Electric Power Development Co., Ltd.

Business Details

Engages in power generation businesses using hydroelectric, thermal (coal, LNG, etc.), and renewable energy sources such as wind and solar power, along with related maintenance and operations, as well as the sale of electricity procured from the wholesale electricity market and other sources. In FY2026 (ending March 2026), the decommissioning of the Matsushima Thermal Power Station and the decline in capacity market prices were factors that reduced revenue, and an increase in repair costs also squeezed segment profit. Segment revenue (including internal sales) was ¥865,624 million, accounting for approximately 69% of the group's total, making it the core business.

Recent Overview

The decommissioning of Matsushima Thermal, the decline in capacity market prices, and increased repair costs combined to reduce segment profit by 33.8% year-on-year.

Power Generation Business segment profit for FY2026 (ending March 2026) decreased 33.8% year-on-year to ¥45,351 million from ¥68,547 million. The main causes were the shrinkage of the revenue base due to the decommissioning of Matsushima Thermal Power Station, the decline in capacity market prices, and an increase in repair costs. On the other hand, the thermal equipment utilization rate rose from 58% to 67%, and electricity sold increased 1.5% year-on-year. In renewables, the hydro water inflow ratio fell from 91% to 88%, resulting in a 2.6% decrease in electricity sold. For FY2027 (ending March 2027), assuming a normal-year hydro water inflow and resolution of thermal equipment troubles, revenue growth in the Power Generation Business is expected.

Key Products

Growth Drivers

• Increase in electricity sold due to a rise in the thermal equipment utilization rate (67% in FY2026 (ending March 2026)), with 73% projected for FY2027 (ending March 2027)
• Recovery in hydroelectric power sales as the water inflow ratio returns to a normal-year level (100%) in FY2027 (ending March 2027) (plan: 8.3 billion kWh → 8.8 billion kWh)
• New construction and upgrading of renewable energy facilities (maximum output for geothermal and solar increased by 29,999kW year-on-year)
• Continued revenue contribution from the capacity market (established as a new revenue source despite price volatility risk)
• Realization of environmental value through corporate PPA agreements and expansion of renewable energy aggregation services
• Groundwork for future CO2-free hydrogen power generation via the GENESIS Matsushima Project (coal gasification power generation IGCC)
• Strengthening of the future revenue base through the completion of construction and commencement of operations at the Ohma Nuclear Power Station

Risks

• Risk of fluctuations in capacity market prices (price declines materialized as a revenue-reducing factor in FY2026 (ending March 2026))
• Risk of fluctuations in the hydro water inflow ratio (dependent on weather and precipitation; fell to 88% in FY2026 (ending March 2026), down from the prior period)
• Risk of fluctuations in fuel prices for coal, LNG, etc. (affected by market conditions for long-term contracts and spot procurement)
• Shrinkage of the revenue base due to the decommissioning of Matsushima Thermal Power Station (maximum output decreased by 500,000kW)
• Risk of increased repair costs (varies depending on the content and scale of periodic inspections; an increase in FY2026 (ending March 2026) squeezed profit)
• Risk of fluctuations in electricity market prices (expanding exposure due to an increasing proportion of sales to the wholesale electricity market)
• Risk of construction delays at the Ohma Nuclear Power Station (an extraordinary loss on disposal of fixed assets was recorded in FY2026 (ending March 2026) associated with the disposal of measurement and control equipment, etc.)
• Risk of impairment losses at Australian renewable energy power generation facilities, the Takasago Thermal Power Station, and others (an impairment loss of ¥32,988 million was recorded in FY2026 (ending March 2026))