TOKYO — Tokyo Electric Power Co. Holdings will likely remain under government control for at least three more years as cleanup costs for a 2011 nuclear meltdown continue to weigh on the Fukushima plant operator’s finances.
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The state injected 1 trillion yen ($8.78 billion) into the utility back in July 2012 via the Nuclear Damage Compensation and Decommissioning Facilitation Corp., taking a 50.1% stake.
Cleanup costs for the Fukushima Daiichi meltdown of March 2011 stand in the way of Tepco’s road to recovery. The figure has doubled from three years ago to 21.5 trillion yen. And the 8 trillion yen in decommissioning costs included in this estimate could rise even more.
Tepco plans to consolidate and merge nuclear and power distribution operations with other companies. But how much of a boost these steps could offer is unclear.
In addition, prospects for resuming operations at the Kashiwazaki-Kariwa nuclear plant in Niigata Prefecture have faded amid pushback from new Gov. Ryuichi Yoneyama.
Costly Fukushima cleanup continues to dog the Japanese utility
The government has planned to apply the proceeds from unloading Tepco shares toward funding cleanup work. The longer the current arrangement continues, the longer this profit will take to generate.
Japan’s retail market for electricity is now fully deregulated. Healthy competition could be hampered by the presence of a government-owned juggernaut. The utility must work quickly to boost its earnings potential.
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