Osaka Gas Co. has abandoned a plan to build a coal-burning power plant northeast of Tokyo, believing it will not be profitable due to emissions reduction requirements and the potential revival of nuclear power, a company source said Sunday.
Teaming up with trading house Marubeni Corp., the Osaka-based utility, whose main service area is in western Japan, was considering building a 100,000-kw plant in Ibaraki Prefecture.
The plant was to start power generation in 2017 with a view to extending the utility's business to the Tokyo area after the electricity market's full liberalization in April.
But the plant will face price competition once more nuclear reactors are restarted, and require costly work to reduce carbon dioxide emissions as the Environment Ministry is reluctant to see any new coal thermal plants built here.
The nation's reactors remain mostly offline across Japan, except for two in south Kyushu, in the aftermath of the 2011 Fukushima nuclear disaster.
Despite persistent public concerns about their safety, a few more have cleared the tightened national safety screening.
When the sale of electricity to households is opened up to competition, power companies that have so far maintained regional monopolies are expected to target the metropolitan region's large population, currently served by Tokyo Electric Power Co.