CSR Charter Ⅰ Creating Value for Customers
Principle and Outline
Amid diversifying customer needs for energy services, the Daigas Group, as a comprehensive energy service provider, is proposing the best mix of energy sources, including natural gas, electric power, liquefied petroleum gas (LPG) and thermal energy, with the aim of enhancing value for customers.
The Group regards the full liberalization of the electric power market as an opportunity to grow, and will do its utmost to promote the further evolution of its comprehensive energy service operations. In addition, the Group will make nationwide efforts to secure various electricity sources, including fossil fuel-based power generation, cogeneration systems, and renewable energy sources.
Energy Business Both in Japan and Overseas
Positioning the electricity business as the second most important business after the gas business
As a comprehensive energy service provider, the Daigas Group proposes the optimal use of natural gas, electricity, LPG and thermal energy. The move is intended to enhance “customer value” at a time when customer needs for energy have been diversified following the liberalization of the energy market.
Among various businesses we are undertaking in the energy field, the Group has been positioning the electricity business as the second most important business after the gas business. In fiscal 2010, the Senboku Natural Gas Power Plant (capacity: 1.109 million kW) went into operation as one of our key power plants. In addition, in Japan, we operate five other fossil-based power plants and three cogeneration systems while participating in or operating six wind power businesses and eight solar power businesses as part of our efforts to promote power generation from renewable energy sources. Our overseas IPP business includes investment in fossil-based power plants, wind power projects and solar power projects in North America and Australia. In 2015, we invested in St. Charles Power Project, a power station located in Maryland, the United States. The power plant began operation in February 2017. In 2017, we also invested in two power plant projects in the United States—the Shore Power Plant in New Jersey and the Fairview Power Plant in Pennsylvania.
These projects give the Daigas Group power sources totaling about 1.990 million kW in Japan and about 1.403 million kW* overseas, both as of the end of December 2017.
- *Electric sources owned by the Daigas Group overseas
- Generation capacity of power plants including partly owned by the Group, excluding plants not yet in operation.
Electricity Sources Owned by the Osaka Gas Group in Japan
Meanwhile, as part of our efforts to expand our LNG and city gas sales into broader regions across Japan, we supply part of the LNG we purchase to large-lot customers and other energy service operators in non-Kansai regions, using LNG tank trucks and ships dedicated to carrying LNG.
In fiscal 2017, we began providing LNG to Hiroshima Gas Co., Ltd.
As for the distribution business in Japan, gas pipelines in two sections—one between Mie Prefecture and Shiga Prefecture, and the other between Himeji City, Hyogo Prefecture, and Okayama City, Okayama Prefecture— have been opened. Pipe networks seen as instrumental in ensuring stable gas supply and developing fresh natural gas demand have also been built.
In the future we will continue to work with energy companies in other regions to promote our multi-energy business, including our power business, and offer a variety of energy solutions to customers.
Development of new electric sources in Japan
The Daigas Group has engaged in the development of renewable energy sources in the past. On top of this, the Group has been strengthening the electricity business in Japan by launching new investment projects.
The Group will ensure the stable supply of reasonably priced and environment-friendly electricity, and contribute to the economic and industrial development of local communities by investing in the Fukushima Natural Gas Power Plant, a project run by Fukushima Gas Power Co. that is now under construction.
Downstream business in Southeast Asia
The Daigas Group sees Southeast Asia as a priority area, due to its promising outlook in view of its expected high economic growth and the business operations of many Japanese companies in the region, mostly manufacturers. To study the feasibility of launching downstream business overseas, the Group has been conducting market research in the region since around 2010.
Gas business in Singapore
Osaka Gas and Singapore's City Gas Pte Ltd. agreed to launch joint sales of natural gas in Singapore. Osaka Gas concluded a contract to buy an equity stake in City-OG Gas Energy Services, a new company set up by City Gas to sell natural gas for industrial use. Under the agreement, Osaka Gas began selling gas in Singapore in August 2013, marking the company's first overseas gas sales.
A total of eight staff—four from Osaka Gas Singapore (OGS) and four from City Gas—belong to City-OG as of May 2017. OGS members are strong in proposal-oriented marketing, especially in conversion of boiler fuels, while City Gas members have prowess in approaching potential local customers and in local business procedures. Since the business in Singapore started in August 2013, 27 contracts have been concluded with local customers. A total of more than 50 industrial customers receive gas from us as of May 2017.
Energy service business in Thailand
Osaka Gas has stepped up its business in Thailand with a focus on the energy service (ES)*1 business, utilizing Osaka Gas's energy service solution know-how, which is based on its engineering prowess regarding the use of natural gas in the Thai industrial market. Specifically, the new company undertakes overall utility-related businesses, including the installation of boilers and industrial furnaces, CNG supply, water and biotechnology.
In October 2013, Osaka Gas founded Osaka Gas (Thailand) Co., Ltd. in Thailand. A total of 17 staff—nine loaned from Osaka Gas and eight local staff — belong to Osaka Gas (Thailand). OGT has received three orders for ES and 34 orders for facility installation and consulting services (as of May 2017) since the business started in October 2013.
In July 2014, Osaka Gas and Nippon Steel & Sumikin Engineering Co., Ltd. agreed to form a business partnership for an on-site business*2 using cogeneration systems built in Thailand. Under the agreement, the two companies established NS-OG Energy Solutions (Thailand) Ltd. The joint company has clinched five contracts for a cogeneration system developed by Osaka Gas. The first of the five contracts is an on-site energy supply project for the No. 2 mill operated by Luckytex (Thailand) Public Co. The joint company began supplying energy to the mill in December 2016.
In November 2015, Osaka Gas and a subsidiary of PTT Public Co., Ltd. in Thailand jointly established OGP Energy Solutions Co., Ltd. to undertake ES business for industrial clients in Thailand. The joint company has received five orders from local companies for energy services and facility installation (as of May 2017).
- *1 Energy service (ES) business
- This service enables customers to introduce natural gas and other facilities, without any initial investment, simply by paying fees that correspond to the amount of energy use. The new company is equipped with natural gas-fired facilities, including boilers and combustion furnaces, to supply steam and other forms of energy to customers to meet their energy-saving needs. As an one-stop service for the management of energy use and facility maintenance, the company has promoted energy-saving as well as stable energy supply.
- Service in which the Daigas Group sets up a cogeneration system on customers' sites or near their sites, and supplies electricity and heat there. The cogeneration system is operated and maintained by staff posted at the facility.
Energy business in Indonesia and Philippines
Osaka Gas Singapore Pte. Ltd. established a representative office in Jakarta in October 2016, marking the Daigas Group's entry in the Indonesian market, and a similar office in Manila in March 2017 to begin business in the Philippines. Other Southeast Asian countries where the Group had started business earlier are Singapore and Thailand.
The Jakarta representative office was staffed with three employees dispatched from Japan (as of May 2017). The office has been conducting full-fledged studies of the downstream gas business and energy-related infrastructure development projects in Indonesia in response to an expected increase in energy demand in the country, with a population of over 250 million and an expanding local economy.
The Manila office has been undertaking business research with a workforce of two since July 2017. Osaka Gas aims to launch energy-related infrastructure development projects in the Philippines, especially LNG-related projects, in view of an expected rise in energy demand there and the country's plan to introduce LNG in response to the expected depletion of locally produced natural gas. Osaka Gas sees energy infrastructure development as a field where the company can use its experience and knowledge effectively.
Overview of Senboku Natural Gas Power Plant
Environment-friendly Senboku Natural Gas Power Plant operating smoothly
In 2009, Osaka Gas's natural gas power plant at the Senboku Natural Gas Power Plant, a core part of our power generation business, went into operation, with four turbines working at a total capacity of 1.109 million kW. The Senboku Natural Gas Power Plant uses natural gas for power generation, creating far less impact on the environment than using other fossil fuels such as oil and coal. Other features make this plant a cutting-edge facility with minimal environmental impact; for example, the use of the gas turbine combined cycle method, which has a high energy efficiency.
Preventing air pollution
Because the Senboku Natural Gas Power Plant uses natural gas, its exhaust gas contains no sulfur oxides (SOx) or soot and dust. Although nitrogen oxides (NOx) are generated by the combustion of natural gas, they are minimized by the use of a low NOx burner, and those that are generated are further reduced by an exhaust NOx removal system.
|Power generation system||Gas turbine combined cycle power generation|
|Generating capacity||(Senboku LNG terminal II)||(Senboku LNG terminal I)|
|No. 1 turbin: 277,000 kW||No. 3 turbin: 277,500 kW|
|No. 2 turbin: 277,000 kW||No. 4 turbin: 277,500 kW|
|Total：554,000 kW||Total：555,000 kW|
|Environmental protection measures||Low NOx burner, ammonia-based exhaust NOx removal system, discharged water processing system, etc.|
Plant System Flowchart
· Use of existing infrastructure
The need for new facilities for the plant is being minimized by locating the plant on the site of the Senboku LNG Terminal, which is equipped with an infrastructure that includes fuel supply facilities.
· Remote operational surveillance system
Stable operation of the plant by a small workforce is achieved by development of an integrated operational monitoring system for controlling power generating facilities spanning two sites.
Use of natural gas (LNG) as the fuel for generating electricity means that no SOx or soot and dust are generated.
The latest low NOx burners are used to reduce NOx emissions.
· Inlet air cooling system
Gas turbine intake air is cooled to limit the reduction in power output at high temperatures.
Flue height is increased to reduce ground-level concentrations of NOx.
· NOx removal system
Inside the waste heat recovery boiler is an exhaust NOx removal system, which uses the dry ammonia catalytic reduction method to break the NOx content of combustion gas down into water and nitrogen and reduce the concentration of NOx in the exhaust gas.
· Cooling towers
No warm wastewater is discharged due to the use of a cooling tower system.
· Wastewater treatment system
Wastewater from the power plant is treated by a wastewater treatment system comprising coagulation sedimentation, filtration, activated carbon adsorption, and pH adjustment to reduce the impact on water systems.
Overview of Nagoya Power Plant and Second Nagoya Power Plant
Smooth operation of Nagoya Power Plant and Second Nagoya Power Plant contributes to the reduction of environmental impacts.
Nagoya Power Plant (capacity: 149,000 kW) and Second Nagoya Power Plant (capacity: 110,000 kW) use mixed fuel, coal and woody biomass, to substantially reduce CO2 emissions. The plants are also equipped with the latest environmental conservation technology to reduce hazardous substances and noise.
Preventing air pollution
The boilers at Nagoya Power Plant and Second Nagoya Power Plant are equipped with various flue-gas purifiers, such as a low NOx burner and denitration system to reduce NOx generation, an electrostatic precipitator to eliminate dust, and a desulfurizer system to reduce sulfur emissions.
|Nagoya Power Plant||Second Nagoya Power Plant|
|Power generation system||Steam-power generation (using pulverized coal and subcritical pressure)||Steam-power generation (using pulverized coal and subcritical pressure)|
|Generating capacity||149,000 kW||110,000 kW|
|Fuel||Coal, woody biomass (5% mixture in energy ratio), and kerosene (auxiliary fuel)||Coal, woody biomass (5% mixture in energy ratio), and kerosene (auxiliary fuel)|
|Environmental protection measures||Low NOx burner, ammonia-based exhaust NOx removal system, electrostatic precipitator, flue-gas desulfurizer system using limestone-gypsum method, etc.||Low NOx burner, ammonia-based exhaust NOx removal system, electrostatic precipitator, flue-gas desulfurizer system using limestone-gypsum method, etc.|
|Cooling system||Cooling system using sea water||Cooling system using industrial water|
System flow of Second Nagoya Power Plant
Woody biomass is mixed with the base coal fuel to reduce CO2 emissions.
· NOx removal system
A flue-gas denitration system (using dry ammonia catalytic reduction method) is installed after the boiler to decompose NOx contained in exhaust gas to water and nitrogen and reduce the NOx concentration in flue gas.
· Electrostatic precipitator
An electrostatic precipitator is installed after the denitration system to eliminate dust in combustion gas.
· Desulfurizer system
A desulfurizer system (limestone-gypsum method) is installed after the electrostatic precipitator to eliminate sulfur emissions in combustion gas. Sulfur is recovered as a form of gypsum to be effectively recycled.
Promotion of Use of Renewable Energy Sources
Operation of wind and solar power generation stations
Expansion of Wind Power Generation Projects in Japan and Overseas
The Daigas Group operates wind power stations at the six locations in Japan listed below. The total capacity of electricity produced by these stations is 85,000 kW, and together they contribute to a reduction in CO2 emissions.
Inami Wind Power Station Co. began building a wind power station in Inami, Wakayama Prefecture, in December 2015. Inami Wind Power Station, with a power output capacity of 26,000 kW, is scheduled to begin operation in June 2018.
- Hayama Wind Power Station Co. (Kochi Prefecture, 20,000 kW, started operation in March 2006)
- Hirogawa Myojin-yama Wind Power Station Co. (Wakayama Prefecture, 16,000 kW, started operation in November 2008)
- Yura Wind Power Station Co. (Wakayama Prefecture, 9,950 kW, acquired in June 2011)
- Hizen Minami Wind Power Station Co. (Saga Prefecture, 18,000 kW, acquired in November 2012)
- Hizen Minami Wind Power Station Co. (Saga Prefecture, 18,000 kW, acquired in November 2012)
- Hirao Wind Power Station Co. (Yamaguchi Prefecture, 9,000 kW, acquired in November 2012)
Overseas, we are participating in the Hallett 4 wind power generation project in Australia. This project installed 63 wind power generation facilities in the state of South Australia (total power generation capacity: 132,000 kW) and commercial operation began in June 2011.
Operation of large-scale solar power stations
Osaka Gas runs large-scale solar (mega-solar) power stations in eight locations—two in Torishima, Konohana Ward, Osaka City, one each in Shoo Town, Katsuta County, Okayama Prefecture, Hirogawa Town, Arida County, Wakayama Prefecture, Oita City, Oita Prefecture and Nabari City, Mie Prefecture, and two in Yura Town, Hidaka County, Wakayama Prefecture. The power generation capacity of these eight mega-solar stations totals about 20,000 kW.
Solar power generation business in the Province of Ontario, Canada
Osaka Gas acquired mega-solar power stations in the Province of Ontario, Canada, jointly with Mitsubishi Corp. (a total of nine power stations of which combined output capacity of about 100 MW). All of the mega-solar power stations started operating by the spring of 2014.
The Canadian solar power business is intended for Osaka Gas to gain know-how about the mega-solar business both at home and abroad.
As a multiple energy operator, the Daigas Group will continue to work on spreading the use of renewable energy and contribute to the realization of a low-carbon society.
Building of a Scheme Aimed at Diffusing the Use of Renewable Energy Sources
Energy Bank Japan Co., Ltd.
Launched renewable power generation business using unique financing technology
After building EcoWave,* a system using a unique financing technology through which customers can install renewable power-generating equipment without any initial investment, Energy Bank Japan Co., Ltd. (EBJ), belonging to the Daigas Group, is promoting a service package that includes the technical assessment, engineering and maintenance of power-generating equipment.
A small hydro stream power station with electricity generation capacities of 15 kW and 10 kW began operating in Nagahama City, Shiga Prefecture in October 2015. The power station, which takes advantage of the elevation difference in its central trunk line flume, is managed by an entity in charge of improving land in areas north of Lake Biwa. The power station is projected to generate 141,000 kWh of electricity a year. EBJ has undertaken four floating solar power projects since fiscal 2015, with their combined output capacity amounting to about 6,580 kW, including the capacity at a proposed power station whose construction has been decided.
- EcoWave is a program under which Osaka Gas installs a cogeneration system and other energy-saving equipment on the customer's site and supplies energy (e.g. heat and electricity) to the customer, who pays service fees to Osaka Gas for the amount of energy (e.g. heat and electricity) used. A development of this service Solar-EcoWave is a scheme under which customers can introduce solar power generation simply by paying service fees in proportion to their energy use without any initial investment.