Clean Coal Day in Japan 2013 International Symposium

Shale Gas Revolution &&

Competition between Fuelspin the Asia Pacific Region

September 5, 2013Tokyo

Yoshihiko SAKANASHIExecutive Vice President

Electric Power Development Co., Ltd. (J-POWER)

U.S. Energy Coal Exports by Destination

60

Mt

50Others

51

(+48%)

30

4034

( 47%)

Asia

( )

20

30 (+47%)

Europe

10

01996 98 2000 02 04 06 08 10 2012

1Source: U.S. Energy Information Administration (EIA), 1996-2012

U.S. Energy Coal Exports to Europe and Asia

To Europe To Asia

35

Mt

To Europe To Asia

35

Mt

25

30

35

25

30

35

(+74%)

15

20

(+124%)15

20

5

10(+124%)

5

10(+59%)

(+35%)

02010 2011 2012

02010 2011 2012

2Source: U.S. Energy Information Administration (EIA), March 2013

Coal Imports into the U.S.

18

Mt

18

141618

(-32%)

18

101214

Others( 35%)

(-30%)13 12

8

68

(-35%)

(-27%)9

8

6

024 Colombia

02010 2011 2012

3Source: U.S. Energy Information Administration (EIA), March 2013

Recent Energy Coal Flows

Russia

JapanChina

USA

Europe

India

C l bi

Korea

TaiwanSoutheast

Asia

ExporterIndonesia

South

Colombia

Australia

Exporter

Importer

South

Africa

4

Coal and Natural Gas Consumption for Generation in the U.S.

Coal consumption for power generation

Natural gas consumption for power generation

10100Mt

for power generationin the U.S.

101,000bcf

for power generationin the U.S.

789

10

789

10

(-12%) (+21%)

8.5

7.5 7.6

9.1

4567

4567

1234

1234

01

2011 201201

2011 2012

5Source: U.S. Energy Information Administration (EIA), March 2013

Energy Networks in the U.S.

Railway networksRailway networksby companies

El t i it t i iElectricity transmission & Natural gas pipelines

6Source: Cambridge Systematics, National Rail Freight Infrastructure Capacity and Investment Study, September 2007,

Copyright 2007, AAR U.S. Energy Information Administration (EIA), January 2011

Power Generation in the U.S. (2013 Outlook)

2012 2013Coal fired : 37.4 40.3 (%)Natural gas-fired : 30.4 27.4

7

World Energy Coal Markets

1 A l i 2 A i P ifi1. Atlantic 2. Asia PacificAPI2, API4 globalCOAL NEWC Index

Coal Prices US$/ton

globalCOAL NEWC Index

Direct competition between the two marketsAPI4

API2

8Source: globalCOAL, Argus Media

World Natural Gas Markets

1. North America 2. Europe 3. Asia Pacific

Hub pricing Hub & oil-linked pricing Oil-linked pricing

× × × ×× × × ×Middle East LNG Prices (FOB)

US$/MMBt

15

20US$/MMBtu Asia – Pacific bound

10

15

Europe bound

No direct competition among the three markets

0

5

1 1 1 2 2 2 2 2 2 2 2

Europe bound

9

among the three marketsO

ct-1

Nov

-1D

ec-1

Jan-

1Fe

b-1

Mar

-1Ap

r-1

May

-1Ju

n-1

Jul-1

Aug-

1

Source: Argus spot LNG price assessments

Examples of New Factors Emerged in 2013

- Action plan on climate change by the Obama Administration

President Obama spoke on climate change on June 25, 2013.

Source: White House

- Deregulation plan on electric power industry by the Japanese GovernmentGovernment

10

Three Essentials for New Pricing System

Transportation networks &- Transportation networks & infrastructure

- Technology developmentTechnology development

- International deployment

11

Transportation Networks & Infrastructure

NetworksNetworksInfrastructure

12

Technology Development

- Coal

- USC- IGCC

CCS- CCSJ-POWER’s Isogo Power Plant located at Yokohama in Japan, a coal-fired power plant with USC technology

- Bottleneck at downstream of l l h icoal value chain

13

*1: Ultra Super CriticalJ-POWER’s examples of international deployment

International Deployment

Isogo power plantJapanChina

Hezhou power plant

*1: Ultra Super Critical2: Integrated Coal Gasification Combined Cycle

J-POWER s examples of international deployment of advanced technologies in Asia

Isogo power plantin operation with the latest USC technology, the highest thermal efficiency level in the

o ld coal fi ed

Hezhou power plantin operation, one of the latest USC*1 plants in China J-POWER invests in and cooperates in construction and operation world coal-fired

generation (2 X 600 MW)

Japan

and operation (2 X 1,000 MW)

Osaki power plant

Indonesia

Osaki power plantunder construction in order to demonstrate IGCC*2 technology to be in operation in 2017

Australia

(image rendering)

p(1 X 166 MW)

(signing ceremony)

Callide oxy-fuel projectin operation in order to achieve recovery of condensed CO2 in oxygen and recycled exhausted

14

Central Java power plantunder development, the first USC plant in Indonesia J-POWER invests in (2 X 1,000 MW)

gas together with geological CO2 storage J-POWER implements jointly with other companies (1 X 30 MW)

Our Next Stage in the Pacific

CoalCoalNatural gas (LNG)

- Transport networks/infrastructure- Technology development- International deployment

15

Thank you very much for your attention.

16