TEPCO Power Grid, Incorporated (E32215) Stock Price

**Business Overview of Tokyo Electric Power Grid**

Tokyo Electric Power Grid is a transmission and distribution operator that forms the backbone of power infrastructure centered in the Tokyo metropolitan area. The company delivers electricity generated at power plants safely and reliably to homes and businesses through its network of transmission lines, substations, and distribution equipment. Beyond supplying power, the company also handles the construction, maintenance, and management of these critical infrastructure assets.

The company's primary customers are electricity retailers and general power consumers. Following Japan's electricity market liberalization in 2016, various power companies have entered the market, but all electricity they sell is delivered to consumers through the company's transmission and distribution network. Revenue is primarily derived from transmission and distribution network usage fees (wheeling charges), ensuring stable income based on electricity consumption levels.

The company operates through a group consisting of 10 subsidiaries and 18 affiliated companies, conducting a wide range of businesses centered on electric power operations. Key affiliated enterprises include Kanden Engineering (which handles facility construction), Toko Denki (a power equipment manufacturer), and At Tokyo (a data center operator), establishing a comprehensive service structure related to power infrastructure.

Tokyo Electric Power Company Grid is adapting to changing market conditions: while energy conservation is slowing electricity demand, the widespread adoption of generative AI and green transformation initiatives are expected to drive new demand through electrification. Under its Fourth Comprehensive Special Business Plan, the company allocates approximately 120 billion yen annually to decommissioning while pursuing discontinuous operational efficiency improvements to enhance profitability. The company continues stable operations under the revenue cap system, fulfills its responsibilities to Fukushima, and aims to increase corporate value.

The company's priority investment areas are upgrading aging equipment and strengthening transmission and distribution networks. Specific initiatives include constructing ultra-high-voltage substations and underground transmission lines in Inzai, Chiba Prefecture to accommodate increased electricity demand from new and expanded data centers. The company also addresses emerging social needs—including enhanced resilience against intensifying and widespread natural disasters, carbon neutrality, digitalization, and decentralization—through efficient equipment maintenance and expansion.

In new market development, the company is actively expanding its business scope domestically and internationally. It is simultaneously advancing procurement reform and international expansion through demonstration projects for energy management in Vietnam and joint transportation trials of pole-mounted transformers with other transmission and distribution operators. Through collaboration and partnerships with companies across industries, the company is creating new value beyond traditional transmission and distribution operations and building business models suited to changing market environments.

Technology innovation efforts center on aggressive digital transformation adoption. The company has established the world's first drone routes and launched drone system services for inspecting and surveying transmission equipment, while implementing productivity improvements to reduce costs through operational efficiency. The company is also improving the entire supply chain through collaboration with construction companies, manufacturers, and other general transmission and distribution operators. These initiatives aim to achieve discontinuous operational efficiency improvements and establish a sustainable business foundation.