Targets and Performance

Stable Supply

Why Is this Materiality?

To serve society by providing stable and low-priced supplies of energy amid heightened expectations for natural gas following the Great East Japan Earthquake and during the ongoing transformation of the Japanese energy industry brought about by reforms in the country’s electricity and gas systems.
To maintain a safe and stable supply by developing competitive power sources and expanding electricity sales to provide optimal energy solutions that not only combine gas and electricity but also add value.
To contribute to the development of local energy services and energy infrastructure in our overseas operations by applying the accumulated technologies of the Tokyo Gas Group.

FY2017 Results and Evaluation

Criteria for evaluating KPIs

: Target achieved (100% or above)
: Target not achieved but improved from the previous fiscal year
: Target not achieved

Note: Qualitative indicators with no evaluation axis are assessed on the basis of whether progress has been made since the previous fiscal year.

Target (CSR KPIs)	FY2017 Results	Evaluation
LNG procurement to ensure stable and affordable supply	■ Further diversification of LNG procurement April 2017: Began studying the possibility of forming a strategic partnership on LNG procurement with Kyushu Electric Power Co., Inc., and reached an agreement to pursue collaboration for achieving flexible and agile reductions in LNG procurement costs and enhancing stability of supply. Built four economically efficient LNG tankers, capable of transiting the Panama Canal, to start receiving LNG from Cove Point in the U.S. from 2018. March 2018: Concluded a new LNG sales and purchase agreement with Malaysia LNG Sdn. Bhd. LNG under long-term contracts: 12 projects in 5 countries (as of end March 2018) Contract volume: approx. 14.24 million tons (FY2017) Proven global natural gas proved reserves: 193.5 trillion m³ Source: BP Statistical Review of World Energy 2018 Link ▶　 LNG Project Contract Volume
Diversification and expansion of overseas business	■ Promotion of overseas business in Southeast Asia and North America May 2017: Tokyo Gas America Ltd. acquired 30% of the shares of Castleton Resources LLC to participate in the natural gas development business in the U.S. July 2017: Tokyo Gas Asia Pte. Ltd. acquired 24.9% of the shares of PetroVietnam Low Pressure Gas Distribution Joint Stock Company and concluded a strategic alliance agreement. October 2017: Tokyo Gas Asia Pte. Ltd. formed a joint venture with the Development Bank of Japan Inc. to acquire 33% of the shares of PT Panji Raya Alamindo, a gas distributor in Indonesia.
Infrastructure development to accommodate wider use of natural gas	■ Development of natural gas infrastructure based in the northern Kanto area Installed an additional vaporizer and tank lorry loading facility at the Hitachi LNG Terminal. Continued preparations for construction of a second LNG tank at the Hitachi LNG Terminal, scheduled for completion in 2020. Development of trunk lines Completed construction of the Koga-Moka Line that connects to our existing network. Formulated plans for construction of the Ibaraki Line between Hitachi and Kamisu, scheduled for completion in FY2020.
Expansion of competitive power generating capacity and electric power sales	■ Expansion in scope of business related to solar power generation August 2017: Established Prominet Power Co., Ltd., based on a capital and business partnership with Shizen Energy Inc.

Key Initiatives for FY2018 and Beyond

We reviewed the Tokyo Gas Group’s key CSR activities and materiality in fiscal 2017. Please visit the related link to view the latest information on our materiality and CSR KPIs.

Link
▶　Identifying New Materiality

DFF Inc., Corporate Social Responsibility Sect, General Administration Dept., Corporate Planning Dept., Resources & Global Business Division, Energy Solution Div, Power Buisiness Dept., Pipeline Network Division, IT Division, Residential Sales Div., Fundamental Technology Dept., Energy Solution Div, Environmental Affairs Dept., Purchasing Dept. , Health Insurance & Employees' Welfare Sect., Personnel Dept., Internal Audit Dept., Audit & Supervisory Board Member's Office, Compliance Dept., Regional Development Div., Finance Dept, ＴＧＥＳ, TOKYO GAS COMMUNICATIONS, INC.

The Pursuit of Safety

Why Is this Materiality?

To provide for customers after major earthquakes and ensure that they can use gas safely.
To enhance the energy security that supports safe and secure living.
To contribute to energy system innovation to support energy conservation and CO₂ emissions reduction.

FY2017 Results and Evaluation

Criteria for evaluating KPIs

: Target achieved (100% or above)
: Target not achieved but improved from the previous fiscal year
: Target not achieved

Note: Qualitative indicators with no evaluation axis are assessed on the basis of whether progress has been made since the previous fiscal year.

Target (CSR KPIs)	FY2017 Results	Evaluation
Promotion of earthquake, tsunami and other disaster measures	■ Promotion of measures against earthquakes, tsunamis and other disasters to ensure greater disaster resilience and a safe supply of gas June 2017: Subdivided the low-pressure service network of the head office area, from 252 blocks into 261, for a more precise remote shutting down of the gas supply in order to prevent disaster.
Promotion of maintenance measures for aging pipes and other infrastructure	■ Promotion of safety measures including upgrading aging gas pipes Informed users during safety inspections and by other means of advice on replacing aging underground house pipes other than those already replaced in FY2015 and performed upgrades upon request.
Improvement of disaster resilience Promotion of switching to safer appliances	■ Promotion of switching to safer appliances Expanded the adoption of cooking stoves equipped with safety sensors for auto shut-off to prevent overheating and flame failure, with 1.75 million units sold to date (as of March 31, 2018). Encouraged customers using appliances such as water and bath boilers lacking safety devices to prevent imperfect combustion to switch to safer appliances through direct mail and providing information during periodic safety inspections. ■Periodic safety inspections Paid 3.931 million visits for periodic safety inspections of gas equipment in fiscal 2017 and completed 3.555 million inspections, excluding times when customers were not at home. Initiatives for more frequent contact with customers Conducted voluntary safety inspections in addition to legally mandated inspections during periodic inspections to facilitate reliable risk conversations with customers. Specific information on voluntary inspections was published via a comparison site for voluntary safety measures of gas retailers by an operator under consignment from the Ministry of Economy, Trade and Industry. Tokyo Gas efforts were rated top class.

Key Initiatives for FY2018 and Beyond

We reviewed the Tokyo Gas Group’s key CSR activities and materiality in fiscal 2017. Please visit the related link to view the latest information on our materiality and CSR KPIs.

Link
▶　 Identifying New Materiality

DFF Inc., Corporate Social Responsibility Sect, General Administration Dept., Corporate Planning Dept., Resources & Global Business Division, Energy Solution Div, Power Buisiness Dept., Pipeline Network Division, IT Division, Residential Sales Div., Fundamental Technology Dept., Energy Solution Div, Environmental Affairs Dept., Purchasing Dept. , Health Insurance & Employees' Welfare Sect., Personnel Dept., Internal Audit Dept., Audit & Supervisory Board Member's Office, Compliance Dept., Regional Development Div., Finance Dept, ＴＧＥＳ, TOKYO GAS COMMUNICATIONS, INC.

Provision of Better Products and Services

Why Is this Materiality?

To deliver better products and services based on proactive communication and customer feedback, thereby enabling customers to use energy safely, securely, and comfortably in keeping with the intent of electricity and gas system reforms.

FY2017 Results and Evaluation

Criteria for evaluating KPIs

: Target achieved (100% or above)
: Target not achieved but improved from the previous fiscal year
: Target not achieved

Note: Qualitative indicators with no evaluation axis are assessed on the basis of whether progress has been made since the previous fiscal year.

Target
(CSR KPIs)

FY2017 Results

Evaluation

Provision of products, services, and related information

■ Response to full liberalization of the electricity retail market

March 2018: Number of applications for electricity service (ongoing) reached approximately 1.13 million. We sought to win more contracts by publicizing the electricity and services offered by Tokyo Gas, largely through direct promotion by LIFEVAL and Enesta, and by pursuing initiatives for expanding partnerships.

■ Promotion of the wider use of ENE-FARM (“EF”) residential fuel cells

We sold 18,500 EF units in FY2017, bringing the cumulative total of units sold since FY2009 to approximately 98,000.

■ Expansion of use of combined heat and power (CHP) systems^*1, commercial gas air conditioners and other systems

We developed and sold the following devices:

A high-efficiency GHP chiller, which is about 20% more efficient than conventional models, was commercialized in December 2017.
Smart Multi^*2, an addition to the lineup of air conditioners that combine a gas heat pump (GHP) and electric heat pump in a single refrigerant system, was commercialized in October 2017.
ENESINFO^*2, a remote control system that saves energy and cost by optimizing the operational ratio between a GHP and electric heat pump.

*1 CHP systems generate electricity and recover waste heat generated as a by-product.

*2 Smart Multi and ENESINFO received the Environmental & Equipment Design Award from the Association of Building Engineering and Equipment.

Reference

CHP systems developed in FY2017: 90,000 kW (cumulative stock: 2,070,000 kW)
Commercial gas air-conditioning systems developed in FY2017: 120,000 RT (cumulative stock: 4,010,000 RT)

■ Initiatives by Tokyo Gas LIFEVAL

Acted as a one-stop source of home-related services, including periodic safety inspections of gas equipment, meter reading, opening and closing of gas valves and processing of applications for gas and electricity services in general, as well as the sale, repair and installation of gas appliances, and renovation work for the kitchen, living room and plumbing.

■ Better use of customer feedback and initiatives for business improvement

Total number of customer comments: 16,460; 1,260 expressions of gratitude (7.7%), 1,358 complaints (8.2%), and 13,842 system requests (84.1%)
Customer feedback was used to identify and analyze issues and improve operations related to rates, customer inquiries via phone and website, and patrols. Examples of improvements were published on our website.

■ Provision of useful information to customers

October 2017: Began providing “Heat Shock Forecasts” to raise awareness of accidents caused by heat shock while taking baths in the winter.
October 2017: Began offering a service that gives users centralized control of information related to their gas and household appliances through a collaboration between the “Torisetsu” smartphone app and myTOKYOGAS.
July 2017: Launched the “Furomimi” service to present a new lifestyle of enjoying audiobooks while taking a bath.

Key Initiatives for FY2018 and Beyond

We reviewed the Tokyo Gas Group’s key CSR activities and materiality in fiscal 2017. Please visit the related link to view the latest information on our materiality and CSR KPIs.

Link
▶　Identifying New Materiality

DFF Inc., Corporate Social Responsibility Sect, General Administration Dept., Corporate Planning Dept., Resources & Global Business Division, Energy Solution Div, Power Buisiness Dept., Pipeline Network Division, IT Division, Residential Sales Div., Fundamental Technology Dept., Energy Solution Div, Environmental Affairs Dept., Purchasing Dept. , Health Insurance & Employees' Welfare Sect., Personnel Dept., Internal Audit Dept., Audit & Supervisory Board Member's Office, Compliance Dept., Regional Development Div., Finance Dept, ＴＧＥＳ, TOKYO GAS COMMUNICATIONS, INC.

Enhancement of Energy Security