Key Point of President's Regular Press Conference
March 2014 Regular Press Conference : President Mizuno's Message
March 25, 2014
Chubu Electric Power Co.,Inc.
- Today I will be discussing the following four matters:
- Filing of “FY2014 Electric Power Supply Plan”
- Launch of the new company “e-Kurashi” for providing home services
- Results of selection of proposals for theme-specific nuclear power-related research based on public call for submissions
- Share transfer agreement signed for the sale of Toho Sangyo shares
Filing of “FY2014 Electric Power Supply Plan”
- Firstly, I’d like to talk about the filing of our “FY2014 Electric Power Supply Plan.”
- Chubu Electric Power Company filed its “FY2014 Electric Power Supply Plan” with the Minister of Economy, Trade and Industry.
- A power supply plan is filed by a power utility in accordance with the provisions of the Electricity Utilities Industry Law. It sets forth the utility’s plan for supplying electric power for the coming 10-year period together with plans for the installation and operation of electrical facilities during that time.
- Regarding power supply and demand, we answered “undecided” in response to items concerning nuclear power station plans and supply capacity following from the previous year. We gave this response because we cannot project when we and other companies will be able to resume operations of our nuclear power stations or develop new ones.
- With the aging of thermal power stations, Chubu Electric Power has decided to start procuring electricity through a bidding process in FY2014 from the perspective of achieving long-term supply stability and economy. Further details on this plan are to be explained later on.
- The overview of the Supply Plan is as follows:
- The electricity sales volume is estimated to be 134.4 billion kWh in FY2023, which is the final year of this ten-year plan. The average rate of annual growth from FY2012 to FY2023 is expected to be 0.7% after temperature adjustment.
- The maximum power demand is expected to be 25.26 million kW in FY2023, with the average rate of annual growth from FY2012 to FY2023 at 0.5% after temperature adjustment.
- The three-day average of maximum power demand in the summer of FY2014 is anticipated to be 24.21 million kW at the transmission end, an increase of 210,000 kW from the actual figure for FY2013.
- Meanwhile, the supply capacity is expected to remain stable, in comparison to the summer of FY2013, despite the decommissioning of Unit 3 of the Nishi-Nagoya Thermal Power Station (November 2013) due to the scheduled commencement of commercial operation at the Joetsu Thermal Power Station Unit 2-2 for May.
- The government is to examine the more detailed outlook of supply and demand in coming months. Its outcome will be taken into account in seeking customer cooperation for energy conservation on another occasion.
(Main Power Generation Facilities Plan and thermal plant bidding)
- There is no significant change to the “Power Generation Facilities Plan” compared to the previous plan.
- According to the “Guidelines for bidding on thermal power generation facilities” by the Agency for Natural Resources and Energy, Ministry of Economy, Trade and Industry, general electric businesses must go through a bidding process to newly acquire thermal power facilities in principle.
- With the aging of thermal power stations, Chubu Electric Power has decided to start procuring electricity through the bidding process next fiscal year. The procurement scale is to be around 1 million kW and the procurement period is to be 15 years from around FY2022.
- The company will start preparation work, e.g. compiling the Summary of Public Bidding, to carry out the bidding procedure by the end of FY2014.
- Chubu Electric Power normally releases its “Operating Objectives” in March each year. However, the release of the objectives is to be postponed for the time being due to difficulty in assessing various factors that form the basis for the management plan amidst the on-going review by the government on the increase of electricity charges.
Launch of the new company “e-Kurashi” for providing home services
- Next, let me talk about the establishment of the new company “e-Kurashi” for providing a range of home services.
- In partnership with Sanyo Homes Corporation, Chubu Electric Power is launching the new company “e-Kurashi” to offer home services such as cleaning your home and handling other housekeeping tasks.
- Our customers have been seeking our consultation on their daily living and residential arrangement when applying for power connection at our sales offices or as part of our service to advise optimum energy use.
- There has also been a growing diversification of customer lifestyles with changing times amidst greater female participation in the workforce that has increased two-income households and the greying population that has increased single-person elderly households.
- Against this background, Chubu Electric Power has been exploring the possibility of offering services associated with customers’ living, tailored to their individual lifestyles, by making use of our customer “connections” nurtured in the course of providing electricity every day.
- Chubu Electric Power will establish the new company in partnership with Sanyo Homes on May 1, 2014, and start offering:
- House cleaning including bathrooms and toilets
- Housekeeping services including light cleaning and cooking
to our customers in Aichi Prefecture in July. The company will expand service areas and service lineup gradually to meet the comprehensive needs of customers.
- Chubu Electric Power will continue to deliver stable supply of electricity, reinforce customer contacts in the residential business area, and offer value-added services that suit customers’ individual lifestyles, in an effort to meet our customers’ trust and expectations.
Results of selection of proposals for theme-specific nuclear power-related research based on public call for submissions
- Next, let me move on to the final selection of theme-specific research on nuclear safety technology, based on public call for submissions.
- In order to ensure the safe use of the Hamaoka Nuclear Power Station into the future, Chubu Electric Power has been making a public call for submissions for theme-specific research since December last year, to undertake research in partnership with universities and research institutes on a much larger scale than those handled in its long-running research submission program.
- Out of numerous entries, Chubu Electric Power has selected the submission by Kyoto University associate professor Cheol-ho Pyeon concerning the processing of high-level radioactive waste. The research will be carried out over five years, starting next fiscal year, with the funding of 100 million yen.
- It aims at developing the technology to convert radionuclides with long half-life into radionuclides with shorter half-life, using proton beam accelerated by an accelerator.
- Such technology would allow us to turn long half-life radionuclides, contained in high-level radioactive waste from nuclear power generation, into radionuclides with short half-life or stable nuclides. This, in turn, would enable the bulk reduction of radioactive waste.
- This is still in the stage of fundamental research. With numerous challenges, it is expected to require an extended period of time before practical application. Yet, it is a technology of great future vision for continued use of nuclear energy, and is expected to help foster young researchers and engineers.
- Chubu Electric Power has high expectations for the project to bring positive outcome and practical application.
Share transfer agreement signed for the sale of Toho Sangyo shares
- Finally, I wish to explain about the “share transfer agreement signed for the sale of Toho Sangyo shares.”
- Chubu Electric Power today signed a share transfer agreement with Valor Co., Ltd. to sell the shares of its 100% subsidiary, Toho Sangyo.
- The agreement covers 6,300 shares or 90% of the subsidiary’s total number of issued shares. The transfer is scheduled for July 1 this year.
- Chubu Electric Power established Toho Sangyo in February 2003 to start the production and sales of king oyster mushrooms, using sawdust of thinned trees from the Owase region.
- Since market entry about 11 years ago, we have maintained the business operation, but have been feeling the strong need to further strengthen partnership with retailers and distributors.
- The agreement with Valor, which operates a wide network of retail stores mainly in the Chubu region, will allow the direct distribution of Toho Sangyo’s mushrooms through Valor Group stores.
- Chubu Electric Power hopes the arrangement will reinforce Toho Sangyo’s business foundation, and enable more stable business management.
It will also contribute to offering employment at the Owase region.
- The fact that we have been able to maintain the business for so many years is attributable to the support and cooperation of all the parties involved.
Marking this milestone development, we wish to express sincere gratitude to all the people who have been involved in the business.
- Chubu Electric Power will continue to retain some stake in the company for the time being, and extend support to Toho Sangyo while it reestablishes regional ties and stable business management as part of the Valor Group.
- That concludes my remarks for today.