By Tsuyoshi Inajima – Dec 7, 2011 2:43 AM GMT+0000
Tokyo Electric Power Co. (9501) may sell some of its thermal power plants to raise funds for compensation payments after the Fukushima disaster, the Yomiuri newspaper reported.
The utility known as Tepco will decide which plants will be sold by the end of March, the Yomiuri said, without saying how it got the information. Tepco will buy electricity from independent power producers through tenders after the sale, the Yomiuri said.
The owner of the wrecked Fukushima Dai-Ichi plant may have to pay at least 4.5 trillion yen ($57.9 billion) compensation to those affected by the disaster, according to an estimate by a government panel headed by bankruptcy lawyer Kazuhiko Shimokobe.
The utility plans to sell assets worth 707.4 billion yen to raise funds for the compensation payment, according to a business plan released in November. At the time, the utility said it may also sell power-generation assets.
Tepco reiterated it’s planning to sell generating capacity in a statement responding to the Yomiuri report. No details have been decided, it said.
Tepco isn’t planning to sell power generation assets immediately because it has insufficient capacity, the Nikkan Kogyo newspaper reported today, citing President Toshio Nishizawa. Nishizawa said Tepco may consider the sales in the medium and long term, the Nikkan Kogyo reported.
The Shimokobe committee recommended in October that Tepco buy electricity from independent providers to reduce electricity generation costs.
Tepco may give up plans to build new thermal power plants apart from those under construction as the utility isn’t able to raise funds for construction, the Yomiuri said.
The utility is expanding capacity at three of its fossil- fuel stations and is planning expansions at two others, the Yomiuri reported. Tepco has 15 operating thermal plants, the newspaper said.
Tepco increased its target for cost cuts by about 100 billion yen to 2.6 trillion yen during the next 10 years, the Yomiuri said. The utility aims to cut the return on pensions contributions by as much as 4.25 percentage points from October, the Yomiuri reported.