J-POWER Group
Medium-Term Management Plan
2024-2026
May 9, 2024
Copyright © J-POWER All Rights Reserved.

Electric
Power
電源開発株式会社
Development Co., Ltd.

Securities
code

9513

1 Summary of Medium-Term

Management Plan FY2021-FY2023

2 Medium-Term Management Plan
FY2024-FY2026

3

Priority Items

Appendix

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1

MISSIONMISSION

Coexistence of a Stable Energy Supply
and Response to Climate Change

The J-POWER group will realize the sustainable development of humancivilization on Earth by contributing to the transition to a carbon-neutral
society while maintaining a stable energy supply toward 2050.
New Tomamae Winvilla Wind Farm

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2

Okutadami Lake

1 Summary of Medium-Term

Management Plan FY2021-FY2023

2 Medium-Term Management Plan
FY2024-FY2026

3

Priority Items

Appendix

Copyright © J-POWER All Rights Reserved.

3

Summary of Medium-Term Management Plan FY2021-FY2023 1/2
PerformancetargetConsolidated ordinary income

hundreds of millions of yen

1,708

Consolidated equity ratio

Achieved

28.5

728

%

RenewableenergyNew development

32.3

29.9

35.0

Owned capacity

MW

MW

2,638

Achieved

1,185

609

RenewableenergyFinancial target

1,700

1,735

Research,etc.
initiated

1,773

9,682

9,650

20

21

9,896

10,004

22

23

30.0

900

Construction
startedOperations
started

20

21

22

23

A target of 90 billion yen achieved
CO2 emissions

Domestic power generation business’s
CO2 emissions
CO2 in tens of thousands of tons

4,538

20

21

23

A target of 30% achieved

Closing share price

20

yen

22

23

Development on a scale of 1,500
MW*1 in sightPer-share dividend amount90
75

3,368*2

Return tostockholders
yen

40

40

50

45

25

0 20 21 21 22 22 23 23

20

21

22

23

Steadily reduced toward FY2025 target

Still recovering from the lows since its
listing

24*1 Compared to FY 2017

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30.0

19.7
40

23

61.5

55

35

22

%

75

35

21

Consolidated payout ratio

100

Record low of 1,356(December 22, 2022)

20

A scale of 10,000 MW achieved

PlannedNew record high of 2,610(February 2, 2024)

3,960

・・・

21

Return tostockholders

Stock market

4,877: Result for FY2013

4,162 4,064

22

Stable dividend continued and dividend
increase determined three times*3

20

21

Planned

14.5
22

23.5
23

The benchmark of 30% not reached*2 Preliminary results*3 The year-end dividend for FY2023 will be put on the agenda for the 72nd General Meeting of Shareholders.

4Summary of Medium-Term Management Plan FY2021-FY2023 2/2
Actions

Major initiatives
Accelerating the development of

Action 1

renewable energy globally

Accelerating thedevelopment ofCO2-free powersources

Steadily promoting the Ohma

New value

creation utilizing
existing assets

Upcycling of renewable energy

Determination and promotion of NEXUS Sakuma Project
Promotion of repowering of hydro and wind powers

Realization of NEXUS Sakuma Project
Securing and improving profitability

Promoting GENESIS Matsushima

Progress of environment assessment
Determination to discontinue the existing
Matsushima Thermal Power Plant

Realization of GENESIS Matsushima Plan
Realization of transition at other thermal power
plantsEstablishment of a joint venture between ENEOS Group
Research and consideration as an advanced CCS business

Development of a CCS value chain based on
implementation in own thermal power plants

Pursuing the possibility of CO2-freehydrogen(Including CO2-free ammonia)

Involvement in the hydrogen/ammonia value chain
and consideration of power generation
applications

Participation in hydrogen/ammonia production
and supply projects
Accelerated studies of power generation use

Accelerating the social

Establishment of external networks and enhanced
internal collaboration
Investing in 13 start-up companies

Shift from exploration to business development

Started operation of three large projects(Triton Knoll in Britain, Jackson in US, Batang inIndonesia)

Reconfiguration of business portfolio
Accelerated payback of investment

Efforts for improvements in capital

Replacement of business portfolio, including saleand reinvestment of assets

Establishment of a system to measure capitalefficiency by business and take appropriate
remedial measures

Promotion of sustainable

Establishment and raising of CO2 reduction plans
Identification of materiality and setting of targets(KPI)

Establishment of PDCA cycle
Further deepening

Initiatives for early implementationof CCS
Action 3

Challenges to
new businessareas

Action 4

Enhancement ofbusinessfoundation

H2

Owned capacity on a scale of 10,000 MW achieved

Improved profitability during price escalation
Reliable promotion of offshore wind power
projects in Japan
Early full-fledged construction
Improved predictability of investment recovery

Plan(Upcycling)

New development on a scale of 1,500 MW in sight

Future tasks

Progress of conformance review

Nuclear Power Plant

Action 2

Results

implementation of innovations
Expansion of overseas businessfoundation

efficiency

management
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5

Nikaho No. 2 Windfarm

1 Summary of Medium-Term

Management Plan FY2021-FY2023

2 Medium-Term Management Plan
FY2024-FY2026

3

Priority Items

Appendix

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6

Positioning of Medium-Term Management Plan FY2024-FY2026
By continuing our initiatives to date, we have gained a certain level of prospects for achieving our 2030 CO2 reduction target.
Looking to the world beyond 2030, the J-POWER group will take on the challenge of further transition and the developmentof carbon-neutral assets.
2021-2023
Long-term
direction

2030

2050

Grow globally through creativity and ingenuity basedon technology and experience
Realize a sustainable society by providing CO2-freeenergy continuously

J-POWERBLUE MISSION 2050

Action plan

2024-2026

First steps to challenges

Medium-Term
Management Plan
2021-2023

New action plan

Medium-Term
Management Plan
2024-2026

Copyright © J-POWER All Rights Reserved.

CO2 emissions

Acceleration
Upcycling
Challenges tobusiness areas-46%

On track
to achieve the goal

FY2013
Ratio of actual
results

NEXT Challenge
Transition of businessportfolio
Transition of business models

2030s

7

Targeted business portfolio 2030s

This plan will be updated, reviewed, and refined as needed according to the government's GX policies (including theenergy master plan, global warming mitigation measures, NDC), the electricity supply and demand situation, theelectricity system design, the progress of industrial development, and other conditions.

With the aim of accelerating the transition to carbon-neutrality after 2030, we will promote the transition of thermal electric power generationin Japan and aim to transform our business portfolio to one centered on carbon-neutral assets both domestically and abroad while being
mindful of capital efficiency.
Business portfolio in 2030s

Business portfolio at the end of FY 2023
Seeking to
expand into
peripheral areas

Ohma
Nuclearpower
Renewable

Overseas

energy in Japan

renewable energy

5,210

In JapanCO2-free power sources*1

1,030

Transmission andtransformation*2

Overseas
CO2-freepowersources

Overseas gas-fired

1,720

power generation(including some coalfired power generation)

6,840

Thermal power
generation in JapanNew field

3,850

Transmission andtransformation*2

Electric power peripheral 730(Natural resources interests)

Aged coal-fired
power 470
The size of the bubble represents the amount of business department fixed assets ( inhundreds of millions of yen)

Carbon-neutral assets

Transition assets

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Overseas
TransitionPowersources

Asset replacement

Coal asset

In Japan
Transition
Power sources

Electric power
peripheral(Natural resourcesinterests)
Thermal power
generation in Japan

Non-performing assets*1 Domestic renewable energy, CO2-free thermal power and Ohma nuclear power*2 Transmission and transformation business is an initiative of J-POWER Transmission.

8

Direction of thermal power generationtransition in Japan

This plan will be updated, reviewed, and refined as needed according to the government's GX policies (including theenergy master plan, global warming mitigation measures, NDC), the electricity supply and demand situation, theelectricity system design, the progress of industrial development, and other conditions.

In accordance with the BLUE MISSION 2050 roadmap, inefficient coal-fired power plants will be phased out,
while high-efficiency thermal power plants will be selected based on the characteristics of each location toachieve low-carbon and decarbonization while contributing to stable power supply.
Image of transition
Isogo Thermal Power Plant

Takasago Thermal Power
Plant

Takehara Thermal Power
Plant

Tachibana-wan Thermal
Power Plant

Image of transition

Unit 1600MW

Hydrogen

Unit 2600MW

Hydrogen

Unit 1

250MW

To be
decommissioned

Unit 2

250MW

To be
decommissioned

Matsuura Thermal Power
Plant

Unit 1600MW

Expansion of biomass mixed
firing + CCS

Unit 3700MW

To be discontinued or made intoa reserve power source

Unit 1

1,050MW
1,050MW

Ishikawa coal-fired powerplant

Kashima Power Station

Ammonia mixed firing
Ammonia

Unit 2

Matsushima Thermal Power
Plant

Ammonia mixed firing

Unit 1500MW

To be decommissioned at theend of FY2024

Unit 2500MW

Addition of gasifier IGCC+CCS

Unit 11,000MWTo be discontinued or made intoa reserve power source

Unit 2

1,000MWAmmonia/CCS

Unit 1156MW

IGCC+CCS

Unit 2156MW

IGCC+CCS

Unit 2322MW

New site

Hydrogen/ammonia

Ammonia2030
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2035

2030

2035

9

Management target
While the impact of climate change policies on our business performance is unavoidable to a certain extent,
we have set a future ROE target of 8% or higher.
We aim to achieve our target of 90 billion yen in ordinary income in fiscal 2026, while keeping in mind thelevel of ROIC required for the future.
Management target
Ordinary income

Net income
attributable toparent company

2030s

FY2026

Approx. 90
billion yen

Approx.
62 billion yen

Performing
assets
ROIC*1Equity ratio

8% or more

Approx.

30% orApprox.

Approx.

ROE

5%

3.5%

more

3.5%

Assuming a ratio of non-performing assets of around 10%, the level of ROIC for operating assets required to achieve a ROE of 8% or more in
the 2030s is set at around 3.5%. Work on converting construction in progress and other assets into operational assets while aiming for a
performing assets ROIC of around 3.5% from FY2026.
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*1 (NOPAT + investment gain (loss) on equity method )/(interest-bearing debt + shareholders’ equity − non-performing assets), NOPAT includes nonoperating income/loss and extraordinary income/loss which can be directly charged to business departments.

10Return to stockholders
We will maintain a policy of stable and continuous dividend payments.
We will pay a stable dividend of 100 yen per share (forecast), and will consider paying an additional
dividend if profits increase over the three-year period.
Basic policy on return to stockholders

Excluding short-term profit fluctuation factors, we aim for a consolidated dividend payout ratio of
30%, and strive for stable and continuous enhancement of returns to shareholders based on profit
levels, performance prospects, financial conditions, and other factors.

Return to stockholders FY2024-FY2026
Dividend
increase

Stabledividend

Additional
dividend
We will consider paying an

additional dividend if profits

Dividend increase to 100 yen,equivalent to a payout ratio of 30%.

100 yen dividend is theincrease over the threeyear period.

lower limit

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11

Capital allocation FY2024-FY2026
We plan to make strategic investments of approximately 300 billion yen over the next three years, with a view to making
700 billion yen in strategic investments by FY2030.
We will prioritize investments in domestic and international carbon-neutral assets that support sustainable growth, with afocus on capital efficiency and profitability.
Allocation plan FY2024-FY2026 In hundredsof millions of yen

Cash out

Operating cash flow

Return tostockholders 550
Investment cash
flow

6,650

In hundreds of millions of yen

Strategy investment

Cash in

5,350

Breakdown of investment cash flow

Global renewableenergy development

Enhancement ofelectric power
networks*1

Thermal powertransition

Hydro power, thermal
power and power
network*1
replacement
investment, etc.

Nuclear power

2,000

600

300

2,300

Financing, etc.

1,450

1,850

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*1 The enhancement of the electric power network is an initiative of J-POWER Transmission.

12BLUE MISSION 2050 road map

CO2 reduction target

This plan will be updated, reviewed, and refined as needed according to the government's GX policies (including theenergy master plan, global warming mitigation measures, NDC), the electricity supply and demand situation, theelectricity system design, the progress of industrial development, and other conditions.

-46%

*1

Actual emissions 0-22.5 million tons

Realization of carbon-neutrality

CO2 emissions from J-POWER Group's
domestic power generation business

CO2 emissions from J-POWER Group's
domestic power generation business

2025

2030

2040

2050

*1

-9.2 million tons
Expansion of
CO2free powersources

4 billion kWh/year increase in power
generation in Japan
New global development

Renewable energy
Nuclear powerStart of construction and operation of Ohma Nuclear Power Plant

Domestic coal-fired
power plants

Push for zeroemission powersources

Further new development, upcycling of existing sites, maximum utilization ofexisting assets

Phased out sequentiallyfrom the aging ones

Low-carbon initiatives(Expansion of biomass mixed firing and introduction of ammonia
mixed firing, etc.)

Development of businessenvironment, and designand construction of facilities

CCS

Press fit and storage

Hydrogen power
generation

Verification test in Japan

Upcycling

Fuel production(CO2-free hydrogen)

Consideration of overseas
commercialization

Utilization in other industries

Stabilization
Power network
Enhancement*2

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Realization of CO2-free thermal power generation(hydrogen, ammonia , IGCC+CCS, biomass mixed firing + CCS, etc.)(Addition of gasifier to existing assets)

Improvement in load following capability by hydro power and upcycling (addition of gasifier to existing assets) and expansionof distributed energy service
Enhancement of the New
Sakuma Frequency Converter
Station and others completed*1 Compared to FY2013 results

Contributing to the enhancement of power networks*2 The enhancement of the electric power network is an initiative of J-POWER Transmission.

13

Onikobe Geothermal Power Station

1 Summary of Medium-Term

Management Plan FY2021-FY2023

2 Medium-Term Management Plan
FY2024-FY2026

3

Priority Items

Appendix

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14

Priority Items
具体的な取組項目

Priority Items

01

02

Growth strategy

Establishment and growth of sustainable
revenue stream

Renewableenergy in Japan

Overseas

Transition strategy

Strategies for business portfolio in 2030s

H2

Hydrogen/ammonia
Transmission andtransformation*1
Ohma Nuclear
power
Innovations

03

04

Securing decarbonization technologies by pursuing multiple
opportunities
Promotion of enhancement plan of the Sakuma Frequency
Converter Station and pursuit of new business opportunities
Steady promotion with a view to the use of long-term
decarbonization power source auctions
Creation of new revenue streams through collaboration withstart-ups, etc.

Business management

Improvement of profitability andinvestment efficiency

Department
management
Investment
efficiency

Enhancement of business portfolio management according tobusiness characteristics by changing segments
Autonomous management of the sector through ROIC,
strengthening of initiatives to improve capital efficiency

Increased competitiveness

Enhancement of group’s competitiveness

Human resources
DX

05

Increased revenue by expanding power generation and realizing
environmental value
Generating returns over multiple time horizons while improving
capital efficiency

Sustainability

Deepening of ESG management

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ESG

Continued development of diverse human resources who will
become pioneers of wisdom and technology
Improved group competitiveness through the creation of 3Ps“Yoryoku” of human resources

From the development of the promotion system to thestage of deepening*1 Transmission and transformation business is an initiative of J-POWER Transmission.

15

Priority Items

01｜Renewable energy business in JapanAs Japan's leader in renewable energy development with a history of more than 70 years, we aim to increase revenue andachieve further growth by expanding power generation (+4 billion kWh) and realizing environmental value by leveraging
our renewable energy assets and knowledge we have built up to date.
General hydropower

Expansionof power
generation

9 billion•••

Onshore Wind

1.1 billion

kWh*1

Promotion of NEXUS
Sakuma Project
Repowering of existinghydro power
Small and medium hydropower development•••

Offshore Wind

0.3 billion

Under
construction/development

kWh*1

Promotion of development
projects on a scale of
1,150MW
Replacement of existingsites with larger windturbines
Improved availability
through constant,centralized monitoring

Geothermal•••

Large-scale
pumping

kWh*1

Promotion of offshore windprojects in Hibikinada
Reliable start of operation
off the coast of Oga City,
Katagami City and Akita
City, Akita Prefecture
Acquisition of new
locations

Solar
Under
construction

Increase its
value as acoordinating
force to support
the mass
adoption ofrenewableenergy sources.

Accelerated new development also through alliance, based on ensuring profitability
Renewable energy power generation in Japan+4 billion kWh per year by 2030
*2

Improved
revenue
Maximization of environmental value

Realizationofenvironme
ntal value

through corporate PPAs, etc.
Corporate PPAs with
consumers who highly
appreciate environmental value

Copyright © J-POWER All Rights Reserved.

*1 Results for FY2023

Diverse renewable energy
power aggregation*2 Compared to FY2022

Improvement of power
generation forecasting
technology

16

｜Overseas businessPriority Items 01

We aim to expand our business segments and business areas while improving capital efficiency, centering on theacquisition of developer profits not only in the power generation business but also in renewable energy and otherbusinesses, and to shift to a business model that can generate profits over a diverse time horizon.
Partial interests are sold after development anddeveloper profits are earned.

Major projects in recent years
Triton Knoll Offshore Wind Farm
Operations started

60
Ownership

857MW Offshore Wind%
Ownership%

2,000MW

JacksonBulanog Batang Hydro
Power Plant

Batang Power Plant

Ownership Operations started

Jackson49%

Under development 32.5MW Hydro

Coal-fired power

40

Operations started 1,200MW
Gas-fired power generation

100

Under development 375MW Solar

Making Genex Power a wholly
owned subsidiaryBusiness area

Solar

Under development

400MW

Onshore Wind

Under development

258MW

Pumping

Under construction

250MW

Storage battery

Operations started

Profit generation timing

Expansion of priority areas

Multiple time horizons

Renewable energy

Investment

Southeast Asia

Independent/joint
development

Short-term

USA

Consulting

Australia

O&M service

Europe & Middle East

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Ownership

775MW

Collective strength

Distributed resources%

Under development

Operations started

Decarbonization

Gas-fired power generation(including the replacementof existing facilities)

Ownership%

Transition of business models
Business segment%

Ownership

Procedures for conversion to a subsidiary
have been initiatedTarget business

51

Jackson Generation Power Plant
Refugio project

Under construction/development 10.6MW Solar

34

Partner

51%

100%

25

Rooftop Solar 9 projects%

J-POWERJ-POWER

Medium-termLong-term

100MW
50MW

Capital efficiency
Improved capital efficiency

Reconfiguration of
asset
portfolio/businessportfolio17

｜CO2-free hydrogen/ammonia strategy

Priority Items 02

In addition to promoting the GENESIS Matsushima Project to commercialize coal gasification power generation technology
for future CO2-free hydrogen power generation, we will pursue various opportunities from upstream to downstream in the
supply chain to secure decarbonized technologies.
Manufacturing and supply

Power generation

CCS

Osaki Coolgen projectPursuit ofcoal
gasification
technology

J-POWER GENESIS
Commercializing

Matsushima Thermal Power Plant (current)

Aiming for CO2-free hydrogen power generation in
the futurewith gasification technology at the core

Operation of a larger gasifier
Demonstration test of gas turbine operation withhighly concentrated hydrogenOverseas bluehydrogen/ammonia

Research and consideration of participation inoverseas upstream projects

Pursuit ofdiversedecarboniza
tion options

Overseas greenhydrogen/ammonia

Research and consideration of participation inoverseas upstream projects

Coal hydrogen in Australia
Consideration of hydrogen production andsupply by lignite gasification

Green hydrogen in Japan
Consideration of the feasibility of greenhydrogen in Japan
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CCS in Japan
Utilization of hydrogen/ammonia
power generation

Consideration of the procurement,
transportation, acceptance, and combustion ofhydrogen/ammonia

Initiatives to implement CCS with the
ENEOS Group

Overseas CCS
Pursuing the possibility of CO2
retention overseas

Green hydrogen/ammonia▶ Acquisition of the development rights for a large-scale greenhydrogen/ammonia production project in Oman•••

Consortium with Yamna and EDF signs business development agreement with
Hydrom*1, an Omani government agency
Approximately 4.5 GW of solar power, wind power, and storage batteries and 2.5
GW of water electrolyzers to be installed
A detailed project study will be conducted in the future to confirm the feasibility ofthe project*1 Hydrogen Oman SPC that oversees the development of green hydrogen projects in Oman

18

｜Contributing to the enhancement of power networks

Priority Items 02

We will steadily promote the J-POWER Transmission's Sakuma Frequency Converter Station enhancement plan to contribute to the wide-area
operation of the power system.
Building on our achievements to date, we will pursue business opportunities to help strengthen the power network to support the mass
adoption of renewable energy.

Transmission and transformation facilities
J-POWER Transmission owns and operates critical transmission and transformation
facilities throughout Japan, including the cross-regional interconnection facilities
that interconnect the grids of different electric power companies.
Facilitiesin
operation

4

Transmission lines Total length: Approximately 2,400 km Substations

locations

AC/DC converter stations 4 locations

Frequency converter stations 1 location

Construction of the New Sakuma Frequency
Converter Station and others

Start of construction in April 2022
Operation scheduled to start in FY2027

Replacement/expansion of the New
Sakuma Frequency Converter Station
and related transmission lines

Today's most pressing issues also include the need to sophisticate
maintenance due to over-aging deterioration and strengthen resilienceagainst intensifying natural disasters. J-POWER will continue to contributeto a stable power supply through these efforts.

West Area
Interconnection Line

Construction of the New Sakuma Frequency
Converter Station and others- New Sakuma Frequency Converter Station

300MW- Sakuma East Trunk Line, etc.

Approx. 138 km

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Hokkaido-Honshu
Interconnection Line
Frequency

J-POWER will steadily promote the replacement/expansion of the New
Sakuma Frequency Converter Station and related transmission lines to meet
consumers' expectations for enhancing the capability to interchange electric
power between 50Hz in eastern Japan and 60Hz in western Japan. J-POWER
will continue to pursue business opportunities contributing tostrengthening power networks.

In theconstruction
phase

The transmission and transformation
business is handled by J-POWER
Transmission Network Co., Ltd., a wholly
owned subsidiary.

KanmonInterconnection Line

Sakuma Frequency Converter Station
Kii Channel HVDC Interconnection Line
Honshu-Shikoku Interconnection Line19

｜Ohma Nuclear Power Plant Project

Priority Items 02

As a large-scale CO2-free power source and a power plant that supports the nuclear fuel cycle, we will promote the Ohma
Nuclear Power Plant Project, which contributes to climate change response and Japan's energy security, with the highest
priority on safety assurance, while also keeping in mind the use of the Long-Term Decarbonization Power Auction
Program.
Overview of Ohma Nuclear Power Plant Project
Ohma Nuclear Power Plant (underConstruction
site

Ohma-machi, Shimokita-gun, Aomori Prefecture

Capacity

1,383MW

Reactor type

Advanced Boiling Water Reactor (ABWR)

Fuel

Enriched uranium
Mixed (uranium and plutonium) oxide

Start ofconstruction

May, 2008

Start ofoperations

To be determined

construction)

Process (Results)(Year)

2008

Applied for a permit to change the reactor
installation in December
Applied for construction plan approval

Construction resumed in
October

Constructioncommenced in May

2009

2010

Obtained permission to install nuclear
reactor in April

Copyright © J-POWER All Rights Reserved.

2011

2012

2013

2014

2015～

Suspension of construction work due to Great East Japan
Earthquake Disaster in March

Hokkaido
Construction
site

The
Sea ofJapan

AomoriThe
Pacific
Ocean

Tokyo

20

｜Creation of new business areas

Priority Items 02

Through investment and collaboration with startups, etc., the J-POWER Group will seek to create value by integrating its
technologies and expertise, and will establish a new organization (newly established as the “Innovation Promotion
Department” in April 2024) to develop and accelerate the results of value creation into new profitable businesses.
Examples of major collaboration with funded start-ups
Green Earth Institute Co., Ltd.

PowerX Manufacturing, Inc.

Combined businessinitiatives such as biomass
fuel production fromwaste oil palm trees

Nippon Fiber Corporation

Production of highperformance long fibers
from thermal power plant
coal ash andcommercialization efforts

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Initiatives to build a new
power grid with storage
batteries and to create
new services that
contribute to therealization of adecarbonized society

Kyoto Fusioneering Ltd.

Strengthened
collaboration on peripheraltechnologies for fusion
power generation, theultimate energy source

WOTA CORP.

Initiatives to create newservices by combining
compact distributed water
treatment technology andrelated products with ourexpertise in power
generation

As of March 31, 2024, we made direct investments in a totalof 12 companies, including the following, in addition to thefive companies listed above.
• GITAI USA Inc• BELLDESIGN Inc.
• Scalar, Inc.
• Save Medical Corp.
• VUILD, inc.
• AREANO Inc.
• WASSHA Inc.
We will seek to create new value with startups and businesses
other than those in which we have invested.

21

｜Business management

Priority Items 03

Through the introduction of ROIC, we aim to improve company-wide ROIC by encouraging businessdepartments to operate autonomously and to consider and implement capital efficiency measures based on
the characteristics of each business.
Change in reportable segment

Business department

Hydro

Wind power

Electric businessPowergeneration
business

Geothermal/solar

Business management
Business department
Business department ROIC=

Business department NOPAT*1 + Business department investment
gain (loss) on equity method
Fixed assets of business departments

Promotion of autonomous business operations and the consideration andimplementation of capital efficiency measures based on business characteristics

Thermal power

Nuclear power
Transmission andtransformation
business

Transmission andtransformation*1

Electric powerrelated businessElectric powerrelated businessElectric powerrelated

Overseasbusiness

Overseasbusiness

Other business

Other business

Overseas

Other

Company-wide
Nonperforming
assetsROIC
Interestbearing debt

Performing
assets=NOPAT*2 + investment gain (loss) on equity
methodInterest-bearing debt + shareholders’ equity

Performing assets ROIC
Shareholders’equityNOPAT*2 + investment gain (loss) on equity
method= Interest-bearing debt + shareholders’ equity –non-performing assets

Review of business portfolio, reduction of corporate expenses and assets, etc.
Copyright © J-POWER All Rights Reserved.

*1 The transmission and transformation business is an initiative of J-POWER Transmission.
*2 After-tax operating income (including non-operating and extraordinary gains/losses that can be directly charged to business departments)22

｜Human resource strategy to enhance corporate value

Priority Items 04

We will contribute to solving various social issues facing Japan and the world by respecting individuals, ensuring
opportunities for diverse work experiences, developing and improving human resources systems that support employees'
challenges, and continuing to nurture diverse human resources who will become pioneers of wisdom and technology.
Harmonious coexistencewith the local community

Promotion of
women tomanagerial
positions

By 2030, more than three times 72
FY2021 level

persons

24

21

Recognised as achieved
in FY2016

Wide range of business fields

Promotion of diversity

Power generation facilities(133 sites in Japan and overseas sites)
Transmission and transformation
facilities, Construction sites, etc.
Renewable energy shift with 100
persons or more

Doubled hiring of
new female graduates
Extension of retirement age to 65
Support for childcare and return
to work

Stable supply
FY2019-FY2024
Acquired for six
consecutive years

Growth field
Carbon-neutrality
Transition

Lean and efficientRich individuality
Diverse humanresources
Spirit of challenge

Promotion offoreigners tomanagerial
positionspersons

Challenges todifficult development

Promotion ofexperienced
hires tomanagerial
positions

32

37

22

23

30

By 2030, increase compared to
FY2021
147

150

151

21

22

23

30

By 2030, 1.5 times more thanin FY 2021
165
136
124
110

persons
Eradication of serious disasters
Promotion of healthy management
Promotion of diverse work styles

Creation of a safe and secure
workplace

Copyright © J-POWER All Rights Reserved.

22 open positions forhuman resources*1
High level of training costs(236 thousand yen/person*2)

Support for autonomous careerdevelopment

21

Increased valueadded
Innovations

Percentageof womenamong newgraduates
hired

22

23

30

20% or more, which is morethan before

16

21

22

22

23

%

*1 Cumulative results up to FY2023 *2 FY2023 results*3 Results for the year in which recruitment activities are carried out; actual induction is in April of the following year.

21

24

25

23

｜Creating 3Ps “Yoryoku” through DX

Priority Items 04

The J-POWER Group aims to create the 3Ps “Yoryoku” (powers of potentiality, productivity and predictivity*) of human resources and improve theGroup’s competitiveness by promoting specific measures to realize its DX promotion vision “DX 3S+D.”* A term coined to describe the following: [Power of potentiality] The power of leeway created by automation and streamlining of operations [Power of productivity] The power of originality and ingenuity gained
through the addition of senses and new functions [Power of predictivity] Ability to predict and foresee based on data analysis

Strength: Strength to earn + D: Data-driven
Improvement of facility
availability/optimization of operation
Reduction of equipment downtime
through predictive failure detection

Optimization of value chain

Predictive detection of equipment failures
using drones and self-developed AI

Market forecasting based on large
volumes of data

AI

Creating 3Ps “Yoryoku” through DX
FY2025 target
Annual time effect

Smartness: Smartness in effectiveness + D: Data-driven

300 thousand
hours

Advanced operation and maintenancethrough the use of robots

VR

Annual monetary effect

3 billion yen

Safety: Safety and Security + D: Data-driven

Rapid visualization of management
information and facility status

Advanced safety management support
through VR, etc.

Thorough business process transformation

Smart security promotion

Problem solving through the use ofgenerative AI, etc.

Realization of work-in-life

Datainfrastructure

Copyright © J-POWER All Rights Reserved.

Digitalinfrastructure

DX human
resources24

Priority Items

05｜Deepening ESG Management

Based on the ESG management promotion system that has been developed so far, we will deepen ESG
management by implementing the PDCA cycle.

Execution

Supervision

Sustainability promotion system

PDCA cycle

Formulation/Review

Board of Directors
Delegation of authority
to execute business

Progress
Suggestion/Report management

Medium-Term Management Plan

Supervision by
Board ofDirectors

A

P

Establishment ofinitiatives items
and targets (KPI)

Dialogue withstakeholders

C

D

Initiatives

Executive committee
Direction

Suggestion/Report

Sustainability promotion board
Coordination

Group businesses: J-POWER Group Sustainability Promotion Conference

Materiality

Achievements to date

Initiatives

Formulation of “BLUE MISSION 2050”
Establishment of new CO2 reduction target for
FY2025
Raising of CO2 reduction target for FY2030

Steady promotion of “BLUE MISSION 2050”
 Steady achievement of CO2 reduction target for FY2025
 Clarification of path toward achieving CO2 reduction target for FY2030
Enhanced TCFD (climate change) disclosure
Implementation of disclosure of TNFD (natural capital)

Respect for people

Establishment of basic human rights policy

Steady progress toward achieving diversity target for FY2030
Implementation and establishment of human rights due diligence

Harmonious
coexistence with thelocal community

Community-based operation of power facilities

Deepening the way of coexistence with the community, led by the officials incharge of coexistence with the community

Enhancement ofbusiness foundation

Establishment of Nominating and Compensation
Committee
Transition to a company with an audit committee

Continued and thorough evaluation of the effectiveness of the Board of Directors
Incorporation and operation of materiality assessment into executive compensation

Energy supply
Response to climatechangeCopyright © J-POWER All Rights Reserved.

25

1 Summary of Medium-Term

Management Plan FY2021-FY2023

2 Medium-Term Management Plan
FY2024-FY2026

3

Priority Items

Appendix

Copyright © J-POWER All Rights Reserved.

26

NEXUS Sakuma Project
The amount of water used for power generation will be increased to achieve a maximum output of +50 MW (400 MW is the second largest inJapan* in terms of general hydraulic power) and an annual power generation output of +55 GWh.
By taking advantage of the generator's ability to operate at both 50Hz and 60Hz, we will contribute to the stable supply of electricity for boththe east and the west.
* The No. 1 general hydro power plant in Japan is J-POWER Okutadami Power Plant (560 MW).

Upcycling of one of the largest hydro power plants in Japan
Current

After renewal

TenryuRiver Volume ofwater usedG

Harmonious
coexistence with thelocal industry

350m3/s

306m3/sPowergenerator

Dam

G

400MW

Water in excess of the amount ofwater for power generation is released
from the dam

2025

400MW

375MW

2026

2030

2031

2035

1st term
Unit 1

Decision of
implementation
Official announcement
Sakuma renewal work
Establishment of
preparatory office

Unit 2

Water turbine/power
generator, building
Scrap and build
1st term construction
Start of construction
River Act and Electricity
Business Act
Approval procedures

Copyright © J-POWER All Rights Reserved.

Unit 3High-efficiency power
generation

New building with
regional characteristics

Effective use of water resources byusing discharged water for power
generation

350MW

2023

A place for open
exchangePowergenerator

350MW

2022

Improved job
satisfaction

Ties to local
communities

TenryuRiver Volume ofwater used

Dam

Sakuma Project

2nd term
Unit 1

Unit 4

1st term
construction
Completion

2nd term
construction
Start ofconstruction

Unit 2

Unit 3

Unit 4

Water turbine/power
generator, building
Scrap and build
2nd term
construction
Completion

27

GENESIS Matsushima PlanFirst step toward CO2-free hydrogen power generation by commercializing the technology demonstrated in Osaki
CoolGen Project.
We aim to become a leader in carbon-free thermal power generation in Japan, starting with upcycling by adding
gasification facilities to existing facilities.
First step toward CO2-free hydrogen
power generation

Supercritical pulverized coal-fired
thermal plant

Gasification system

Gas clean-up unit
OxygenGas
turbineCoal

BoilerElectricity
SteamturbineG

Biomass

G

Electricity

Gasifier
Heat-recovery
steam generator

Stack

Coal

2021

Biomass2024
Preparation for starting
construction

Announcement of
implementation
Environment
assessment
Start of procedure
Copyright © J-POWER All Rights Reserved.

Matsushima Thermal Power Plant (current)

Ammonia

2028

2026

Realization of GENESIS
Matsushima Plan

Construction work

Implementation of CCS
Existing Unit 1
decommissioned
Existing Unit 2
discontinued

Start ofconstruction

CO2-freeHydrogenpower
generation

Start ofoperations

28

Toward medium- and long-term enhancement of corporate value
Based on the analysis and evaluation of the current situation, we will work to improve capital efficiency
using ROIC as an indicator and to improve the corporate value over the medium to long term by further
strengthening the dialogue with the market regarding our response to the risks inherent in our business.
Analysis and evaluation Partially updated from material published on October 31, 2023

Capitalprofitability/c
apital costMarketevaluation

ROE

Shareholders’capital cost

PBR at end of
period

2019

2020

2021

2022

2023

5.3%

2.8%

8.1%

11.4%

6.8%

FY2026

0.5 times

0.4 times

0.3 times

0.4 times

0.4 times

2030s
ROE

About 6% on a CAPM basis.

We recognize that our stock price is subject to the following risks andrequires a return in excess of the cost of equity described above.
• Increased uncertainty in the electric utility industry• Progress in transitioning thermal power generation amid expected
decline in coal-fired power business• Ohma Nuclear Power Plant Project• Uncertainty about the contribution of the renewable energy
business to earnings

8% or more
ROE

Approx. 5%

Necessary level

Performing assets
ROIC*1

Performing assets
ROIC*1

Approx. 3.5%

Approx. 3.5%
Level required to achieve an ROE of 8%
or higher, assuming a non-performing
assets ratio of approximately 10%.

Remedial measures
Renewableenergy in Japan

Expansion of power generation and realization ofenvironmental value

P16

Overseas

Expansion of business scope and profit generation overmultiple time horizons

P17

Coal-fired
power

Publication of domestic thermal power generationtransition direction

P9

Ohma Nuclear
Power Plant

Consideration of the use of a long-term decarbonized
power supply auction system

P20

Businessmanagement

Study and implementation of measures to improve
capital efficiency through the introduction of ROIC

P22

Copyright © J-POWER All Rights Reserved.

ROE target/ROIC level image

Setting ROE target for 2030s
Establishment of ROIC levels necessary to achieve the above ROE
targets
Providing predictable shareholder returns

P11

Enhanced disclosure and ongoing efforts to engage in proactive
dialogue with the market*1 (NOPAT + investment gain (loss) on equity method )/(interest-bearing debt + shareholders’ equity − non-performing assets), NOPAT includes nonoperating income/loss and extraordinary income/loss which can be directly charged to business departments.

29This document contains forward-looking statements such as projections, plans, and targets related to the J-Power and our groupbusinesses. These statements are based on information currently available to J-Power and on projections and other assumptions
made at the time this document was prepared. These statements are based on certain assumptions. These statements andassumptions may prove to be objectively incorrect or may not be realized in the future.
The information in this document concerning companies other than J-Power and our group companies is taken from public
information, etc., and J-Power has not verified and does not guarantee the accuracy and adequacy of such information.