HIGHLIGHT
For the Prosperity of Future Generations

Taking on the Challenge ofRenewable Energy
The following is an introduction by field to ITOCHU Corporation’s involvement in renewable energy projects worldwide.

Core Subjectsof ISO 26000

Bolstering activities in the renewable energy sector is cited as a priority
area in our medium-term management plan, “Brand-new Deal 2012.”
Wind, solar, geothermal and other renewable energies are expected tosee growth going forward as major sources of energy due to better
government policy and greater knowledge in countries around theworld, lower technology costs, and other factors. ITOCHU intends toinvest in power generation assets and other facilities that utilize theserenewable energy sources and take part in manufacturing and distribution projects for products like bioethanol. Through these initiatives wewill take on challenges that affect the entire planet: reducing greenhouse gas emissions and addressing resource depletion.

Community involvementand development

Global Power Generation Volume by Fuel Type (2007–2035)(1 trillion kWh)

Background to Renewable Energy
and ITOCHU’s RoleTheEnvironment

20
Liquid fuels
Natural gas
Nuclear power
Coal
Renewable energy

1510502007

2015

2020

202520302035 Year

Source: Compiled by ITOCHU Corporation from “International Energy Outlook 2010,” published by the U.S. Energy Information Administration (EIA)

Solar Energy

ITOCHU is working to form competitive value chains by organically linking upstream raw
materials, midstream intermediate products, and downstream system integration andpower projects being developed in Japan, North America and Europe.

Partnership with Abengoa Solar of Spain in
Solar Thermal Power Generation Business

Establishment of SolarNet Holdings, Largest
Solar Distribution Company in US

In December 2010, a partnership was formed with a major Spanish
solar thermal power generator, Abengoa Solar, to develop solar power
projects in Asian and European countries. An agreement was alsoreached to jointly construct two 50 megawatt concentrating solar
thermal power plants in Extremadura in western Spain and carry out
power generation business. ITOCHU will take a 30% stake. Commercial
operation is scheduled to start in 2012, with power generated at theseplants sold to the grid based on the Spanish feed-in tariff system*.
Taking advantage of abundant sunlight in Extremadura, the two plants
will produce enough energy to meet the electricity needs of about
52,000 households and achieve emissions reductions totaling approximately 63,000 tons of CO2 per year.

The solar power distribution business has been expanding significantly
in recent years due to heightened environmental awareness and government support measures. ITOCHU has been developing its solar
business in the US, one of the three major solar markets in the worldalong with Europe and Japan, acquiring system integrators* Solar
Depot in June 2007 and SolarNet in April 2009. These two companies
were integrated in February 2011 to further bolster the business,creating SolarNet Holdings, the world’s largest solar distribution company for mainly household and industrial use. Going forward, synergistic effects from integration will be targeted through unification of sales
networks and reducing costs.

* Feed-in tariff system: A system for purchasing electricity at preferential rates designed topromote the use of renewable energy sources

Similar solar thermal power plant also operated by Abengoa (image courtesy of Abengoa)

9* System integrator: Operator that handles design, sales, and construction of solar power generation systems that combine solar cell modules and peripheral equipment

Example of past SolarNet projects: Beringer Vineyards, California

Wind PowerIn May 2010 ITOCHU and General Electric agreed to comprehensively
partner in uncovering joint investment projects around the world in therenewable energy sector and signed a memorandum of agreement to thiseffect. The agreement strengthens the two companies’ partnership in
anticipation of increased investment opportunities in renewable energies
at the global level. GE and ITOCHU have cooperated on two joint wind
power projects to date.

Keenan II Wind Power Project in Oklahoma
The total power capacity of the Keenan II wind farm in the U.S. stateof Oklahoma, which ITOCHU invested in with GE in October 2010, is152 megawatts (66 2.3-megawatt wind turbines). A 20-year powerpurchase agreement has been signed with Oklahoma Gas & ElectricCompany, and power will be supplied to approximately 45,000
households in Oklahoma. The project is expected to reduce greenhouse gas emissions by roughly
413,000 tons annually. Commercial operation commenced inDecember 2010. The wind farm’soperations and maintenance ishandled by NAES Corporation, awholly owned subsidiary ofITOCHU and one of the world’s
major power plant operation andmaintenance service companies.

GE Chairman and CEO Jeff Immelt and ITOCHU President & CEO
Masahiro Okafuji

World’s Largest Wind Power Project
Shepherds Flat, Oregon
The second joint project with GE after Keenan II is the Shepherds Flat
wind farm in Oregon, which is slated for completion in 2012. Total
capacity will be 845 megawatts (338 2.5-megawatt turbines), andwhen completed it will be the world’s largest wind power project.
Power will be supplied to approximately 235,000 regular households
in California under a 20-year power purchase agreement with
Southern California Edison, a California power utility. The project will
reduce greenhouse gas emissions by approximately 1.5 million tons
annually, and uses 2.5 megawatt wind turbines from GE Energy. Theturbines are larger than other models and generate power using
permanent magnets. The technology used in the generators is highly
reliable and highly efficient. It will improve connectivity with the gridand help reduce wind power costs. The project also includes laying
approximately 150 kilometers of road and stringing roughly 270
kilometers of power lines.

Keenan II wind farm

Bioenergy

ITOCHU is promoting projects that utilize bioenergy, a renewable energy that has
garnered attention because it addresses the global problems of resource depletion andreduction of greenhouse gases.

Participating in Largest Biomass
Power Project in the U.S.

Initiatives with Bungein Brazil

Bioethanol Production Projectin Vietnam

ITOCHU will develop, invest in and operate abiomass power project in northern Florida
through Tyr Energy, a U.S. independent power
producer. The power plant will be the largest
biomass power project in the U.S., with agenerating capacity of 100 megawatts, andwill be fueled by wood chips and tree thinnings. After going into commercial operationin 2013 the project will supply power toapproximately 70,000 households based on a30-year power supply agreement with thepower utility in Gainesville, Florida. Operations
and maintenance will be performed by NAES,
a wholly owned subsidiary of ITOCHU and oneof the world’s largest operation and maintenance service companies. We intend toactively develop and promote renewableenergies through project initiatives.

ITOCHU has been developing production andsales projects for bioethanol and sugar madefrom sugarcane with Bunge, a major U.S.
agribusiness firm, in the Brazilian states ofMinas Gerais and Tocantins since 2008. Plans
call for expanding the total ethanol production
capacity of both projects to approximately
500,000 kiloliters. The ethanol will be solddomestically in Brazil but also exported toNorth America, Europe and Japan. In addition,
bagasse, fibrous matter that remains after thesugarcane is crushed, is effectively utilized asfuel for onsite power generators, with any
surplus power sold in the country. Brazil is amajor bioethanol producer, accounting for
approximately 30% of the global market, andis working to provide stable supplies of highly
cost competitive bioethanol.

ITOCHU is taking part in a fuel bioethanol
production project in Binh Phuoc Province,
Vietnam in partnership with Petrovietnam Oil
Corporation of the Petrovietnam Group,
Vietnam’s national oil and gas company.
Commercial production of bioethanol fromcassava, which is cultivated extensively in
Vietnam, is slated to commence in the springof 2012 with targeted output of approximately 100,000 kiloliters annually. Bioethanol
produced by the project is expected to be
distributed to the market through gas stations
affiliated with Petrovietnam Oil. Vietnam is
expected to promote the production andsupply of ethanol-gasoline blends going
forward as a domestically produced alternative to gasoline.

Biomass Power Generation Plant

Sugarcane being harvested

Gas station selling
ethanol-gasoline blends

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