January 2022 Regular Press Conference : President Hayashi's Message

• First, I would like to discuss the changes that we will make to our organizational structure.
• In November of last year, Chubu Electric Power Group formulated “Management Vision 2.0,” which anticipates, based upon the society that we envision to be constituted by the year 2050, what we need to do to make sure that we achieve the profit levels and action approaches set out in the 2018 Management Vision, and clearly prescribes the progress that we must attain by 2030.
• This year marks the start of our efforts to realize that vision, and I believe we will make steady and tangible progress in that direction.
• One concrete action which we will make toward achieving that is first to retool our organization. Today, we decided to execute an organizational revision that will take effect on April 01 of this year. I would like to present some of those details.
• This organizational revision will establish new business units that will expand the areas in which we do business and operate as well as promote our DX strategy, both key initiatives toward realizing our vision, and strengthen our business foundation to be able to support these efforts.
• First, I would like to explain the Global Business Division and Regional Infrastructure Business Office, which are to be established with the aim of expanding the scope of our business areas.
• The Chubu Electric Power Group will aim to increase consolidated ordinary income to the level of 250 billion yen and beyond. Furthermore, we will seek to alter the ratio in our business mix of growth segments, such as our business overseas as well as the provision of new value, with the goal of revamping the typical ratio of 1:4 with our domestic energy business to a ratio of 1:1.
• We will establish the Global Business Division in order to ensure that we realize these growth strategies. The institution of a dynamic business execution structure, which clearly delineate responsibilities and authorities, will enable us to aggressively expand our operations as well as integrate and augment technology and know-how gained overseas with strengths that we have developed at home in Japan so as to bolster our revenue base.
• We will establish the Regional Infrastructure Business Office for operations in Japan. This will be an independent organization promoting water supply, transportation, and other infrastructure businesses as well as those furthering resource efficiency and the circular economy as we announced in December of last year. This office will quickly provide innovative solutions for regional issues as it is our wish to contribute to realizing a circular society.
• Next, I would like to talk about the Digital Transformation Strategy and Promotion Office.
• The Digital Transformation Strategy and Promotion Office will be established to integrate the current functions of the Corporate Planning & Strategy Division as pertains to its responsibility for DX strategy along with some functions of the Business Service Division relating to its responsibility for promoting digitalization. This will allow the new office to thereby formulate and implement DX strategy throughout the entire Chubu Electric Power Group.
• Within the Chubu Electric Power Group, the Digital Transformation Strategy and Promotion Office
  will spearhead the reworking of business models to focus on the customer’s perspective, the delivering of new value tailored to the diverse needs of communities and customers, and the leveraging of digital technologies to make our operations more efficient and advanced.
• In addition, we will also endeavor to strengthen our business foundation, which is indispensable to realizing our vision.
• The source of Chubu Electric Power Group’s growth and transformation is its people. I will be personally involved in focusing our efforts on reinforcing our human resources strategy so that we may realize our vision.
• As part of that effort, we will establish the Human Resource Strategy Office, which will be directly accountable to me, the president, so that we may better integrate our human resources strategy and system designs.
• Along with bolstering our strategy for diversifying, developing, and placing personnel, the embodiment of our corporate value, in positions best suited to their aptitudes, the Human Resource Strategy Office will promote the creation of an environment and structure in which each and every one of the Chubu Electric Power Group’s invaluable personnel is able to make an even greater contribution.
• Moreover, the Kaizen Promotion Office will be established to further accelerate and consolidate Kaizen activities based on the Toyota production system principles, which have been steadily making progress since this initiative was launched in 2017, throughout the entire Chubu Electric Power Group.
• Through the efforts of this office, our aim is to institute a decisive transformation in the quality of the work performed by our organizations and each and every one of our employees, thereby transitioning into a more agile and robust corporate culture capable of standing out from the competition over the long-term future.
• In addition, organizational changes will also be made at Chubu Electric Power Miraiz.
• Chubu Electric Power Miraiz will establish the Carbon Neutral Promotion Division, which will be dedicated to decarbonization initiatives.
• The expansion of renewable energy to more than 3.2 GW by 2030, a stretch goal for renewable energies set in the initial vision by the Chubu Electric Power Group, is a tremendous challenge. To achieve this goal, it is essential not only that our group independently implement initiatives, but also that we further enhance collaboration with our customers and business partners.
• The Carbon Neutral Promotion Division will be the force driving the entire Chubu Electric Power Miraiz company and steadily propel initiatives advancing the triad of “energy saving,” “energy creation,” and “energy activation,” which we will promote together with society and our customers to achieve electrification and decarbonization.

• Next, I would like to discuss our executive personnel assignments.
  With this new organization that I just discussed, we decided today on a new executive structure to further accelerate the initiatives for realizing Management Vision 2.0. I would like to introduce these executive personnel assignments.

(Executive personnel assignments effective April 01)

• First, I would like to present the executive personnel assignments that will be effective April 01 for Chubu Electric Power.
• Senior Managing Executive Officer Ito Hisanori will be promoted to executive vice president. He will supervise the newly established Human Resource Strategy Office. In addition, as general manager of the Corporate Planning & Strategy Division, he will be in charge of the Regional Infrastructure Business Office and Digital Transformation Strategy and Promotion Office, steering the company’s priority initiatives. 
• Furthermore, we will promote two people to the position of senior managing executive officer and they will serve as division general managers. Sato Hiroki, who has extensive experience in overseas operations, will serve as general manager of the newly established Global Business Division, and Noda Hidetomo, who possesses a wealth of experience in new projects as well as R&D, will serve as general manager of the Business Development Division.
• Next is the director appointments and executive structure of Chubu Electric Power Grid.
• Ichikawa Yaoji will step down as president and director, and Shimizu Ryuichi, the current executive vice president and director, will take over. Shimizu Ryuichi’s expertise is in on-site operations. He has the ability to exercise resolute command and lead employees.
• Last is the executive assignments at Chubu Electric Power Miraiz.
• Ishikawa Tamiko, who has accumulated extensive and diverse experience in information systems, sales, technology development, and other areas, will be promoted to serve as the first woman executive officer ever at Chubu Electric Power, Chubu Electric Power Grid, and Chubu Electric Power Miraiz.
• That concludes my remarks about our executive personnel assignments.

(In summary)

• As Executive Vice President Mizutani explained earlier, the Chubu Electric Power Group is facing a severe cash flow situation this year on account of the greater time-lag loss resulting from the fuel cost adjustment system as fuel prices have soared globally and the increase in power procurement costs due to the rise in wholesale electric power exchange prices, in addition to other factors.
• To break this impasse, the entire Chubu Electric Power Group will immediately mobilize to meticulously screen and select expenditures. We will also quickly improve cash flow by adopting a variety of measures so that each of our businesses squarely recognizes the realities of their respective markets and maximizes profits.
• In addition, the environment in which the energy business operates is at a historical turning point. The structure of society as well as lifestyles are undergoing major changes, and policies are being accelerated toward realizing carbon neutrality by 2050.
• So that we surmount the waves of change flowing in this business environment and the Chubu Electric Power Group achieves further growth and contributes to the sustainable development of our region, I will firmly be at the helm and steer the new organization and new executive structure discussed today, and our entire group will unite as we fully devote ourselves to the success of these efforts.
  This ends my presentation.