Tokyo Electric Power Company Holdings Inc. is aiming to integrate its nuclear and power transmission and distribution businesses with other utilities to free up funds to use in dealing with the aftermath of the Fukushima disaster.
According to Tepco’s revised business turnaround plan announced Wednesday, the company will establish a consortium with other utilities to quickly facilitate its reorganization and integration plan.
The utility’s first major revision to the plan since its formulation in January 2014 follows the industry ministry’s doubling of its estimated total cost for the nuclear disaster cleanup to ¥22 trillion ($197 billion).
Once it finishes the overall revision, possibly in April, Tepco hopes to get government approval for the plan.
Under the revised plan, Tepco hopes to boost management efficiency and increase productivity to free up funds, and it will decide whether to postpone freeing itself from state control from the originally planned fiscal 2017 to the fiscal year starting in April 2019.
The revised plan stresses the importance of reaching a basic agreement with Chubu Electric Power Co. to fully integrate their non-nuclear thermal power generation operations by this spring.
Tepco is also planning to hold discussions with other utilities to promote the reorganization and integration of power transmission and distribution in the industry. The utility is considering acquiring related overseas operators over the medium- to long-term as part of the strategy.
The company also envisions reorganizing and integrating its nuclear operations. It hopes to establish a consortium with domestic nuclear operators to secure talent and technologies, and to develop new light-water reactors. The utility is also aiming to expand into overseas nuclear power generation markets, according to the plan.
The company will also seek cooperation from other power companies in reactivating its Kashiwazaki-Kariwa nuclear plant in Niigata Prefecture despite a loss of public confidence.
The prospect of the reactivation of the seven-reactor plant remains unclear with Niigata Gov. Ryuichi Yoneyama having taken a cautious stance toward its restart. The latest plan does not set out a specific timeline.
As the cleanup and decommissioning costs mount, Tepco remains under state control with the government holding majority voting rights through the Nuclear Damage Compensation and Decommissioning Facilitation Corp. The entity was established to help the utility pay damages for the disaster.
Tepco’s status has prompted concerns among other major utilities that even if they cooperate, profits generated through such arrangements could be used to pay for decommissioning and damages.
To ease such concerns, the revised turnaround plan says Tepco will map out rules for government involvement and where the cost burden will fall.
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