Financially struggling Japan Logitec Cooperative Association is likely cease electricity retail operations at the end of March, informed sources said Wednesday.
The Tokyo-based power retailer has asked Tokyo Electric Power Co. to cancel a contract to use Tepco’s power grid, chiefly due to its deteriorating financial health, the sources said.
Because it does not operate its own customer transmission network, Japan Logitec will have to quit the business after the grid use contract is scrapped. It has fallen behind in grid fee payments, the sources said.
Japan Logitec has been procuring electricity in bulk from regional power utilities and selling it to large-lot users such as companies and municipalities via the existing power grid more cheaply than traditional power suppliers.
The sources also said the retailer closed its offices in Hokkaido and the Chubu region this year, adding that its unpaid fees to Tepco appear to surpass ¥1 billion.
Analysts say when the nation’s power retail market is liberalized in April more retailers may be forced out of the business due to intensified competition.