Pledges JPY 500 Billion Annually for Fukushima, 450 Billion profit over next decade
TOKYO — Nearing his first anniversary in office, TEPCO President Tomoaki Kobayakawa spoke at a press conference held at the Federation of Electric Power Companies (FEPC) of Japan, in which he set out a bold vision for global growth and investment in renewables while also pledging to continue providing strong support for the restoration of Fukushima.
Kobayakawa, who at 53 is TEPCO’s youngest leader ever, is charting a dramatically new path for the company as it navigates the challenges posed by deregulation of Japan’s energy markets, the country’s declining population, and the need to continue cleanup work at Fukushima. The company, he said, will continue its transformation from a local utility to an innovative global energy and technology company, partnering with other leaders around the world.
“Our main mission is guaranteeing the delivery of a stable supply of low-cost electricity customers. Within that mission, nuclear power is not everything. Thermal power, the procurement of renewable energy, and hydropower all play a part.”
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Commitment to Fukushima
The focus on the future will not come at the expense of TEPCO’s obligations to its past, Kobayakawa said. Noting the steady improvement of the situation both inside the Fukushima Daiichi facility and in the surrounding towns, he affirmed the corporate mission to rebuild communities and restore the trust of the residents, including efforts to support the sale of Fukushima produce.
Increase corporate value, earnings
To meet its obligations at Fukushima and return the company to profitability, Kobayakawa said TEPCO aims to grow revenue by 500 billion yen annually, and generate a total of 450 billion yen in profit over the next decade.
This will be accomplished through streamlining businesses and cost reduction, reorganization and integration of nuclear power and distribution, as well as forming alliances with partners.
Expanding in a shrinking market
To meet these ambitious goals, Kobayakawa said, TEPCO must look beyond its traditional service area in the Kanto region around Tokyo. Japan’s electricity market is shrinking due to energy conservation and a rapidly decreasing population. TEPCO will create businesses in new areas, such as its JERA joint venture with Chubu Electric, which will create a value chain from fuel upstream to thermal generation and bundling the sale of electricity and natural gas.
Renewable energy domestically and globally
With TEPCO’s fuel and thermal power generation business as an established revenue stream, the company has high hopes for the promise of renewable energy, which it expects to become a comparable pillar in the future based on global investment projections over the next decade. Kobayakawa commented that while there are challenges to overcome in connecting renewables to the distribution network, he is confident that the company’s proprietary know-how will find various solutions.
To formulate a detailed plan during the coming fiscal year, TEPCO’s holding company will pull together expertise from its various teams, including engineering, distribution, and international project consultation to form the Mirai (Future) Management Committee.
“Renewables are an essential component of our future. We believe we can scale up our renewables business to create a new source of revenue comparable to JERA.”