On February 27, 2020, Tohoku Electric Power (Tohoku), headquartered in Miyagi Prefecture, released its Medium- to Long-Term Vision. Tohoku’s goal is to become a business group that grows with the sustainable development of society and contributes to the realization of a smart society in the 2030s, while improving the competitiveness of its core electricity supply business.
Tohoku’s Medium- to Long-Term Vision reflects the changes in the business environment in their operating regions of Tohoku and Niigata Prefecture. Since its founding, Tohoku has been doing so through stable power supply with our basic principle: “No prosperity regions of Tohoku, no development of our group.” However, their operating region has seen progressive depopulation, declining birthrates, and an aging population. The competition has also become more intense due to the full liberalization of the electricity retail market and the impact of digitalization on the conventional utility business model. In its Medium- to Long-Term Vision, Tohoku focuses on enhancing the competitiveness of its core business as well as setting its growth strategy in the smart society businesses, addressing various social issues.
Tohoku has set 2020 to 2024 as a transition period for Tohoku’s business model. During this time, Tohoku will strategically invest in management resources in order to shift its business model towards the realization of a smart society. The investments will include Virtual Power Plant (VPP) and battery storage, mobility services, and smart city development. Tohoku will also strengthen its core business by maintaining its diversified energy portfolio and will continue the development of new renewable and gas-fired power plants. In addition, Tohoku will improve the resiliency of its electricity network and aims to reduce its operational costs using Artificial Intelligence (AI) and Internet of Things (IoT) technology solutions. Tohoku aims to achieve consolidated cash earnings of 320 billion yen (approximately $3 billion) * in FY 2024.[1][2]
*Based on the exchange rate as of March 10th, 2020.
[1] http://www.tohoku-epco.co.jp/news/normal/1205982_1049.html
[2] http://www.tohoku-epco.co.jp/news/normal/__icsFiles/afieldfile/2020/02/27/b2_1205982.pdf