Tokyo Electric Power may spin off or sell thermal power plants: report

Tokyo Electric Power Co (Tepco), the operator of the stricken Fukushima Dai-Ichi nuclear plant, may spin off or sell its thermal power plants, starting with six such facilities, the Nikkei business daily today reported without citing sources.

The plan under consideration by Tepco and the Japanese government to split its fossil-fuel power operations from its nuclear power and other businesses would come after the state injects around 1 trillion yen (approx $13 billion) into the troubled company, which would help pay the cleanup and compensation costs that would run into billions of dollars.

The infusion of public money would in effect nationalise the company for at least 10 years and is expected to become profitable by 2013.

Three of six reactors at Tepco's Fukushima plant suffered a core melt-down after the 11 March 2011 earthquake and tsunami knocked out its cooling systems and set off the world's worst nuclear accident since the 26 April 1986 Chernobyl disaster.

The fossil fuel division of Tepco, Asia's biggest utility, which accounts for nearly 60 per cent of the  company's generation capacity and whose assets are estimated at around $11.7 billion, could also be divided into several units and sold, the Nikkei said.

Reacting to the report, Tepco today said in a statement, ''While Tepco has previously announced in the special business plan approved on 4 November 2011 that the sale of assets including generation facilities was under consideration, no decision has been made regarding the separation and sale of thermal power division. Also no decision has been made regarding the introduction of in-house company system.''

''We will continue to consider Tepco's management structure while cooperating with the Nuclear Damage Compensation Facilitation Corporation in establishing the comprehensive special business plan,'' the statement added.