Tokyo Electric Power Company
Tokyo Electric Power Company Holdings, Incorporated is a Japanese electric utility holding company servicing Japan's Kantō region, Yamanashi Prefecture, and the eastern portion of Shizuoka Prefecture. This area includes Tokyo. Its headquarters are located in Uchisaiwaicho, Chiyoda, Tokyo, and international branch offices exist in Washington, D.C., and London. It is a founding member of strategic consortiums related to energy innovation and research; such as JINED, INCJ and MAI.
In 2007, TEPCO was forced to shut the Kashiwazaki-Kariwa Nuclear Power Plant after the Niigata-Chuetsu-Oki earthquake. That year, it posted its first loss in 28 years. Corporate losses continued until the plant reopened in 2009. Following the 2011 Tōhoku earthquake and tsunami, one of its power plants was the site of one of the world's most serious nuclear accidents, the Fukushima Daiichi nuclear disaster. TEPCO could face ¥ in special losses in the current business year to March 2012, and the Japanese government plans to put TEPCO under effective state control to guarantee compensation payments to the people affected by the accident. The Fukushima disaster displaced 50,000 households in the evacuation zone because of leaks of radioactive materials into the air, soil and sea.
In July 2012, TEPCO received ¥1 trillion from the Japanese government in order to prevent collapse of the company to ensure electricity is still being supplied to Tokyo and its surrounding municipalities, and decommission the Fukushima Daiichi Nuclear Power Plant. TEPCO's management subsequently made a proposal to its shareholders for the company to be part-nationalized. The Nuclear Damage Compensation and Decommissioning Facilitation Corporation later became the majority stockholder to oversee the damages and decommissioning of the power plant. The total cost of the disaster was estimated at $100 billion in May 2012.
History
Japan's electricity sector, nationalized in 1939 in preparation of total war, were privatized in 1951 on behest of the U.S./Allied occupation forces, creating nine privately owned government-granted monopolies, one in a certain region; this included TEPCO. Tokyo Electric Power Co., Inc. was established by reorganizing Kanto Haiden and Nippon Shuden, which were established through wartime integration.In the 1950s, the company's primary goal was to facilitate a rapid recovery from the infrastructure devastation of World War II. After the recovery period, the company had to expand its supply capacity to catch up with the country's rapid economic growth by developing fossil fuel power plants and a more efficient transmission network.
In the 1960s and 1970s, the company faced the challenges of increased environmental pollution and oil shocks. TEPCO began addressing environmental concerns through expansion of its LNG fueled power plant network as well as greater reliance on nuclear power generation. The first nuclear unit at the Fukushima Dai-ichi nuclear power plant began operational generation on March 26, 1971.
During the 1980s and 1990s, the widespread use of air-conditioners and IT/OA appliances resulted a gap between day and night electricity demand. In order to reduce surplus generation capacity and increase capacity utilization, TEPCO developed pumped storage hydroelectric power plants and promoted thermal storage units.
Recently, TEPCO is expected to play a key role in achieving Japan's targets for reduced carbon dioxide emissions under the Kyoto Protocol. It also faces difficulties related to the trend towards deregulation in Japan's electric industry as well as low power demand growth. In light of these circumstances, TEPCO launched an extensive sales promotion campaign called 'Switch!', promoting all-electric housing in order to both achieve the more efficient use of its generation capacity as well as erode the market share of gas companies.
Major subsidiaries
As Tokyo Electric Power Company Holdings, Inc. is a holding company, there are several major wholly owned subsidiaries.- TEPCO Power Grid Responsible for managing power grid around Kantō region and transmits and distributes electricity between electricity wholesaler and retailer.
- TEPCO Energy Partner Electricity retailer operating under "TEPCO" brand throughout Japan, except Okinawa.
- TEPCO Fuel & Power Operates fossil fuel power stations mainly for TEPCO Energy Partner.
- Tokyo Electric Generation Company Generates wholesale electricity for electricity market.
- Tokyo Electric Power Services Co. Ltd Provides consulting services for electric power industry.
Corporate overview
- Capital stock: ¥676,424,197,050
- Total outstanding shares: 1,352,876,531
- Number of shareholders: 821,841
- Electricity sales : 92,592 million kWh, 194,148 million kWh, 286,741 million kWh
- Peak demand: 64.3 million kW
- Number of customers : 25,120,000 / 83.89 million kW, 2,630,000 thousand / 39.75 million kWh, 27,740,000 / 123.64 million kW
- Revenue from electricity sales: ¥4,637.2 billion yen
Ownership
On April 11, 2012 TEPCO announced that the Tokyo Metropolitan Government had temporarily become the largest shareholder of the firm with 9.37 percent voting rights, after former largest share holders Dai-ichi Life Nippon Life Insurance Co. and Nippon Life Insurance Co. had sold their 3.42 and 3.29 percent stakes in the company. The two life insurance companies had lost their interest in TEPCO after the shares had lost almost all their value at the stock market. At the next shareholders meeting of TEPCO in June 2012, Tokyo hoped to put a halt to TEPCO's plans raising the price of electricity. This position was changed by later ownership changes.
Community compensation
Tokyo Electric Power could face 2 trillion yen in special losses in the current business year to March 2012 to compensate communities near its crippled Fukushima nuclear plant, according to JP Morgan.Salary pay cuts
The company workers agreed to a management proposal to cut their pay as a sense of responsibility for the world's worst nuclear disaster. Annual remuneration for board members would be reduced by 50 percent since April 2011, while payment for managers would be cut by 25 percent and workers by 20 percent both since July 2011 and bonuses since June 2011. The company expects to save about 54 billion yen a year from the pay cuts.In July 2012, it was announced that annual salaries of managers would be reduced by at least 30%, with workers pay cut remaining at 20%. On average employees pay would be cut by 23.68%. In addition, the portion of the employee health insurance program that the company covers would be reduced from 60% to 50%, the standard in Japan.
Power stations and generation capacity
- Hydro: 160 / 8,521.0 MW
- Thermal : 26 / 36,995.0 MW
- Nuclear: 3 / 17,308.0 MW
- Wind: 1 / 1.0 MW
- Total: 190 / 62,825.0 MW
Position in the industry
Management and finance
For the fiscal years ending in 2011, 2012 the company had a pretax loss, in 2013 the deficit was 377.6 billion yen. In the following year 2014 red figures were expected too.Generation
The company's power generation consists of two main networks. Fossil fuel power plants around Tokyo Bay are used for peak load supply and nuclear reactors in Fukushima and Niigata Prefecture provide base load supply. Additionally, hydroelectric plants in the mountainous areas outside the Kanto Plain, despite their relatively small capacity compared to fossil fuel and nuclear generation, remain important in providing peak load supply. The company also purchases electricity from other regional or wholesale electric power companies like Tohoku Electric Power, J-POWER, and Japan Atomic Power Company.Transmission and distribution
The company has built a radiated and circular grid between power plants and urban/industrial demand areas. Each transmission line is designed to transmit electricity at high-voltage between power plants and substations. Normally transmission lines are strung between towers, but within the Tokyo metropolitan area high-voltage lines are located underground.From substations, electricity is transmitted via the distribution grid at low-voltage. For high-voltage supply to large buildings and factories, distribution lines are directly connected to customers' electricity systems. In this case, customers must purchase and set up transformers and other equipment to run electric appliances. For low voltage supply to houses and small shops, distribution lines are first connected to the company's transformers, converted to 100/200V, and finally connected to end users.
Under normal conditions, TEPCO's transmission and distribution infrastructure is notable as one of the most reliable electricity networks in the world. Blackout frequency and average recovery time compares favorably with other electric companies in Japan as well as within other developed countries. The company instituted its first-ever rolling blackouts following the shutdown of the Fukushima I and II plants which were close to the epicenter of the March 2011 earthquake. For example, on the morning of Tuesday, March 15, 2011, 700,000 households had no power for three hours. The company had to deal with a 10 million kW gap between demand and production on March 14, 2011.
File:Aerial Work Platforms - Japan - 2012.ogv|thumb|Three TEPCO aerial work platform trucks work together on utility poles, upgrading overhead power lines in Tokyo, Japan.