Hiroshima Gas Co., Ltd.TSE: 9535

CSR Report 2024

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Hiroshima Gas CSR Report

Corporate Social Responsibility Report

2024

Digest

Creating a sustainable

society with our hands...

Flow of delivering natural gas to our customers

City gas supply owchart

Raw material procurement

City gas production

and transport

Natural gas is extracted overseas, cooled to approximately -160ºC, liqueed, and then imported as LNG (liqueed natural gas).

LNG is placed into storage tanks and vaporized according to demand. It then undergoes caloric value adjustment and is supplied as city gas.

Bintulu facilities in Malaysia

Hatsukaichi LNG terminal

[Natural gas extraction] [LNG transport ship]

[LNG storage tank]

[LNG vaporizer]

Supply area and organization

(As of March 31, 2024)

Supply area (7 cities and 4 towns within Hiroshima prefecture)

Number of customers

Hiroshima, Kure, Onomichi, Mihara, Hatsukaichi, Higashi-hiroshima, Fukuyama,

417,000

Aki-gunKaita-cho /Saka-cho /Fuchu-cho /Kumano-cho

Hiroshima district

Number of customers

356,000

Kabe facilities

Higashi-hiroshima plant

Kabe facilities

Head ofce

Kaita facilities

Kaita facilities

Higashi-hiroshima plant

Head ofce

Hatsukaichi LNG terminal

Kumano

facilities

Kumano facilities

Kure district

Number of customers

Kure branch

44,000

Kure branch

Hatsukaichi LNG terminal

Hiroshima Gas makes sure its energy supply system is stable and secure

Hiroshima Gas CSR Report 2024

so that all of its customers can always use natural gas in a safe manner.

Digest

City gas supply

Delivery to customers

Gas is supplied to customers through 5,300 km of underground piping (supply and service pipelines).

The gas that we supply can be used in a variety of applications.

Gas pipe bridges

Factories, etc.

Hotels, buildings, schools, etc.

Kitchens, hot water supply, etc.

[Gas holder]

[Industrial use]

[Commercial use]

[Residential use]

Natural gas is an environmentally friendly type of energy!

Wholesale

supply

(Hiroshima Gas)

Wholesale supply utilizing equipment from

LNG tanker trucks Setouchi Pipeline Co., Ltd., a consolidated subsidiary

Mizushima station

Mizushima LNG terminal

(Setouchi Pipeline Co., Ltd.)

(Mizushima LNG Co., Ltd.)

HiroshimaOkayama

prefectureprefecture

Mizushima station Mizushima LNG terminal

Bingo plant

Fukuyama Gas Co., Ltd.

Bingo plant

Onomichi branch

Onomichi/Mihara

district

Number of customers

17,000

Onomichi branch

Energy plays an important part in every part of our lives.

Legend

Supply area

Gas holder

(Hiroshima district)

Gas production plant

Supply area

(Kure district)

Head ofce/Branch/

Supply area

Facilities

(Onomichi/Mihara

Proposed pipeline

district)

Pipeline

Pipeline

(Hiroshima Gas)

(Setouchi Pipeline)

Materiality of the Hiroshima Gas Group (Key Issues)

Based on our management philosophy of "striving to be a company trusted by the community," the Hiroshima Gas Group has specied our materiality (key issues) for the realization of a sustainable society. The indicators and goals corresponding to our materiality are linked to our 2030 Vision and FY2024 Mid-Term Management Plan.

Contribute to a carbon

Resolve social issues by

Improved activities and

Promote governance

Provide a stable

job satisfaction of

Sound development as

Contribute to

neutral society

utilizing digital technology

diverse human resources

a local energy supplier

and compliance

supply of energy

local communities

Hiroshima Gas Group 2030 Vision

Slogan for Hiroshima Gas Group 2030 Vision

Declaration of the Sustainable Development Goals set by Hiroshima Gas Group for the benet of communities

Declaration of the Sustainable Development Goals set by Hiroshima Gas Group for the benet of communities

- Taking action to create a brighter future -

Three Basic Values

Our Slogan Represents

Basic Policies for 2030 Vision

  • The Hiroshima Gas Group grows with the community
  • Energy that truly benefits communities
    ❸ To pursue inspiration and send moving messages that we can share with the entire community
  • Pursuit of inspiration through our operational policies
    2 Pursuit of inspiration through our energy service
    3 Pursuit of inspiration through peace of mind
    4 Pursuit of inspiration through connection with others

Based on our management philosophy of "striving to be a company trusted by the community," Hiroshima Gas Group seeks to implement viable corporate governance and work toward the Sustainable Development Goals proposed by the United Nations in order to contribute to building a sustainable society under the company slogan of "energy that truly

benets communities."

October 30, 2020 Hiroshima Gas Group

Efforts by Hiroshima Gas Group to achieve carbon neutrality by 2050

Efforts by Hiroshima Gas Group to achieve carbon neutrality by 2050

1

2

Until 2030, we will steadily promote the reduction of CO2 emissions in our business activities and at our customers' sites, focusing on the various ESG-related project efforts we have implemented thus far to reduce our environmental impact.

In the future, we will engage in the "decarbonization of the gas itself" through the use of methanation and hydrogen, as well as decarbonization of power sources, aiming for carbon neutrality by 2050.

Targets for FY2030

Contribution to CO2 emission reductions

Volume of renewable energy power sources handled CO2 emissions at Hiroshima Gas ofces and production plants

300,000 tons/year*1

60,000 kW*2

50% decrease from FY2013*3

*1: Contribution to CO2 emission reductions by Hiroshima Gas and its customer sites as of FY2030 (from FY2021)

*2: Includes power sources applicable for a feed-in tariff (FIT) such as solar power, wind power, and biomass.

*3: Included in contribution to CO2 emission reductions of 300,000 tons/year

Roadmap to carbon neutrality by 2050

2030

2050

Carbon reduction

and decarbonization

Shifting to natural gas and LP gas (Fuel shift from oil and coal)

Gas

at customer sites

Efciently using natural gas and LP gas by expanding the use of CGS, fuel cells, etc.

Decarbonization of the gas itself

Carbon reduction

and decarbonization

at customer sites

Electricity

Decarbonization of

power sources

Environment Forest

conservation

Investigating potential for next-generation energy (Methanation/hydrogen)

(Utilizing CO2 credits)

Introducing and

expanding e-methane*

Procuring and supplying electric power from the electric power market

Supplying green electric power

Securing renewable energy power sources and electric power after the purchase period under

the FIT scheme expires (Constructing virtual power stations)

Thermal power source

(Electric power market)Making renewable energy power sources

the main power sources in the electric power market

Conserving forests and creating CO2 credits

Carbon neutrality

* Synthetic methane produced using non-fossil energy sources, such as green hydrogen, as raw materials

Management

Reforming and strengthening the business base for the safe

and stable supply of energy and improved corporate value

Company performance information

First decrease in revenue in three years and rst decrease in ordinary prot in ve years. Eight consecutive year of increase in the number of customers.

Consolidated net sales

(Millions of yen)

82,268

95,219

90,670

76,802

73,250

2019

2020

2021

2022

2023 (Fiscal Year)

Consolidated prot

■ Ordinary prot

(Millions of yen)

  • Prot attributable to owners of the parent

7,412

5,272

4,616

5,216

3,454

3,467

3,662

3,375

2,153

2,329

2019

2020

2021

2022

2023 (Fiscal Year)

Gas sales volume and number of customers [Non-consolidated]

  • Gas sales volume (millions of m3)
  • Number of customers (Individual customer locations)

417,252

417,624

415,500

416,788

414,396

596

569

566

500

481

2019

2020

2021

2022

2023 (Fiscal Year)

Business activities

LNG procurement and production

In order to provide a stable supply of city gas, we are striving to diversify our suppliers and ensure stable procurement of LNG (liqueed natural gas), the raw material for city gas.

City gas is produced at the Hatsukaichi LNG Terminal, the Bingo Plant, and the Higashi-hiroshima Plant. LNG reception and the entire gas production process at these locations are tightly controlled via the central control room.

LNG ship docking at our Hatsukaichi LNG Terminal

Central control room

Supply and distribution plants

We are promoting the construction of new gas pipelines and systematic maintenance and management.

In addition, we have established a system to ensure the stable delivery of city gas, including a 24-hour response and dispatch system for emergency situations.

Security command center

Business

City gas is used for a variety of purposes, including residential, commercial, and industrial use, and we are proposing ways to expand and efciently use natural gas.

We also conduct inspections and public awareness activities to ensure safe and secure gas use.

Emergency vehicles

  1. comprehensive system has been put into place to ensure that gas is used in a safe and secure manner.

City gas proposals to customers

Safety inspection of gas equipment

Gas Safety Guidebook

Environment

Reducing environmental burdens at customer sites and in

business activities as well as contributing to the local

environment to achieve carbon neutrality by 2050

Shifting fuel to natural gas and LP gas

Compared to oil and coal, natural gas and LP gas are environmentally-friendly and clean energy sources that emit less CO2 and toxic substances during combustion.

By shifting fuels from oil and coal to natural gas and LP gas, we will contribute to CO2 emission reductions at our customers' sites.

[Effective reduction of CO2 through fuel shifts from oil and coal to natural gas and LP gas]

Oil and coal

Fuel shift

Natural gas

Coal

Oil

and LP gas

LP gas

Natural

100

80

65

gas

60

CO2 (carbon dioxide) emissions when coal is

set at 100

Efciently using natural gas and LP gas

Gas cogeneration systems use natural gas to generate electricity and, at the same time, utilize the heat generated for hot water supply and air conditioning to efciently use energy.

We are promoting the efcient use of energy by, for example, promoting the spread of the household fuel cell "ENE-FARM."

Thermal power station

Transmission line

Conventional

power generation

systems

100%

Home

Energy utilization

efciency*

Lighting

Electricity

41%

Unutilized waste heat and transmission loss 59%

Household

fuel cell "ENE-FARM"

Home

Energy utilization

efciency*

ENE-FARM

Hot water Lighting

100%

Electricity + Heat

Approx.

85 to 97%

Waste heat that is difcult to utilize Approx. 3 to 15%

* Based on LHV (Lower Heating Value: Caloric value not including latent heat of vaporization of water vapor generated during

Source: The Japan Gas Association

ENE-FARM type S

fuel combustion) criteria.

* Calculated using ENE-FARM manufacturer published values.

* "ENE-FARM" is a registered trademark of Tokyo Gas Co., Ltd., Osaka Gas Co., Ltd., and ENEOS Corporation.

Participation in a methanation demonstration project using local raw materials

Hiroshima Gas is participating as a co-implementer of the "Demonstration of a Model of Regional Methanation with Local Production and Consumption Aimed at Cost Reduction through Utilization of Local Resources" with Saibu Gas as the representative company. Our company is implementing this demonstration project as a study of a local production and consumption model in the Chugoku region with the goal of reducing e-methane production costs and providing environmental value through methanation that makes effective usage of excess electricity from renewable energy, a local resource, and byproduct hydrogen and unused CO2 generated by neighboring plants.

Sales of green electric power

From January 2024, we started sales of green electric power primarily to residential customers who use gas of Hiroshima Gas and the Hiroshima Gas Group. By adding environmental value derived from renewable

energy and providing

electricity with net-zero

CO2 emissions, we are contributing to the betterment of the environment

together with our custom- ers.

Expanded utilization of renewable energy

By promoting efforts to spread the use of renewable energy sources such as biomass generation, solar power generation, and small-scale hydropower generation, we strive to not only reduce CO2 emissions but also to conserve the environment, revitalize the local economy, and more.

Kaita Power Station (Biomass generation)

Higashi-Onomichi Solar Power Station

Forest conservation activities

In addition to absorbing and storing

CO2 and preventing landslide disasters

through

forest

conservation activities

as well as revitalizing hilly and

mountainous regions by promoting

forestry, we also contribute to the

conservation of the local environment

through

the

conservation

of

biodiversity and the like.

Tree-planting event at "Hiroshima Gas Jinsekikogen

Forest (Mt. Ishiya) for the Benet of Communities"

Digital Strategy Dept.
Yodai Yamada
There are many different programs.

Society

Working with the local community to promote efforts for the

realization of a sustainable society

Contributing to the development of local communities

As a company that has a strong relationship rooted in the local area, we promote partnerships with local communities and conduct a wide range of social contribution activities centered on the four areas of promotion of arts and culture, promotion of community, promotion of sport, and educational support (commitment to the next generation of education).

Promotion of arts and culture, and promotion of community

Hiroshima Symphony Orchestra Concerts

Concert stage Promotion of sport Hiroshima Gas Badminton Club

Educational support (Commitment to the next generation of education)

As part of our efforts to contribute to local communities, we cooperate with government agencies, education committees, schools, businesses, and other organizations with the aim of actively developing next-generation education programs. We offer a variety of next-generation educational programs primarily for elementary and junior high school students.

[Energy and environmental education] Science shows, Technical Research Institute science lessons [Disaster prevention education] Lifeline disaster prevention classes,

Hiroshima Gas disaster prevention classes [Food education] Eco-cooking classes*

* "Eco-cooking" is a registered trademark of Tokyo Gas Co., Ltd.

Badminton training session

Aiming for a comfortable work environment

Lifeline disaster prevention class

Next-generation educational programs pamphlet

Efforts for work style reform

With regard to work style reform, we are promoting activities centered on three efforts: ① Reducing total working hours, ② Establishing an environment with diverse and exible work styles, and ③ Promoting activities of diverse human resources (promoting women's activities).

① Reducing total working hours

● We set days when employees are

Company-wide "leaving work on time" day

encouraged to leave the workplace on

time without working overtime.

"Let's come late" and "let's go home early" days

    • We set days when employees are encouraged to arrive late or leave early by utilizing exible working hours, etc.
  • Establishing an environment with diverse and flexible work styles

Flexible working hours system

  • Giving each employee discretionary control over their own working hours allows for more efcient work. Shorter exible working hours for childcare or long-termcaregiving
  • As part of childcare and long-term caregiving support measures for employees, four types of work patterns with shorter working hours per day have been set to support employees balancing work and childcare or long-term caregiving.

[Change in the number of employees using shorter exible working hours system for childcare]

Category

Fiscal Year

2019

2020

2021

2022

2023

Number of employees using shorter exible

17

17

21

20

19

working hours for childcare (persons)

Telecommuting work system

    • We promote exible work styles by utilizing the three measures of "telecommuting," "satellite ofce work," and "mobile work."
  • Promoting activities of diverse human resources (promoting women's activities)

Ensuring at least 30% of all hired individuals are women

  • Ratio of hired individuals that are women: 41.2% (FY2023)

Expanding the scope of women's positions to all divisions and groups Appointing women to management positions

  • Ratio of management staff that are women: 5.3% (FY2023)

[Change in the number of employees using the childcare leave system and return-to-work rate]

Category

Fiscal Year

2019

2020

2021

2022

2023

Persons using

8

8

6

14

22

Childcare

the system

leave system

Return-to-

100

100

100

100

100

work rate (%)

Acquired "Kurumin certication"

In August 2022, Hiroshima Gas acquired "Kurumin

certication," meaning the Minister of Health, Labour and Welfare has certied us as a company that supports childcare.

Employee voices Taking childcare leave

I took "post-childbirth paternity leave (childcare leave at the time of childbirth)" for about two weeks when my wife, who works at the same company as me, gave birth to our rst child, so that I could support her upon returning home from the hospital. As it was not a hometown birth, my wife was very happy that I could take leave and handle the housework, allowing us to get through the post-childbirth period together,

and I was also very happy to have time to spend with my newborn child. I am also very thankful to everyone at my workplace who gave me their full support.

My wife and I both have now returned to work where we are working in a well-structured and efcient manner in order to balance our careers and child raising, as we hope to continue to be able to spend precious time together as a family.

Management philosophy

Striving to be a company trusted by the community

Based on our management philosophy that aims to create a company that is trusted by the local community, Hiroshima Gas wishes to continue carrying out business activities emphasizing on the stable supply of energy and ensuring the safety of all as our corporate social responsibility.

Head ofce

2-7-1, Minamimachi,

address:

Minami-ku, Hiroshima

TEL 082-251-2176

Established:

October 1909

Capital:

5.268 billion yen

Number of

686

employees:

Business eld: 1 Gas business

2 Sales of gas appliances

3 Sales of liqueed natural

gas

Hiroshima Gas Head Ofce Area

(As of March 31, 2024)

Organizational chart

(As of April 1, 2024)

Auditors・Board of Auditors

Board of Directors

Top Management

Executive Board

Social Contribution Dept.

International Business Dept.

Dept.

Innovation Promotion Ofce

Corporate Planning Ofce

Corporate PlanningDept.

General Affairs Dept.

Environmental and

Human ResourcesDept.

Accounting Dept.

Purchasing Dept.

Energy Resources and

Digital Strategy Dept.

Technical ResearchInstitute

Public RelationsOfce

AuditDept.

Secretarial

Energy Business Division

Pipeline Business

Production Business

Division

Division

Power Business Preparation Ofce

Sales Planning Dept.

Sales Promotion Dept.

Customer Service Dept.

Sales Engineering Dept.

Residential Energy Sales Dept.

Industrial Energy Sales Dept.

Commercial Energy Sales Dept.

Kure Branch

Onomichi Branch

Distribution Planning Dept.

Gas Supply & Distribution Maintenance Dept. Gas Piping Equipment Management Dept.

Technical Training Center

Hatsukaichi LNG terminal

Bingo Plant

Engineering Dept.

Regional service representatives

◎ Gaslife

Business hours: 9:00am to 5:30pm (Monday to Saturday)

1 Gaslife Hiroshima

1-30,Minamitakeya-cho,Naka-ku, Hiroshima

2 Gaslife Aki

3-1-14, Funakoshiminami, Aki-ku, Hiroshima

3 Gaslife Itsukaichi

2-7-43, Kairoen, Saeki-ku, Hiroshima

4 Gaslife Gion

5-13-1, Nishihara, Asaminami-ku, Hiroshima

5 Gaslife Kure

1-6-16, Chuo, Kure

6 Gaslife Onomichi

3-2,Tenma-cho, Onomichi

7 Gaslife Kabe

9-13-7, Kameyama, Asakita-ku, Hiroshima

8 Gaslife Saijo

4-38,Saijogojo-cho,Higashi-hiroshima

0570-550-720

All Gaslife

* If you cannot use the Navi-Dial service (e.g., if you are using an

IP phone or calling from abroad), please dial 082-240-8891.

stores

[Reception hours] Monday to Saturday (national holidays

excluded) from 9:00am to 7:00pm

[Closed] Sundays, national holidays, year-end and New Year

holidays (December 31 to January 4)

  • Showroom

Experience the latest gas equipment and the sheer warmness provided by gas.

Examples of exhibition equipment

● Household fuel cell (ENE-FARM)● Floor heating and bathroom heater comparison rooms ● Try it! Kitchen activities (Kitchen comparison)

Gastopia Center

Gastopia Itsukaichi

1-30,Minamitakeya-cho,Naka-ku, Hiroshima

2-7-43, Kairoen, Saeki-ku, Hiroshima

TEL: 082-240-8888

TEL: 082-923-5678

Overview of main subsidiaries

(As of March 31, 2024)

Hiroshima Gas Propane Co., Ltd.

・Capital: 300 million yen・Established: March 1969・Sales: 13,114 million yen・Number of employees: 106

Hiroshima Gas Techno-Service Co., Ltd.

Gastopia Gion

Gastopia Aki

・Capital: 80 million yen・Established: June 1998・Sales: 9,232 million yen・Number of employees: 208

Hiroshima Gasmate Co., Ltd.

5-13-1, Nishihara, Asaminami-ku, Hiroshima

3-1-14, Funakoshiminami, Aki-ku, Hiroshima

TEL: 082-850-3506

TEL: 082-821-1130

・Capital: 20 million yen・Established: April 1975・Sales: 932 million yen・Number of employees: 156

Hiroshima Gaslife Co., Ltd.

・Capital: 15 million yen・Established: June 2018・Sales: 3,801 million yen・Number of employees: 170

Be-Smile Co., Ltd.

・Capital: 75 million yen・Established: June 2001・Sales: 209 million yen・Number of employees: 27

Setouchi Pipeline Co., Ltd.

・Capital: 150 million yen・Established: May 2003・Sales: 1,169 million yen・Number of employees: 11

Gastopia Kure

Gastopia Onomichi

HG LNG Shipping Corporation

1-6-16, Chuo, Kure

3-2,Tenma-cho, Onomichi

・Capital: 1 million yen・Established: February 2005・Sales: 2,164 million yen

TEL: 0823-22-1262

TEL: 0848-22-2161

Hiroshima Gas Co., Ltd.

Hiroshima Gas Website

2-7-1, Minamimachi, Minami-ku, Hiroshima 734-8555

Public Relations Ofce, General Affairs Dept.: 082-252-3000 (Direct line)

https://www.hiroshima-gas.co.jp/english/index_e.htm

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