Rieko Sato has been the Managing Director of TEPCO Energy Partner since 2016. Before her current role, she served as a Corporate Officer of Tokyo Electric Power Company (TEPCO) and Vice President of the Customer Service Company (a TEPCO in-house company) between 2013 and 2016, where she focused her energy on the development of new products and services to expand TEPCO’s service area under the upcoming full liberalization of the electricity retail market.
Prior to this, she provided support to disaster victims at the Fukushima Nuclear Accident Compensation Office. Since 1999, when she joined the Sales Division, she has consistently held various functional and operational positions, bringing about innovative changes at the company which were crucial in an increasingly competitive market. These included her appointment as the Manager of Quality of Operation and Human Resource Development in 2009, Manager of Innovation Training at the Training Center in 2006, and Manager of Business Process Re-engineering at the Tokyo Branch Office in 2004.
She joined TEPCO in 1990 and researched new technologies in the Technology Development Division after gaining experience in power equipment planning at the Ginza Branch Office. She holds a Master’s degree from the Graduate School of Tsukuba University.
1. How has the liberalisation of Japan’s electricity and gas markets impacted retail business models, and how has TEPCO evolved to stay competitive?
I think of the liberalization of Japan’s electricity and gas markets as a positive change because TEPCO Energy Partner has been able to evolve our business model sequentially, such as by expanding our area of power sales and entering the residential gas retail market. The power retail market has become increasingly competitive due to the liberalization in April 2016, since companies from diverse industries which are quite different from those in the past, such as telecommunication carriers, railroad companies and municipalities, have started selling power in sets with their own products, improving customer satisfaction and attracting new customers. In order to differentiate ourselves from other companies and seize a competitive advantage, TEPCO Energy Partner now aims to become an “Integrated Energy Services Company” which also sells energy conservation services to customers, rather than a company that focuses solely on selling electricity and gas. This concept of an “Integrated Energy Services Company” has become possible thanks to the enormous boost we have received from the elimination of business restrictions, which enables us to sell power freely in combination with gas.
2. TEPCO is increasingly collaborating with innovative start-ups. How will this benefit customers and the broader industry?
TEPCO Energy Partner now focuses on “open innovation”, which enables us to provide high value products which fit customers’ needs in a timely manner. Especially in fields with striking technological evolution, such as IT, many start-ups develop new technologies under tough domestic and international competition. Start-ups can become our business partners since we choose our partners. Together with our careful security considerations including the protection of individual customer information and data, we select our partners regardless of size but rather on the quality of their technologies and contribution to improving customer value.
3. How is TEPCO preparing for a smarter energy future characterised by digitalisation and the Internet of Things (IoT)?
We are developing, and we try to provide attractive IoT services for our customers by combining our vast customer base, and know-how and technologies in electricity usage including Home Energy Management Systems (HEMS), with other companies’ know-how, products and technologies. For example, in August 2016, TEPCO Energy Partner signed a basic agreement with Sony Mobile Communications Inc. and started to discuss business tie-ups for IoT services in smart homes. We have developed IoT services that fit customers’ lifestyles, conducted field trials of some services, and we aim to launch this year. Sony Mobile Communications Inc. has products and technologies that enable two-way communication, and know-how in the design of user-friendly interfaces and the creation of service solutions. As an “Integrated Energy Services Company”, TEPCO Energy Partner is striving to create new value in response to the diverse needs of society, and offer products and services with IoT to enable safe and comfortable lifestyles and businesses for our customers.
4. How can renewables achieve a bigger share of the power generation mix in Japan and across Asia?
Generally speaking, in Japan, in order to increase the share of renewables, investment to improve the flexibility of the power system is essential because it is an island country which lacks flexibility in the power system and has limitations in the amount of renewables that can be connected to the grid.
In order to support renewable energy as a power retail company, TEPCO Energy Partner started to offer the first “hydro” electricity tariff in Japan to industrial and commercial customers, with a price plan called “Aqua Premium”. We have won contracts with several companies since April 2017. Customers using “Aqua Premium” can cover their base load, or all of the electricity they use, with hydro power and thus reduce their CO2 emissions. For example, if a customer buys 1000 MWh per year, it can reduce its CO2 emissions by 500 tons per year. In addition, in order to maintain and expand the use of hydro power stations, TEPCO Group uses a part of the revenue from this price plan to improve power generation efficiency and foster protection of watershed forestry. We make efforts to address global warming and continue to strive to create new value which addresses the various needs of customers and facilitates better lives and businesses.
5. What are your thoughts on the SIEW 2017 theme, “Rethinking Energy; Navigating Change”?
The SIEW 2017 theme, “Rethinking Energy; Navigating Change”, suits the current situation in the Japanese energy sector. In Japan, the electricity retail market was fully liberalized in April, 2016 and the gas retail market was liberalized this year, 2017. People are now able to choose their suppliers and even power sources, including renewables and hydro. In the midst of these changes, people have started to rethink their energy usage and even their lifestyles and their sense of values. From a nationwide perspective, considering Japan is a resource-poor country, we should continue to have an energy composition based on “S+3E” - Safety plus Energy Security, Economy, Environment - although it is expected that energy demand will remain moderate in the future due to population decline and further progress in energy conservation. TEPCO Energy Partner would like to play a part in shaping such changes rather than simply following them. We will continue to lead the creation of an energy conservation society and strongly support customers to enable them to lead better lives and run successful businesses.