Tepco falling behind with restructuring

Bailout fund blames delayed reactor restarts

Kyodo

Tokyo Electric Power Co. is having difficulty sticking to its 10-year restructuring plan as its nuclear reactors remain idle, a key member of a government-backed fund providing financial assistance to Tepco said Thursday.

“Because the restarting of the Kashiwazaki-Kariwa plant is falling further behind schedule, it is a fact that differences between the business plan (and the current situation) are widening,” Yoshiharu Kawabata told reporters, referring to the complex in Niigata Prefecture, the biggest of Tepco’s three nuclear plants.

Kawabata, head of the decision-making board of the Nuclear Damage Liability Facilitation Fund, made the remarks after he met with Tepco President Naomi Hirose.

He did not specify when the business plan should be revised, only noting that he will “keep a close watch” on the issues surrounding the restart of the utility’s reactors.

On Thursday, Tepco officials presented to the board a report on recent developments regarding its business conditions.

Under the 10-year restructuring plan jointly compiled by the fund and Tepco, the utility is projected to move into the black in the current fiscal year through March by reactivating some of the seven reactors at its Kashiwazaki-Kariwa plant. This would help curb its heavy fuel costs for thermal power generation, and by other steps.

For the April-June quarter, Tepco reported a group net profit of ¥437.93 billion but posted an ordinary loss of ¥29.49 billion amid growing fuel costs.

With the new nuclear regulations that came into force in July, some utilities applied for safety checks of their reactors by the Nuclear Regulation Authority so they can restart them, but Tepco has not been able to apply for the screening of the Kashiwazaki-Kariwa reactors in the face of opposition from Niigata Gov. Hirohiko Izumida.

Tepco has three nuclear plants — Kashiwazaki-Kariwa, the six-reactor Fukushima No. 1, which was wrecked by the huge earthquake and tsunami in March 2011 and lost four of its units, three to core meltdown, and the four-reactor Fukushima No. 2, located near the No. 1 plant.

Return to profitability

Tokyo Electric Power Co. earned a group net profit of ¥437.93 billion in the April-June quarter, but fuel costs for thermal power generation continued to weigh heavily on the bottom line.

The quarterly net profit compares with a loss of ¥288.39 billion incurred the year before, Tepco said Wednesday.

Tepco, struggling to turn its business around after receiving a ¥1 trillion capital injection from the government, registered an operating loss of ¥23.49 billion in the quarter, compared with a loss of ¥108.84 billion a year earlier, while revenue was up 9.8 percent to ¥1.44 trillion.

The utility did not release an earnings outlook for the full fiscal year due to the difficulty in forecasting whether any of its idled reactors at its Kashiwazaki-Kariwa plant in Niigata Prefecture will be allowed to restart — a key measure to help curb fuel costs.