporate value. Based on the investment standards for securing value-creation,
we will establish companywide management goals such as ROIC, which indicates the eligibilityof investments to support JERA’s sustainable growth. To firmly achieve these goals, I believe it
is important to link them with the business targets of three business departments possessing
various functions and characteristics, and strictly manage them. Further, we are also investigating
the disclosure of our medium- and long-term capital allocations as a means of demonstrating thedirection of the sustainable growth.
The second is “balance sheet management.” In addition to our domestic power generation business,
including zero CO2 emission thermal power generation and a renewable energy business, we supporta lengthy value chain extending from upstream to fuel transportation, trading, and power generation
spanning a wide area that includes North America, Asia, Australia, the Middle East, and Europe.
Given that we have assets of more than four trillion yen to support these businesses, it is vital that
we manage these assets appropriately through strict financial discipline. For overseas, renewableenergy, and zero-CO2-emission-related businesses in which further investments are planned overthe medium and long term, we will verify our optimal capital structure based on financial ratingsand integrated risk amounts and set and manage financial soundness targets in addition to current
initiatives. In this way, we will engage in more accurate balance sheet management.
The third is “highlighting the relationship between nonfinancial and financial information.” We wish toclarify the relationship between our nonfinancial information and the enhancement of corporate value.
This, in turn, will show that our sustainable initiatives to realize a decarbonized society, centering on“JERA Zero CO2 Emissions 2050,” contribute to the improvement of medium- to long-term returns
and the lowering of risk, and that they also lead to further enhancement of our corporate value.
Financial strategy framework (image)Companywide KPIs

Profitability, efficiency, and growth management

Companywide KPIs
Capital costs

Balance sheet management

Highlighting the relationship between financial and nonfinancial information

I see our financial strategies as a tool for engaging with our diverse array of stakeholders. As werealize the further enhancement of sustainable corporate value, in order to receive recognition fromour stakeholders, we will aim to disclose our financial strategies in ways that are easy to understand.
We will also stimulate communication with our stakeholders through the process of formulating
and disclosing this information, further deepening mutual understanding, and meeting stakeholder
expectations.

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Financial and Non-Financial Highlights
To achieve JERA’s “Mission and Vision,” JERA is steadily implementing the six measures of the business plan we formulated in April 2019, with the aim of sustainably enhancing our corporate value.
In addition, we will focus on promoting diversity and inclusion and strengthening corporate governance. We will also work to propose flexible work styles and provide career development support, and, further,ensure diversity in the Board of Directors.

Financial
Operation Revenue (billion yen)

Net income attributable to owners of parent

Cash flows from operating, investing, and financing activities/freecash flow (billion yen)

■ Net income attributable to owners of parent■ Operating CF(with and without time lags*) (billion yen)

■ Net income excluding time lags

■ Investing CF

3,280.0
2,780.7

168.5

2,730.1■ Financing CF

157.8

240.8
111.6

340.8

143.3

13.1

90.0

Free cash flow

551.6

68.7

89.5

-133.0-119.9

22.5
2018

2019

Consolidation of existing
thermal power generation business*

2020-310.8

2018

(FY)

2019

2020

(FY)

2018

2019

-452.0-272.02020(FY)

Despite fluctuations due to resource prices, net sales have been running ataround 3 trillion yen. By segment, our domestic thermal power generation andgas supply businesses made up the majority, followed by our fuel-related andoverseas power generation businesses.

Net income attributable to owners of parent increased significantly due toconsolidation of existing power generation businesses and new sources of income
including our trading business.

After the consolidation of existing thermal power businesses, cash flows fromoperating activities was strongly positive. Conversely, due to the replacement ofdomestic thermal power stations and overseas business investment, etc., cash
flows from investing activities was significantly negative. However, this was withincash flows from operating activities.

Return on equity (ROE) (with and without time lags) (%)

Total assets/net assets (billion yen)/Equity ratio (%)

Interest-bearing debt (billion yen)/Debt-to-Equity(D/E) ratio*■ Total assets■ Interest-bearing debt

ROE

ROE excluding time lags

*Profits and losses resulting from the time difference up until variation in fuel prices are reflectedin sale prices.
*FY2018 was prior to the consolidation of existing thermal power generation businesses and thus
does not include profits and losses from time lags.

16.0■ Net assets

Equity ratio

4,090.8

4,035.3

45.0

38.2

41.2

0.63

D/E ratio

0.98
1,505.9
38.2

0.96
1,613.2
41.2

9.8

4.1

8.5

2019

2020

(FY)
既存火力発電事業等統合

After the consolidation of existing thermal power generation businesses, ROE
was 16.0% (8.5% excluding time lags) for FY2019, and 9.8% (6.9% excludingtime lags) for FY2020. We are moving forward with management of profitability,
efficiency, and growth.
*FY2018 was prior to the consolidation of existing thermal power generation businesses and thus
does not include profits and losses from time lags.

357.8

613.1

225
2018

1,762.1

1,601.2

1,257.4

6.9

2018

2019

2020

(FY)

Our Equity ratio remained stable at around 40%. We prepared for risks bymaking use of external funding for the capital needs in our business activities
while maintaining good financial soundness. In FY2020, we issued our first evercorporate bonds.

2018

2019

2020

(FY)

Interest-bearing debt increased significantly with the consolidation of existing
thermal power businesses. Currently, we are conducting balance sheet
management aiming for a D/E ratio of around 1.0.
*D/E ratio = Interest-bearing debt/Shareholder’s equity.

*With the consolidation of existing thermal power businesses in April 2019, we established a unified, continuous value chain from fuel upstream, procurement, and transportation to power generation and electricity and gas wholesaling.

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Financial and Non-Financial Highlights

Non-financial
FY2020 Domestic power generation output
by type of fuel (TWh)Equity ownership in renewable energy output (GW)

Coal

43.2 (18%)

Approximately
Approximately

Total

Total power
generation
output in Japan

244.6

845.4 TWh

0.9

1.1

1.2

of total power generation
output in Japan

Benchmark A

1.000

201.5（82％）

2018

2019

2020 (End of FY)

2

2

Standard to achieve:
At least

1.00

Fuel upstream/fuel transportation

20.48

0.68（0.5％）（13.8％）

Total

148.59million t-CO2

Benchmark B

LNG

FY2020 CO2 emissions (Scope 1) (million t-CO )/CO2 emission intensity in Japan (kg-CO /kWh)Overseas power
generation

Approximately

TWhApprox. 30%

FY2020 Thermal power generation efficiency
benchmarks, the Energy Conservation Act

46.8

％

Standard to achieve:
At least

44.3%

CO2 emission intensity ofdomestic power generation
business

0.491 kg-CO2/kWh

Domestic power
generation

127.44（85.8％）

Note: FY2019 total emission intensityof thermal power generation in Japan:
0.567 kg-CO2/kWh

JERA is responsible for approximately 30% of the total
power generated by electric utilities in Japan. Notably,a significant portion of electric power is generated from
LNG, which has low CO2 emissions.

We are developing renewable energy in Japan andoverseas with a focus on offshore wind power generation,
which leverages our strength of large-scale development.

Both benchmarks A and B meet the standards to achieve.

Number of employees (consolidated)

Number of women management personnel/
percentage of management positions held by
women (%)

FY2020 number of outside directors

FY2021 Board of Directors diversity

As of April 1, 2021

As of April 1, 2021

As of March 31, 2021

Women

■ Number of women management personnel
Percentage of management positions held by women320
Total number of
employees

4,907

3.3

3.5

4.2
32

25

Men

4,587
4
2018

We respect the diversity and individuality of every one of
our employees and are engaged in the fostering of anopen and fair corporate culture, as well as the creationof an environment in which all employees can feel
comfortable working.

20192020 (End of FY)

Based on the principle of leveraging diverse values andthoroughly implementing the concept of fairness, we
proactively provide opportunities for women employees toexhibit their skills.

A: A benchmark for the degree of achievement of power generation
efficiency targets by fuel type.
B: A benchmark for the overall power generation efficiency for thermal
power generation.

Outside directors

5

Three of which neither work for
JERA nor are JERA shareholders

10
In addition to executive directors who work for JERA
and directors who were originally shareholders, we hire
directors who neither work for JERA nor are shareholders
to ensure diversity of knowledge, experience, and otherfactors among the Board of Directors.

JERA has established an environmental target for FY2030 (“JERA
Environmental target 2030 for its Business in Japan”) of achieving a
20% reduction in CO2 emission intensity for all thermal power generationin Japan based on the Japanese government’s outlook for 2030.

Board of Directors
diversity

1 2
woman,

foreignnationals

10

Believing that ensuring the diversity of our Board of
Directors leads to better business decision-making,we have appointed a woman and foreign nationals as
directors.

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

JERA Zero CO2 Emissions 2050: The challenge of achieving zero CO2 emissions from domestic and overseas operations
JERA Zero CO2Emissions
2050

JERA’s mission is to provide cutting edge solutions to the world’s energy issues.
To contribute to the realization of a sustainable society, JERA will take on the challenge of achieving, by 2050, virtually zero CO2 emissions from JERA’soperations in Japan and overseas.**JERA Zero CO2 Emissions 2050 is premised on the continual development of decarbonization technology, economic rationality, and consistency with government policy. JERA is continuing to develop decarbonization technology byourselves, and is taking the initiative to ensure economic rationality.

Three Approaches of JERA Zero CO2 Emissions 2050

1

2

3

Complementarity between Renewable
Energy and Zero CO2 Emission Thermal
Power Generation

Establishment of Roadmaps Suitable
for Each Country and Region

Adoption of “Smart Transition”

JERA will achieve “JERA Zero CO2 emissions 2050” through a combinationof renewable energy and zero CO2 emission thermal power generation. The
introduction of renewable energy is supported by thermal power generation
capable of generating electricity regardless of natural conditions. JERA will
promote the introduction of greener fuels and pursue zero CO2 emission
thermal power that does not emit CO2 during power generation.

“JERA Zero CO2 emissions 2050” will be achieved by establishingroadmaps that show optimal solutions for each country and region.
Since the energy situation is different for each country and region—such as the presence of regional transmission lines or pipelines and thetypes of renewable energy that could be adopted—JERA will work withstakeholders on a country and regional basis to establish roadmaps. We
will develop a roadmap for our business in Japan and will extend thisapproach to other countries and regions.

“JERA Zero CO2 emissions 2050” will be achieved through a combinationof technologies that are available and reliable at the time adoption decisions
are made, lowering technical risk and smoothing the transition to a green
society.

Leading the Decarbonization Effort in the Energy Industry
As a global company that solves energy issues not only in Japan but also around the world, JERA considers global warming countermeasures to be the highest-priority management issue.
In October 2020, we announced “JERA Zero CO2 Emissions 2050” in order to further accelerate the initiatives we had engaged in so far and, at the same time, clarify ourlong-term vision for JERA. JERA Zero CO2 Emissions 2050 challenges us to achieve virtually zero CO2 emissions from our domestic and international businesses by 2050,
and we are taking three approaches toward achieving this goal.
The first step is to develop “JERA Zero CO2 Emissions 2050: Roadmap for its Business in Japan” to illustrate the path toward zero CO2 emissions in domestic business,
and we have established “JERA Environmental Target 2030” to serve as environmental targets to achieve by 2030 toward that end. JERA Zero CO2 Emissions 2050 was
formulated with an emphasis on maintaining a stable supply of energy while promoting decarbonization swiftly and at low cost. Thus, we have received a lot of positive
feedback from our stakeholders around the world.
In order to ensure this drive becomes more than just words, we are leveraging the strengths of the value chain from the fuel upstream to power generation and are proactively
moving forward with specific initiatives in Japan and overseas, including strengthening partnerships and developing technologies for realizing zero CO2 emission thermal power.
The realization of a decarbonized society is a challenge shared by all humanity and is not something JERA can achieve on its own. JERA will continue working with affiliatedorganizations/groups and shareholders who share this goal, proposing new ways to supply energy and leading the effort toward decarbonization in the energy industry.

Corporate Vice President,
Managing Executive Officer, Director,
Chief Operating Officer, Corporate Strategy Department

Hisahide Okuda

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Contents / Editorial Policy

JERA Zero CO2 Emissions 2050

Value Creation

By 2040

Shutdown/decommissioningof inefficient coal-fired
thermal power plants

Co-firing withammonia
Co-firing withhydrogen*Zero CO2 emissions thermal power generation

RenewableenergyAchieve a 20% reduction of CO2 emission intensity from all thermal power
generation in Japan based on the Japanese government’s Long-Term
Energy Supply and Demand Outlook for fiscal 2030

Conduct proving tests at an actual coal power plant(Hekinan Thermal Power Station)

Demonstration experiments
Verification of stable operation using actual
generator at a power plant

Financial and Corporate
Information

Roadmap for its Business in Japan

By 2030
Period of moving into action toward achieving zero CO2 emissions

Demonstration experiments

Foundation for Value
Creation: ESG

Strategies

20%
reduction of
CO2 emission
intensity

Launch full-scale operation
Finalize details in light of results of thedemonstration

Resolving technical issues(selection of hydrogen carriers)
Selection of the technically and economically optimalhydrogen carrier from among ammonia, liquefiedhydrogen, methylcyclohexane (MCH), etc.

By 2050

Period of taking on the challenge of achieving zero CO2 emissions
By 2030

Shut down/decommission
completion

Shut down/decommission all inefficient JERA coalfired thermal power plants (supercritical or less)

Early 2030s

20% co-firing rate

Achieve a 20% ammonia co-firing rate at
all JERA coal-fired thermal power plants

Achieve virtually zeroCO2 emissions from JERA
businesses

Increase

Zero CO2
emissions

2040s
Commencement of

the co-firing specialized combustion
rate
Shift to exclusively ammonia-fired thermal
power plants due to replacement of prior plants

2030s

Increase

Launch full-scale

the co-firing rate

operation◦Promote development focused on offshore wind power◦Support introduction in the form of storage batteriesThis roadmap will be gradually developed in greater detail based on relevant conditions such as government policies. JERA will revise the roadmap when relevant conditions change significantly.
*We are also considering the use of CO₂-free LNG.

CO2 emitted from power plants that cannot be
exclusively ammonia-fired as of 2050 will be
offset using offset technology or by CO2-free LNG

JERA is actively working to reduce CO2 emissions. In its domestic operations, JERA will achieve the following by FY2030:

JERA
Environmental
Target 2030 for its
Business in JapanS hut down/decommission all inefficient (supercritical or less) coal-fired thermal power plants and promote demonstration experiments of mixed combustion withammonia at high-efficiency (ultra-supercritical) coal-fired thermal power plants.
Promote the development of renewable energy centered on offshore wind power generation projects and work to further improve the efficiency of LNG thermal
power generation.
Reduce CO2 emission intensity by 20% compared to that of thermal power plants in Japan as a whole, based on the long-term energy supply and demand outlook for
FY2030 set by the government.
“JERA Zero CO2 Emissions 2050 Roadmap for its Business in Japan” and “JERA Environmental Target 2030” are premised on the continual progress of decarbonization technology, economic rationality, and consistency with government policy.
JERA is continuing to develop decarbonization technology by ourselves, and is taking the initiative to ensure economic rationality.

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Contents / Editorial Policy

Special Feature
Basic Approachtargets) in line with the TCFD*1 recommendations. In September 2021, JERA endorsed the TCFD
Recommendations and joined the TCFD Consortium*2.
We will continue to promote disclosure based on the TCFD recommendations in the Integrated
Report to further enhance communication with stakeholders including investors.

*2

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Response to the TCFD Recommendations

As a global enterprise that solves energy problems not only in Japan but also around the world,
JERA considers climate change measures to be a priority issue and specifies them in its Materiality.
For the purpose of appropriately evaluating climate-change-related risks and opportunities andsustainably enhancing corporate value, we have summarized our climate-change-related systems
and businesses in general and the efforts represented by the “3 approaches” set forth in “JERA Zero
CO2 Emissions 2050” into 4 elements (governance and risk management, strategy, metrics, and*1

Value Creation

TCFD (Task Force on Climate-related Financial Disclosures): The task force established by the
Financial Stability Board (FSB) in response to the wishes of the G20 Finance Ministers andCentral Bank Governors meeting to stabilize the financial system due to climate change. It
published a framework and recommendations for disclosure on climate change-related risks
and opportunities for companies, etc.
The TCFD Consortium was established as a forum where companies and financial institutions
that support the TCFD recommendations work together to promote initiatives and discuss
effective corporate disclosure and efforts to link disclosed information to appropriate investment
decisions by financial institutions. In order to further enhance corporate disclosure level inline with the TCFD recommendations by companies and to promote constructive dialogue(engagement) between investors and companies, the consortium actively publishes various
guidance and holds the TCFD Summit as a forum where companies and financial institutions
from around the world gather together.

Governance and Risk Management
GovernanceImportant policies, targets, and reviews related to climate change measures are determined by the
Board of Directors or the Leadership Panel under the corporate governance system.
In addition, for the purpose of advancing ESG management, we have established the Sustainability
Promotion Committee, which is chaired by the President and under the direct control of the Board of
Directors, to oversee sustainability across department throughout the company. The Environmental
Subcommittee reports on annual action plans and performance for all environment-related activities,
including climate change measures.
Furthermore, Directors exchange opinions with outside experts, sharing the latest information andfindings at Leadership Panel or other meetings. In addition, we have hold “Sustainability Seminars” formanagers as appropriate. By continuously deepening the knowledge and understanding of trends in
ESG management, including climate change, from directors to employees, we will proactively work
to further improve our ESG activities.

Risk Management
In order to gain a proper understanding of and mitigate risks associated with corporate activities, wehave established a risk management system with the President as the highest decision maker andconduct Integrated Risk Management that classifies risk into operational risk, market risk, and credit risk.
With regard to climate-change-related risks, we identify risks based on the recognition that they
may affect these areas. In particular, risks that should be managed by directors are selected as“important risks to be managed by management.” The Risk Management Committee, chaired by
the president, reviews and deliberates on the management status of these risks and response
policies for them and brings those for discussion and reports them to the Board of Directors, bothon a regular basis and as needed.

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Special Feature Response to the TCFD Recommendations

Strategy - Setting up analysis targets and scenarios Selection of analysis targets We conduct scenario analysis to identify and analyze risk opportunities throughout our business value chain. The analysis covers not only the short-term, but also themedium-term (to 2030) and long-term (to 2050).

Selection of scenarios

The following two scenarios have been established with reference to the information published by the International Energy Agency and the Intergovernmental Panel on
Climate Change.

Configuration
Scenarios

Assumedbusiness
environment

Referencescenario

Scenario for below 2oC

Scenario for 4oC or higher

Bold policies and technological innovations will be implemented to achieve sustainable development by limiting theincrease in global average temperature by the end of this century to 1.5 to below 2°C compared to pre-industrial
levels.

Although national policies (new policies) are implemented, suchas Nationally Determined Contributions made in line with the Paris
Agreement, the average global temperature by the end of this century
will increase by more than 4oC compared to the pre-industrial levels.

◦Global power generation increases due to economic growth and electrification. In particular, the amount ofelectricity generated by renewable energy, particularly solar and wind power, increases significantly.
◦Fossil fuel consumption decreases and demand for green fuels such as hydrogen and ammonia increases. On theother hand, natural gas continues to play an important role as an energy source in Asia and other regions where
the increase in energy demand is remarkable.
◦IEA: “Sustainable Development Scenario (SDS)”◦Working Group I contribution to the Sixth Assessment Report of the IPCC: “SSP1-1.9, SSP1 -2.6”◦IEA: “Stated Policies Scenario (STEPS)”◦Working Group I contribution to the Sixth Assessment Report of the
IPCC: “SSP3-7.0, SSP5-8.5”

Scenario for below 2oC: Possible changes in business environment*1

Scenario for 4oC or higher: Possible changes in business environment*2

Global Power Generation and Electrification Rate

Global demand for hydrogen and ammonia(TWh: Power Generation)
60,000（Mtoe）
600(%: Electrification Rate)
40
Electrification Rate

45,000

Others

30,000

Other
Renewable
Energy15,000Natural Gas Demand by Region
（Bcm）
1,500

500

900
20

300

2040

2050

North America

600
200

Middle East

10

2030

Extreme temperature
events*3

400

0

0

2019

2030

2040

2050

0

Extreme precipitation
events*3

Europe

300

100

Solar

2019

Asia

1,200

30

Wind

0

◦Increase frequencies and intensities of extreme temperature andprecipitation events.
◦Sea level chronically rises. Combined with the occurrence of riverflooding due to storm surges and extreme precipitation, the risk offlooding will be increased, especially in coastal cities.

AfricaLatin America

2019

2025

2030

2040

Sea level rise*4

Frequency

Intensity increase

Approx.

Approx.

9.4 times+5.1oCFrequency

Intensity increase

Approx.

Approx.

2.7 times+30.2%+0.63 - 1.01 meters*1 Based on IEA “World Energy Outlook 2020” and “Sustainable Development Scenarios (SDS)” in Energy Technology Perspectives 2020.
*2 Prepared on the basis of the Working Group I contribution to the Sixth Assessment Report of the IPCC. All values are compared with the values assumed before the Industrial Revolution.
*3 Estimated value at 4°C rise. “Extreme” refers to a weather phenomenon that can occur only once in 10 years.
*4 Assumed values for 2100 for the SSP5-8.5 scenario.

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Special Feature Response to the TCFD Recommendations

Strategy: Impact assessment on JERA’s businessBusiness opportunities and risks in JERA related to climate change were analyzed based on the scenario set up on the previous page.
As a result, it was reconfirmed that various initiatives and measures such as our “JERA Zero CO2 Emissions 2050” contribute to business opportunities as well as business risk reduction.
Category
Policy and
Legal

Technology

Changes in the business environment

Tightening regulation of fossil
fuel use

Scenario for below 2°C

Changes in energy supply
structure through thedevelopment and introductionof non-fossil energy
technologies
Expansion of the electricity
marketMarket andService

Growing global awareness ofclimate change
Reputation◦Introduction of carbon pricing◦Restrictions on carbon emissions◦Tightening energy conservation
regulations◦Increased operating costs◦Operating limits for owned power supplies◦Reduced cost of technology
development and green fuel◦Expanding opportunities to develop and introduce hydrogen andammonia fuels◦Reduction of renewable energy andstorage battery technology costs◦Reduced utilization rate of owned power supplies◦Increasing needs for energy transport and consumption efficiency◦Grid distribution◦Expanding business opportunities with renewable energy and storage
batteries◦Increased electricity demand due toeconomic growth and electrification◦Expanding power supply opportunities◦Increased importance of natural gas as bridging energy◦Improving customer needs for green
products and services◦Expanding business opportunities with green power and fuel◦Investor divestment and engagement◦Acceleration of global warming
countermeasures and directconnection of corporate evaluation

Scenario for 4°C or higher

Acute
Increased acute risk

Assessing the impact (risk/opportunity) on JERA

◦Frequent and severe natural disasters◦Financial constraints resulting from curbing or withdrawing investmentin the fossil fuel business◦Expanding opportunities to utilize transition green finance◦Damage to reputation due to slow or delayed efforts

Increased chronic risk

2030

2050

Risk Level

JERA’s response to changes
Steady promotion of “JERA Zero CO2Emissions 2050”
We will steadily implement measures based on theroadmap on p.16, focusing on “Zero CO2 emission
thermal power generation” and “renewable energy.”
Strengthening the LNG Value Chain
We will maintain and expand the scale of LNG
procurement through replacing domestic power
generation to more efficient power generationand expanding overseas power generation.
We will also aim to increase profitability throughout thevalue chain by connecting this scale to the expansion of
trading and participation in upstream businesses.

Actively disseminate information to
stakeholders
We will provide stakeholders, including electricity
users and investors, with appropriate information on
our company’s measures toward zero CO2 emissions,
thereby expanding green power and diversifying
financing.

◦Achieving ambitious goals to improve reputation◦Increased disaster response costs◦Increased equipment damage and recovery costs◦Changes in renewable energy power generation◦Increasing need for stable energy supply

Chronic

Present

Opportunity
Level◦Sea level and tsunami height rise

◦Increased disaster response costs◦Changes in climate patterns, such assustained high temperatures◦Decreased power generation efficiency◦Electric demand fluctuations

Improving disaster resilience
In preparation for the occurrence of natural disaster risks,
including acute and chronic risks, we are developing
emergency disaster response rules and manuals,
conducting regular disaster drills, and upgrading the
JERA version of the BCP and BCM. We will also diversify
our sources of power and fuel to enhance our resilienceagainst disasters.

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Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Special Feature Response to the TCFD Recommendations■ Efforts to Achieve Zero Emissions in JERA’s Value Chain
JERA is participating in business throughout the fuel value chain from the upstream development, transportation, and storage of fuel to the power generation and sale of electricity. We are working withmany countries and companies around the world to achieve zero emissions at each stage.

JERA’s Value Chain
Fuel upstream development

Fuel upstream
development
Fuel procurement

Power generation and sales

Transportation and storage◦Signed Memorandum with Petronas oncooperation in the decarbonization field◦Consideration of cooperation with Yara
International in the development of blue
ammonia production projects◦Investment inHydrogenious
Fuel transportation
LOHC Technologies
GmbH, a developerof hydrogen storage
and transportation
technologies

Electricity sales◦Commencement of verification project for cofiring of ammonia at Hekinan Thermal Power
Station (P30)◦Start of hydrogen demonstration project atdomestic LNG thermal power plant◦Consideration of hydrogen utilization at Unit 6 of
the Linden gas-fired power station in the UnitedStates◦Gunfleet Sands offshore wind farm in the United
Kingdom and Formosa 1~3 offshore wind farm in Taiwan◦Investment in Zenobē Energy Limited, a UK storage cell
operator◦Development of onshore wind power and solar
power generation in North America◦Investment in ReNew Power Limited, a renewableenergy power generation company in India◦Joint study on feasibility of clean ammonia production project in
the United Arab Emirates (P26)◦Conduct feasibility studies on CO2 capture and methanation in
the United States

Fuel receiving
and storage

Power generation

Renewable energy development◦Consideration of offshore wind power development in
Hokkaido, Aomori, and Akita prefectures◦Start of demonstration of energy storage system data
platform

Metrics and Targets
We have positioned “JERA Zero CO2 Emissions 2050” as a long-term goal and have established aroadmap for achieving this goal as well as an interim target for CO2 emissions in 2030. In addition, we arecontinuously calculating and evaluating actual results to manage progress every year.

Target◦JERA Zero CO2 Emissions
2050: Roadmap for its
Business in Japan (P16)

Actualresult◦Environmental Data (P46)

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Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Strategy

Business Environment Awareness and Response
Reorganizing Our Business Model to Respond Properly to Changes in the Domestic and Global Environments
We have organized into three profit centers—Business Development, Optimization and O&M Engineering, which draw profits from returns on investments, market transactions and O&M engineeringbusiness, respectively—with the aim of expanding profits by turning changes into business opportunities by securing and strengthening excellent skills for responding to environmental changes for eachfunction.

Present

Business Development
function
Worldwide power generation
assets: 80 GW
Knowledge of LNG carriers andfuel upstream business

Optimization function

Changes in the business environment◦Increased demand for energy

in Asia◦Exit from coal/ gas shift◦Innovations in energy technology◦Increased competition inelectricity and gas sales

A trader that is one of theworld’s largest fuel purchasers,
and one of Japan’s largest
power producers◦Market creation, introduction ofsystems◦Appearance of completely newrisks

O&M Engineeringfunction◦Expansion of digitalization◦Increased grid instability(expansion of renewable energy)◦Steps toward zero CO2

Provider of O&M engineering
services of 70 GW in Japanemission thermal power

Response to changes
Expand value chain business in each countryHigh-efficiency gas thermal power construction
Large-scale renewable energy, hydrogen andammonia business development

Enhance thermal power generation and fuelutilization capacity

Leverage global market trading
Find new customers

Remote monitoring and predictive management
Improve agility in response to varianceInternalize decarbonization technology

Roles of each department

Skills to acquire

Provide solutions based on
our assets and each country’s
needs with the aim of achieving
an optimal asset portfolio andexpanding income◦Capacity to form new projects
in each country (Example: Gasto-power /renewables)◦Asset portfolio optimization◦Establishment of a hydrogenand ammonia value chain

Optimize the entire value chain
from fuel procurement to powerand gas sales with the aim of
expanding opportunities for profit
and maximizing spreads.

◦Market intelligence◦Risk control capacity

Implement flexible operations andreduce costs in facility operation andmaintenance with the aim of achieving
high added value in O&M engineering
services and expanding profits.

◦The capability to transform
operations by utilizing digitaltechnology◦Engineering capabilities
leveraging facility user
expertise

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Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Photo by Ørsted

Business Strategies
Execution of Six Measures to Achieve Our “Mission and Vision”
We are systematically executing six measures to achieve our “Mission and Vision.” We will maintain and expand the scale of LNG procurement through streamlining and replacement in domestic power
generation, and through expansion in overseas power generation. Additionally, we aim to connect the procurement scale to trading expansion and upstream business participation in an effort to improve theprofitability of entire value chains.
We intend to grow renewable energy as a main pillar of our future business portfolio by using our large-scale business development capacity cultivated through existing business to promote development
in offshore wind power and other areas.
Six Measures

Business Development
Department

Resource and electricity
trading and market
creation

O&M Engineering
Department
World-class agility andoperation efficiency

Gas-to-power (LNG commercial flow expansion)

Optimization
Department

Strengthening of domestic power supply portfolio
through replacements (LNG thermal power)

Excellence of LNG
value chains and largescale renewable energy
development

Flexible supply sources(LNG securement)
Large-scale renewable energy(offshore wind power)

Expansion of trading businessscope and opportunities

Introducing JERA O&M Way to
all JERA thermal power plants toachieve mobility and agility andimprove operational efficiency

2025 Targets**Targets in the businessplan published in April
2019◦Develop domestic replacement: 7-9 GW (5 to 7 sites)◦Win Gas to Power projects◦LNG carriers: Approximately 25◦Equity ownership in renewable energy output: 5 GW

Consolidated
net income:200 billion yen◦LNG transaction volume: Approximately 35 million tons
◦Optimization through the effective use of LNG carriers◦Profits from trading◦Power plant operation and maintenance: Equivalent to80 GW worldwide◦20% reduction of O&M engineering expenditures (compared
to pre-consolidation figures of TEPCO/Chubu Electric Power)◦50% reduction of periodic inspection duration

Credit rating:A-grade or
higherOrganization and management that promotes
achievement of One Global JERAJERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Establishing a Robust Management Base to Support Business Strategies
Our systematic execution of the six measures to achieve our “Mission and Vision” depends on the underlying organizational structure that supports business strategies toward those ends. We are aiming toincrease the efficiency of our business overall and enhance our corporate value on the strength of our Corporate Strategy, Finance and Accounting and Business Support & Solutions Departments, which
support the activities of our three profit centers in addition to underpinning centralized, optimal management of entire supply chains.

Business
Development

Corporate Strategy(including ICT departments)
Strengthening of our management basethrough the companywide pursuit of optimized
business resources and establishment oforganizational and governance systems

Finance and Accounting
Optimization

Provision of optimal finance andaccounting services and strengthening ofcorporate governance in terms of finances

Business Support & Solutions
O&M Engineering

Establishment of a business foundationthat contributes to the demonstrationof advanced expertise and sounddevelopment

Strengthening of our management basethrough the establishment of organizationaland governance systems that contribute to
the planning of optimal business resource
allocation and swift, appropriate decisionmaking for realizing business strategies

Establishment of an ICT base, use ofmanagement data, and promotion ofdigital transformation (DX) to create
the strategic value available fromdigitalization

Enhancement of management information
by enhancing the functionality of managerial
accounting and finance and accounting
systems for each department and businessin order to provide support for management’s
swift and flexible decision-making

Strengthening balance sheet
management through diversification of
the company’s sources of funding andseeking the optimal capital structure inorder to establish and maintain a robust
financial baseAcceleration of business development
through the provision of support andadvanced solutions throughout thecompany in terms of personnel, general,and legal affairs

Specifically, in terms of human resources,
establishment of environments conduciveto active participation by diverse humanresources regardless of nationality,
gender, or other differences throughinitiatives for D&I*, human resources
development, and work style reform*D&I: Diversity and Inclusion (accepting and making the best use of diverse human resources)

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Digital Transformation (DX)
Becoming a Data-Driven Company
through DX that Realizes JERA’s
Growth Strategy
JERA aims to be a Japan-based global energy company. Having
inherited the human resources and systems of Tokyo ElectricPower and Chubu Electric Power, we are in the process of blazing
a new trail with our innovative approach.
ICT departments are the organization in charge of our entire
growth strategy-based DX, from strategies to implementation,
and we are promoting a transformation that incorporates cuttingedge technologies.
The core of our transformation is our human resources. In addition
to developing human resources, under the slogan “We Decide,
We Control, We Create” and placing importance on the diversity of
every one of our employees
as well as their ability to makeindependent decisions andtake action, we are working
as One Team to create a new
business platform throughDX.
Senior Managing Executive Officer
Global CIDO
(Global Chief Information and
Digital Officer)

Sami Ben Jamaa

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

DX Roadmap
In order to achieve our aim and become a Data-Driven Company that makes decisions swiftly and accurately on the basis of data,
we have launched an IT and Digital Transformation Project as a companywide initiative to promote more efficient and sophisticatedoperations as well as new value creation through DX in each of our business divisions.

Business Transformation
Data-Driven◦Digital Power Plants◦Convert all systems to the cloud◦Operational process transformation◦Industry 4.0 platform◦Global business management foundation◦Modernization of legacy systems(compatibility with cutting-edge
technologies)

Foundation◦ICT strategies and policies◦All systems cloud first◦Making the entire value chain visible

Complete Cloud Transition Initiative

Securing and Developing Digital Human Resources

In order to provide a system environment that responds swiftlyand flexibly to sudden changes in the business environment, wehave consolidated our legacy and modern systems to become
the first energy company in Japan to achieve the migration of
all core systems to the cloud. Currently, we are moving forwardwith DX by combining thelatest technologies such as
AI and the IoT, in addition
to promoting initiatives forbusiness continuity planning(BCP) and working toward
multi-cloud computing.

We are promoting the diversification of our human resources byproactively securing excellent human resources from outside thecompany who possess advanced knowledge of ICT, regardless ofage, gender, or nationality, and we currently employ staff from morethan 10 different countries. ICT departments promote education
on digital trends, technologies, work on publishing newsletters,
and hold seminars to improve the digital literacy of all employees.

AI

Cloud

RPA

DX

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Business Development
Department
A Group of Investment
Professionals Aiming to Create
an Optimal Asset Portfolio by
Providing Energy Solutions
Our mission is to optimize the asset portfolios of existingand new businesses by providing energy solutions. As aprofessional of global asset management that develops andmanages optimal assets, we are developing businesses thatmeet the needs of various countries. In addition to our LNG
value chain business from upstream to power generation,
we are also engaged in initiatives to develop a hydrogenand ammonia business and a renewable energy businessfor realizing a further decarbonized society.
LNG thermal power and zero CO2 emissions thermal power
are complementary to renewable energy with unstable
power output. Through a combination of thermal powersources and renewable energy and solutions by our global
value chain, we will contribute to regional decarbonizationand economic growth.

Value Creation

Strategies

Yukio Kani

Financial and Corporate
Information

We are developing and operating projects in Japan as well as Asia, North America, and Australia. As one of the world’s largest powergeneration and fuel business companies, in addition to developing cutting-edge, high-efficiency thermal power sources, we areengaged in the LNG procurement, upstream, and transportation businesses. We are also moving forward with the development of
renewable energy, the establishment of a hydrogen and ammonia fuel value chain, and the transition to zero CO2 emissions thermal
power generation. Going forward, we will continue to accelerate our business globally in line with each country’s needs through theactive involvement of diverse human resources and alliances and collaboration with partners in Japan and around the world.

Strengths

Opportunities

Initiatives◦One of the world’s largest LNG transaction volumes◦Widespread value chain from fuel upstream to
power generation◦Trustworthiness as the world’s chosen partner forlarge-scale business development◦Global trend toward decarbonization◦Increased demand for energy in Asia
◦Expansion of renewable energy and gas-fired
power generation◦Technological progress toward the realization of
zero- CO2 emission thermal power generation◦Expansion of integrated projects from fuelprocurement to power generation（gas-to-power）◦Replacement with the most efficient power plants◦Proactive development of renewable energy andhydrogen and ammonia businesses

Domestic Power Generation Business

Overseas Power Generation and Gas-to-Power BusinessIn an effort to both enhance ourdomestic
competitivenessandreduce environmental impact, weare replacing our existing thermal
power plants with the most efficientmodels while making use of theirinfrastructure and are adopting cutting-edge exhaust gas treatment
equipment. In addition, we consider the introduction of hydrogen andammonia fuels, which do not emit CO2 during combustion. We arealso working to realize a composition of power sources consistent
with energy and environmental policies in order to achieve a balance
between the stability and sustainability of our energy supply.

We possess about 30 projects inmore than 10 countries around theworld and are developing businesses
with the experience we havecultivated through our projects. We
are aiming to expand development
based on strategies to meet the needs of markets in North America,
Asia, and the Middle East. We are also focusing on a new businessarea, namely, discovering gas-to-power projects, which we consider
a key to our future growth.

Renewable Energy BusinessCorporate Vice President, Managing Executive Officer, Director,
Chief Operating Officer, Business Development Department

Foundation for Value
Creation: ESG

We aim to be the No. 1 company in Asia foroffshore wind power generation, which is afield expected to see massive growth in the
future, and are currently involved in multiple
projects in Taiwan. We are strengthening bothour organization and personnel and will also Photo by Ørsted
be developing domestic offshore wind-power generation projects, as well
as floating offshore wind-power generation, going forward. Further, we areproactively developing solar and onshore wind power in places such as North
America and India and will additionally be working on a battery storage businessthat will contribute to stabilizing the balance between supply and demand.

LNG and Next-Generation Fuel Value Chain BusinessOur annual LNG transaction volume
totals approximately 40 million tons,
and we participate in businesses
throughout the entire value chain,from upstream development totransportation, trading, and power
generation. Through our expertisethat we have cultivated with LNG as well as one of the greatest
offtake capabilities in the world, we will also establish a hydrogenand ammonia value chain to realize zero CO2 emission thermal
power and, at the same time, aim to supply other industries anddevelop our global businesses.
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Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

FY2020 Main achievements/accomplishments

Commencement of commercial operation ofthermal power plants

Thermal power plants loan
agreements concluded

Overseas:

Overseas:

1.1 GW Japan: 0.65 GW

0.745 GW

Domestic offshore wind powerat the early stage environmental
impact statement
inspections started
cases

2

Collaboration agreements
in decarbonization andGas-to-Power
fieldscases

3Providing Value▪Achieving Zero CO2 Emission Thermal Power Generation▪Development of Renewable Energy▪Stable Supply of Energy and Reducing Environmental Impact

Initiatives to establish Hydrogen andAmmonia Value Chain

Development of Renewable Energy in
Locations Around the WorldMoving Ahead with Domestic Thermal Power
Plant Replacement Plans

Having established “JERA Zero CO2 Emissions 2050,” we aremoving forward with the introduction of cleaner fuels for thermal
power generation and are pursuing zero CO2 emission thermal
power, which does not emit CO2 during power generation.
Backed by our LNG value chain from upstream and procurement
to power generation, our favorable and long-standing
relationships with leading companies around the world, andour overwhelming fuel transaction volumes, we will establish
a value chain for hydrogen and ammonia, which are fuels forrealizing decarbonization. We are engaged in studies aiming
for this value chain with numerous countries and enterprises
across the world such as collaborations with PETRONAS, Yara
International ASA, the world’s largest nitrogen-based fertilizer
manufacturer, and the commercialization of clean ammonia
production in the United Arab Emirates. Through these
initiatives, we are contributing to the stable supply of energy
as well as the shift toward a decarbonized society, not only inJapan but also internationally.

We have set a goal for our renewable energy business ofdeveloping 5 GW energy output by FY2025, and we aremoving forward with projects in locations around the world. Aspart of our offshore wind power business, we are simultaneously
involved in projects at different stages of early development,
construction, and operation in Taiwan, whose natural conditions
closely resemble those of Japan. We are strengthening our humanresources, both from within and outside JERA, and, leveraging
the expertise gained in Taiwan, will develop projects together withtrusted partners in Japan. We are also moving toward participationin projects of floating offshore wind power.
Regarding onshore wind power and solar power generation, we areengaging in development from the early stages with a dedicated teamin North America of mas.sive market, in addition to investing in ReNew
Power, a major power company in India. Going forward, we will also
accelerate joint development with local companies in various Asian
countries. Further, we will promote a new business model throughsolutions combining solar and wind power with storage batteries.

We are steadily moving ahead with plans to replace aging thermal
power generation facilities in Japan with state-of-the-art, highly
efficient facilities for the realization of a stable energy supply and a
low-carbon society. Additionally, these thermal power generation
facilities can supplement the load variation of renewable energy
and function as a bridge to a decarbonized society.
As a notable example, we are proceeding with replacement of
the Goi Thermal Power Station and Anegasaki Thermal Power
Station in Chiba Prefecture. By utilizing cutting-edge technology
to realize thermal efficiencies among the highest in the world, weare developing power plants that not only supply inexpensive
electricity but also have a low environmental impact (do not emit
large amounts of CO2).

Formosa I Offshore Wind Power Generation ProjectImage of the Goi Thermal Power Station
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Optimization
Department

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

JERA handles the largest LNG transaction volumes in the world and has ten years of experience in fuel trading. We ensurecomprehensive optimization of the huge value chain from fuel procurement to transport, receiving, power generation, andsales while utilizing trading to achieve the most cost-efficient, flexible operation. In the sale of electricity and gas in Japan, we
contribute to the provision of energy solutions that meet customers’ needs and the development of the energy market by utilizing
short- and long-term bilateral transactions and trading markets.

Pursuing Optimal Operation ofEnergy Value Chains
JERA continues to contribute to sustainably growing society
in which prosperous lifestyles are attainable. To achieve
this goal, the Optimization Department, which is in chargeof operating the entire energy value chain, will combine
individual business segments and implement proper risk
management in order to pursue optimal operations and tocreate new services for our customers.
Amid sweeping changes in the business environment, we
contribute to the development of the global energy market
and establishment of a sustainable society by flexibly
responding to fluctuations in energy demand and markets,
optimizing operations, and utilizing the trading network of
JERA Global Markets Pte. Ltd. (JERAGM).

Managing Executive Officer,
Chief Operating Officer, Optimization Department

Value Creation

Strengths

Initiatives

Opportunities◦Competitive, flexible procurement
portfolio◦A wealth of market intelligence, mainly
from JERAGM◦Expertise in dealings in the electricity andgas markets◦Terminals and power plants capable offlexible operations and receiving◦Increase competition in electricity andgas sales◦Market creation, introduction ofsystems◦Variation in resource prices◦Variation in domestic electricity demand

Short-Term Fuel Procurement
Business

Fuel Trading BusinessElectricity and Gas Sales Business

In April 2019, we expanded the scope of our
optimization and trading from coal to include
LNG. With approximately 300 people mainly
at JERAGM, which has offices worldwide
including in Singapore and London, weare contributing to the optimization ofentire supply chains through asset-backed
trading that leverages our world-class fuelprocurement scale.

We meet the diverse needs of our customers
and provide a stable supply of electricity andgas by our supply capabilities backed by largescale fuel contracts as well as our operational
experience and achievements. In addition, by
supplying as much electricity as possible to
the wholesale electricity market, we contributeto stable power supply and demand in Japan.
Further, by entering new markets such as
the capacity market and supply-demand
adjustment market, we are playing a part in thedevelopment of Japan’s electricity markets.

JERA has the world’s largest procurement
scales and established an outstanding
fuel portfolio with short-term (within four
years for LNG) price competitiveness andresponsiveness to the risks associated withvolume and price fluctuations. We intend
to contribute to the economical supply ofelectricity and gas in Japan on the basis of
our strong fuel procurement and expand ourfuel trading business on the strength of ouracquired flexibility.

◦Response to variation in demand through optimization of entire
value chains◦Risk control through optimal management of our fuel portfolio
in response to market trends◦Pursuit of new service for new electric power companies while
limiting the amount and risk
◦Securing consistent profits through sales to retailers of the Tokyo
Electric Power Company and the Chubu Electric Power Company

Sunao Nakamura
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Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

FY2020 Main achievements/accomplishments

LNG transaction volume
Approximately

Electrical energy sold

LNG procurement from40 million t 246.6 billion kWh 13 countries

Providing Value▪Capacity of Stable Supply▪LNG Fuel Supply Business/Reducing Environmental Impact▪Portfolio Optimization Function Leveraging Global Markets

Contributing to stable Power Supply and
Demand through Optimal Operation

Start of LNG Bunkering Business

Fuel Trading via JERA Global Markets

JERA has started an LNG bunkering business in the Chubu regionof Japan through Central LNG Shipping Japan Corporation andCentral LNG Marine Fuel Japan Corporation, two entities of a
joint venture with Kawasaki Kisen Kaisha, Ltd., Toyota Tsusho
Corporation, and Nippon Yusen Kabushiki Kaisha.
In response to the global trend of tightening environmental
regulations, the International Maritime Organization (IMO) has
established the goal of reducing greenhouse gas (GHG)emissions
from international shipping by half by 2050, compared to 2008,
and many LNG-fueled ships are expected to be built going forward.
The joint venture was established in May 2018. Work continued
toward the start of operations, and on October 20, 2020, ventureowned LNG bunkering vessel “Kaguya” supplied the first ship-toship LNG fuel in Japan.
JERA will continue to drive the conversion of ships to LNG fuel andreduce the impact on the environment through the LNG bunkeringbusiness with this joint venture.

Together with joint venture partner EDF
Trading Limited, we engage in the fueltrading business via subsidiary company
JERA Global Markets Pte. Ltd. With anasset-backed trading model, leveraging alarge commercial stream of fuel supplies
for JERA and EDF combined with thirdparty transactions, we have engaged in
optimal trading in LNG and coal markets
and their respective transportation markets with a solid trackrecord. In addition to its head office in Singapore, JERA Global
Markets has offices in London, Amsterdam, Tokyo, and Baltimore,
USA. Making full use of flexible fuel contracts, controlled fleets,
access to European LNG terminals and pipeline gas markets,
financial market expertise, and supporting IT infrastructure, JERA
Global Markets strives to optimize transactions globally.

Our Optimization Department minimizes the impact of expanding
fluctuations in power demand due to recent uncertainties by
optimizing our entire value chain, including the optimal operationof thermal power generation and fuels, and leveraging our trading
network through JERAGM.
We contributed to the stabilization of Japan’s electricity supply anddemand during the nationwide power supply–demand strain in thewinter of FY2020 through optimizing inventory and implementing
additional procurements about 3 million tons of LNG, a previously
unprecedented amount, through spot trades starting in October
2020 and received from November 2020 to February 2021 inorder to increase supply capacity as much as possible.

Others59%
FY2020Volume of
LNG received
nationwide
in Japan

JERA

41%

LNG and Coal Trading structure since April 2019
UK Office
EDF
Trading

33.33％JERA
Trading
International

JERA
100％

66.67％JERA Global Markets
Head Officein Singapore
Optimization of LNG
and coal purchase,sale, transport, etc.

Netherlands
OfficeUS OfficeJapan Office

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O&M Engineering
Department
Promoting the JERA O&M Way
toward being a world-classplayer in O&M
Our O&M Engineering Department, a group comprising morethan 3,000 engineers, has continuously delivered electricity
through many years of O&M experience in power plants and fuelterminals. We also continue to coexist with local communities andsupport comfortable lifestyles and the manufacturing industry
in those communities. Going forward, we will combine “Kaizen”(constant improvement) and the technical capabilities that wehave cultivated through our experience with digitalization toestablish and refine the “JERA O&M Way,” which balances costcompetitiveness and market responsiveness and provides anunprecedented, outstanding level of O&M services comparedwith competitors inside and outside Japan. Further, by promoting
digital power plants, we will also seek to transform operations andpursue zero CO2 emission thermal power generation in order torealize a decarbonized society. We contribute to the enhancementof customer value through the deployment of the “JERA O&M
Way” aiming to be one of the world’s top O&M players.

Senior Managing Executive Officer
Chief Operating Officer, O&M Engineering Department

Tetsuya Watabe

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

JERA has inherited a 70-year track record in stable electricity supplies in the Kanto and Chubu regions, the eastern and central areas of Japan,
and possesses expertise in O&M (operation and maintenance) and engineering (development and construction) gained through the ownershipand operation of approximately 80 million kW of power plants in Japan and overseas. We also coexist with local communities through efforts
such as taking responsibility for projects over long periods of time, from power plant design, procurement, and construction to maintenanceand operation. We offer world-class O&M Engineering services by combining the expertise gained through business experience with the world’s
leading technologies to ensure safe, competitive, and agile operation of power plants and receiving terminals for customers in and outside Japan.

Strengths◦Group of more than 3,000 skilled
engineers◦Opportunities and experience operating
an abundant power supply portfolio

Initiatives

Opportunities◦Electricity market competition◦Digitalization◦Expansion of renewable energy◦Development of zero CO2 emission thermal
power generation capabilities◦O&M with world-class competitiveness◦Worldwide deployment of the JERA O&M Way◦Decarbonization initiatives(coal-ammonia co-firing, O&M in offshore wind power)◦Digital Power Plants promotion

Engineering Work

Procurement Work

Through the varied expertise wehave gained from designing diverse,
large-scale power plants, we seek tooptimize plant design, “JERA bestpractices,” and realize both ensuring
facility reliability and reducing
construction costs.

We are reducing the costs in the
procurement of a great variety ofequipment and materials throughmarket research, cost analysis,
adjustment of order methods andthe utilization of third-party products
and services. We are also working
to reform work processes based on
global best practices.

Operation Work

Maintenance Services

In the operation of our power
generation facilities and LNG
terminals, we realized power plant
operation that is flexible and agile,including increasing availability andexpanding fuel types through ourexperience of continuous stable
power supply. In addition, we arealso working on remote supervisionand predictive management by using IoT.

Through O&M and engineeringexperience and capabilities cultivated
via our track record, we achieve bothcost reductions and sustaining offacility reliability, even in the operationof facilities beyond their designed
service life. In addition, we also
contribute to the improvement ofmarket responsiveness and the
reduction of operating costs by reducing the time required for periodic
inspections through onsite “Kaizen” (constant improvement).
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Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Number of maintenance facilities in FY2020

Power plants in Japan

27 plants

LNG terminals in Japan

8 bases(excluding jointly operated terminals)

Power generation capacity in Japan70 million kW

Providing Value▪Realizing Cost Competitiveness/Market Responsiveness▪Advancing Our O&M and Engineering through DX▪Pursuing Zero CO2 Emission Thermal Power

Deployment of the “JERA O&M Way”

Promoting Digital Power Plants

Utilizing Ammonia as a Fuel

The “JERA O&M Way,” which combines our “Kaizen” skills andtechnological capabilities with digitalization, has been cultivated
via our operation of power plants in Japan and around theworld. Through our O&M and engineering services, we realizeboth cost competitiveness and market responsiveness and,at the same time, continue to deepen (sophistication of ourtechnology) and evolve (expanding our services), in turn further
enhancing our position against competitors.
In addition, by applying our expertise that we have accumulated
through these activities not only at our power plants but also in
the operation of a variety of customer plants, we are aiming to
be a world-class player in O&M services.

JERA has long been working on remote monitoring andpredictive management utilizing IoT. Seeking to further enhance
our O&M and engineering, we are promoting a Digital Power
Plant Project to gather and store all data regarding power
plant facilities and workers via a shared platform, evaluate andanalyze this data using AI, and transform work processes.
In addition, through this project, we are working to connect
electricity and fuel markets through data in real time in order tomaximize not only the life cycle value of power plants but also
the entire value chain, from fuel to power sales.

Ammonia makes it possible to transport and store hydrogen
efficiently and at low cost. In addition to an energy carrier,ammonia can be used as a fuel for thermal power generation.
Ammonia is expected to have a great advantage in reducing
the emission of greenhouse gases because it doesn’t emit CO2
during combustion.
This initiative will generate electricity by co-firing coal andammonia using Unit 4 at the Hekinan Thermal Power Station(power output: 1 GW) and evaluate boiler heat-absorption
characteristics as well as environmental load characteristics
such as exhaust gases. Further, AI will be utilized to optimize
boiler operation to fully realize ammonia co-firing technology.

Operations

Maintenance

Pipeline

Performance
management

Health, safety,
crisis management,
environmental
conservation

Tank and carburetor area

Demonstration unit
(Unit 4)Hekinan Thermal Power Station

Yokohama Thermal Power Station
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Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Foundation for Value Creation
The JERA Group works as one to resolve social issues and enhance corporate value.

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Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

JERA’s ESG
JERA Business and ESG Management
As a global company, JERA has established as its “Mission” the provision of cutting-edge solutions
to the world’s energy issues. We seek to advance ESG management throughout the entire value
chain based on fully grasping and managing of the impact of our business activities on society andthe environment as well as the effects of changes in the business environment on our business.

Fuel upstream
development

Fuel procurement

E◦Consideration for the environment and human rights of local communities◦Securing stable sources of energy by improving the diversity andflexibility of LNG sources◦Respecting human rights, ensuring safety, and establishing a soundworking environment for field workers in resource extraction

S
S

Sustainability Management System
In May 2019, we established the Sustainability Promotion Committee to oversee sustainability
across departments throughout the company. The committee is under the direct control of theBoard of Directors and is chaired by the company president.
Under the Sustainability Promotion Committee, four subcommittees investigate issues and promotemeasures in four areas: the “environment”; “society and human rights”; “governance”; and “public
and investor relations” in terms of ESG. All departments have been involved in making progress inthe consideration of matters relating to sustainability through the activities.
We continue to promote sustainable activities that are integrated with our business activities andmove forward with initiatives aiming to develop business and resolve social issues in addition tocontributing to the achievement of SDGs.
Diagram of Sustainability Management System

Optimization andtrading

Fuel transportation

S

Board of Directors
Sustainability Promotion Committee
Committee Chairman: President
Sustainability Promotion Committee Executive Office

Receiving andstorage terminals

G

Domestic power
generation

Overseas power
generation

JERA’s ESG initiatives in value chains

Environmental aspects◦Ensuring safety during LNG receiving◦Enhancing safety measures at LNG storage terminals◦Respecting human rights, ensuring safety, and establishing a goodworking environment for workers at LNG storage terminals

S◦Reducing GHG emissions and waste associated with power generation◦Consideration for environments and human rights of local communities
near power plants◦Enhancing power plant safety measures◦Respecting human rights, ensuring safety, and establishing a goodworking environment for power plant workers

E
E

S
S

Electricity and gas
sales

E

◦Consideration for the environment during LNG transportation (reducing
greenhouse gas (GHG) emissions, preventing air pollution, considering
biodiversity)◦Safe navigation in LNG transportation◦Respecting human rights, ensuring safety, and establishing a goodworking environment for crew members of LNG carriersE(as of August 31, 2021）

Social aspects

Society and Human
Rights Subcommittee

Governance
Subcommittee

PR andIR Subcommittee

Actual number of Sustainability Promotion Committee held in FY2020

In FY2020, the Sustainability Promotion Committee was held twice. In the first meeting, the committee
discussed the activities of its subcommittees in the previous fiscal year as well as directions for activities
for the current fiscal year.
In the second meeting, the committee discussed JERA’s Materialities and the content of “the Corporate
Communication Book 2020,” publicly announcing the Materialities after identifying and approving them.

◦Providing a stable supply of energy◦Enhancing initiatives to improve customer satisfaction

S

S

Environmental
SubcommitteeG

Governance aspects (grasping and managing the value chain impact on environmental and social aspects)

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Creation: ESG

Strategies

Financial and Corporate
Information

JERA’s Priority Issues (Materialities)
In order to sustain growth while adapting flexibly to changes in the business environment amid the increasing uncertainty of the modern world, it is important to fully understand and manage the impact of theexternal environment on us and the effects of our business activities on stakeholders and society. We have identified priority issues that we need to address—which we call “Materialities” —for resolving society’s
issues and enhancing our corporate value over the medium and long term.

Process of Identifying Materialities(See “Corporate Communication Book 2020” p. 12–13 formore information.)

STEP

1

MissionGlobal leader in LNG and renewables,
sparking the transition to a clean
energy economy

Identify issues

We analyzed the external environment, ourbusiness strategies, and other factors to createa list of 59 issues relevant to our company.

Environment◦ Decarbonization/expansion of renewableenergy◦ Compliance with environmental legislation

STEP

2

VisionTo provide cutting edge solutions to
the world’s energy issues

Assess the significanceof the issues◦ Improved efficiency of thermal power
generation

Human Resources

Society◦ Respect for diversity◦ Securing and developing global, strategic
human resources◦ Securing and developing skilled workers◦ Management of employee health and workplacesafety and sanitation◦ Promotion of work–life balance◦ Energy supply in pursuit of customer satisfaction◦ Application of digital technology◦ Leveraging our technology to makecontributions in various fields◦ Communication with local communities◦ Improvement of energy infrastructure indeveloping countries

Assess the significance of the 59 issues from
Step 1 on stakeholders and society on the one
hand, and on the company on the other.
STEP

3

Human Rights
Assess relevance

Verify the validity of the issues assessed in
Step 2 in terms of the corporate strategies andstakeholders’ perspectives.

◦ Consideration of the human rights of local community members

Governance

STEP

4

Identify Materialities

Regarding the issues considered in Step
3, obtain approval from the Sustainability
Promotion Committee (chaired by the company
president).

◦ Enhancement of corporate governance◦ Risk identification, management, and response◦ Strengthening of earning power◦ Stable supply of electricity◦ Safety of facilities (process safety, disaster prevention andresponse measures)◦ Response to large-scale disasters and pandemics◦ Rigorous compliance◦ Bilateral communication with stakeholders

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Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

JERA’s Materialities◦Initiatives ◎KPI
Category

Materiality

Environment

Human Resources

Governance

Main initiatives

Relevant pages
P15-22Compliance with environmental legislation◦Implementation of environmental conservation based on environmental laws and regulations, ordinances, and agreements with local governments ◎Zero violations ofenvironmental laws and regulations, etc.

P43-46

Respect for diversity◦Career awareness-enhancing leadership and management position training for women◎Increasing the ratio of women in leadership positions (executives: 15%, management positions: equivalent to woman employee ratio)◦Establishment in April 2021 of JERA Miraiful (a special subsidiary for the employment of people with disabilities) and promotion of employment of people with disabilities

P48

Securing and developing global, strategic human resources◦Flexible employment of new and mid-career hires in accordance with business needs ◦A diverse variety of training supporting independent career development

Securing and developing skilled workers◦Promotion of technology insourcing ◦Certification of knowledge, technologies, and skills that should be acquired by all technical employees

Management of employee health and workplace safety
and sanitation◦The formulation of “Safety Philosophy and Policies and Principles of Conduct” in March 2021, fomenting safety awareness, including in Group companies◎Zero fatal accidents ◎Setting a new record for number of continuous days without an accident◦Continuous education on mental health ◎Stress check total health risk scores at or below 100 points (the national average)

Promotion of work–life balance◦Promotion of “JERA Work Design” to design workplaces, structures, and corporate culture in order to realize new working styles

P50

Energy supplied in pursuit of customer satisfaction◦Selling electricity and gas that can flexibly meet the diverse needs of customers, such as long-term/large-scale to short-term demand

P27-28

Application of digital technology◦Global development of cloud computing, network maintenance, and system sharing◦Promotion of digital power plants that combine our Kaizen (constant improvement) and technological capabilities with digital technology

P24, P30

Leveraging our technology to make contributions in various
fields◦Promotion of decarbonization utilizing renewable energy and contributing to local communities by strengthening disaster resilience

P54

Communication with local communities◦Formulation of “Social Contribution Activity Policy” in July 2021 and the implementation of social contribution activities inside and outside Japan◦Establishment of systems and implementation of measures aimed at strengthening coordination with local communities, such as periodically exchanging information withlocal governments and administrative bodies

P53-54

Improvement of energy infrastructure in developing
countries◦Promotion of zero CO2 emissions in accordance with the conditions of individual countries◦Promotion of the Philippine project to relieve unelectrified communities (contributing to the Philippine government’s target of achieving a 100% household electrification
by 2022)

Consideration of the human rights of local community
members◦Respecting human rights, including the development of working environments and safety for all parties concerned in Japan and overseas.
◦Promotion of human rights education through seminars and other means

P40

Enhancement of corporate governance◦Enhancing Board of Directors deliberations based on the results of Board effectiveness evaluations ◦Ensuring diversity in the Board of Directors (appointment of
woman and foreign national directors)

P35-37

Risk identification, management, and response◦Accurate awareness and advance prevention of risks accompanying business activities

Strengthening of earning power◎Consolidated net income of 200 billion yen (2025) ◎Credit rating: A or higher (2025) ◎Synergy effect of 100 billion yen/year within 5 years from integration

Stable supply of electricity◦Response to variation in demand and supply through optimization of entire value chain (from fuel procurement to power generation)◦Improvement of equipment availability and detection of predictors of power-generation equipment abnormalities utilizing the IoT

Improved efficiency of thermal power generation

Society

Human Rights

Relevant SDGs

◦Promotion of “JERA Zero CO2 Emissions 2050”◎LNG thermal power replacement development in Japan: 7–9 GW (5–7 sites in 2025) ◎Equity ownership in renewable energy output: 5 GW (2025)◎20% reduction in CO2 emission intensity for thermal power generation compared to the Japanese government’s outlook for FY2030

Decarbonization/expansion of renewable energy

Safety of facilities (process safety, disaster prevention andresponse measures)
Response to large-scale disasters and pandemics

P49
P29-30, P49
P51-52

P15-20,P54

P38-39◦Advanced BCP/BCM enabling continuation and restoration of stable supply ◦Implementation of coordinated drills with relevant local governments and neighboring
companies in preparation for a fire on power plant grounds◦Implementation of emergency recovery drills in preparation for power plant operation stoppages caused by a large-scale earthquake, etc.

P11-12, P21-22
P27-30P39,
P51-52

Rigorous compliance◦Further inculcation of Compliance Policy and Compliance Code of Conduct ◦Strengthening of transmission of information on compliance starting with top messages◦Implementation of e-learning for executive officers and employees

P41-42Bilateral communication with stakeholders◦Proactive, interactive communication with all stakeholders ◦Timely, accurate disclosure of information and opinion exchange for shareholders and investors◦Timely, accurate disclosure of information via a variety of media

P55

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Creation: ESG

Strategies

Financial and Corporate
Information

G: Corporate GovernanceCorporate Governance
Basic Approach

Enhancementof Corporate
GovernanceThe basic principle of our corporate governance is to ensure an autonomous and independent
corporate culture as well as a management system capable of fair, swift decision-making by strong
and sound management/financial structures trusted by the global energy market. To achieve theseprinciples, we established our own “Corporate Governance Guidelines” in October 2019 and enact
a proper corporate governance system as well as constantly work to improve and strengthen it.
WEB

JERA Corporate Governance Guidelines
https://www.jera.co.jp/english/corporate/corporate_governance/*The guidelines set out a basic approach and system for our corporate governance and serve as a code of conduct for our directors
in pursuit of sustainable growth and enhancement of corporate value.

5outsideSelection of
directors possessing anabundance of knowledge
and experience

Issue AwarenessCorporate governance that supports management in making appropriate decisions is essential tosustainable corporate growth and enhancement of corporate value in the medium and long terms.
As the business environment undergoes rapid change, it is necessary that we take on various
governance issues in a timely manner. These issues include the Board of Directors exercising
its functions to an even greater extent, the securing of diversity in human resources, and thestrengthening of initiatives for sustainability challenges.
JERA will strive to continuously strengthen its governance in order to earn the trust of shareholders,investors, and all of our stakeholders.

3

Outside directors:

Outside corporate
auditors:

5 persons

3 persons(FY2020)(FY2020)

23 times

Director

attendance rate:

99%

Corporate
auditorattendance rate:

100%

17 times
Corporate
auditorattendance rate:

100%

Corporate Auditors Council

Supervise

Board of Directors

Corporate auditors: 3 persons

Internal Audit Department(Term of office: 4 years)

Meetings of the Corporate Auditors Council:(as of August 31, 2021）

Shareholders meetings

Independent Auditor

Directors: 10 persons

Corporate Strategy Department
Finance and Accounting Department

Audit

10

(Term of office: 1 year)

Meetings of the Board of Directors:

Shareholders

Financial audits

Organizational design: Company with corporate auditors
Corporate
Directors:
persons auditors:
persons

Diagram of Corporate Governance System

Collaboration

Overview of Corporate Governance

Governance System
In order to expand business throughout the world in a wide range of fields, the Board of Directors
consisting of directors from JERA who are familiar with JERA’s business, and outside directors who
have extensive knowledge and experience shall make material business decisions and supervise
business executions. Further, JERA has corporate auditors as independent officers (the “Corporate
Auditors”) who shall be responsible for auditing the execution of the Directors’ duties.
In addition, in order to separate the decision-making and supervision of management from theexecution of business and to effectuate accurate and prompt decision-making and efficient businessexecution, JERA has adopted an executive officer system where executive officers are responsible
for business execution based on the decisions made by the Board.

Directors’ Discussions Nomination
and Compensation Committee

Executive System
Leadership Panel

Business Support & Solutions
Department
Business Development Department

Chairman and President

Optimization Department
O&M Engineering Department

Expert Committees (Investment Valuation Committee, etc.)

East Japan Branch/West Japan Branch

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Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

G: Corporate GovernanceCorporate Governance oles, Responsibilities, and Diversity of the BoardR
of Directors
Based on applicable laws and regulations and our Articles
of Incorporation and internal rules, the Board of Directors
determines management objectives and business strategies,
makes other important decisions for managing the company,
and supervises the execution of duties. Additionally, we believethat responding swiftly and appropriately to the businessenvironment and ensuring the objectivity and soundness ofour decisions toward that end are vital for expanding businessthroughout the world in a wide range of fields. Therefore, ourefforts to ensure diversity of knowledge, experience, and otherfactors among the Board of Directors include hiring directors
who neither work for the company nor are shareholders, inaddition to executive directors who work for the company anddirectors who were originally shareholders.

Support for Directors
We have established a system that provides directors with thesupport they need to properly perform the duties expected ofthem. Among other things, the system provides each director
with correct and complete information as well as opportunities toobtain knowledge and recommendations about our company’s
core businesses from outside experts from around the world.
In FY2020, we reviewed our business strategies for key
regions of Asia and North America based on expert advice
and discussed information disclosure and ESG initiatives
appropriate for a global company. These efforts brought
innovativeness and depth to the deliberations of the Board of
Directors, and obtained expertise that will contribute to thefurther development of our business domains.
The topics of Directors’ Discussions in FY2020 were wideranging, including such priority management issues as
decarbonization strategies, regional strategies, and humanresources strategies in addition to sharing and analyzing thelatest systems and policy trends inside and outside Japan.

Evaluation of Effectiveness of the Board
Once each year, we evaluate each director and corporate
auditor on matters such as their contributions in Board meetingsand operation status to help continuously enhance and improve
the Board’s effectiveness. The Board of Directors analyzes
and assesses the results of these evaluations, considers andimplements measures to address the issues identified, andconstantly works to improve the Board’s functionality andeffectiveness.
In FY2020, we aimed to create an environment enabling
the Board of Directors to concentrate further on strategic
deliberations in order to further expand our business domains
and take pioneering measures for a decarbonized society.
Examples of measures included enhancing briefings for outside
directors and establishing regular reports concerning the basic
state of the company. In addition, we worked on maintaining
and enhancing the effectiveness of the Board of Directors, evenin the midst of the COVID-19 pandemic, through proactive
utilization of teleconferencing, and increasing the frequency ofBoard of Directors meetings as well as Directors’ Discussions.
In self-assessments of the effectiveness of Board meetings in
FY2020, the Board judged that although there were certain
accomplishments, particularly the holding of Board meetings
during the COVID-19 pandemic, further improvements toenhance deliberations are needed. These include the selectionof points of deliberation, and the utilization of the opinions ofoutside experts.
Accordingly, in FY2021, we are aiming to further enhance
the Board’s deliberations. Efforts include revising standards
concerning Board discussion and reporting matters, working tocompile materials cognizant of strategic views, and the buildingof a mechanism to incorporate the opinions of outside experts
regarding high-level and priority issues.

Leadership Panel and Expert Committees
We have established a Leadership Panel comprising thecompany chairman, president, vice president, and executive
officers based on policy set out by the Board of Directors. The
panel provides opportunities to deliberate, make decisions on,
and receive key reports about important management matters.
We have also established expert committees to assist the
Leadership Panel in each of the main fields under its control, andthe committees offer recommendations from their perspectives
as experts to supplement the panel’s deliberations.
With the exception of limited areas for which there is no expert
committee coverage, the Leadership Panel incorporates theexpert committees’ recommendations into their deliberations
and decisions on all relevant matters to discuss and reportto the Board of Directors. The panel reports the committees’
recommendations to the Board along with the results of theirdeliberations.

Strengthening JERA Group Governance
JERA provides suitable support to Group companies so thatthey may autonomously maintain and make use of systems
for ensuring the appropriateness of operations. Specifically,
we strive to make it possible for Group companies to engage
in efficient decision-making and execute professional duties
swiftly and appropriately through means such as defining
responsibilities and authority via our Internal Rules. For
important matters in the execution of professional duties, wehave established a system for Group companies to engage inadvance discussion and make reports in accordance with theinternal rules.
In addition, we provide periodic education and training for
new directors and officers, as well as candidates for these
positions, including for those of Group companies, in order todeepen understanding of the duties and obligations required of
directors and corporate auditors, such as our ideal for corporate
governance.

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Creation: ESG

Strategies

Financial and Corporate
Information

G: Directors & Officers

Directors and Officers

1
2

Indicates an outside director as provided for in Article 2-15 of the Companies Act.
Indicates an outside auditor as provided for in Article 2-16 of the Companies Act.

Directors
Reelection
ChairmanToshihiro Sano
Joined Tokyo Electric Power Co., Inc.
Director, Vice President, Tokyo Electric Power
Co., Inc.
Director (non-executive), JERA
Director, Tokyo Electric Power Company
Holdings, Inc.
President, TEPCO Fuel & Power, Inc.
Chairman, TEPCO Fuel & Power, Inc.
Chairman, JERA

April 2015:
April 2016:
June 2017:
April 2019:

Reelection

Reelection

Reelection

President

Corporate Vice President, Managing
Executive Officer, Director, Chief Operating
Officer, Business Development Department

Corporate Vice President, Managing
Executive Officer, Director, Chief Operating
Officer, Corporate Strategy Department

Senior Managing Executive Officer,
Director, Chief Financial Officer,
Finance and Accounting Department

Yukio Kani

Hisahide Okuda

Kazuo Sakairi

Satoshi Onoda▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)

April 1977:
June 2014:

Reelection▪Attendance / Number of Boardof Directors meetings held
22/23 (96%)▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)

April 1980:
April 2018:

June 2018:
April 2019:

Joined Chubu Electric Power Co., Inc.
Executive Vice President, Chubu Electric Power
Co., Inc.
President, Power Generation Company
Director (non-executive), JERA
Director, Executive Vice President, Chubu ElectricPower Co., Inc.
President, JERA

April 1986:
April 2013:
April 2015:
April 2016:
July 2016:
April 2019:
April 2020:

Joined Tokyo Electric Power Co., Inc.
Executive Officer, Tokyo Electric Power Co., Inc.
Managing Executive Officer, Tokyo Electric Power
Co., Inc.
Vice President, TEPCO Fuel & Power Inc.
Managing Director, JERAManaging Director, Chief Strategy Officer, JERA;
Director (non-executive), TEPCO Fuel & Power
Corporate Vice President, Director, Chief
Operating Officer, Business Development
Department, JERA
Corporate Vice President, Director, Chief
Operating Officer, Business Development
Department, JERA

▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)

April 1988:
July 2017:
April 2019:
April 2020:
April 2021:

Joined Chubu Electric Power Co., Inc.
General Manager, Strategies & Alliances Office,Head of Corporate Planning & Strategy Division,
Chubu Electric Power Co., Inc.
Managing Executive Officer, Chief Operating
Officer, Corporate Strategy Department, JERAManaging Executive Officer, Director, Chief
Operating Officer, Corporate Strategy
Department, JERA
Corporate Vice President, Managing Executive
Officer, Director, Chief Operating Officer,
Corporate Strategy Department, JERA

▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)

April 1987:
Joined Bank of Tokyo (currently MUFG Bank)
November 2002: M&A Team Head, Corporate Advisory
Department, Mitsubishi Securities (currently
Mitsubishi UFJ Securities)
June 2006:
Senior Director, GCA Corporation
January 2015: Executive Officer, GCA Corporation
April 2019:
Managing Executive Officer, Director, Chief
Financial Officer, Finance and Accounting
Department, JERA

Reelection Outside

New election Outside

New election Outside

New election Outside

Reelection Outside

Director1

Director1

Director1

Director1

Director1

Joseph M. Naylor

Miyuki Suzuki

Satoru Katsuno

Seiji Moriya

David Crane▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)

November 1984:
June 1991:

White & Case LLP
Vice President, ABB Group Energy Ventures(Hong Kong)
June 1996:
Senior Vice President, Lehman Brothers
March 2000:
Chief Operating Officer, International Power PLC,
Chief Executive Officer, International Power PLC
December 2003: Chief Executive Officer, NRG Energy, Inc.
Senior Operating Executive, Pegasus Capital Advisors
April 2016:
April 2020:
Director, JERA
September 2020: Chief Executive Officer, Climate Real Impact Solutions
January 2021:
Director, Saudi Electricity Company▪Attendance / Number of Boardof Directors meetings heldー

September 1982: Joined Chevron
November 2003: Vice President, Strategy, Planning & BusinessSupport, Global Gas, Chevron (California)
July 2006:
Chief Executive Officer / Chief Operating Officer,
Sasol Chevron (United Kingdom)
March 2009:
General Manager, Business Development,
Projects, Chevron (California)
August 2013:
Corporate Vice President, Strategic Planning,
Chevron (California)
April 2021:
Director, JERA

▪Attendance / Number of Boardof Directors meetings heldー
March 2002:
Executive Vice President and Head, Consumer
Business, Japan Telecom Co. Ltd
June 2004:
Chief Executive Officer, Asia Pacific, LexisNexis.
January 2007: President and Chief Executive Officer, KVH Co Ltd.
December 2011: Chief Executive Officer and Representative
Director, Jetstar Japan KK
President and General Manager, Cisco Systems JapanMay 2015:
January 2018: President, Asia-Pacific, Japan and China, Cisco
Systems (Singapore)
September 2019: Outside Director, MetLife Japan KK Ltd
April 2021:
Director, JERA
July 2021:
Outside Director, Western Digital Corporation▪Attendance / Number of Boardof Directors meetings held

April 1977:
June 2013:
June 2015:
April 2020:
April 2021:

ー
Joined Chubu Electric Power Co., Inc.
Director, Executive Vice President,
General Manager of Corporate Planning &Strategy Division, Chubu Electric Power Co., Inc.
President & Director, Chubu Electric Power
Co., Inc.
Chairman, Chubu Electric Power Co., Inc.
Director, JERA

▪Attendance / Number of Boardof Directors meetings held
22/23 (96%)

April 1986:
Joined Tokyo Electric Power Co., Inc.
April 2016:
Managing Director, TEPCO Fuel & Power, Inc.
September 2018: Director, Executive Vice President and Chief
Financial Officer (Assistant to the President),
Tokyo Electric Power Company Holdings, Inc.;
President, TEPCO Fuel & Power, Inc.
April 2019:
Director, JERA

Corporate Auditors
OutsideAuditor2

Shigeyoshi Araki

April 1985:
April 2018:

April 2019:▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)▪Attendance / Number of Board of
Joined Chubu Electric Power Co., Inc.
Company Auditors meetings held
Executive Officer, Chubu Electric
17/17 (100%)

Power Co., Inc.; General Manager,
Thermal Power Generation
Business Department, Power
Generation Company
Corporate Auditor, JERA

April 1985: Joined Japan Development Bank
June 2015: Managing Executive Officer, Directors,
Development Bank of Japan Inc.
June 2016: Executive Director, ResearchInstitute of Capital Formation,
Development Bank of Japan Inc.
April 2019: Corporate Auditor, JERA

OutsideOutsideAuditor2

Auditor2

Hideo Oishi

Minako Fujiie▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)▪Attendance / Number of Board ofCompany Auditors meetings held
17/17 (100%)

April 1988:
July 2016:
April 2019:

Joined Tokyo Electric Power
Co., Inc.
General Manager, Tsurumi
Branch Office, TEPCO Power
Grid, Inc.
Corporate Auditor, JERA

▪Attendance / Number of Boardof Directors meetings held
23/23 (100%)▪Attendance / Number of Board ofCompany Auditors meetings held
17/17 (100%)

Appointment of Directors
Candidate Directors shall be decided by a resolution made by the Board after
deliberation by the Nomination and Compensation Committee, taking into
consideration personal characteristics and core competencies appropriate for theirrole as Directors and the structure of the Board to ensure diversity.
The Nomination and Compensation Committee comprises at least three directors,
including two outside directors who were shareholders before they became directors,
and exists to discuss matters involving personnel affairs and compensation of
directors, corporate auditors, and executive officers.

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

G: Risk Management

Risk Management
Basic Approach

Undertaking the enhancementof JERA’s BCP and BCM as a
global company

The JERA Group continues to work toward highly effective
risk management. The reason for this is that we seek to gain aproper understanding of and prevent the risks associated withour corporate activities in addition to working to minimize loss
when these risks occur. We view these efforts as underpinningthe enhancement of our corporate value and fulfilling our social
responsibility to our stakeholders.

Risk Management System
The JERA Group has established a highly effective risk
management system, under the overall responsibility ofthe president. The purpose is to fulfill such crucial social
responsibilities as providing a stable supply of energy.
Specifically, we have established “Internal Rules for Risk
Management” for risk management during normal times, and“Internal Rules for Crisis Management” for responding to crises
and emergencies.
Diagram of Risk Management System

Number of criticalinformation
security incidents:0(as of August 31, 2021）

Board of Directors

cases

Issue AwarenessComplexly interconnected global risks and ESG issues are
emerging, including increasingly frequent and intense natural
disasters and infectious diseases, as well as climate change,
the exhaustion of a variety of resources, economic disparity andpoverty, and political instability. Coupled with the developmentof the global economy and an increasingly borderless world,
amid such risks becoming ever more diverse and complicatedwith each passing year, companies must establish and maintainsystems for appropriately responding to a variety of risks.
The JERA Group will work to continuously enhance its risk
management, in order to fulfill its social responsibilities as anenergy provider that supports social infrastructure.

Each responsible unit is expected to manage the risks associatedwith its business activities as a part of its execution of duties;risks that affect multiple units are properly managed with crosssectoral responses. In addition, managers of risk management
report to the Risk Management Committee whenever there aremajor changes to the risks they are managing.
The Risk Management Committee chaired by the JERA
president seeks to prevent the occurrence of risks that could
have a severe impact on the Group’s business. When suchrisks occur, the response is swift and appropriate in an effort tominimize the impact on the Group’s business, and necessary
reports are made to the Risk Management Committee on aquarterly basis. Of those risks that could severely impact theGroup’s business, risks particularly requiring management by
the Board of Directors are selected as “serious risks subject
to control by senior management.” These are discussed andreported on at Board of Directors meetings regularly and asneeded. In turn, the Board of Directors gains a full understandingof each risk and exercises supervision to ensure that these risks
are properly managed.
Risk Map Formulation Flowchart

Main Risk Categories

Board of Directors❶ Operational accidents❷ Finance

President (Chief Executive Officer of risk management)
Leadership Panel

Risk Management Committee
Committee Chairman:
President
Committee Vice Chairman: Chief Operating Officer, Corporate Strategy Department
Committee Members:
Chairman, Chief Operating Officers, Global CIDO,*
Heads of the Planning Group and General Affairs Group
Committee Observers:
Corporate Auditors
Committee Advisors:
Outside experts

Executive Office(Corporate Strategy
Department)

Chief Operating Officers (Managers of risk management)
Responsible unit of risk management (Each department)

Branch offices

Power plants/
construction sites

LNG centers
Group companies❸ Regulations/legal reforms/
geopolitics❹ Outside stakeholders

Risk Management Committee❺ Management strategy

Deliberation and affirmation of management status andresponse policies for “serious risks subject to control bysenior management”❻ Labor affairs and humanresources

Selection of Significant Risks
Selection, affirmation, and evaluation of “serious risks
subject to control by senior management”❼ Input/output❽ Product/energy prices❾ Natural disasters
 Investment management
 Uprisings/crime

Risk Identification–Evaluation

 Cybersecurity

Departments and groups create risk scenarios that
the Risk Management Committee Executive Officereorganizes to create a risk map

 Legal/ethics
 Environment/climate change*CIDO: Chief Information and Digital Officer

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

G: Risk Management

Risk Management

Highly Effective Risk Management
The JERA Group’s risk management is based on integrated
risk management and the management conducted as partof fiscal health evaluations and investment evaluations ofindividual projects, and through their integral functioning, we
engage in appropriate risk management. In our integrated
risk management, we define possible risks as one of three
types: “operational risk,” “market risk,” and “credit risk.” After
quantifying our total risk exposure based on our market risk andcredit risk, the difference with our risk capital is calculated as
our risk buffer. Rooted in the principle of keeping our operationalrisk covered within the bounds of our risk buffer, we engage indetailed management in accordance with our risk map.
Meanwhile, for our financial health evaluations, we first verify
the financial health of the company utilizing the credit rating
methodologies of credit rating organizations. We then evaluate
the outlook for credit rating levels in the long term as part of thebusiness-plan formulation workflow. Through these means, we
confirm that the investment grade is secured in the long term.
We appropriately evaluate, manage, and monitor the risks ofindividual investments and other projects through examinations
conducted by the Investment Valuation Committee.
Integrated Risk Management
Uncertainties
whose probabilityof occurrence
cannot becalculated
Risks whose
statisticalprobably ofoccurrence canbe calculated

Managed via risk map

Operational risk

Market risk
Credit risk

Risk buffer

Total risk
exposure

Risk capital(equity)Countermeasures for Large-Scale Disasters
JERA owns about half of the thermal power plants in Japan.
Accordingly, we have formulated and published a disastermanagement operation plan based on “the Basic Act on
Disaster Management in Japan,” as well as “a Civil Protection

Business Plan” and “an Operation plan for Pandemic Influenza
and “New Infection Diseases Preparedness and Response.”
We have also prepared emergency disaster countermeasure
regulations and manuals to enable swift decision-making andresponse in the event of emergencies.
In light of the national and local governments’ revisions ofdamage estimates and disaster prevention measures for theearthquakes occurring directly beneath the Tokyo metropolitan
area or off the Nankai Trough, which are of recent concern, we
have been undertaking earthquake countermeasures and othernecessary facility measures, as well as periodically conducting
drills to simulate large-scale disasters.

Enhancement of JERA’s BCP and BCM
JERA has taken a variety of measures to deal with theoccurrence of a large-scale disaster. We formulated our current
plans and internal rules, etc. based on plans and rules inherited
when the thermal power business of Tokyo Electric Power
Company and Chubu Electric Power Company was integrated
into JERA’s thermal power business.
Taking into account the expansion of our business domains andchanges in the business environment post-integration, we aim tofurther enhance our ability to respond to a disaster. Accordingly, atthe present time, we are investigating our existing countermeasures
and will formulate BCP and BCM for JERA that conform tointernational standards as appropriate for a global company.
In addition, through this initiative, we will work not only to enhance
the JERA Group’s disaster response capabilities, but also to utilize
the knowledge thus gained to support the disaster prevention
preparations of local communities and other companies.
Basic Policy for JERA’s BCP and BCM◦In the occurrence of any disaster or risk event, we ensure public safety
premised on compliance with laws and ordinances, placing maximum
priority on human health security.
◦We rapidly restore and continue operations concerned with our corebusiness of the provision of power and gas to contribute to society and thecommunity in order to fulfill our responsibilities as an energy provider that
supports social infrastructure in Japan.

COVID-19 Response
Even amid the global COVID-19 pandemic, the JERA Group
believes that maintaining a stable supply of energy is a social
responsibility of the utmost importance. Accordingly, with firstpriority being given to protecting the health and safety of theresidents of Japan, our employees, and their families, we have
implemented thorough measures to prevent the spread of
infection in our workplaces.
Examples of Specific Initiatives
Companywide◦Reduction of unnecessary or non-urgent operations as the situation
develops, concentration of resources on the operations most important forthe continuation of our business

Power Plants◦Restriction of access to central control rooms in facilities important to power
provision◦Establishment of support systems such as a system to secure alternate
personnel for shift employees

Head Office/BranchOffices◦Identification of duties requiring on-site response and targeted employees◦Full utilization of staggered work hours and telework depending on the
spread of COVID-19◦Migration of management meetings and other major meetings to the web

Procurement◦Identification of the status of global LNG/coal production plants andreceiving terminals globally, and monitoring of market trends

TOPICS

Achieving a High Rate of Telework

Since the time of our establishment, we have had global
business activities in mind, distributing laptops and iPhones
to all employees, and building an IT environment enablingthem to work anywhere, anytime, both in Japan andoverseas. As a result, excluding workplaces such as power
plants requiring physical attendance in order to ensure thestable provision of power, we achieved our highest rate of
telework to date, close to 90%, in mid-May 2020, withoutcausing any disruption to our business activities.
Scope ofcalculation*

Target period

Target rate

Achievements(average rate)

Head Office, East
Japan Branch, andWest Japan Branch

April 26, 2021–
May 28, 2021

80% (during thedeclaration of a stateof emergency)

80%*The number of employees excluding workplaces such as power plants requiring physicalattendance in order to ensure the stable provision of power (approximately 1,770 employees)

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

G: Information Security and
Human Rights

Information Security
Basic Approach
The use and application of information technology is vital for fulfilling our mission to help the peopleof the world achieve prosperous lifestyles and invigorate industry and economy by providing a stablesupply of energy. Accordingly, we strive to take information security measures and have establishedan “Information Security Policy” in an effort to appropriately protect information assets and enhance
the safety of our business dealings.

Enhancing Information Security Measures
The scope of the Information Security Policy includes everyone involved in the company’s operations
and all things, environments, and other resources used therein. The policy also covers the proper
management and protection of relevant information assets, as well as the strengthening of security
measures for responding to cyberattacks and other threats.
We continuously educate all employees who work with information assets with the aim of improving
their technological level and awareness of information security, expending every effort to observelaws, regulations, our Information Security Policy, and relevant regulations. In addition, in an effort toinstill awareness of information security and facilitate swift responses to information security incidents,
we give each employee a “security card” containing rules to be observed. Along with this, we provide
education through e-learning and other means, and continuously conduct training on targeted email
attacks for all employees in order to reduce the risk of virus infiltrations and information leaks due tosuch emails. It is worth noting that once again in FY2020, no major incidents involving information
security or the protection of personal information occurred.

Responding to Cyberattacks
Amid the rising threat of cyberattacks, the maintenance of mechanisms for swift and appropriate response
is essential. We continuously participate in the activities of the “Japan Electricity Information Sharing
and Analysis Center (JE-ISAC),” an organization through which electricity businesses share and analyze
cybersecurity information, andDiagram of Cybersecurity Management System(as of August 31, 2021）
gather such information to inform
Head Officeour responses to increasingly
CISO
advanced and sophisticatedcyberattacks such as ransomware.
JERA-SIRTIn FY2020, we also participated in
Chief Executive Officer
West Japan Branch
East Japan Branchof security
training organized by the “National
Manager of security
Manager of security
Center of Incident Readiness
management
management
Manager of security
and Strategy for Cybersecurity”(West Japan Branch)(East Japan Branch)
management (Head Office)in order to further strengthen ourorganizational response capabilities.

Human Rights
Basic Approach
In our “JERA Group Compliance Policy,” we pledge to be an upstanding member of the global
community by supporting protection of the human rights advocated in the Universal Declaration of
Human Rights and respecting the diverse cultures and customs of countries and regions around theworld. In addition, in the “JERA Group Compliance Code of Conduct,” we pledge to respect humanrights in all aspects of business activities, and not to discriminate on the basis of race, skin color,
gender, language, religion, political or other opinions, nationality or social origin, property, family
origin or other social status, or for any other similar reason; and we abide by this pledge.

Initiatives to Respect Human Rights
JERA possesses a global value chain, from fuel upstream development to transportation, storage,
and power generation and sales. As harassment, undue discrimination, and other human rights
issues become more severe, we perceive increasing respect for human rights to be a priority issue.
We are currently formulating a human rights policy based on “the United Nations Guiding Principles
on Business and Human Rights.” We are also working to build a due diligence mechanism forhuman rights to ensure respect for human rights, including ensuring safety and improving theworking environments of all people in and outside Japan.
In addition, in March 2021, we invited attorney Atsuko Honda from the Anzai Law Office as an
outside lecturer to hold a seminar on the “topic of harassment prevention and response.” Coveringvarious types of harassment resulting from the diversification of working styles and changes in social
conditions, the lecture deepened understanding of leadership methods for preventing harassment in
the workplace and what to do in the event of its occurrence. It also reaffirmed our aim of establishinglively workplaces in which human rights are respected. Going forward, we will continue to regularly
engage in educational and awareness activities.

TOPICS Establishment of a Harassment Consultation DeskIn FY2021, we established “Internal Rules for Harassment Prevention” in order to maintainworkplace environments which are free from harassment and comfortable for employees towork in. These rules outline the prevention and elimination of harassment in the workplace
and prescribe measures to be taken in the event of a problem caused by harassment. JERA
had already established a “Whistleblowing Desk,” but with the creation of these internal rules,
we established a new consultation desk for discussing harassment within and outside JERA
(internal: Labor Affairs and Human Resources Group; external: law office).

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

G: Compliance

ComplianceOctober 2020, whistleblowing
compliance management
system certification (selfadaptation declaration
registration system)

The JERA Group is conscious of its mission as a member of the
global business community and gains and maintains the trust of
its stakeholders by ensuring thorough compliance with the laws
and regulations of Japan and other countries, acting in goodfaith based on a heightened sense of ethics befitting a global
company, and otherwise acting in accordance with “the JERAGroup Compliance Policy” and the “JERA Group Compliance
Code of Conduct.”WEB

JERA Group Compliance Policy
https://www.jera.co.jp/english/corporate/compliance/ethicspolicyWEB

JERA Group Compliance Code of Conduct
https://www.jera.co.jp/english/corporate/compliance/codeofconduct/

Compliance Promotion System

Further inculcationof complianceawareness

Issue AwarenessAmid an unending stream of corporate scandals, society
and stakeholders are becoming more and more critical ofcompanies. Of particular note in recent years, in addition tobribery and problems with competition laws, issues concerning
human rights in supply chains have been widely reported, and,alongside laws, ordinances, and international rules, there isstrong pressure on companies also to comply with social norms.
The JERA Group supports the principle of a charter regarding
compliance advocated in Japan as well as global society andacts in good faith based on a heightened sense of ethics
befitting a global company.

The JERA Group has installed a Compliance Committee topromote compliance management and to function as a bodyfor reviewing and determining measures for ensuring thatcompliance is carried out and takes hold within the Group.
The Compliance Committee comprises the Chairman, President(who serves as the Committee Chairman), Vice President,
Chief Operating Officers, and Heads of Branches of JERA. The
Committee Chairman has the authority to nominate outside
attorneys and other outside experts as temporary committee
members as needed. In addition, the Compliance Committee
makes proposals or reports to the Board of Directors asnecessary, on the measures related to overall compliancedeliberated by the Committee, including consideration,
evaluation, investigation, and deliberated misconduct, etc., aswell as corrective measures and measures to prevent recurrence
thereof, and other important matters.
Furthermore, the Compliance Committee has assigned
compliance managers and persons for promoting complianceat each workplace and place of business, as well as at Group
companies, to establish a system that promotes a unified
approach to compliance between JERA and Group companies.

Compliance Promotion
The Compliance Committee reviews and determines measuresfor promoting compliance for each fiscal year in an effort toensure that compliance is carried out and takes hold within the
JERA Group in accordance with “the JERA Group Compliance
Policy” and “the JERA Group Compliance Code of Conduct”,
while considering factors such as the result of questionnaire
surveys administered to employees.
In addition, we hold meetings on compliance with our Group
companies inside and outside Japan, ensuring that compliancerelated initiatives and issues are shared throughout the Group
while at the same time strengthening our promotion ofcompliance in the Group. We continue to conduct compliancetraining and implement various other measures to ensure thatawareness of compliance takes hold in the Group, and thatevery effort is made to achieve compliance.
Diagram of the Compliance Promotion System(as of August 31, 2021）

Board of Directors
Proposal/reporting

Compliance Committee
Chairman, President, Corporate Vice President, Chief Operating Officers,
Heads of Branches, outside committee members
Committee Chairman: President Committee Vice Chairman: Corporate Vice President
Observers: Corporate Auditors Executive Office: Legal Group

Collaboration

Workplaces and business offices
Compliance managers: In principle, the primary divisions of departments and branch offices,and the chiefs of front-line organizations

Persons for promoting compliance: Persons nominated by compliance managers
Responsibilities

Encouraging, leading, and setting good examples of business operations in compliance
Participating in and recommending compliance training
Implementing discussions in workplaces
Responding appropriately to inappropriate events, etc.

Whistle-Blowing DeskGroup companies
Compliance managers:

Collaboration

Basic Approach

In principle, chiefs of organizations in charge of the companies’ compliance

Persons for promoting compliance:
Persons nominated by compliance managers

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

41

Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

G: Compliance

Compliance

Primary Compliance Promotion Measures in FY2020
MeasureMessages frommanagement

Fair and Equitable Trade with Suppliers (CSR- and ESG-Based Responsible Procurement)
Description

Messages about compliance from management executives (April and October)Training

Invited outside lecturers to conduct trainings at Compliance Committee and Group Compliance Promotion
Council meetings and made recorded movies available to all employees

e-learning

Conducted e-learning over two sessions on the Compliance Code of Conduct for all directors, officers, andemployees (approximately 4,400 people; participation rate: first session 99.5%, second session 98.6%)

Questionnaires

Administered questionnaires about awareness of compliance (response rate: 77.0%)

Improvement ofGroup promotion
systems◦Held regular Group Compliance Promotion Council meetings with domestic subsidiaries
Enhancing practical discussion of Group compliance in Japan◦Started discussions and countermeasure investigations regarding the creation of a Group compliancesystem with major overseas subsidiaries(including gaining a full understanding of current conditions regarding each company’s compliancesystems and state of serious risk management)

Both domestically and abroad, we will go beyond merely complying with the law, acting to ensure
fairness and justice in the pursuit of our trading and business activities. We uphold free trade and market
competition and conduct fair business with suppliers in accordance with the Antimonopoly Act andrelevant domestic and foreign laws and regulations. In an effort to promote mutual diligence, maintainclose communication, and further establish trust-based relationships with our suppliers, we hold briefings
on our procurement policy at which we listen to each other’s opinions and wishes. Note that as part of
COVID-19 measures, in 2020, these briefings were conducted with the exchange of documents.
We have established a Procurement Policy, and, in addition to thoroughly assuring quality andreducing procurement costs, make efforts to engage in CSR- and ESG-based, responsible
procurement activities through means such as the observation of laws, regulations, and corporate
ethics; the ensuring of safety; and BCP.
WEB

Corruption Prevention
The JERA Group has established a code of conduct for preventing all forms of corruption inaccordance with “the JERA Group Compliance Policy” and “the JERA Group Compliance Code of
Conduct.”
In February 2020, in response to examples of improprieties by other power companies in Japan,
and in an effort to ensure fair, honest relationships with suppliers, we established “Internal Rules for
Giving and Receiving Money and Goods,” setting out specific prohibitions for giving and receiving
money and goods to and from business partners. We also explain these rules to our suppliers or
potential customers when we hold briefings on our procurement policy.
Excerpt from “the JERA Group Compliance Code of Conduct,” on Preventing Corruption◦We always maintain proper and healthy relationships with our business partners and do not provide them with money,
goods, entertainment, or any other economic benefits that exceed sound judgement.
◦In our procurement activities, we provide open, fair, and equal participation opportunities in both domestic and overseas
markets and select suppliers through rational and transparent procedures.
◦We establish and maintain fair and open relations with the political and governmental counterparts of each country andregion in compliance with domestic and foreign laws and regulations, and internal rules.
◦We do not entertain, provide goods, or provide any other economic benefits to public officials or anyone in an equivalent
position, domestic or overseas.
◦We do not make any payments if we are aware that a portion of the payments made to agents or consultants, or any suchparties, is being or is suspected of being diverted for the purpose of engaging in improper activities with public officials or
persons in an equivalent position.

Procurement Policy
https://www.jera.co.jp/english/corporate/procurement/

Whistleblowing System
The JERA Group has established a Whistleblowing desk for receiving tips from inside and outside the company
in an effort to prevent as well as quickly discover and resolve compliance violations. The desk can be reached via
email 24 hours a day and accepts tips and reports of legal violations as well as all types of corruption (including
bribes), violations of rules of employment and internal rules, harassment and human rights violations, actions
that damage the Group’s reputation and social credibility, and more. To promote the use of the whistleblowing
system, we are working to improve its reliability and periodically inform employees about it.
Our employees or temporary employees can make reports either under the informant’s real nameor anonymously, and we will conduct the investigations in response to the wishes of informants.
We expend every effort to maintain the confidentiality of the content of reports and findings ofinvestigations, as well as to protect informants by prohibiting disadvantageous treatment andretaliatory measures against them. In addition, when compliance violations are confirmed, we shalltake various corrective and recurrence prevention measures.
In FY2020, the desk received twelve inquiries and reports. On October 30, 2020, we became the firstenergy company to realize the Whistleblowing Compliance Management System (self-adaptation declaration
registration) after our system was deemed to meet the certification requirements set out by the Consumer
Affairs Agency of Japan.
Consultation users

Consultation desk

JERA

Whistleblowing desk

Employees
Temporary employees, etc.

Compliance Committee Executive OfficeOutside law firm

JERA Group companies

Group company consultation desk

Employees
Temporary employees, etc.

Note: Some group companies have not established a consultation desk.

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

E: Environment

Environment
Basic Approach
October 2020,
announcement of“JERA Zero CO2Emissions 2050”

As a leader in the thermal power generation business in Japan,
JERA respect energy and environmental policy represented
by the Strategic Energy Plan, and proactively promote thedevelopment of renewable energy.
Furthermore, as a global energy company, we fully recognize
the importance of global-scale environmental protection, strictly
observe the environmental laws, regulations, and ordinancesof each country and region, and make efforts to reduce CO2
emissions and other environmental burdens with the aim ofrealizing a sustainable environment, society, and economy.

Environmental Management System

September 2021,
endorsement of TCFD
recommendations

Issue AwarenessIn accordance with the world’s increasing population andthe development of the international economy, global-level
environmental issues are becoming increasingly severe. Theseissues include overuse of resources, waste and pollution
problems, and loss of biodiversity. In particular, increased
greenhouse gas emissions from human activity are causing
global warming. Disasters resulting from abnormal weather
around the world are increasing in frequency and intensity,
threatening people’s lives and economic activity.
Against this backdrop and in response to the adoption of theSDGs as well as the Paris Agreement by international society,efforts are being made to accelerate the establishment of targets
and mechanisms for countering climate change, conserving
biodiversity, and realizing a recycling-oriented society. There arealso increasing expectations and calls for national governments
and companies to develop their own initiatives.
In order to realize a sustainable society that promotes the coexistenceof the environment and the economy, JERA are working with our
stakeholders and utilizing our knowledge, skills, and technology tocome up with our own solutions to environmental issues.

Our business—investing various resources to generate power—
contributes to society by providing the stable supply of electricity
and gas that underpins industry and prosperous lifestyles. On
the other hand, our business activities generate CO2, waste,

and other materials that create environmental burdens.
We make many proactive efforts to minimize these materials
as well as resource consumption, including improving power
generation efficiency, reducing CO2 emissions, eliminating air
pollutants, and recycling waste. We continue to contribute to
the establishment of a sustainable society by moving ahead
with the enhancement of our environmental management, aneffort led by the Environment Subcommittee of the Sustainability
Promotion Committee.

Environmental Education and Communication
We conduct training for all employees involved in environmental
work at power plants to enable them to acquire the knowledge
they need. We are also proactively disclosing environmental
data and the like in response to the recent increase in calls forthe disclosure of nonfinancial information.

Material Balance (FY2020*1)
INPUT

OUTPUT

Business activities

Fuel consumption for power generation

Coal:

13.07 million t

Petroleum:

390,000 t
Electric power
consumption at
offices, etc.

Fuel upstream
Fueldevelopment transportation
Fuel procurement

Fuel sales
and trading
3.12 million t

Scope 1:114.95 million t-CO2

Scope 2:4,000 t-CO2

Scope 3:20.68 million t-CO2

Total:

135.64 million t-CO2

SOx emissions

5,090 t9.51 million kWhPowergeneration

Water usage

Sending-end
power:NOx emissions

17,800 t

Industrial water
intake:17.71 million m3

Tap water intake:

810,000 m3

Groundwater usage:

180,000 m3

Total:

Gas and LNG
sales volume:

27.40 million t

Biomass:

50.70 millionkL (crude oil
equivalent)

Gas sales

20,000 kL

LNG*2:
Total energy
consumption

GHG emissions (CO2 equivalent)

Gross wastewater
volume7.51 million m3
COD emissions

20 t

Disposal byreclamation

244.6 billion kWh

10,000 t

18.70 million m3*1 Figures for JERA in Japan only and Hitachinaka Generation Co., Inc.

*2 Includes utility gas and LPG

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

E: Environment

Environment

Reducing CO2 Emissions

Preventing Air Pollution

In October 2020, we unveiled “JERA Zero CO2 Emissions
2050” as a future-oriented initiative to reduce CO2 emissions.
We accept the challenge of this initiative: to achieve zero CO2emissions in all JERA businesses throughout the world by 2050
with the aim of contributing to the realization of a sustainable
society in line with our mission to provide cutting-edge solutions
to the world’s energy issues.
We have already proactively promoted the renewable energy
business throughout the world and moved ahead with sustained
initiatives through our participation in relevant organizations.
We have begun considerations for offshore wind power
development in the sea off Akita Prefecture and in Ishikari Bay
to follow in the UK and Taiwan. We are also developing solar
power generation in many Asian countries.
We aim to achieve zero CO2 emissions by supplementing the
adoption of renewable energy, which is easily influenced bynatural conditions, with stable power generation from zeroCO2-emission thermal power plants. We intend to continue
moving forward with various initiatives toward achieving “JERA
Zero CO2 Emissions 2050.”

Highestperformancein Japan

FY2020Total thermal power
generation efficiency(low heating value):

49.7

％

Nishi-Nagoya Thermal Power Station Group 7-1
and 7-2:

Highly Efficient Combined Cycle LNG
Power Generation System
Design efficiency(low heating value):At least

62%

The world’s most efficient combined cycle power
generation system reduces fuel consumption and CO2
emissions

JERA Zero CO2 Emissions 2050 >>p. 15

The air pollutants discharged by our thermal power plants
include sulfur oxides (SOx), nitrogen oxides (NOx), and sootfrom boiler exhaust and other sources. We are taking steps toreduce emissions by working to improve incineration methods
and installing exhaust gas desulfurization and denitration
systems, electric precipitators, and the like, all in an effort tocomply with exhaust standards set out in laws and regulations
as well as local ordinances and environmental preservationagreements with local governments. In FY2020, our SOx andNOx emission intensities were 0.02 g/kWh and 0.07 g/kWh,respectively; we have maintained substantially lower figures
than leading countries in Europe and the Americas.
SOx and NOx Emissions Per Unit of Power Generation Output（g/kWh）

2.0■SOx ■NOx

1.8

TOPICS
Joining the “Ocean Renewable Energy Action
Coalition”
In 2020, JERA joined the “Ocean Renewable Energy
Action Coalition,” which explores initiatives that need to be
implemented by national governments and the industrial
world for the sustained expansion of offshore wind power
generation with a target year of 2050.
Aiming to be a global leader in renewable energy, JERA
is proactively promoting large-scale offshore wind power
generation projects inside and outside Japan. JERA is also
contributing to the sustained promotion of offshore wind
power generation through participation in industry groups.

1.5
1.1

1.0

0.8

0.7

0.0

0.7

0.6

0.5 0.4 0.4

0.4
0.1

USA

(2018)

Canada(2018)

UK(2018)

France(2018)

0.1
Germany(2018)

0.2 0.2 0.2

Italy(2018)

Japan(2018)

0.02 0.07
JERA(FY2020)

Source: Prepared based on the OECD Stat Extracts (for emissions) and based on“World Energy Balances 2020” (IEA) (for power generation output)

Water Quality Conservation Measures (Consideration for
Marine Environments)

We discharge wastewater from our thermal power plants
properly, monitoring it constantly using equipment such ascontinuous water quality measurement systems and purifying
it using wastewater treatment systems so that it satisfies
wastewater standards. We also sufficiently consider the impact
on surrounding marine environments; for example, to limit thewarming of ocean water used in our condensers, we practiceslow intake from deep ocean areas with low water temperatures,and release water on the surface at reduced release speeds.

Construction of Formosa 1 Offshore Wind Farm of Power Generation
Project in Taiwan © Formosa I Wind Power Co., Ltd. All rights reserved.

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

E: Environment

Environment

Effective Use of Resources

Control of Chemical Substances

We recycle proactively in order to makeeffective use of limited resources. One of
Coal ash effective
utilization rate:
our main waste materials is coal ash from％the coal we use at thermal power plants.
We are promoting the effective use of coalash as a raw material for cement and as aland development material for its superb material characteristics
such as fine particles, light weight, and increased strength. Our
effective utilization rate of coal ash in FY2020 was 99.99%.

99.99

Proper Storage and Treatment of PCB Waste
PCB (polychlorobiphenyl) waste retained at thermal power
plants, based on the related laws and regulations, is stored/
managed appropriately and progresses through planned
processing. Note that equipment using PCB as insulating oil(high-concentration PCB equipment) is entrusted to JESCO(Japan Environmental Storage & Safety Corporation) for
disposal.

State of Waste Treatment Facility Maintenance
The Waste Disposal and Public Cleansing Act in Japan requires
companies to publish information on the state of their waste
treatment facility maintenance. In April 2019, JERA inherited
licenses to install waste treatment facilities from TEPCO Fuel
& Power and the Chubu Electric Power Company under the
Waste Disposal and Public Cleansing Act, and we publish
information about the state of facility maintenance—past as wellas present—on our website.

WEB

State of Waste Treatment Facility Maintenancehttps://www.jera.co.jp/business/thermal-power/environment/waste/maintenance
Only Japanese text

Regarding chemical substances used at our thermal power
plants, we observe the PRTR Act in Japan (Act on Confirmation,etc. of Release Amounts of Specific Chemical Substancesin the Environment and Promotion of Improvements to theManagement Thereof) and make efforts toward strict control
and reduction of emissions based on internal rules.

Compliance with Environmental Legislation
We make efforts toward environmental conservation by
conducting business based on environmental laws andregulations as well as local ordinances and agreements withlocal governments. In FY2020, we received no administrative
penalties under this legislation.

TOPICS Preserving Biodiversity
The environmental impact assessment we conductedwhen replacing Units 1 and 2 at Yokosuka Thermal Power
Station confirmed that the area was home to falcons, anendangered species in Japan.
In response, we undertook measures such as using
low-noise, low-vibration machinery to avoid negatively
impacting the falcons’ breeding environment. We also
installed nesting boxes on the new stacks to create anenvironment in which the falcons can build nests. In the
future, we intend to install green spaces with hunting
grounds for the falcons and take other steps to conserve
their habitat.

Consideration of Environments Surrounding Power Plants
In accordance with the Environmental Impact Assessment Act
in Japan, we conduct environmental impact assessments ofthe environments surrounding power plants during installation,
replacement, or other work on the plants as well as after
operation starts, and explain the results and engage in dialogue
with members of local governments and communities. We
use the results of these environmental impact assessments toconsider the impact of our work on surrounding environments,and make conservation efforts accordingly, including measuresagainst noise, vibrations, and industrial waste, and measures topreserve scenery.

A falcon observed on the power plant property

Primary Measures
Measures

Description

Measures against
noise and vibrations

Our measures against noise and vibrations include choosing proper
placement of buildings and equipment, adoption of equipment for lowering
noise/vibration, and installation of silencers/sound barriers.

Measures against
industrial waste

We take steps to properly treat waste by creating manuals tailored to theoperations of individual thermal power plants.

Measures forlandscapepreservation

We make efforts to ensure that power plants blend in with local scenery,
while considering costs.
See p. 54

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

45

Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

E: Environment

Environment

Environmental Data
Item*1Unit

FY2018*2

FY2019FY2020Item*1

Fuel consumption for power generation

Unit

FY2018*2

FY2019FY2020

Other indirect CO2 emissions (Scope 3)

thousand t-CO2

25,49023,91020,6800.04

Coalｍillion t

16.26

14.83

13.07

Purchased goods and services

thousand t-CO2

0.08

0.07

Petroleum

million kL

0.54

0.37

0.02

Capital goods

thousand t-CO2

580

770

710

LNG, LPG, utility gas

ｍillion t

33.10

31.21

27.40

Activities related to fuel and energy

thousand t-CO2

24,70022,97019,800

Biomass
Sending-end power

thousand t

190

390

390

Fuel transportation and circulation in upstream departments

thousand t-CO2

ー

ー

ー

billion kWh

283.4

265.3

244.6

Waste generated by businessthousand t-CO2

210

160

170
0.6

Gas sales volume

million t

2.66

3.06

3.12

Business travel

thousand t-CO₂

0.6

0.6

Total energy consumption (crude oil equivalent)million kL

59.68

55.25

50.70

Employee commuting

thousand t-CO₂

1

1

1

Total thermal power generation efficiency (low heating value)

%

49.7

50.1

49.7

Lease assets of upstream departments

thousand t-CO₂

ー

ー

ー

Thermal Power Generation Efficiency Benchmark Index A*3(Act on the Rational Use of Energy)

ー

0.994

1.002

1.000

Fuel transportation and circulation in downstream
departments

thousand t-CO₂

ー

ー

ー

46.8

Processing of sold products

thousand t-CO₂

ー

ー

ー

Use of sold products

thousand t-CO₂

ー

ー

ー

Treatment after disposal of sold products

thousand t-CO₂

ー

ー

ー

Lease assets of downstream departments

thousand t-CO₂

ー

ー

ー

Franchise

thousand t-CO₂

ー

ー

ー

Investment

thousand t-CO₂

ー

ー

ー

CO2 emission intensity of power generation*7

kg-CO₂/kWh

0.476

0.469

0.469

Thermal Power Generation Efficiency Benchmark Index B*(Act on the Rational Use of Energy)

3

%

46.3

46.8

million kWh

11.60

10.92

9.51

Intensity of energy consumption at offices, etc.

MJ/m²

25.87

16.86

14.37

Industrial water intake

million m³

19.08

18.12

17.71

Tap water intake

thousand m³

390

870

810

Groundwater usage

thousand m³

20

20

180

Greenhouse gas (GHG) emissions associated with power
generation business(Scope 1)

thousand t-CO2

134,908

124,63 0114,950

Domestic/JERA Group: CO2 emission intensity of power
generation business*5,7

kg-CO₂/kWh

0.493

0.492

0.491

Global/JERA Group: CO2 emission intensity of power
generation business*5,6,7

kg-CO₂/kWh

0.499

0.496

0.493

Electric power consumption at offices, etc.

CO2 emissions

thousand t-CO2

134,850

124,500

114,830

CH4 (methane) emissions

thousand t-CO2

ー

10

10

thousand t-CO2

120

110

100

N₂O (nitrous oxide) emissions
SF₆ (sulfur hexafluoride) emissions*

4

HFC (alternative CFC) emissions*4
Domestic/JERA GroupCO2 emissions associated with power generation business(Scope 1)*5

thousand t-CO2

7

4

6

thousand t-CO2

0.3

0.6

0.4

thousand t-CO2

Global/JERA GroupCO2 emissions associated with power generation business(Scope 1)*5,6

thousand t-CO2

CO2 emissions associated with fuel upstream business(Scope 1)*5,6

thousand t-CO2

CO2 emissions associated with fuel transportation business(Scope 1)*5,6

thousand t-CO2

CO2 emissions from power consumption in buildings
associated with business activities (Scope 2)

thousand t-CO2

148,620

166,300
150
200
5139,010161,110240300
5127,440

147,920350330
4*1 Figures for JERA in Japan only and Hitachinaka Generation Co., Inc. unless otherwise noted*2 Figures for FY2017 and FY2018 (before the consolidation of existing thermal power businesses) calculated based on totals of all JERA facilities as of April 1, 2019
*3 Figures for JERA in Japan only.
*4 Calendar year totals*5 Joint venture figures calculated based on JERA’s share*6 As a rule, totals for overseas businesses are based on local fiscal years and reporting standards *7 Figures based on sending-end power

SF6 (sulfur hexafluoride) capture rate (during inspections)

%

99.7

99.8

99.9

SF6 (sulfur hexafluoride) capture ate (during removal)

%

100.0

100.0

99.4

thousand t

9.24

7.50

5.09

g/kWh

0.03

0.03

0.02

thousand t

23.2

21.1

17.8

NOx (nitrogen oxide) emission intensity*7

g/kWh

0.08

0.08

0.07

Gross wastewater volume

million m³

7

7.6

7.51

SOx (sulfur oxide) emissions
SOx (sulfur oxide) emission intensity*7
NOx (nitrogen oxide) emissions

COD (chemical oxygen demand) emissions

t

20

21

20

Industrial waste and byproducts generated

million t

2.39

1.99

2.04

Disposal by reclamation

thousand t

20

10

10

Coal ash effective utilization rate

%

99.98

99.99

99.99

Number of severe leaks

cases

0

0

0

PCB (polychlorinated biphenyl) content
Number of transformers and capacitors disposed of

units

111

16

57

Volume of PCB-contaminated insulating oil treated

kL

124

86

510

Cases involving fines and sanctions for violations ofenvironmental laws and regulations

cases

0

0

0

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

46

Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Human Resources

Human Resources
JERA’s Ideal Employees
Formulation of a
Diversity and Inclusion
promotion strategy

Aiming to Become a Group with Four Important Traits

Diversity

Excellence

Entrepreneurial
SpiritFairness

Striving for organizational and personal growth basedon respect for formation of views and diversity such as
differences in gender, nationality, ethnicity, experience,expertise, etc. regardless of rank or position.

Seeking further expertise and personal
growth through constant incorporationof new skills and knowledge avidly

Adeptly perceiving changes, seeking
opportunities, and continuously
innovating

Being accountable and taking theinitiative with a heightened senseof ethics and fairness in all matters

Priority Initiatives Related to Human Resources
Corporate culture◦Management training for managers◦Internal communication (consciousness reform)◦Diversity and inclusion

Promotion of“JERA Work
Design”

Issue AwarenessCompanies are expected to increase the labor participation rate
through developing a work environment in which diverse humanresources can flourish and establishing systems for flexible
working styles. Further, as companies become increasingly
global, premised on respect for the diverse cultures, customs, andhistories, etc. of each country and region, JERA recognizes it as
a duty of a company to maintain work environments that protect
health and safety, and to provide employees with fair employment
and promotions as well as impartial treatment and evaluations.
JERA positions its human resources as the vital source of theGroup’s capacity for growth, and we will promote a variety ofmeasures based on priority human resource initiatives.

Career development◦Introduction of independent career-formation mechanism◦Implementation of career path guidance/career development consultations◦Enhancement of elective training, rank-based training, and selection training◦Introduction of an internal recruitment system

Personnel system (salary/evaluations/promotions)
Employees
and families◦Personnel system (salary/evaluations/salary increases)◦Personnel system based on meritocracy

Working styles and employee welfare◦Expansion of telework◦Opened satellite offices (the greater Tokyo area, Nagoya)◦Enhancement of employee welfare (leave, allowances, etc.)

Message from the Senior Operating Officer

The vital source of our capacity for growth—needed to achieve our “Mission and Vision”—is none other thanour “human resources.” Positioning our “corporate culture,” “career development,” “working styles/employee
welfare,” and our “personnel system” as priority human resource initiatives, it is our desire to realize “the happinessof our employees and their families.” Under the principle of diversity and inclusion, we are creating organizations
that respect everyone’s diversity and individuality to enable them to succeed in fair, equitable environments.
Additionally, we have been rolling out a mechanism for independent career formation in which employees
establish their own career goals and are provided with support in building their skills and abilities throughcareer path guidance and various forms of training. Through “JERA Work Design,” an initiative for designinga diverse array of working styles, we are promoting a variety of measures and are also aiming to enhance thework–life balance of our diverse human resources even as they fully exercise their capabilities. At the sametime, we are enhancing systems that support these initiatives, and we will be moving forward with initiatives
that will support JERA’s sustainable growth through the growth of our employees.

Senior Managing Executive Officer
Chief Operating Officer, BusinessSupport & Solutions Department

Masahiro Takizawa

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Diversity and Inclusion

Diversity and Inclusion
Overview of Diversity and Inclusion Promotion Strategy

Top Commitment
JERA perceives the promotion of diversity and inclusion as central to its strategy for realizing its mission.
JERA will aim to be an organization rich in “Diversity” as seen from a variety of perspectives, including
gender, nationality, race and ethnicity, sexual orientation, experience, and expertise. Further, JERA willachieve “Inclusion” in which a diverse array of people can respect each other, exercise their abilities tofull effect, contribute to the organization, and realize personal growth in fair, equitable environments.

Our Diversity and Inclusion Section, which was established in April 2020, is rolling out a variety ofmeasures to realize our vision for promoting diversity and inclusion.
Through respect for diversity and communication on an equal footing, our employees will share acommon vector of creating new value. This will also foster an inclusive and fair corporate culture inwhich everyone can expect to receive opportunities, experience individual growth, and contribute.
MeasuresOur vision for diversity and inclusion is summarized into two core beliefs below:◦The company must do everything possible to help all employees to feel happy, motivated,
and fulfilled at JERA, to the benefit of themselves, their partners, families, and communities.
◦Our “Vision and Mission for Diversity and Inclusion” can only be achieved by happy,
motivated and fulfilled employees.

Formation of
an inclusive
organization

Specifically, we are working to achieve the following four aims:⒈ Prioritize professional development and career opportunities for current and future employees.
⒉ Use our employees’ skills to tear down barriers to building a next generation energy business.
⒊ Develop new sustainable global energy solutions for future generations.
⒋ Be recognized for our achievements by external stakeholders, locally and globally.

We will build a happy, motivated, and fulfilling company capable of delivering exciting new solutions to
the world in which we live.

Leveraging diverse values and fundamentally
adhering in a thorough manner to the principleof fairness, we are focusing on gender
diversity, one of the most impactful of thevarious aspects of diversity. By establishing
numerical targets and proactively providing
women employees with opportunities, we
aim to increase the percentage of women in
leadership positions.
WEB

Diversity and Inclusion
https://www.jera.co.jp/english/corporate/diversity

D and I Month

Diversity management
training◦Held training for managers on topics such as unconscious biases and inclusive
leadership

Implementation ofe-learning◦Held e-learning to promote the use of childcare leave among male employees
as well as to foster a culture of mutual recognition of a variety of working styles;
about 3,800 employees participated

Employee attitude surveys◦Conducted employee awareness surveys in order to ascertain the level ofunderstanding of D and I and to link it to improvements and measures.

Supported career◦Provided support for women in manager positions, including assigning sponsors,development in order tocareer development awareness instillation, acquisition of opportunities, andincrease the percentage of
network building
women in leadership positions ◦Conducted training to foster awareness of career development

External network building
and collaboration

 iversity and Inclusion Promotion
D
Strategy
Increasing the Percentage of
Women in Leadership Positions

Gender diversity
initiatives

Equivalent to women employee ratio
by FY2025

30% or more

15%
7.7%
4.2%
Board
members

2020

Managers

Board
members2025◦Participation in “EMPOWER” (an alliance of companies from different countries
launched on the basis of the G20 summit declaration in June 2019, with the aimof increasing women’s involvement in decision-making positions at companies)◦Endorsed the “Keidanren (Japan Business Federation) Challenge Initiatives for
30% of Executives to be Women by 2030”

Percentage ofwomen occupying
leadership positions(FY2020 women employee ratio: 7%)

Managers

Description◦Held workshops and events online for all employees in March 2021
◦A total of about 550 employees participated in the workshops “Lessons from
Leading Companies to Promote Women’s Activities” and “Lessons on D and I
from Global Companies and Groups,” as well as a senryu (traditional Japanesehumorous poem) competition.

Medium to long term

Board members: Officers under the Companies Act in Japan

TOPICS Establishment of a New Company, JERA Miraiful
In April 2021, JERA established JERA Miraiful Co., Ltd., a new company
to provide increased work opportunities for people with disabilities. The
objective of JERA Miraiful is to create employment opportunities that promote
the independence of and participation in society by people with disabilities,
for whom employment opportunities remain limited. With a planned startof business in April 2022, JERA Miraiful will establish its main businessbases in the cities of Yokohama and Nagoya and will be commissioned by
JERA to do business such as uniform management, gardening (flower andstrawberry cultivation, flower bed management), and administrative support.

The corporate logo of
JERA Miraiful represents
our wish to be a company
where everyone can work
actively and with a smile.

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

48

Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

S: Human Resource Development

Human Resource Development
Overview of Independent Career Development(Formulated in March 2020)

Human Resource Development Policy
JERA considers each and every employee to be an important asset and will engage in human resource
development in accordance with the following approach.

[Objectives of Human Resource Development]❶ Employees continuously pursue personal growth and live energeticallythroughout their lives❷ Through employee growth, enhance JERA’s corporate value and achieve our“Mission and Vision”

Careerdevelopment
goals,
plan revision

Reflection(regular/consultations)

UpwardspiralTaking on new
job roles(internal
recruitment
system)Self-development suchas elective training andqualificationacquisition

Proactive on-the-job training
and follow-up throughoff-the-job training[Basic Approach]■ J ERA respects the diversity of its human resources and supports its employees in their aims tobecome professionals in all areas of expertise

Creation of a career development
plan to close the gaps between
individual abilities
and career goals◦Helping JERA employees improve their skills and develop a mindset for sustained successand dominance inside and outside Japan as well as contributing to social progress

Career development consultations■ JERA provides opportunities for taking on new challenges in order to stay ahead of the times◦Developing people who adeptly innovate in unpredictable times◦Helping employees make bold attempts to achieve further growth and find places to exhibit their skills

Training System

Expertise◦Deploying a rotation and helping employees improve their skills toward achieving their career goals

Capacity for Reform

Management
Capabilities

Fairness

CareerCompany understanding

Position-based

Learning culture

Corporate philosophy

Corporate ethics

Management know-how

Beginner

Organization and employee management

Ownership

Resourcefulness

Influence

Conceptual ability

Creation

Thinking

AnalysisIntermediate

Professional Training

Leadership

Advanced

Optimization Department

O&M Engineering Department

Corporate

By levelBusiness Development Department

We proactively support the growth of all JERA Group employees, including those at overseas sites

We are establishing mechanisms that provide strategic support for employee growth throughindependent career development, professional development, and more based on the Human
Resource Development Policy we formulated in March 2020. To establish supportive environments
for employees’ self-realization, we have created mechanisms for career development to build theirown careers, a training system providing multifaceted support for skill development to realize thatcareer development, and an internal recruitment system to support employees in taking on new
challenges to diversify their careers.
We continue to be proactive in improving systems and providing opportunities for each and every
JERA employee to exhibit their skills to the fullest in pursuit of corporate and individual growth.

Comprehension ofBusinesses andSystems

Five Pillars of Growth■ JERA respects employees’ career plans and provides maximum support for their realization

Human Resource Development Plan

Career consultation desk

General Training■ Professional training: Department-specific skills training aimed at fostering the demonstration of common skills required for
departments, as well as cutting-edge solutions and high-level specialized expertise and skills planned for each department.
■ General training: Various elective training programs and position-based training programs, etc. planned by the Human Resources
Development General Management Department.

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

S: Work Style Reform

Work Style Reform: JERA Work Design
Promotion of “JERA Work Design”

Promoting Work–Life Balance

In April 2021, approximately 90% of the employees seconded to us from TEPCO Fuel & Power, Inc. and Chubu Electric Power Co.,
Inc. transferred into JERA. As we fulfill our social mission as an essential operator amid the massive changes in the energy businessenvironment, we will enhance our corporate value and, at the same time, increase the happiness of our employees and their families.
To this end, we will design various ways of working through both hard and soft measures with a well-balanced combination of office workand remote work to enable diverse human resources to make the most of their abilities.

Three Measures

1

Designing mechanisms
to enable diverse
personnel to work
flexibly

Flexibly combining office work and remote work

Description and Results◦Realizing efficient business operations and appropriate labor management through means such as
standardizing business processes, promoting visualization, and creating online meeting guidelines

Teleworking
System◦Trials began in February 2019, and full-scale operation started in February2020 (working from home or satellite offices)◦Employees are free to telework on days of their choice without any
restrictions on the purpose (up to twice per week or eight times per month)

Skill improvement system for employees through remote capabilities

Life Support
Leave◦Introduced for all employees for helping personnel involved in childcare
achieve balance between work and family

Days for No
Overtime Workat Headquarters◦An initiative to reduce overtime working hours◦Applied on the second Friday of each month◦Improving an online training system to support employees’ independent careerdevelopment

WorkstyleCreation of workplaces premised on remote work

◦Promoting free-address offices for efficient office utilization◦Creating innovation through promoting encounters between employees via layoutchanges

WorkplaceWEB

SystemStandardization of business processes for remote work◦Utilizing satellite offices to reduce the burden of employees who live away from their families
or commute long distances (began trial operation of Yokohama Satellite Office in July 2021)

Designing an open
corporate culture thatallows for diverse
working styles

Various Systems for Achieving Work–Life Balance◦Easing the requirements for acquiring remote work to realize more flexible working styles

Establishment of satellite offices

3

In February 2020, we enacted a full-scale teleworking systemwith no restrictions to enable workers to enjoy flexible work
styles as a part of promoting work–life balance. We have alsoestablished a system for supporting childcare such as life support
leave to encourage not only women, but also men to participate inchildcare, thereby embracing a work style that enables a diverse
array of human resources to flourish. We continue to diversify
work styles while incorporating the opinions of our employees.

2

Designing workplaces
that support diverse
working styles and help
generate innovation

D and I instillation◦Planning and implementing online events that make it easy for employees to participate◦Fostering a corporate culture that is inclusive and open through group work and opinion
exchange

Management support for promoting diverse working styles◦Implementing manager training concerning work management for remote work
◦Developing communication tools using digital technology

JERA Work Design
We started bringing the initiatives of JERA Work Design up to full speed in FY2021.
https://www.jera.co.jp/english/corporate/workstyle/

CultureTOPICS Family-Friendly Boss Declaration
In order to enable humanresources who possessa diverse array of values
to fully demonstrate
their capabilities, it isnecessary to build a
corporate culture thatis open and in which diverse working styles are mutuallyaccepted.
Aiming to build a culture in which male employees canalso take childcare leave without hesitation and in which all
employees can be active in their own way, we have releaseda “family-friendly boss declaration.” (The declaration isavailable [we apologize, but only in Japanese] on the Ministryof Health, Labour and Welfare’s Ikumen Project website.)
JERA GROUP CORPORATE COMMUNICATION BOOK 2021

50

Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

S: Health and Safety

Safety and Health
March 2021,
formulated
our “Safety
Philosophy” and“Safety Policies”(Formulated in March 2021)[Safety Philosophy]

Safety is the foundation of our business and the source of our corporate value. We give thehighest priority to safety in all our business activities.
The Mission of the JERA Group is to provide cutting-edge solutions to the world’s energy issues. To fulfill this mission, it is essential
to conduct our business activities safely and supply energy in a stable manner.
To that end, the JERA Group will develop its business activities based on the premise of “Safety First” in its entire supply chain fromfuel upstream investment and procurement to sales and will work on further safety measures to ensure that everyone in society canhave peace of mind.

Set a new record
for consecutive
incident-freedaysTarget numberof occupational
fatalities:

0

cases

Issue AwarenessIn accordance with matters such as frequently occurring natural
disasters, changes in the international energy situation, andchanges in the environment of power provision, it is necessarythat we ensure a strong and sustainable power supply system.
Particularly in recent years, earthquakes and other natural
disasters have occurred frequently, become more severe, andhave affected much larger areas, necessitating that we improve
our disaster resilience.
As a company responsible for a significant portion of the stablesupply of energy vital to the people of Japan, we are committed
to safety management at our facilities and take extensive disasterprevention measures. Additionally, we will improve health control
based on the awareness that ensuring the health and safety of
our employees is the foundation of business operation.

[Safety Policies][Principles of Conduct]

Based on the Safety Philosophy, the JERA Group will work on thefollowing policies:

To realize our safety philosophy and policies, each and every employee
will act in accordance with the following principles of conduct:

1 C reate a safe and comfortable work environment.

1 Work together across organizations andprocedures and rules.
3 Design, operate and maintain facilities withsafety in mind.

2 Adopt the safer decision when in doubt.

2 Observe safe and appropriate operating

responsibilities to ensure safety.
3 Continue constant efforts and initiatives toensure safety.

Fostering Safety AwarenessOur thermal power generation facilities and fuel facilities contain manypieces of machinery and equipment, and the potential danger of eachmust be understood and safety measures must be taken in daily
patrols, facility maintenance, and other work around them. Basedon a safety activity plan formulated each year, we develop safety
activities in unison with affiliates and contractors. In particular, for our
employees who work at our facilities, we hold “danger simulation
training” to enhance their sensitivity to potential dangers. We also
share safety information on-site, conduct patrols, and hold study
sessions for employees to work in conditions where safety is assured.
Going forward, we will once again share our newly formulated
Safety Philosophy and Safety Policies with Group companies,
cooperative companies, and contractors, and strive to further
foster safety awareness.

Main Achievements of Safety Activities in FY2020
Priority Action Item

Main Achievements

Implementationof various safetymeasures◦Sharing and horizontal deployment of disaster cases, disaster
information, and positive examples◦Review of safety award system

Strengthening of thesafety management
system to foster asafe culture◦Established a safety review project to strengthen the safety
management system◦Established Safety and Disaster Prevention Unit, General Affairs Group(October 2020)◦Formulated Safety Philosophy and Safety Policies (March 2021)

Implementation ofsafety management
aimed at improving
safety quality◦Implemented accurate checks and reviews based on management system◦Implemented safety management in collaboration with subsidiaries
and affiliates◦Examined safety management methods for expatriates and overseas travelers

Implementation ofsafety activities incollaboration withnationwide activities◦Implemented a period of enhanced safety activities in line with
National Occupational Safety Week in the summer◦Implemented the Winter Safety Campaign in conjunction with theyear-end and New Year’s Zero Accident Campaign

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Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

S: Health and Safety

Safety and Health

Promoting Health Management
Based on the awareness that “health and safety are the foundationof our business operations,” we have established a health andsafety management system under the responsibility of thepresident in order to promote health and safety activities as a priority
management issue. Safety and Health Committees established ateach business site and led by the Health Management Office workin cooperation with industrial physicians, public health nurses,
health insurance unions, and labor unions to formulate an annual
health and safety activity plan and promote initiatives aimed atmaintaining and improving the health of employees.
In FY2020, we focused on measures aimed at reducing mentalhealth problems and lifestyle-related diseases resulting from theincrease in working from home. Going forward, we will continue
working to build workplace environments that are safe andeasy to work in. We will do this by strengthening cooperation
between workplaces and industrial health staff, improving
mechanisms supporting both the early detection and treatment
and prevention of illnesses, and promoting a variety of related
measures.
Main Achievements of Health and Safety Activities in FY2020
Priority Action Item

Main Achievements

Compliancewith laws andordinances on
health and safety◦100% regular medical examination reception rate
◦Implemented medical examinations by occupation◦Completed response to the revised Health Promotion Act of Japan on
measures against second-hand smoke◦Provided smoking cessation support, including treatment guidance
and provision of information for employees wishing to quit smoking

Mental healthmeasures◦Implemented mental health care training for managers and interviews
with industrial health staff by physicians and clinical psychologists◦Conducted self-care training for general workers◦Stress check reception rate: 97.0% (FY2019: 94.8%)◦Recommended interviews with industrial physicians and external
consultations for highly stressed individuals

Measures toprevent healthproblems caused by
overwork, etc.

◦Implemented industrial physician interviews for individuals working
extensive hours◦Sent out reminder emails to employees who work long overtime hours
and their superiors

Measures toprevent the onsetof lifestyle-relateddiseases, etc.

◦Enhanced measures after medical examinations, including for
expatriate employees◦Held health and safety lectures at monthly Safety and Health Committee
meetings and issued a newsletter over the company intranet

Diagram of Health and Safety Management System(as of August 31, 2021)

Company

Appointment

Chief Executive Officerof health and safety
Direction

Health managers
Appointment

Appointment

Safety managers
Health and safety
promoters

Petroleum Industrial Complexes and Other Petroleum Facilities,
and the High Pressure Gas Safety Act of Japan. In particular, forthermal power plants located in special disaster prevention zones
such as petrochemical complexes, JERA is taking measures inaccordance with the scale of the plant.
WEB

Reporting,coordination

Safety and Health Committee

Guidance,
recommendation,
Reporting,advising
coordination
Instruction,
development

Workplace managers

Medicalexaminations, etc.
Health and safety
education
Instruction

Circulation of
meeting
minutes

Health care offices(industrial physicians)

Diseasecontrol
Other

Reporting,coordination

Employees

Safe and Stable Operations
We expend every effort to ensure the safe and stable operation of ourthermal power plants by monitoring their operation status 24 hours
a day from a central control room. We conduct daily inspections toswiftly discover any abnormalities, rigorously inspecting the external
appearance of our facilities and checking each piece of equipment
to ensure that we catch even the slightest changes in temperature,vibrations, abnormal noises, and other problems.
We also conduct periodic operator inspections as required by
the Electricity Business Act of Japan, our own periodic voluntary
inspections, and other periodic inspections appropriately so that
our facilities can be operated safely. We have systems in place forthe soonest possible restoration of operations together with affiliates
in the unlikely event of a problem occurring during operation.

Safety Management and Disaster Prevention Measures
Our thermal power plants handle agreat deal of dangerous substances,and we are appropriately managing
them in accordance with relevantlaws and regulations such as theFire Service Act of Japan, the Act
on the Prevention of Disaster in

Main safety management and disaster prevention measures
https://www.jera.co.jp/english/corporate/safety/prevention

Earthquake Countermeasures
When constructing thermal power plants, we design them to beearthquake-resistant in accordance with the Building Standards Act
of Japan, the Fire Service Act of Japan, and other relevant regulations,as well as the Rules of Quality Assurance for the Safety of Thermal
Power Plants (Japan Electric Association Code, JEAC), and confirm
seismic performance through periodic facility inspections after
construction. We also implement individual measures as needed inlight of facility damage caused by past earthquakes.
Additionally, for earthquakes announced by public organizations likethe National Disaster Management Council, we evaluate the seismic
resistance of important facilities at each power plant and implement
measures such as seismic reinforcement to avoid long-term
shutdowns due to collapse or earthquake damage. In the future,when new knowledge is obtained, such as the announcement of
new seismic assumptions, we will examine the validity of the existing
earthquake countermeasures and consider necessary measures.
WEB

Examples of individual measures reflecting facility damage causedby past earthquakes, and main facilities with seismic reinforcement
https://www.jera.co.jp/english/corporate/safety/earthquake

Safety Measures for LNG Receiving Terminals
At our LNG receiving terminals, in preparation for the unlikely eventof an LNG leakage, safety measures are being implemented basedon the following three concepts: “(1) leakage prevention,” “(2) early
detection of leakage,” and “(3) preventing leakage from spreading.” Wealso make considerations for the handling of fire, for example adopting
explosion-proof structures for electrical equipment surrounding LNG
facilities and restricting the use of products that may cause fire by
designating control zones (including special control zones).
We have been operating safely for over 40 years since theintroduction of LNG. We strive to further strengthen our safetymeasures and take all possible measures in our operation.
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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Coexisting with Local Communities

Coexisting with Local Communities(Formulated in July 2021)

Social Contribution Activity Policy
Basic Policy
In conducting global business, in addition to its business activities, the JERA Group aims to proactively engage insocial contribution activities, to build strong relationships of trust with regional communities and other stakeholders,
and to achieve sustainable development together with local communities.
In implementing social contribution activities, we will respect the cultures, customs, nature, history, and othercharacteristics of individual countries and regions. At the same time, we will contribute to society and community
development through activities leveraging the strengths of the entire JERA Group.

Purpose of Activities
The purpose of our social contribution activities is the continuous creation of a virtuous cycle in which those relationships of trust lead to enhanced
corporate value by contributing to the realization of a sustainable society through the building of relationships of trust with stakeholders.

Priority Areas for Activities
Aiming to realize a sustainable society, we will engage in activities giving priority to the three areas of “coexistence with theenvironment,” “education for the next generation,” and “the resolution of local community issues.”

July 2021, Formulated our“Social Contribution Activity
Policy”

1 Coexistence with the Environment
Providing medical supplies in Bangladesh

Issue AwarenessIn addition to such global issues as climate change, countries andregions are facing increasingly severe endemic issues, including
poverty and disparity, resource problems, and demographic
changes. Against this backdrop, there is an expectation forcompanies to proactively involve themselves in grappling withthese regional and community issues.
As a company engaged in business on a global level, we
contribute to the economic and social development of regions
and communities. We do this by gaining a firm understandingof the problems faced by regions and communities and working
with a variety of stakeholders to implement social contribution
activities leveraging our strengths.

We will contribute to better conservation of the global environment by working to reduce the environmental burden of our businessactivities together with measures such as promoting greening and environmental protection.

2 Education for the Next Generation

We will pass on the skills and expertise we have cultivated through our business operations to the next generation and contribute to theeducation of human resources who will shoulder the future of energy so that they can flourish on a global scale.

3 Resolution of Local Community Issues

We will contribute to the resolution of the diverse array of issues faced by the countries and regions we do business in, including increasing
disaster preparedness, creating jobs, and eliminating unelectrified communities.

Support for Employee Social Contribution Activities
We will provide our employees with opportunities for social participation, and support employees’ voluntary social contribution
activities.

Collaboration with Stakeholders
We will aim to engage in communication with stakeholders and collaborate with them to engage in a diverse array of social issues.

Information Disclosure
We will proactively disseminate information on our basic policy for social contribution activities as well as the content of the social
contribution activities we conduct via our website and reports.
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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Coexisting with Local Communities

Coexisting with Local Communities

Coexisting with the Environment
Environmental Conservation and Scenery
Preservation Measures at Thermal Power Plants
The thermal power plants
we own throughout Japan
implement measures to preserve
the landscape in consideration of
the impact of operations on thesurrounding environment. We
Yokohama Thermal Power Station
have implemented landscapesimulations for the chimneys and the main building and selected
the shape and color. We are also actively involved in greening andare preserving the environment by planting trees at power plantpremises, etc., to harmonize with nature. These premises have now
become forests home to many rare insects and other species.

Cleanup and Environmental Beautification Activities
JERA’s thermal power plants and other places of business work
together with affiliates and local governments to proactively
participate in cleanup and environmental beautification activities
in the surrounding communities. In spite of restrictions during the
COVID-19 pandemic, in FY2020, 360 employees participatedin environmental beautification activities.

TOPICS

Beach Cleanup Activity

In April 2021, we conducteda beach cleanup activity
in Akita Prefecture. JERA
employees worked with local
residents and staff as well
as players from “Prestige
International Aranmare*,” awomen’s basketball team based in Akita City, Akita Prefecture.
*Aranmare: A women’s basketball team established in 2015. Starting in the
2021–2022 season, the team will be participating in the premier W League, afirst for a team from the Tohoku region (team management: Prestige InternationalInc.). JERA concluded an agreement in March 2021 to be a uniform partner for
three seasons starting in the 2021–2022 season.

Education for the Next Generation
Establishment of a Scholarship Program
In December 2020, JERA established the “JERA Asia
Scholarship program” for international students from Asian
countries to study at Japanese universities and graduate
schools. By providing financial assistance for international
students studying in Japan, this scholarship program aims to
support the development of talented people who will contributeto the future economic development of Asian countries.
In FY2020, the scholarships were provided to students fromvarious Asian countries studying at the International Universityof Japan, which has engaged in the education of global humanresources for many years.

Power Plant Tours
In FY2020, we suspended reception of power plant tours in order toprevent the spread of COVID-19. From September 2020, however,
we held online tours of the Kawasaki Thermal Power Station. Enabling
people to view the power plant from their own homes without being
physically present made it possible even for people living far fromthe plant to take part, and the tours were well-received. For our
tour course for elementary school pupils and parents participating
together, we worked to enhance the content so that parents andchildren could have funlearning together, including
providing content teaching
about electricity as used indaily life, experiments, andquizzes.

WEB

WEB

Public relations and JERA’ｓ “Denryoku Kan” (Museums of Electricity)
https://www.jera.co.jp/corporate/pr
Only Japanese text
Power plant tour information
https://www.jera.co.jp/node/17
Only Japanese text

Resolution of Local Community Issues
Donations to Atsuma Town via Corporate Hometown
Tax
Sharing in a belief in regional disaster prevention through thelocal production of power held by the town of Atsuma in Yufutsu
District, Hokkaido, in March 2021, JERA donated, through thecorporate version of the Hometown Tax system, 740 million yen
to a “local production for local protection” sixth-order industry
energy project* in Atsuma.
*The project aims to promote local energy production for local consumption and toutilize locally produced energy for local disaster management by installing renewableenergy power generation equipment and storage batteries in public facilities and bypracticing energy management.

Providing Medical Supplies in Bangladesh
We have contributed to sustainable economic development
in Bangladesh by developing new gas-fired power generation
business and investing in Summit Power International Limited(“Summit Power”), the country’s largest independent power
producer (IPP).
Like other countries, Bangladesh experienced a shortage of
medical supplies due to the spread of COVID-19 throughout theworld. In response, we began providing medical supplies freeof charge in July 2020. To date we have provided ambulances,
artificial respirators, and personal protective gear including
protective suits and masks.

Overseas/Affiliate Initiatives and Contributions to theSDGs
We invested in TeaM Energy Corporation, an affiliate in thePhilippines (JERA and Marubeni each have a 50% stake).
TeaM Energy has developed various initiatives over many
years to contribute to the resolution of social issues in thePhilippines through the non-profit TeaM Energy Foundation
Inc. These include resolving the problem of poverty throughthe electrification of homes and unelectrified communities;
protecting the environment; and support for education,
medicine, and drug eradication.

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Stakeholder Engagement

Stakeholder Engagement
Main Stakeholders

Demands and Expectations

Initiatives

Customers◦Stable supply of electricity◦Energy supply in pursuit ofcustomer satisfaction◦Decarbonization and expansion ofrenewable energy◦Promotion of ESG initiatives

We provide a stable supply of energy to customers throughout
the world using value chains from fuel procurement to power
generation and electricity and gas sales based on our mission toprovide cutting-edge solutions to the world’s energy issues. We
also establish strong, trust-based relationships by continuing
to respond to customer expectations on a foundation of ESGconscious business management.

◦Operating activities◦Website◦Fair and equitable trade◦Strengthening of collaboration

We promote CSR-conscious procurement activities in aneffort to fulfill our social responsibilities and engage in fair andequitable trade with our suppliers.
We also promote mutual diligence and maintain close
communication with our suppliers and partners toward ourmutual development.

◦Procurement policy briefings◦Collaboration with othercompanies in domestic
and global businesses◦Joining organizations suchas “the Ocean Renewable
Energy Action Coalition”◦Environmentally conscious business
management◦Consideration of the human rights
of local community members◦Contribution to local economies◦Local job creation and skill
development

We proactively engage in dialogue with people in local
communities where our power stations are located and establish
strong, trust-based relationships in an effort to continuously
develop alongside each other.
We also work for the development of society through social
contribution activities tailored to local communities andbusiness activities that respect the nature, history, culture, andcustoms of each and every country and region in which we
conduct business.

◦Power station tours◦Participation in local
community events◦Provision of medical
supplies outside Japan◦Enhancement of corporate value◦Strengthening of earning power

We disclose financial and non-financial information and engage
in dialogue with our shareholders and investors in an effort
to further understanding and improve our corporate value torespond to their expectations.

◦Shareholders meetings◦IR briefings◦Securing and developing global,
strategic human resources◦Management of employee healthand workplace safety and sanitation◦Respect for diversity◦Promotion of work-life balance◦Elimination of discrimination andharassment◦Improvement of reporting systemeffectivenessWe seek to ensure the health and safety of our employees
and create comfortable, positive working environments on afoundation of respect for human rights. Additionally, to enable
our diverse human resources to fully exhibit their skills, we
intend to maintain our system that enables them to choose theirown career paths and work styles. In addition, we proactively
move forward with various measures including hiring global
human resources and promote active participation by womenand the employment of people with disabilities.

◦Creation of inclusive
organizations◦Support for independent
career development◦Promotion of work styles
tailored to diverse needs◦Employee satisfaction
surveysBusiness
partners

Local
communities

Basic Approach
JERA conducts business activities amid its involvement with
its stakeholders, which include customers, business partners,
local communities, shareholders, investors, and others. We
fully understand the social responsibility to fulfill the demands
and expectations of our stakeholders, and strive for active
communication to respond to theｍ in good faith.
We intend to continue improving our business activities andservices through lively, interactive communication with our
stakeholders. Furthermore, our efforts to disclose both financial
and non-financial information in a timely, appropriate manner willlead to proper assessments and valuation by our stakeholders in
addition to helping us achieve sustainable growth and maximize
our corporate value.

Shareholders andinvestors

Employees

Results

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Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

S: Communication with Employees

Communication with Employees
Basic Approach“JERA letters”: Letters from thepresident to employees and theirfamilies

Post Anything

As a company that came into being from the merging of twoelectric power companies with different corporate cultures, ourmost important task is to come together as “one team” and blend
together in the truest sense of the phrase so that we can maximize
the synergy of our consolidation and achieve growth. We areplanning and developing various programs for internal exchange
in a continuous effort to further our blending and consolidation.

Online CaféIn April 2021, approximately 90% of theemployees seconded to us from TEPCO
Fuel & Power Inc., and Chubu ElectricPower Co., Inc. transferred into JERA.
President Onoda sent messages tothe employees and their families whowill together build the future of JERA.

Employee Satisfaction Surveys

In order to stimulate communication between employees evenunder the conditions of remote work, we hold an online cafe in which
President Onoda participates (called Remote Coffee Break with the
President and held twice a week for 45 minutes a session). Serving
as a valuable space where communication difficulties can be shared,
solutions can be suggested, and a variety of other topics can be
discussed, our online cafe has also served to spur the formulationof new ideas and innovations through unstructured conversations.
Other Initiatives to Stimulate Communication
MeasureLetterPresident

Ball

Employee/family

Issue AwarenessDescription

Since FY2019, we have conducted “employee satisfaction surveys”
to gain a quantitative understanding of our employees’ opinions,motivations for their work, and other information. (Since FY2020, surveys
have also been given to employees seconded to Group companies.)
We use the surveys to investigate three categories of employee
satisfaction: “Work and Assessments,” “Working Conditions andEnvironment,” and “Loyalty to the Company.” In turn, we havefound that overall satisfaction points have continued to increase by
one point over the previous year, and that there was great demandfor improvement in how work is conducted through remote work
as well as the reformation of working styles. We intend to consider
courses of action for improving on the issues highlighted in thesesurveys, and to use the issues as fundamental data for formulatingcompany policy and management strategies to help create more
appealing workplaces and improve corporate value.

Company Newsletter

In May 2020, we published a company newsletter titled “Things
to Know About JERA.” The newsletter highlighted the people andappeals of individual workplaces in an effort to improve employee
motivation and help them design their career paths.

Website for employeeinitiated communication

We operate a website on which employees share information witheach other. The website includes an “Everyone’s a Reporter!” pagefor introducing events at headquarters, branch offices, and power
plants in real time, a “Workplace Watch” page on which young
employees at headquarters introduce their workplaces, and more.

President’s Blog

A blog regularly updated by President Onoda.

TOPICS◦Lunch meetings between
the president and young/mid-level employees◦One Coin Café◦One Coin Bar

Temporarily suspended due to COVID-19“JERA Letters” Recognized withan International ECHO Award

President

A lack of internal communication can lower employee motivation,
increase stress, and even decrease productivity, making it a key
issue for a company to resolve.
In recent years, measures aimed at enhancing communication
have become urgently needed due to such issues as theincreasing diversification of working styles and the rise in remote
work as a result of the effects of COVID-19.
JERA positions internal communication as an essential measure.
In turn, we are planning various programs for internal exchange
to further our blending and consolidation.

Post Anything are set up to enable employees to freely andanonymously share anything—from questions and concerns tosuggestions for improvement, fears and worries, and good news.
The posts are reported to management and are provided to the entire
company as feedback alongside action proposals from supervising
divisions. In FY2020, we received 90 posts, and they resulted inanswers to problems as well as improvements to dairy work.

A One Coin Café eventin 2019

Our “JERA Letters” initiative has been recognized with aprestigious “International ECHO Award,” an internationallyknown marketing commendation with a lengthy history,
having been established in 1929. The initiative, in which
top management (President Onoda) sends messages
directly to employees and their families and receives their
responses, was praised for its outstanding distinctiveness.
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Contents / Editorial Policy

Financial andCorporate
Information

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

State of Operating Results, Etc.
Business Environment and Our Response
In FY2020, in spite of the prolonged global effects of the
COVID-19 pandemic, the Japanese economy experienced aslow recovery in economic activity after the lifting of the stateof emergency in May 2020. From around November 2020,
however, the pandemic again began to worsen and thereafter
the situation remained uncertain, sometimes improving andsometimes worsening. Additionally, from the end of 2020
through the New Year period, intermittent influxes of strong cold
waves, something that only occurs once every several years,
put pressure on power supply and demand.
Against this backdrop, JERA strove to ensure the stable supplyof power, taking measures against COVID-19 at its power plants
in April 2020. These measures included measures to prevent
infection and the spreading of the virus through means such as
prohibiting access to control rooms other than for operators;
and formulating a business continuity plan that, among otherthings, established a system of alternate teams preparedby experienced operators. In response to the power supply–
demand strain from the end of 2020 to January of the next year,
we contributed to the stabilization of Japan’s electricity supply
and demand through means such as optimizing inventory andimplementing additional procurements to the maximum. This
included securing about three million tons of LNG, a previously
unprecedented amount, through spot trades starting in October
2020 and received from November 2020 to February 2021 inorder to increase supply capacity as much as possible.
Additionally, amid the growing global trend toward
decarbonization, we have been making efforts to reduce CO2
emissions based on our “Environmental Targets” established in
April 2019. As Japan’s largest power generation utility, we arein a position to actively lead the realization of a decarbonizedsociety. In October 2020, to further accelerate our efforts
to date and clarify our long-term vision for the company, weestablished “JERA Zero CO2 Emissions 2050.” Further, in orderto achieve “JERA Zero CO2 Emissions 2050” in our domestic

operations, we formulated “JERA Environmental Target 2030
for its Business in Japan,” a roadmap and established newenvironmental targets for 2030.
In October 2020, we formulated our vision for “Digital Power
Plants,” which will transform thermal power plant O&M
through digital technology. These digital power plants combine“Digitalization” linking data on all equipment and workers for realtime visualization and utilization with our “O&M Kaizen skills,”
which are constantly being upgraded, and the “Technological
Capabilities” that we have cultivated to date. Through this,
we are creating new value and working to improve the costcompetitiveness and market responsiveness of our power
generation facilities.

State of Operating Results
We posted net sales of 2,730.1 billion yen, a 549.8 billion yen
decrease from FY2019 due to a decline in retail unit prices inaccordance with lowered resource prices, as well as a decreasein electricity sales. In spite of issues such as the profit and loss
imbalance resulting from the COVID-19 pandemic, ordinary
profit was 244.1 billion yen, a 69.7 billion yen increase from
FY2019. This was a result of such factors as the results ofstarting year-round operation of the Freeport LNG Project andincreases in subsidiary due to a strong fuel trading business.
Profit attributable to owners of the parent was 157.8 billion yen,a 10.6 billion yen decrease from FY2019.

[Fuel Business]
Profit attributable to owners of the parent was 48.0 billion yen,a 22.9 billion yen increase from FY2019. This was a result ofsuch factors as investments in our upstream businesses in thefuel supply chain and other areas, our fuel transportation andtrading businesses, the results of starting year-round operationof the Freeport LNG Project, and increases in subsidiary profit
due to a strong fuel trading business.

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Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

State of Operating Results, Etc.

[Overseas Power Generation Business]
We posted a loss of 7.6 billion yen for profit attributable to owners of
the parent, a 4.37 billion yen decrease from FY2019. This was a resultof such factors as investments in power plant projects overseas,
the reactionary effects of profits from selloff of overseas power
generation projects recorded in FY2019, and losses from overseas
power generation projects due to worsened market conditions.

[Thermal Power and Gas Business in Japan]
We engage in the sale of power and gas in Japan, and in
spite of the downturn in business resulting from the COVID-19
pandemic, profit attributable to owners of the parent was 152.8
billion yen, a 1.70 billion yen increase from FY2019. This wasa result of such factors as the reactionary effects of losses
associated with the selloff of LNG recorded in FY2019.

State of Financial Condition
Total assets were 4,090.8 billion yen, a 55.5 billion yen increase
from the end of FY2019. This was a result of increases inproperty, plant, and equipment due to the replacement ofthermal power facilities in Japan.
Liabilities were 2,328.7 billion yen, a 105.2 billion yen decrease
from the end of FY2019. This was a result of such factors as adecline in accrued income taxes.

Total net assets were 1,762.1 billion yen, a 160.8 billion yen
increase from the end of FY2019. This was a result of suchfactors as the recording of profit attributable to owners of theparent.
Consequently, our equity to asset ratio was 41.2%.

Primarily focusing on improving the efficiency of our thermal
power and gas business in Japan, the basic policy of the JERAGroup (JERA and its consolidated subsidiaries) is to ensure thelong-term stable supply of power. The JERA Group’s capital
investments for FY2020 were 225.997 billion yen. By segment,
investments were 1.679 billion yen for fuel business, 8.413
billion yen for overseas power generation business, 214.553
billion yen for domestic thermal power and gas business, and1.351 billion yen for others.

State of Cash Flows
Cash and cash equivalents on a consolidated basis at the endof FY2020 were 561.6 billion yen, a 159.2 billion yen increase
from the end of FY2019.
Profit from cash flows from operating activities was 340.8 billion
yen, a 210.8 billion yen decrease from FY2019. This was a result oftax payments being relatively large compared with FY2019.
Loss from cash flows from investing activities were 272.0 billion
yen, a 38.7 billion yen decrease from FY2019. This was a resultof such factors as a decline in losses for purchasing investment
securities.
Consequently, free cash flow was 68.7 billion yen, a 172.0
billion yen decrease from FY2019.
Profit from cash flows from financing activities was 89.5 billion
yen, a 541.5 billion yen increase from FY2019. This was a resultof such factors as the issuance of corporate bonds and large
repayments of borrowing in FY2019.

Value Chains and Segmentation

Fuel Business

Capital Investment

 lans for Construction of New Facilities and Facility
P
Retirement, Etc.
Capital investment plans for the fiscal year ending March 2022
(FY2021) on a consolidated basis total 379.407 billion yen for
the entire Group. On the major premise of ensuring the stablesupply of power, from the perspective of thoroughly streamlining
management in the mid to long term, we will strive to control theamount of capital investments in our capital investment plans.
There are no plans to retire or sell off any important facilities.

Main Facility Plans (Thermal Power)

Overseas Power
Generation Business

Optimization and Trading

Upstream Development

Overseas Power Generation

Domestic Power
Generation

Electricity/
Gas Sales

Start of Operation

Segment

Site

JERA Power YOKOSUKA LLC

Thermal Power and
Gas Business inJapan

Yokosuka
Units No. 1, 2

650×2

Aug. 2019

Jun. 2023;
Feb. 2024

JERA Power ANEGASAKI LLC

Thermal Power and
Gas Business inJapanAnegasaki
New Units
No. 1, 2, 3

646.9×3

Feb. 2020

Feb., Apr.,
Aug. 2023

Goi United Generation LLC

Thermal Power and
Gas Business inJapan

Goi Units No.
1, 2, 3780×3

Apr. 2021

Aug., Nov. 2024;
Mar. 2025

JERA Power TAKETOYO LLC

Thermal Power and
Gas Business inJapan

Taketoyo Unit
No. 5

1,070

Apr. 2018

May 2022

Fuel Procurement

Thermal Power and Gas Business in Japan

Start ofOutput(in thousand kW) Construction

Company

Transportation
Receiving and Storage
Terminals(as of March 31, 2021)

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

58

Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Consolidated Balance Sheet(Unit: Millions of yen)

Assets

As of March 31, 2020

(Unit: Millions of yen)

Liabilities

As of March 31, 2021

Current assets

As of March 31, 2020

As of March 31, 2021

Current liabilities

Cash and deposits

459,178

616,132

Notes and accounts payable - trade258,321287,329

Notes and accounts receivable - trade292,262

323,157

Short-term borrowings

92,391

74,553Inventories

175,967

154,318

Other

488,631

276,172

Total current liabilities

839,344

638,055

1,413,565

1,498,737

434

472

180,712

191,494

1,594,712

1,690,704

2,434,056

2,328,760

OtherTotal current assets

216,121231,027

1,143,531

1,324,636

Non-current liabilities
Long-term borrowings

Non-current assets
Property, plant and equipment

Retirement benefit liability

Buildings and structures

359,102348,272

Other

Machinery, equipment and vehicles

940,670

946,642

Total non-current liabilities

Land

331,653

331,653

Construction in progress

348,563374,504

9,688

8,958

1,989,679

2,010,030

Share capital

5,000

5,000

Other

41,54937,123

Capital surplus

1,312,517

1,312,523

Total intangible assets

41,54937,123Retained earnings

248,562

379,415

1,566,080

1,696,938

0

290(41,505)(4,384)Foreign currency translation adjustment

15,947(6,650)Total accumulated other comprehensive
income(25,558)(10,744)

60,74575,926

Total net assets

1,601,267

1,762,120

Total liabilities and net assets

4,035,324

4,090,880

OtherTotal property, plant and equipment
Intangible assets

Total liabilities

Net assets
Shareholders’ equity

Total shareholders’ equity

Investments and other assets
Investment securities

613,305

559,401

Accumulated other comprehensive income

Other

247,258

159,689

Valuation difference on available-for-salesecurities

Total investments and other assets

860,564

719,090

2,891,792

2,766,244

4,035,324

4,090,880

Total non-current assets
Total assets

Deferred gains or losses on hedges

Non-controlling interests

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

59

Contents / Editorial Policy

Consolidated Statement of Income

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Consolidated Statement ofComprehensive Income(Unit: Millions of yen)

For the Year Ended March 31,
2020
Net sales

3,280,002

2,730,146

Cost of sales

3,058,839

2,422,130

Gross profit

221,162

308,015

Selling, general and administrative expenses

54,15358,576

Operating profit

167,008

249,438

Interest income

6,621

2,144

Dividend income

2,995

8,406

Non-operating income:

496

2,540

Share of profit of entities accounted for using
equity method

15,925

－

Other

5,085

4,451

Total non-operating income

31,124

17,542

8,158

7,950

－

3,406

－

5,282

Gain on sale of non-current assets

Non-operating expenses:
Interest expenses
Share of loss of entities accounted for using
equity method
Foreign exchange losses
Loss on impairment of non-current assets

5,821

－

Commission for syndicated loans

5,569

4,631

Other

4,154

1,514

Total non-operating expenses

23,70322,786

174,429

244,194

Gain on sale of investment securities

20,956－

Total extraordinary income

20,956－

Loss on impairment of non-current assets－

16,376

Total extraordinary losses－

16,376

Profit before income taxes

195,386

227,818
44,950Ordinary profit(Unit: Millions of yen)

For the Year Ended March 31,
2020

For the Year Ended March 31,
2021

For the Year Ended March 31,
2021

181,134

173,648(31)

271

Deferred gains or losses on hedges(24,494)

41,993Foreign currency translation adjustment(6,597)(6,434)

Share of other comprehensive income ofentities accounted for using equity method(7,762)(19,561)

ProfitOther comprehensive income:
Valuation difference on available-for-salesecurities(38,886)

16,269142,248

189,918

Owners of parent

130,648

172,666

Non-controlling interests

11,60017,251

Total other comprehensive income
Comprehensive income
Total comprehensive income attributable to:Extraordinary income:Extraordinary losses:

Income taxes - current

65,420

Income taxes - deferred(51,168)

9,219

Total income taxes

14,252

54,169Profit181,134

173,648

Profit attributable to non-controlling interests

12,591

15,795

Profit attributable to owners of parent

168,543

157,852

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

60

Contents / Editorial Policy

Value Creation

Strategies

Foundation for Value
Creation: ESG

Financial and Corporate
Information

Consolidated Statement of Changes in Net Assets(Unit: Millions of yen)

Shareholders’ equity
For the Year Ended March 31, 2020

Balance, April 1, 2019

Share capital

Capital surplus

5,000

Accumulated other comprehensive income

Non-controllinginterests

Retained earnings

Total shareholders’equityValuation difference
on available-forsale securities

Deferred gains orlosses on hedges

Foreign currencytranslation
adjustment

Total accumulated
other comprehensive
income79,831

553,960(420)(9,713)22,017

11,883

168,543

168,543

168,543

188

188

188

843,388843,388469,129

47,329Total net assets

613,173

Changes during period
Profit attributable to owners of parent
Change in ownership interest of parent due totransactions with non-controlling interests
843,388

Increase by corporate division
Other changes in the year-net

420(31,791)(6,070)(37,441)

13,416(24,025)

Total changes in the year－

843,388

168,731

1,012,119420(31,791)(6,070)(37,441)

13,416

988,094

Balance, March 31, 2020

5,000

1,312,517

248,562

1,566,080

0(41,505)

15,947(25,558)

60,745

1,601,267(Unit: Millions of yen)

Shareholders’ equity

Accumulated other comprehensive income

Total shareholders’equity248,562

1,566,0800Dividends of surplus(27,000)(27,000)(27,000)

Profit attributable to owners of parent

157,852

157,852

157,8525

5

Balance, April 1, 2020

Share capital

Capital surplus

5,000

1,312,517

Deferred gains orlosses on hedges

Foreign currencytranslation
adjustment

Total accumulated
other comprehensive
income(41,505)

15,947(25,558)

Non-controllinginterests

Retained earnings

Valuation difference
on available-forsale securities

For the Year Ended March 31, 2021

60,745

Total net assets

1,601,267

Changes during period

Change in ownership interest of parent due totransactions with non-controlling interests

5

Other changes in the year-net

290

37,121(22,597)

14,813

15,18029,993

Total changes in the year－5

130,852

130,858

290

37,121(22,597)

14,813

15,180160,852

Balance, March 31, 2021

5,000

1,312,523

379,415

1,696,938

290(4,384)(6,650)(10,744)

75,926

1,762,120

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

61

Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Consolidated Statement of Cash Flows(Unit: Millions of yen)

For the Year Ended March 31,
2020(Unit: Millions of yen)

For the Year Ended March 31,
2021

For the Year Ended March 31,
2020

For the Year Ended March 31,
2021

Cash flows from financing activities

Cash flows from operating activities
Profit before income taxes

195,386

227,818

Increase (decrease) in short-term borrowings-net(1,645,769)(23,975)

Depreciation and amortization

197,940

187,737

Proceeds from long-term borrowings

1,344,698

149,746

Loss on impairment of non-current assets

5,821

16,376

Repayments of long-term borrowings(151,186)(62,409)

Interest and dividend income(9,616)(10,550)

Proceeds from issuance of bonds－

39,882

Interest expenses

8,158

7,949

Dividends paid－

(27,000)(115,177)(28,213)

Dividends paid to non-controlling interests(1,557)(574)(Increase) decrease in inventories

2,177

22,674

Other-net

1,760

13,872

Increase (decrease) in trade payables

171,139

25,188Net cash provided by (used in) financing activities(452,054)

89,542Other-net

86,413(51,490)Effect of exchange rate change on cash and cash
equivalents(2,701)

977

Subtotal

542,242

397,490

159,253

25,822

41,642 et increase (decrease) in cash and cashNequivalents(213,948)

Interest and dividends received
Interest paid

(7,814)(8,936)Cash and cash equivalents at the beginning of
the year

269,587

402,431

Income taxes paid

(8,579)(89,371)

Increase in cash and cash equivalents resulting
from absorption-type split

335,000－

Net cash provided by operating activities

551,670

340,825

Increase (decrease) in cash and cash equivalents
resulting from change in scope of consolidation

11,791－(115,798)(31,580)

Cash and cash equivalents at end of the year

402,431561,685

Proceeds from sale of investment securities

15,846－

Loan advances(4,126)(4,974)

Proceeds from collection of loans receivable

1,633

650

(211,188)(241,358)

3,806

1,461

(Increase) decrease in trade receivables

Cash flows from investing activities
Purchase of investment securities

Purchase of non-current assets
Proceeds from sale of non-current assets－(1,511)

Purchase of shares of subsidiaries resulting inchange in scope of consolidation(2,950)－

Other-net

1,913

5,221

(310,863)(272,092)

Purchase of shares of subsidiaries

Net cash used in investing activities

For details about financial information, please visit the Investors Relations section of our website and refer to our securities report.
WEB

JERA Securities Report and other financial results
https://www.jera.co.jp/english/corporate/ir
JERA GROUP CORPORATE COMMUNICATION BOOK 2021

62

Contents / Editorial Policy

Thermal Power Plants in Japan

Value Creation

Strategies

Foundation for Value
Creation: ESG(as of March 31, 2021)

List of Thermal Power Plants1 (Total output and fuel type listed for each thermal power plant)
◆LNG

◆Coal

◆Heavy oil◆Crude oil

2.38 GW／◆
4.4 GW／◆◆◆

5.66 GW／◆◆◆
4.38 GW／◆❼ Goi <GOI UNITED GENERATION>

Replacement is being
planned❾ (Scheduled to start operation in FY2023)■

3.6 GW／◆
1.941 GW／◆

 Sodegaura

3.6 GW／◆ Futtsu

5.16 GW／◆

Yokosuka <JERA Power YOKOSUKA>
 (Scheduled to start operation in FY2023)

1.3 GW／◆

 Minami-Yokohama

1.15 GW／◆ Yokohama

3.541 GW／◆

 Higashi-Ohgishima

Power Plant’s Name <Operator’s Name＞
Includes jointly operated terminals in the Chita
and Yokkaichi areas.

2❶

0.65 GW／◆❺ Kashima

Anegasaki <JERA Power ANEGASAKI>

1■Coal terminal

2 GW／◆❻ Chiba❽ Anegasaki

Kawagoe Thermal Power Station■ LNG terminal2❶ Joetsu

Hitachinaka Kyodo❹<HITACHINAKA GENERATION>

Joetsu Thermal Power Station◆Utility gas❷ Hirono❸ Hitachinaka

Shinagawa Thermal Power Station

Financial and Corporate
Information■■■■

 Kawasaki

3.42 kW／◆1.05 GW／◆

 Shinagawa

1.14 GW／◆

 Atsumi

1.4 GW／◆◆ Hekinan

4.1 GW／◆

Taketoyo <JERA Power TAKETOYO> (Scheduled to start operation in FY2022)

1.07 GW／◆

 Chita

3.966 GW／◆

 Chita Daini

1.708 GW／◆

 Shin-Nagoya

3.058 GW／◆

 Nishi-Nagoya

2.376 GW／◆ Kawagoe

4.802 GW／◆ Yokkaichi

0.585 GW／◆⓴❷⓳

2 GW／◆

 Oi

■■
■■

■

❸❹

Sea of Japan❺⓲⓱

Pacific Ocean

❻
❼

⓰

■⓯

⓮
■⓭

East China Sea

■

❽❾

❿
■⓫

⓬

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

63

Contents / Editorial Policy

Overseas Business and LNG
Supplying Countries*

Value Creation

Thermal power generation
business

Renewable energy
business

Foundation for Value
Creation: ESG

Strategies

Fuel upstream business

Optimization business

Financial and Corporate
Information(as of August 31, 2021)
IPP: Independent power producer
IWPP: Independent water and power producer
SPP: Small power producer*Countries from which JERA receiving terminals imported LNG displayed (FY2020).

(*■ in gray)

❶
❷
❾
❸❹
❺

❻ ❼

⓰

❿
❽⓮ ⓫

⓱

⓯⓬

⓭

❶ Netherlands
Rietlanden Coal Terminal❷ UK
Gunfleet Sands Offshore Wind Power

Taiwan: Formosa©

Formosa I Wind Power Co., Ltd. All rights reserved.

Umm Al Houl Gas Thermal IWPP

❹ UAE
Umm Al Nar Gas Thermal IWPP

❺ OmanProvided by Chevron Australia.

US: Cricket Valley

Sur Gas Thermal IPP❻ India
ReNew Power Wind and Solar Power IPP❼ Bangladesh

JERA Global Markets(Optimization and Trading)

Ratchaburi Gas Thermal IPP
Rice Husk Biomass Thermal IPP

Ras Laffan C Gas Thermal IWPP

⓯ Singapore

Solar Power IPP
Wind Power IPP

Ras Laffan B Gas Thermal IWPP

Phu My Gas Thermal IPP

Cogeneration Project in Industrial Estate

JERA Global Markets(Optimization and Trading)❸ Qatar⓮ Vietnam

EGCO IPP

Zenobe Battery Energy Storage

Mesaieed Gas Thermal IPP

Australia: Wheatstone❽ Thailand⓰ US
Tenaska Gas Thermal IPP❾ JapanCarroll County Gas Thermal IPP❿ Taiwan

Cricket Valley Gas Thermal IPP

Chang Bin/Fong Der/Star Buck Gas Thermal IPP
Formosa 1 Offshore Wind Power IPP
Formosa 2 Offshore Wind Power IPP⓫ Philippines
TeaM Energy⓬ Indonesia
Cirebon Coal Thermal IPP

Linden Gas Thermal IPP
Compass Gas Thermal IPP
Freeport LNG
JERA Global Markets(Optimization and Trading)⓱ Mexico
Valladolid Gas Thermal IPP
Falcon Gas Thermal IPP⓭ Australia
Darwin LNG
Gorgon LNG
Wheatstone LNG
Ichthys LNG

Summit Power IPP Project
Meghnaghat Gas Thermal IPP

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

64

Contents / Editorial Policy

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

List of Group Companies(as of March 31, 2021)

Consolidated Subsidiaries
Name

Equity Method Affiliates
Location

Business Description◦JERA Power International B.V.*1

Investing, financing, guarantees, etc. for overseas power
Amsterdam, the Netherlands
generation business, etc.

◦JERA Australia Pty Ltd*1

Perth, Australia

Managing fuel-related business in Australia◦JERA Global Markets Pte. Ltd.*1

Singapore

Fuel trading business and associated business◦Tokyo Timor Sea Resources Pty Ltd*1

Perth, Australia

Investing in a gas field development project in theAustralia-East Timor Joint Petroleum Development Area

◦Hitachinaka Generation Co., Inc.*1

Tokai-mura, Naka-gun,Ibaraki Prefecture

Power generation at thermal power plants andassociated business◦LNG Marine Transport Co., Ltd.

Chiyoda-ku, Tokyo

Marine transport of liquefied natural gas and otheragency business◦JERA Asia Pte. Ltd.

Singapore

Development of electricity-related and gas-related
projects in Asia

◦JERA Power YOKOSUKA LLC

Yokosuka City, Kanagawa
Prefecture

Power generation at thermal power plants andassociated business◦JERA Power ANEGASAKI LLC

Ichihara City, Chiba Prefecture

Power generation at thermal power plants andassociated business◦Chita LNG Co., Ltd.

Chita City, Aichi Prefecture

Receiving, storage, and gasification of liquefied naturalgas, and delivery-related operations◦Goi United Generation LLC

Ichihara City, Chiba Prefecture

Power generation at thermal power plants andassociated business◦JERA Power (Thailand) Co., Ltd

Bangkok, Thailan

Power generation operation/maintenance andengineering services in Thailand (investing in the
aforementioned businesses)◦Fuel TEPCO, Ltd.*2

Koto-ku, Tokyo

Petroleum product sales, operation and management offuel facilities for thermal power generation, and disasterprevention and response operations for power plants,
etc.

◦JERA Power TAKETOYO LLC

Taketoyo-cho, Chita County,
Aichi Prefecture

Power generation at thermal power plants andassociated business◦JERA Americas Inc.

Delaware, USA

Managing power-generation and fuel-related business in
the Americas (investing, financing, guarantees, etc. for
US power generation business, etc.)◦JERA Americas Holdings Inc.

Delaware, USA

Managing power-generation and fuel-related business in
the Americas

Name

Location

Business Description◦Soma Kyodo Power Company, Ltd.

Soma City, Fukushima
Prefecture

Operation and maintenance of thermal power plants andelectricity sales◦Joban Joint Power Co., Ltd.

Chiyoda-ku, Tokyo

Operation and maintenance of thermal power plants andelectricity sales◦KASHIMA KYODO ELECTRIC
POWER Co., Ltd

Kashima City, Ibaraki
Prefecture

Operation and maintenance of thermal power plants andelectricity sales◦Kimitsu Cooperative Thermal Power
Company, Inc.

Kimitsu City, Chiba Prefecture

Operation and maintenance of thermal power plants andelectricity sales◦TeaM Energy Corporation

Manila, the Philippines

Power generation business in the Philippines

37 other companies

48 other companies*1 Five companies qualify as specified subsidiaries. Note that of the other 48 companies, the following qualify as specified subsidiaries: JERA Trading
International Pte. Ltd.; JERA Ichthys Pty Ltd; JERA Gorgon Pty Ltd; Tokyo Electric Power Company International B.V.; JERA Power Management
Asia B.V.; Reliance Bangladesh LNG & Power Ltd.; Chubu Electric Power Integra Pty Ltd; JERA Darwin Investment Pty Ltd; JERA Darwin LNG Pty
Ltd; Cygnus LNG Shipping Limited; JERA Storage Investment B.V.; Pacific LNG Shipping Limited; Pacific Eurus Shipping Limited; Tokyo Timor Sea
Resources Inc.; JERA Global Markets Netherlands B.V.; JERA Global Markets North America, LLC; and JERA Global Markets UK Ltd.
*2 Company name changed to Nexeraise Co., Ltd. in July 2021.

JERA GROUP CORPORATE COMMUNICATION BOOK 2021

65

Contents / Editorial Policy

Company Organization

Value Creation

Foundation for Value
Creation: ESG

Strategies

Financial and Corporate
Information

Corporate Outline(As of July 1, 2021)

Corporate Auditor

Auditor’s Section

Corporate NameJERA Co., Inc.

Internal Audit Group[Headquarters]
Nihonbashi Takashimaya Mitsui Building 25th Floor, 2-5-1 Nihonbashi,
Chuo-ku, Tokyo
103-6125
TEL: 03-3272-4631 (Switchboard) FAX: 03-3272-4635

Corporate Strategy Department
Chairman/President◦Planning Group◦Research Group◦Technology Strategy Group◦Enterprise Value Creation Group◦Information and Communication Technology Strategy
Group◦Information and Communication Technology Management
Group

Finance and Accounting Department◦Accounting Group◦Finance Group

Location◦Structured Finance Group[West Japan Branch]
JP TOWER NAGOYA 18th Floor, 1-1-1 Meieki, Nakamura-ku, Nagoya-shi,
Aichi
450-6318
TEL: 052-740-6842 FAX: 052-740-6841

Business support and Solution Department◦Labor Affairs and Human
Resources Group◦Global Human Resources
Group◦General Affairs Group◦Legal Group

Business Development Department◦Business Development Strategy Group◦Business Management Group◦Power Plant Regional Affairs Group◦Domestic Business Management Group◦Renewable Energy Business◦Domestic Business Development GroupGroup◦Overseas Power and Energy◦Upstream Resources and Value
Infrastructure Business Group
Chain Business Group◦Offshore Wind Power Business ◦LNG Transaction GroupGroup

Optimization Department◦Fuel Operation Management◦Optimization Strategy GroupGroup◦Energy Solution Sales Group 1◦Energy Solution Sales Group 2 ◦Power Operation Management◦Short-term Optimization GroupGroup◦Coal, Oil & Biomass Fuel Group◦LNG Contract Management
Group 1
◦LNG Contract Management
Group 2

[East Japan Branch]
Hibiya Kokusai Building 9th Floor, 2-2-3 Uchisaiwai-cho, Chiyoda-ku,
Tokyo
100-0011
TEL: 03-3272-4631 FAX: 03-6363-5781

Establishment
Date

April 30, 2015

CapitalJPY 5 billion yen

Shareholding
Ratio

Business
Details

TEPCO Fuel & Power, Inc. 50%
Chubu Electric Power Co., Inc. 50%◦Thermal Power Generation Business◦Renewable Energy Business◦Gas and LNG Business◦Engineering and Consulting related to the above businesses, etc.

O&M Engineering Department◦O&M Engineering Strategy
Group◦Digital Power Plant Promotion
Group◦Operation Group◦Engineering Group◦Domestic Engineering Service
Group◦Purchasing Group

East Japan BranchWest Japan Branch
JERA GROUP CORPORATE COMMUNICATION BOOK 2021

66

It is always the challengers, those who face difficulties head-on, who build the future.
When you see players compete, the strength to do your very best
wells up within you.
At JERA, we feel the same way—we are Japan’s largest power company,
and we are expanding the range of our activities throughout the world.
We believe that taking on the challenge of“JERA Zero CO2 Emissions 2050” that sets a goal of achieving
zero CO2 emissions by 2050, will open up a new future.
In the same way that a baseball game can turn on a single pitch,
we intend to make waves in the world with our scale and ideas.
Taking energy, and the promotion of culture and sports throughbaseball, into the future.

JERA is devoting its energy to cheering for the Central League.

JERA Co., Inc.

Nihonbashi Takashimaya Mitsui Building 25th Floor
2-5-1 Nihonbashi, Chuo-ku, Tokyo 103-6125
TEL: 03-3272-4631 FAX: 03-3272-4635
www.jera.co.jp

We identify with the business objective of Nippon Pro Baseball—promoting baseball to contribute to thedevelopment of sports, thereby contributing to prosperity in Japan and international goodwill—and are a special
sponsor of the Central League, which continues its steadfast journey of developing baseball.