Chubu Electric Power Co.,Inc. | October 2017 Regular Press Conference : President Katsuno's Message - Key Point of President's Regular Press Conference (2017)

Key Point of President's Regular Press Conference (2017) October 2017 Regular Press Conference : President Katsuno's Message

October 27, 2017

Chubu Electric Power Co.,Inc.

  • Today I will be discussing the following three matters:
    • FY2017 second quarter financial results
    • Measures implemented at the Hamaoka Nuclear Power Station
    • Outlook for this winter’s electricity supply and demand

FY2017 second quarter financial results

  • Our consolidated sales for the second quarter of FY2017 stood at 1,393.3 billion yen. That is an 86.4 billion yen increase year on year, due to growing fuel adjustment costs and more surcharges associated with renewable energy and subsidies.
  • Our consolidated ordinary income marked 87.3 billion yen: a decrease of 76.4 billion yen. The main factor of this is the different-timing margin of fuel adjustment and fuel costs reversing into losses.
  • I now would like to turn to our income excluding differences in cut-off timing.
  • There were factors of deterioration in our balance of income to expenditures. Those included lower hydropower and electric power sales, as well as increased depreciation. Regardless, as a result of further advancing our management streamlining since the beginning of this fiscal year we achieved greater efficiency totaling 11 billion yen, accordingly drawing some 100 billion yen of income excluding differences in cut-off timing: that’s an amount similar to the same period from last year.
  • Turning to our non-consolidated financial results, sales stood at 1,280 billion yen. This is a 66.1 billion yen increase year on year. Our ordinary income marked 78.2 billion yen, which is a 79.5-billion-yen profit decrease from the year earlier.
  • The interim dividend for this quarter has been set to 15 yen per share.
  • Regarding the earnings outlook for FY2017, the forecasted earnings value we announced on July 28 have been revised to reflect the latest performance trends.
  • We are expecting consolidated sales of 2,760 billion yen, as announced previously, and a consolidated ordinary income of 110 billion yen.
  • As for management streamlining efforts, we have gotten a prospect of cutting 15 billion yen. That has been achieved by benefits of further progress in efficiency-achieving initiatives, ongoing since early this fiscal year, in addition to the 10-billion-yen fuel price reduction factored in the previous announcement.
  • We are expecting a roughly 10-billion-yen profit increase from our previous announcement.
  • Our income, excluding differences in cut-off timing, is expected to mark 125 billion yen.
  • Under my lead, we will maintain company-wide efforts to streamline management and work to maintain confidence and meet expectations of customers, shareholders, and society.
  • This concludes my remarks on financial results.

Typhoon No. 21’s impact

  • My heart goes out to those who have suffered damage from Typhoon No. 21, which swept through the Chubu region on October 22 and 23.
  • The entire region also experienced a blackout. Restoration work for eastern parts of Nagano Prefecture particularly did not go smoothly because fallen trees affected our equipment and roads were blocked off, delaying the return of power to all customers until Wednesday, October 25.
  • We sincerely apologize for inconveniences we have caused to customers living in the area exposed to the blackout.

Measures implemented at Hamaoka Nuclear Power Station

  • Amongst measures implemented at Hamaoka Nuclear Power Station, today I will talk about the establishment of the Hamaoka Advisory Board for Safety and filing of application concerning the clearance system for Hamaoka Units 1 and 2’s demolition waste.
  • I first will refer to the former matter.
  • Chubu Electric Power previously set up the following to deliberate measures for enhancing Hamaoka Nuclear Power Station’s safety, and has in turn been promoting efforts for voluntarily and continuously maintaining the Station’s safety:
    • The Nuclear Safety Improvement Committee: a deliberative body for business administration which discusses measures needed for improving safety in general
    • The Nuclear Safety Improvement Committee Advisory Board: a platform where experts from areas including academia and industry, as well as crisis management specialists, offer opinions on safety improvement from wide-ranging perspectives including business administration, risk management, and governance.
  • The newly established the Hamaoka Advisory Board for Safety is a deliberative body specifically geared to on-site safety.
  • The Advisory Board consists of specialists who have long been involved with nuclear power at manufacturers, administrative organizations, and electric power utilities. Drawing on experience and knowledge they obtained in their respective fields, they will offer findings and advice related to the Station’s safety enhancement.
  • Advisory Board members are to make week-long stays at Hamaoka Nuclear Power Station around twice a year to observe on-site work and documents, attend meetings, and discuss with station personnel, in turn making safety improvement recommendations to me, the president.
  • Based on the recommendations, our Nuclear Power Division will deliberate and implement improvement measures after considering and making decisions. The status of responses for those measures will be reported to the Nuclear Safety Improvement Committee.
  • The Advisory Board is wasting no time: they are to perform their first activity at Hamaoka Nuclear Power Station from November 27 to December 1.
  • We look forward to Advisory Board members giving us candid recommendations based on their knowledge and experience; examples include:
    • Recommendations purely for serving to safety, leaving cost and difficulty out of account
    • Recommendations that Chubu Electric Power would not internally think of
  • I now turn to the application of the clearance system for Hamaoka Units 1 and 2’s demolition waste, for which we filed with the Nuclear Regulation Authority on October 17.
  • Hamaoka Nuclear Power Station Units 1 and 2, for which decommissioning started in November 2009, entered its second decommissioning plan stage last February.
  • Currently we are looking into the status of decontamination and contamination of the reactor pressure vessels, and also dismantling the turbine, main steam piping, and other equipment in the reactor area’s peripheries.
  • The waste expected in conjunction with the decommissioning of Chubu Electric Power’s Units 1 and 2 is some 450 thousand metric tons.
  • Approximately 350 thousand metric tons out of that waste has not been exposed to radioactivity at all. Some 80 thousand metric tons of that waste is subject to the clearance system, i.e. waste with extremely low radioactive contamination, having negligible effects on humans. The remainder is waste with low radioactive levels.
  • The filing is aimed at applying the clearance system and involves methods for measuring and evaluating radioactivity concentration of the approximately 6,900 metric tons of clearance system-subject waste, produced in the second decommissioning stage’s early half.
  • Future proceedings include our receiving the national government’s approval for radiation measurement/evaluation methods, thereafter measuring and evaluating waste with the approved method, and accordingly having the national government’s confirmation that said waste is subject to the clearance system.
  • The decommissioning of Hamaoka Units 1 and 2 has so far been smoothly proceeding. Decommissioning, however, is a long-term initiative lasting over some 30 years. We will steadily carry it forward with top priority on safety.
  • Chubu Electric Power will advance measures implemented at the Hamaoka Nuclear Power Station by thoroughly illustrating to and gaining understanding from local communities and society at large.

Outlook for this winter’s electricity supply and demand

  • Regarding this winter’s power supply and demand outlook in the Chubu area, we are expecting to see a maximum electric power (maximum power three-day average) of 22.6 million kW in January and February. Prospects of securing stable electricity supply appear to be promising for this winter.
  • We look forward to seeing customers maintain their energy conservation/saving efforts in view of effectively harnessing energy and limiting CO2 emissions.
  • Specific examples are available both on Chubu Electric Power’s website and the KatEne homepage. We encourage customers to take a look at them.
  • To ensure our supply capability, we will work to stably deliver electricity by continuing to reliably operate and maintain thermal/hydropower stations as well as transmission and conversion facilities, expending all possible efforts for our supply system.

Chubu Electric Power employee taking active part in Japan’s national para ice hockey team

  • Lastly, I would like to talk about achievements a Chubu Electric Power employee has made on Japan’s national para ice hockey team.
  • In early October, Sweden hosted a para ice hockey qualification tournament for the Pyeongchang Winter Paralympics. Mamoru Yoshikawa, staff member of our Iida Sales Office, Nagano Regional Office, played an active part in the Japanese national team, and the team managed to secure a spot for the Paralympic Games.
  • Para ice hockey is an exciting sport offering many highlights such as eye-opening, brilliant shots and intense physical contact between players.
  • I look forward to seeing Mr. Yoshikawa selected as Japan’s national team member for the Pyeongchang Winter Paralympics, and hope he offers an excellent performance just as he did in the 2010 Vancouver Winter Paralympics.
  • This ends my presentation.