Government considering plan to dismantle TEPCO
A secret plan to dismantle Tokyo Electric Power Co. (TEPCO), the operator of the crippled Fukushima No. 1 nuclear power plant, is circulating within the government...... The proposal... envisages the passing of a special measures law that would put the company under close government supervision before eventually bankrupting it and completely restructuring its remnants. There are also proposals to smash the company's powerful influence on politicians and the mass media and force executives to give all their pay and severance settlements to victims of the earthquake....
The plan expects bankruptcy proceedings to begin once the amount of compensation is settled and the total cost of handling the Fukushima accident can be estimated.....
Some estimates put the cost of compensation and handling the Fukushima accident at approximately 10 trillion yen, meaning TEPCO is already effectively bankrupt.....
The plan envisages a drastic restructuring of TEPCO during the bankruptcy and rehabilitation process.
During the bankruptcy proceedings, a financial dissolution plan would be compiled after most of the debt was finalized. That plan would likely include eliminating all the company's capital and asking financial institutions to forgive debt.
The biggest issue at the rehabilitation stage is likely to be a proposal supported by some METI officials to separate the power generation and power transmission arms of TEPCO.
When Britain privatized its electricity generation industry, it was separated into two distinct sectors: companies handling power generation and firms responsible for power transmission. The aim was to keep down the price of electricity by encouraging competition in the industry.
In Japan, all nine electric power companies handle both power generation and transmission, and they have been fighting the idea of separating the two functions for years.
Under the plan, TEPCO would first be made a holding company and subsidiaries would be established to separately handle power generation and power transmission. Conventional thermal and hydro power plants owned by the power generating arm would be gradually sold off to new entrants to the market. Selling off plants and profitable subsidiaries would lessen the financial burden on the public. Eventually, TEPCO would end up as a power transmission company on a far smaller scale than it is at present.
Sources said separation into power generation and transmission companies would probably happen two or three years after passage of the special measures law.
The fate of the plans may partly rely on bureaucratic politics, and, specifically, the relative influence of two rival bureaucratic factions within METI and ANRE.
One high-ranking ANRE official emphasized that the plan had not yet been authorized, and a mid-level METI bureaucrat said, "It is only being talked about by those in the Prime Minister's Official Residence and the National Policy Unit.".......
There is a strong possibility that the plan will be watered down by politicians in the Diet or emasculated by officials in METI and ANRE, which has been chosen as the lead agency overseeing the future of TEPCO.
asahi.com