Renewable Energy Investment Portfolio

We will provide funding and support for the development and future commercialization of a hybrid energy storage system designed to offer a battery hub with leasing functionality for external users. This project is being conducted by NR-Power Lab Co., Ltd. ("NR-Power Lab"), a joint venture between NGK Insulators, LTD. and Ricoh Co., Ltd.

We have invested in DAX, LLC in collaboration with Fuyo General Lease Co., Ltd. and ASTMAX Co., Ltd. This project involves the installation of a grid-scale BESS with a rated output of 50 MW and a capacity of 100 MWh. Construction is scheduled to begin in 2023, with operations set to start in 2025. Once operational, transactions will be conducted in the wholesale power, supply and demand adjustment and capacity markets based on AI forecasts.

We have co-invested in two utility-scale energy projects in the United States, managed by InfraRed Capital Partners Limited.

Aquila Capital Investmentgesellschaft ("ACI"), the asset management subsidiary of Aquila Capital Holding GmbH ("Aquila Capital"), in which we hold a 40% stake, has entered into a strategic partnership with Commerzbank Aktiengesellschaft ("Commerzbank").ACI will leverage Commerzbank's global network to expand its assets under management and explore new growth opportunities through collaboration. In return, Commerzbank will benefit from ACI's expertise in sustainable investment, offering its clients a wealth of opportunities aligned with its mission to promote the energy transition. As part of this strategic alliance, Commerzbank will acquire a 74.9% stake in ACI.Aquila Group reaffirms its long-term commitment to ACI and will continue to play a leading role in shaping its future growth.

We have acquired a 3.3% stake in Hornsea One, one of the world's largest operating offshore wind power projects. Hornsea One is part of the Hornsea series by Ørsted A/S ("Ørsted"), a leading offshore wind operator, located off the northeastern coast of England. The project features 174 turbines across approximately 407 square kilometers, with a combined total capacity of 1.2 GW. Under Ørsted's management, Hornsea One has a proven operational track record and is expected to generate long-term, sustainable cash flow.

We have jointly invested in an onshore wind power project located in Scotland, managed by Capital Dynamics Ltd. ("Capital Dynamics"), alongside other investors. The consortium has acquired a 100% equity stake in this 50 MW ready-to-build project from a German developer. The project is expected to begin commercial operations in 2025/26 and to have a long-term offtake contract.

Through an SPC in which we have invested, we have entered into a power supply contract with Toshiba Energy Systems & Solutions Corporation ("Toshiba Energy Systems & Solutions") under the Feed-in Premium ("FIP") scheme for the solar PV plant we co-developed with CO2O Inc. We will continue to acquire and operate solar PV plants under the FIP scheme to contribute to carbon neutrality.

This partnership with Solariant Capital, LLC ("Solariant") will drive our strategic investment in U.S. solar PV and other clean energy projects. We will initially focus on developing approximately 1 GWp solar PV and 2.5 GWh BESS projects across the southeastern and southwestern regions of the United States. We will continue to expand our footprint in the U.S. renewable energy market.

We will contribute our solar PV projects as assets under management to a privately placed core fund formed by Daiwa Real Estate Asset Management Co. Ltd., which specializes in investments in brownfield solar PV projects. By integrating external capital through the use of funds, we will promote capital recycling to support continuous reinvestments that maximize capital efficiency.

In cooperation with our strategic partner Green Thermal co.ltd. ("GT"), we have invested in and developed the third medium-sized biomass power plant that utilizes local, unutilized, general wood materials as fuel. This is the first biomass power plant in Yamanashi Prefecture.

Aiming to further expand our investment in the battery storage sector, we have invested in Exergy Power Systems, Inc. ("Exergy"), a startup from the University of Tokyo.

We have begun providing mezzanine financing for renewable energy projects in collaboration with Shinsei Bank, Limited and Shinsei Trust & Banking Co., Ltd. By combining the expertise of the Shinsei Bank Group in project finance with our knowledge of renewable energy investment, we aim to offer alternatives to senior loans and equity financing for renewable energy businesses, promoting environmentally friendly power generation.

This is the first privately placed solar PV core fund structured by the Daiwa Securities Group, incorporating three brownfield solar PV projects we developed in Hokkaido Prefecture. Driven by the "locally produced, locally consumed" concept, the fund raised equity and debt primarily from investors and financial institutions in Hokkaido. The debt was financed through the Daiwa Green Finance Program ("Daiwa GFP"), which includes ABL and beneficiary interests and has received a green rating from a third-party institution.

This is a medium-sized geothermal energy development project in Ebino City, Miyazaki Prefecture. We aim to accelerate our geothermal power initiatives both in Japan and overseas by leveraging the experiences and insights gained from this project.

We have invested as a limited partner in the Japan Energy Fund ("JEF"), a decarbonized energy fund established by ENECHANGE Ltd. ("ENECHANGE") and Looop Inc. ("Looop"), two emerging companies in the energy sector. The fund aims to promote a sustainable society by encouraging Japanese companies to invest in decarbonized energy projects abroad.JEF's initiative is centered around two main components: "JEF Renewables" and "JEF Ventures." "JEF Renewables" focuses on investing in renewable energy businesses in emerging countries, while "JEF Ventures" targets energy-based startups (referred to as "ventures" in Japan) in Europe and North America, where technology and energy markets are more advanced.

To further expand our business and meet the increasing demand from Japanese investors for opportunities in renewable energy, we have entered into a strategic partnership with Aquila Capital Holding GmbH ("Aquila Capital") and acquired a 40% stake in the company.

We have invested in Swimsol GmbH ("Swimsol"), a company with expertise and achievements in offshore solar PV. This project explores further investment opportunities in this field, which is expected to grow.

This medium-sized geothermal development project in Hakodate City, Hokkaido, is our first investment in geothermal power. We aim to accelerate our initiatives in geothermal energy both in Japan and overseas, leveraging the experiences and insights gained from this project.

This is a joint project with our strategic partner, Biomass Fuel Co., Ltd. ("Biomass Fuel"), to establish a company and construct a wood pellet manufacturing plant in Vietnam.

We have invested in and developed the second medium-sized biomass power plant, using local wood materials as fuel, in cooperation with our strategic partner, Green Thermal co.ltd. ("GT"). This is the first biomass power plant in Wakayama Prefecture.

The Yonezawa Minami biomass power plant is our first investment in biomass power. The plant primarily uses unutilized general wood materials for fuel, sourced mainly from Yamagata, Fukushima and Miyagi Prefectures. This power plant has been developed in partnership with Green Thermal co.ltd. ("GT").

Green Thermal co.ltd. ("GT") is a leading developer of medium-sized biomass power plants in Japan, locally sourcing wood-based fuels. GT has strong advantages not only in developing these power plants but also in managing and operating them, including the procurement of domestic timber. The key executives' extensive experience and deep expertise in the forestry industry play a significant role in these operations.