National

Tokyo says Tepco may stay nationalized to deal with massive cost of nuclear disaster

Kyodo

Faced with massive ongoing costs stemming from the 2011 nuclear crisis in Fukushima, Tokyo Electric Power Co. Holdings Inc. may remain under state control longer than initially planned, the government said Monday.

Under the current plan, the utility would gradually reduce government involvement in its management from April.

However, at a key panel meeting the government proposed a revised option in light of the huge compensation and decommissioning expenses that are involved.

The government leads the business operations of the utility, known as Tepco, acquiring 50.1 percent of its voting rights through the state-backed Nuclear Damage Compensation and Decommissioning Facilitation Corp.

Some ministry bureaucrats have also been dispatched to the utility.

It is understood the state-backed body will assess efforts to reform the company in late March and make a decision on whether to reduce state involvement.

“The direction of Tepco reform is coming into sight,” said Economy, Trade and Industry Minister Hiroshige Seko at the panel meeting. “We have to come up with a more detailed picture of the reform.”

The government is seeking to split the activities of the utility into “business operations,” including retail sales and power generation, and “Fukushima operations” related to decommissioning reactors at the disaster-hit Fukushima No. 1 nuclear plant and paying compensation, which would remain under public control.

As for Tepco’s business operations, the government plans to free them of state control at an early date, hoping to promote industry reorganization involving nuclear and energy distribution businesses.

The plan was revealed at the panel meeting at the trade ministry to study compensation and decommissioning issues facing the utility. The panel will compile proposals by the end of this year.

The government also seeks cooperation from other power companies in reactivating Tepco’s Kashiwazaki-Kariwa nuclear power plant in Niigata Prefecture, which would be the main source of its revenue.

With the involvement of other utilities, the government hopes to ease local distrust of Tepco’s nuclear plant operations. Two reactors at the Kashiwazaki-Kariwa plant are under prolonged safety examinations by nuclear regulators.