Hokkaido Electric Power Company, Incorporated
9509・Prime Market・Electric Power & Gas
Hokkaido Electric Power (Power Generation & Retail Electricity Business)
Core segment of the Hokuden Group. Responsible for power generation and retail electricity business and corporate functions.
| Period | Current | Previous | Change |
|---|---|---|---|
| Sales (before elimination of inter-segment transactions) | ¥735,808 million | ¥788,051 million | ↓ |
| Segment ordinary income | ¥44,618 million | ¥53,689 million | ↓ |
| Increase in tangible and intangible fixed assets (capital expenditure) | ¥138,739 million | ¥86,723 million | ↑ |
| Depreciation | ¥34,992 million | ¥36,417 million | ↓ |
| Retail electricity sales volume | 22,058 million kWh | 22,729 million kWh | ↓ |
| Sales volume to other companies | 11,981 million kWh | 10,770 million kWh | ↑ |
| Interest expense | ¥14,793 million | ¥10,949 million | ↑ |
Business Details
The Hokkaido Electric Power segment is the core segment that integrally handles the Group's head office (corporate) functions and the power generation and retail electricity business. In addition to in-house generation from hydroelectric, thermal, and new energy sources, the company procures electricity by combining it with power received from other companies, and conducts retail sales for low-voltage (lighting and power) and high/extra-high voltage customers, as well as wholesale sales to other companies. For FY2026 (ending March 2026), retail electricity sales volume was 22,058 million kWh (down 3.0% year on year), while sales volume to other companies was 11,981 million kWh (up 11.2% year on year). While a decrease in the fuel cost adjustment amount due to lower fuel prices pushed down sales, an expansion in the timing-lag gain under the fuel cost adjustment system and an increase in hydroelectric power generation volume supported earnings.
Recent Overview
Sales and profit both decreased year on year due to a combination of the decrease in the fuel cost adjustment amount and costs related to the Tomari Nuclear Power Plant restart efforts, together with rising interest rates.
For FY2026 (ending March 2026), sales decreased by ¥52,242 million year on year to ¥735,808 million, mainly due to a decrease in the fuel cost adjustment amount accompanying lower fuel prices. Segment ordinary income decreased by ¥9,071 million year on year to ¥44,618 million, as fuel cost reductions from the expanded timing-lag gain under the fuel cost adjustment system and increased hydroelectric power generation volume (water inflow ratio of 103.6%) were offset by efforts toward the restart of the Tomari Nuclear Power Plant and rising labor costs, prices, and interest rates. Capital expenditure increased substantially year on year to ¥138,739 million, as investment toward carbon neutrality accelerated. For FY2027 (ending March 2027), earnings are expected to deteriorate as the timing-lag effect under the fuel cost adjustment system shifts from a gain to a loss, with ordinary income projected to decrease substantially.
Key Products
Growth Drivers
- Fuel cost reduction effect accompanying increased hydroelectric power generation volume (water inflow ratio of 103.6% and generation volume of 3,646 million kWh for FY2026, ending March 2026)
- Increase in sales volume to other companies (expansion of wholesale sales accompanying increased renewable energy purchases, up 11.2% year on year)
- Expected fuel cost reduction and earnings improvement from the restart of the Tomari Nuclear Power Plant
- Medium- to long-term increase in electricity demand accompanying the siting of digital industries such as next-generation semiconductor plants and large-scale data centers
- Strengthening of supply capacity through Ishikari Bay New Port Power Station Unit 2 (scheduled to begin operation in FY2030) and Unit 3 (FY2033)
- Expansion of capital expenditure toward achieving carbon neutrality (construction in progress of ¥431,887 million)
Risks
- Risk of a timing-lag loss arising under the fuel cost adjustment system (the effect is expected to shift from a gain to a loss in FY2027, ending March 2027)
- Risk of delay in the restart of the Tomari Nuclear Power Plant (prolonged review process and additional safety measure construction work)
- Risk of increased procurement costs due to rising fuel prices and wholesale electricity market prices (FY2027 assumptions: crude oil CIF $95/bl, exchange rate ¥158/$)
- Risk of fluctuations in electricity demand due to temperature variability (decrease in heating and cooling demand)
- Risk of increased costs due to rising labor costs, prices, and interest rates (interest expense increased ¥3,844 million year on year)
- Risk of continued challenging competitive environment due to wholesale electricity market prices remaining at low levels, and a decrease in retail electricity sales volume
- Risk of increased grid stabilization costs accompanying the large-scale introduction of renewable energy
Last updated: June 23, 2026