In light of the Fukushima nuclear crisis, the Diet enacted a law Wednesday to begin a drastic, three-stage reform of the electricity sector that will free up the regionally monopolized supply system.

The law will enable the creation of a nationwide power grid operator in about 2015 as the first part of the reform, and sets a timeline for fully liberalizing the retail market and separating utilities' power generation and transmission businesses by around 2020.

The government has been seeking to overhaul the power industry after the earthquake and tsunami in March 2011 and ensuing Fukushima nuclear disaster led to power shortages and exposed the vulnerability of the existing electricity supply system.