Development of a wood biomass fuel supply infrastructure

「The situation surrounding fuel procurement for the eF-On Shingu Power Plant remains difficult. However, by providing nearby sawmills with wood-drying services using steam from the power plant and wood-cutting services, we will establish a framework under which they can assist with the collection of sawmill residues and other materials.」

「In the forestry business, sales increased to approximately 1.8 times the level of the same period of the previous year as we expanded external sales of logs. However, the business remained loss-making owing to increased staffing and transportation equipment, as well as external outsourcing costs to secure the volume of logging operations.」

「Through a wood-drying service using steam from the eF-On Shingu Power Plant, we will promote collaboration with local sawmill operators and develop new sources of fuel procurement.」

「With respect to the supply of wood-chip fuel, for which supply and demand remain tight, the group's forestry business has proactively promoted logging operations, contributing to the supply of unused wood to group power plants, while also focusing on external sales to improve earnings. However, it has not yet reached the stage at which the business as a whole is supported and contributes to profit.」

「In the group's forestry business, we have proactively promoted logging operations to offset these changes in the procurement environment and have played a certain role in supplying unused wood to group power plants, although external outsourcing, loading and unloading, transportation and other operating costs have increased.」

「In the group's forestry business, we have proactively promoted logging operations to offset these changes in the procurement environment and have played a certain role in supplying unused wood to group power plants, although external outsourcing, loading and unloading, transportation and other operating costs have increased.」

「In the group's forestry business, we have proactively promoted logging operations, contributing to the supply of unused wood to group power plants, while also focusing on external sales to improve earnings.」

「The procurement of wood-chip fuel remained difficult because the volume of logs available for chipping continued to decline owing to soaring timber prices, while procurement prices were also trending higher.」

「Soaring timber prices have continued since the beginning of the fiscal year, while the deterioration in log distribution conditions has spread nationwide, resulting in an ongoing situation in which fuel procurement has put pressure on the group's earnings.」

「Soaring timber prices have continued since the beginning of the fiscal year, while the deterioration in log distribution conditions has spread nationwide, resulting in an ongoing situation in which fuel procurement has put pressure on the group's earnings.」

「To maintain the proactive procurement of wood-chip fuel, we promoted the procurement of adequate-quality fuel, including from remote areas, which resulted in higher fuel procurement costs.」

「As we promoted the proactive procurement of wood-chip fuel in response to soaring timber prices, we were unable to secure adequate-quality fuel, resulting in higher fuel procurement costs. Rising diesel and gasoline prices pushed up logistics costs, increasing expenses related to power plant operations as well as external outsourcing costs for the forestry business. In addition, personnel costs, travel expenses, and recruitment and training costs rose substantially as staffing increased in preparation for the start-up of the Shingu Power Plant, while depreciation of large equipment used in forestry operations also became a burden.」

「In the Green Energy business, we will continue working to reduce total wood-chip fuel consumption and accumulate know-how, while improving the utilization rate of unused wood. In power plant operations, in addition to conducting detailed inspections and maintenance with the goal of maintaining high operating rates, we will increase log intake in the areas around the eF-On Bungo-Ono and eF-On Mibu power plants, which have chip-processing facilities, as well as the eF-On Shingu Power Plant, although a certain period remains before the latter begins operations.」

「For future fuel supplies for the Shingu Power Plant, we are securing logs, primarily sourced from Wakayama Prefecture, and are progressively working to expand our supplier base. We are also actively pursuing the acquisition of forestland required to advance collaboration with our forestry business.」

「In this segment, we have strengthened staffing not only for plant operations but also for fuel procurement and the forestry operations division, and have begun logging operations using forestry machinery and roundwood sales.」

「Fuel consumption at the 2 power plants in the Kyushu region tended to be lower than last year.」

「To secure fuel quality, particularly by reducing the moisture content of fuel chips, we will examine the characteristics of each region, share the respective measures within the Group and pursue improvements based on a best-practice approach. With regard to unused wood, the owners of the forests and standing timber that constitute the source material are aging, and in some regions, people engaged in logging are also struggling to find successors for the next generation. As a result, there is a risk that the experience and know-how of those engaged in the forestry business will not be passed on to the next generation and will be lost. To establish a stable, long-term supply of unused wood that contributes to the stable operation of the power plants, we will work to acquire and improve our expertise in forest management and logging techniques.」

「At the other power plants, the increase in fuel consumption during the first quarter was improved, while the newly established エフオン壬生 steadily expanded its performance. As a result, profit increased, more than offsetting the higher costs associated with the new plant, and both net sales and profit increased.」

「The Group has continued its initiative to procure fuel types mainly from relatively dry recycled wood, changing the mix of fuel types used for its wood biomass power generation. This achieved a certain reduction in total fuel consumption compared with the first quarter.」

「Based on the experience of increased consumption caused by the higher moisture content of wood chips following record rainfall in western Japan due to a stalled seasonal rain front and typhoons during the same period of the previous year, the Group began changing the purchasing mix of each fuel type from the current quarter to improve fuel efficiency.」

「Regarding the wood chips used as fuel, consumption increased during the first half of the period because the moisture content of the chips rose as a result of record rainfall in western Japan caused by a stalled seasonal rain front and typhoons. The utilization rate of unused wood also increased in anticipation of higher future earnings.」

「Regarding the wood chips used as fuel, consumption increased during the first half of the period because the moisture content of the chips rose as a result of record rainfall caused by a stalled seasonal rain front and typhoons. The utilization rate of unused wood also increased in anticipation of higher future earnings.」

「We believe that important management priorities include broadening fuel procurement channels, accepting roundwood, increasing chip-processing output, reducing costs by leveraging economies of scale in plant operations, and securing and training specialized personnel to promote the active use of forest resources.」

「Operating profit also increased significantly due to higher net sales and the ability to procure fuel raw materials at stable prices.」

「To ensure a stable fuel supply, we will develop stockyards and chip-processing centers and also work in areas such as forest-resource surveys and forest management.」