TEPCO submits 10-year restructuring plan to government

• 12 years ago (2012-04-28)
• David Flin

Asia 892 Nuclear 659

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Japan’s Tokyo Electric Power Company (TEPCO) and a state-backed bailout fund have submitted a restructuring plan to the government. The plan is intended to help TEPCO overcome its financial plight following the Fukushima disaster, with the injection of 1 trillion yen though public funds and electricity rate increases.

The comprehensive special business plan will become official once approval is given by Yukio Edano, Japan’s Economy, Trade and Industry Minister. This approval is expected in early May, and will pave the way for de facto nationalisation of TEPCO. TEPCO and the Nuclear Damage Liability Facilitation Fund said that the full content of the plan will only be announced after it has gained approval.

It is believed that some of the terms include TEPCO promising to cut over 3 trillion yen in costs through fiscal 2020 to finance compensation payments related to the Fukushima accident. TEPCO has said that it will seek to increase profits by raising domestic electricity rates by about 10 percent for three years from July, and restarting its nuclear reactors in Niigata Prefecture from fiscal 2013. TEPCO has predicted that it will move into the black by March 2014.

The Japanese government has decided to appoint Kazuhiko Shimokobe, head of the bailout fund’s decision making board, as the next Chairman of TEPCO. The new management line-up will be unveiled when TEPCO announces its fiscal 2011 financial results, expected in May.