JERA Co., Ltd.
[#01] A decarbonized society that the world's largest energy company is seriously aiming for
JERA is an energy company established in 2015 as a joint venture between Tokyo Electric Power Company and Chubu Electric Power Company. We have high international competitiveness with a business model that supports a series of value chains from procurement of fuel resources to transportation, trading, power generation, and sales, and currently boasts thermal power generation that accounts for half of the domestic power and one of the world's largest fuel handling volumes. . In recruiting new colleagues this time, we asked Mr. Yukio Kani, Executive Vice President and Executive Officer, about JERA's vision, mission, and the type of human resources it seeks.
A world-leading energy company with a unified value chain
Executive Vice President / Yukio Kani
──To begin with, please tell us about JERA's business outline.
JERA is a joint venture established in April 2015 by integrating the fuel and thermal power divisions of TEPCO and Chubu Electric Power with the aim of creating an internationally competitive energy company in Japan. We have built a business model that is rare in the world, in which the entire value chain, from the procurement of fuel resources to transportation, power generation, and sales, is integrated on a large scale.
With total assets of approximately 8.7 trillion yen and annual handling volume of LNG (liquefied natural gas) of approximately 37 million tons, it boasts one of the largest business scales in the world. Annual power generation at 27 thermal power plants in Japan is approximately 255 billion kWh. This is equivalent to about 30% of domestic power generation.
JERA's business is divided into three business divisions. First, the business development department aims to build an optimal asset portfolio and increase earnings, the optimization department manages assets in the entire energy value chain economically and flexibly, and then fuel receiving terminals and thermal power plants. It is an "O&M (operation and maintenance) and engineering department" that operates safely and at low cost.
By promoting their businesses with their respective expertise and by collaborating borderlessly, we have established a robust system that can withstand changes in the domestic and international environment and social conditions.
──What are the characteristics and strengths of JERA that other companies do not have?
JERA's strength lies in its three pillars of power generation options: LNG-based gas-fired power, renewable energy such as solar and wind power, and low-carbon energy using hydrogen and ammonia. While there are many companies that specialize only in gas-fired power generation or renewable energy, JERA's business model, which handles a wide variety of power generation on a large scale, is rare even in the world.
The amount of power generated by renewable energy fluctuates depending on the environment and climate, and hydrogen-ammonia power generation is still under development and cannot guarantee a sufficient supply. Therefore, by combining gas-fired power generation that is easy to control, we have realized a sustainable power generation and supply system that can stably and reliably meet demand. The fact that all of these are controlled and operated optimally by JERA alone is a major feature that other companies do not have.
Balancing social contribution and business expansion with customer-oriented solutions
──JERA's mission is to provide cutting-edge solutions to the world's energy problems. Please tell us about your thoughts here.
I think it is common for conventional electric power companies to have a mission from the supplier's perspective, such as "stable supply of energy." However, at JERA, we have incorporated the customer's point of view while maintaining a stable supply as a major premise. This is reflected in the phrase "the world's energy problem." We find value in solving customers' problems caused by the world's energy problems. It also emphasizes that its solutions are "cutting-edge" that can provide new value to its customers, and has expressed its strong intention to continue to be a global leader in energy solution providers.
In order to achieve this mission, JERA will break away from the conventional seniority-based, bureaucratic, vertical society, and thoroughly create a flat organization where anyone can raise their hand and speak freely and take on new challenges. I'm here.
We place particular emphasis on fostering a culture that is not afraid of failure. Providing cutting-edge solutions means promoting unprecedented projects ahead of the industry. There is more or less failure. I believe that it is important not to be discouraged by any difficulties, and to move forward while making agile course corrections even if we fail.
──Could you introduce a specific example of providing a “state-of-the-art solution”?
One of the projects we are currently focusing on is offshore wind power generation. Since 2018, we have been participating in the UK's Gunfleet Sands offshore wind power project to build wind power generation facilities in Japan's vast ocean, and have acquired advanced operational knowledge. We also participated in the Formosa offshore wind power generation project in Taiwan. In Taiwan, we are in the process of acquiring knowledge of the construction phase in addition to the operation, and have been involved in the "Formosa 2" project, which is about to start, from the previous stage, the business launch phase.
We are also actively working on the use of fuel ammonia as an alternative to fossil fuels. Since ammonia does not emit CO2 (carbon dioxide) when burned, it can be co-combusted with coal to significantly reduce CO2 emissions from thermal power generation.
In fiscal 2021, JERA started a large-scale ammonia co-firing initiative at the Hekinan Thermal Power Station in Aichi Prefecture. We plan to increase the ammonia co-firing rate by repeating demonstration experiments, aiming for 20% co-firing in FY2023, 50% co-firing in FY2028, and complete decarbonization by 2050. This is the world's first attempt to utilize ammonia on such a large scale, and it is attracting a great deal of attention from around the world.
The use of ammonia as a fuel not only contributes to the realization of a sustainable society, but can also be a great business opportunity for JERA. This is because JERA can build an ammonia value chain by owning both the technology to generate ammonia itself and the thermal power plants that consume it. While maximizing the leverage of our own demand, we are expanding the market for fuel ammonia, and we are considering further business expansion such as ammonia sales in the future.
The goal is zero CO2 emissions by 2050. Searching for a truly sustainable society
──Please tell us about your vision for the future and the growth strategy for achieving it.
JERA announced "JERA Zero Emission 2050" in October 2020. This is a big challenge to reduce CO2 emissions from our business in Japan and overseas to virtually zero by 2050. As a stepping stone for this, we have also formulated a "New Vision for 2035." We are making steady progress toward decarbonization by providing a clean energy supply base that combines renewable energy and low-carbon thermal power.
Europe, which leads the world in renewable energy, will face a serious energy shortage around 2021 due to continued bad weather. In addition, the price of natural gas soared due to Russia's invasion of Ukraine. The world is still in turmoil.
In order to prevent Japan from falling into such a situation, it is essential to consider Japan's unique circumstances and have a variety of power generation options that can be used according to the situation. In addition to LNG, which provides the most stable supply of electricity, we will develop clean energy and combine various power generation technologies such as onshore wind power, fixed offshore wind power, floating offshore wind power, solar power, storage batteries, and ammonia and hydrogen co-combustion. We will do our best to provide solutions.
Towards a completely decarbonized society. I want to make big dreams come true by combining various abilities
──You say that you are in the midst of trying to do something that no one else has been able to do, but what kind of person are you looking for?
We are now looking for people with various skills and experience, not only in the energy industry, for rapid business expansion and new challenges. In fact, the backgrounds of our mid-career recruits are diverse, and the head office alone has more than 10 nationalities, and it continues to grow even at this very moment. As a result, although the situation changes from moment to moment, when viewed globally, there are close to 30 countries. There is also a wide variety of industries and occupations.
If there is a common point, it would be that they each have their own core expertise and empathize with JERA's mission and the story towards it. We believe that the perfect environment is in place for those who want to demonstrate their abilities in their areas of expertise and contribute to the business, and to have an impact on society and the world. If you are excited about JERA's mission and vision, I would love to hear from you.
──Please tell us about the experiences and careers that can only be obtained at JERA.
JERA is a company that has a medium- to long-term perspective unique to the infrastructure business, while at the same time coexisting with a sense of speed that adapts to global standards. There are times when you work with many stakeholders to follow a steady process, and there are times when you create a system from scratch at the speed of a startup, so it can be said that it is a workplace where you can envision a variety of career paths.
Our goal is a completely decarbonized society. We still have a lot of issues to solve, but we should be able to realize a carbon-free world by leveraging our respective expertise and bringing together our collective wisdom. JERA, which boasts one of the largest business scales in the world, is seriously working on decarbonization, so it can truly change the world. I believe so.
For that you need new friends. We look forward to working with you to realize the big dream of a decarbonized society.
[Series] Towards an energy company that changes the world. Challenge of "JERA" from Japan (3 times in total)
JERA was established in 2015 as a joint venture between Tokyo Electric Power Company and Chubu Electric Power Company. As one of the world's largest energy companies, we are responsible for a series of value chains from procurement of fuel resources to power generation and sales, and our mission is to provide cutting-edge solutions. What is the goal of JERA, which continues to grow by leaps and bounds? We will approach the appeal of the company in three parts, including efforts toward a decarbonized society and advanced DX cases.
