―― From the time of its founding, one of JERA’s goals has been to become a global energy company, yet electric companies are usually thought of as domestic businesses. Why is JERA seeking to globalize?
Originally, electric companies in Japan delivered electricity domestically. Fuel procurement, too, was strictly for the purpose of domestic power generation. Today, however, with domestic market demand shrinking due to a declining population and economic maturity, full liberalization of the retail electric power market is sure to lead to even greater competition going forward. One way to survive in this kind of environment is to expand overseas. For both fuel procurement and power generation, we’re developing infrastructure in countries and areas that will need energy in the future. There are enormous needs overseas, particularly in Southeast Asia and the Middle East, and we have to globalize in order to meet them.
Although shrinking, the domestic market, of course, will continue to be important. In a country like Japan that has a mature society, there is a demand for inexpensive, high-quality electricity. We’ll be doing the same thing both domestically and overseas, but the demands are different. In any case, in simplest terms, we ‘ll be generating power both domestically and overseas, and procuring the fuel to do so. We’ll also branch into resource development and fuel trading. This is how we will globalize.
The shift to value chains is already underway around the world. We are seeking to move upstream from power generation into areas like fuel procurement while the international resource majors, for example, are advancing downstream toward power generation. Trading companies, meanwhile, are trying to move both upstream and downstream from their intermediate position as distributors. Globalization is a competition for share. You could say that JERA’s mission in globalization is to engage in that competition.
―― Hendrik Gordenker, an American, has taken on the role of chairman. Is this also a symbol of globalization?
This is the first time that a non-Japanese has become chairman of a Japanese electric or gas company. Although this may be something new from a domestic standpoint, seen from a global perspective there’s nothing unusual about it at all. Chairman Gordenker plays a supervisory role, taking a global view in watching to see whether JERA is moving in the right direction, and whether we may have missed anything. His global network of contacts must also be mentioned. As a legal expert in fuel and power generation project contracts, he’s also a businessman who offers us valuable advice. He may symbolize our globalization, but he’s also a leader who will guide us into world markets.
We will secure LNG, with its unrestricted destinations and high fluidity, and achieve optimal operation with the expansion of our transport fleet. In terms of profit, we will invest in vessel ownership securing stable profits.
LNG Fleet "Bishumaru"