Nippon Paper Industries Co. plans to build a 100-megawatt coal-fired thermal power plant at its paper pulp factory in Akita Prefecture, with the aim of beginning commercial power sales in 2017, industry sources said Thursday.
The company will invest tens of billions of yen in the power plant, which is designed to burn not only coal, but also timber from forest thinning, they said.
As the nation's paper market shrinks and Japan deregulates its retail power sector, Nippon Paper has already become a significant power generator. It aims to surpass ¥50 billion in annual energy sales by 2016.
It also plans to construct a thermal power plant in Miyagi Prefecture and cooperate with trading house Mitsubishi Corp. and Chubu Electric Power Co. in building a coal-fired power plant in Shizuoka Prefecture.
In 2015, it expects to launch a large photovoltaic solar power plant in cooperation with Mitsubishi in Tokushima Prefecture and start operation of a biomass power plant in Kumamoto Prefecture.
Nippon Paper now has total power generation capacity of 1.8 gigawatts, primarily for its own paper pulp factories.
The shrinking domestic paper market and planned electricity sales liberalization are prompting other Japanese paper makers to expand into commercial power generation, too.
Among them, Oji Holdings Corp. has announced a plan to found an electric power generation company jointly with Itochu Enex Co. in January. Daio Paper Corp. is considering participating in the electricity retail market in the future.