Air Water will enter the electric power generation business by constructing a mixed coal and biomass power generation station with an output of around 100,000kW in Hofu, Yamaguchi prefecture in conjunction with Chugoku Electric. The company is aiming to commence operation in 2018.

The industrial gas industry is one which consumes large amounts of electric power. It suffered severely when the cost of electric power rose due to incidents at power stations in 2011. Along with coming up with numerous measures to reduce costs, the industry has continued to make efforts to secure profitability, involving measures such as price revisions. Nevertheless, with nuclear power stations not starting up again as it had hoped they would, the situation is such now that the industry cannot clear away the risk that electric power fees and fuel procurement costs will again be on the rise. Air Water too, which has industrial gas as its core business, is indeed faced with this issue. The company also has a need to procure by its own means the electricity it consumes to hedge future risks related to electric power.

There was then the FIT system whereby electric power generated by renewable energy would be bought up at a fixed price over a long span of time. In addition, the company was seeing itself heading toward a major period of change involving the complete liberalization of the electric power business. A chance came about for it to enter a new business as a power generation company. This means that a door had opened for it to procure electric power directly on its own. Furthermore, even with respect to its existing businesses, Air Water would be able to offer them a new business service with electricity added to the menu. For this reason it is now going to tackle the business of electric power generation.

Already within the Air Water group, a new biomass electric power generation facility with an output of 16,530kW has been constructing on the premises of the Ako plant of Nihon Kaisui, scheduled to go into operation in January of next year. The new project will therefore become the second electric power generation project for the company. The output will be 10 times as great as the previous one, amounting to 100,000 kW. Power will be generation with a mixed combustion of coal and biomass, making it the largest of its kind in Japan. As fuel it will use 250,000 tons of coal a year, and 30,000 tons of unused lumber. The coal and lumber will be mixed at a set ratio and combusted.

The success or failure of biomass power generation is said to depend on the stable procurement of the wood biomass which turns into the fuel. Air Water has decided to import the wood biomass fuel from abroad and to procure unused lumber locally in Yamaguchi Prefecture. By procuring fuel locally the company will strive to realize the Air Water business model which, along with contributing to the economic promotion of the local area, will also be one rooted locally, involving local procurement and consumption.

The company plans that the electric power generated, along with being sold as new electricity, will also be used for in-house consumption. Likewise, it will also be possible to utilize the FIT system regarding the electric power generated using biomass fuel. The company will put together the actual method of operating the power generation business and of marketing the electric power after consultation with Chubu Electric.

The new power generation station will be constructed on the grounds of the Hofu plant which Air Water took over from Kanebo in 2004. It will utilize about 40,000 m2 out of the total premises of the plant of 110,000 m2. The premises is used by the Air Water Bellpearl plant. In addition there is a VSU liquefaction unit which was constructed there last year. Air Water gives as the reasons for the implementation of the project at this location that it owns underutilized land sufficient for the construction of a power station. Other reasons are that the land is also adjacent to a port eminently suitable for the transport of fuel, and the existence of Chugoku Electric Power as a partner being rich in experience and having knowledge regarding electric power generation. As for Air Water itself, in February of last year it sounded out Chugoku Electric Power concerning this joint business and investigated the potential.

The company plans to go ahead with the construction of the facility with the aim of commencing operation in 2018. Together with the above mentioned Ako plant of Nippon Kaisui, the total amount of electric power generated by Air Water on its own will be the equivalent of 1/4 used by its group. As mentioned above, the company would like to supply eventually on its own all of the annual electric power consumed by its group. Because of this, it will be going ahead with several power generation projects. The industrial gas industry itself, looking back at electric power over the past few years, will be paying a great deal of attention to what Air Water will be doing, which has embarked on the electric power business.