Japan's power utilities report 6th year of decline in power sales

Okinawa Electric Power

28/04/2017 12:31

By Osamu Tsukimori 
    TOKYO, April 28 (Reuters) - Power sales at Japan's former 
regional utilities dropped for the sixth straight year in the 
year through March, as more and more retail accounts have 
drifted away since the government opened up the market last 
April. 
    The energy sector has been in flux in the wake of the 
Fukushima nuclear disaster of 2011, and in the last year the 
government has removed the final barriers to cross-ownership 
between gas and electricity suppliers. 
    Power sales at the 10 former regional monopolies totalled 
783.4 billion kWh in the year to March 31. That was down 1.7 
percent from the previous year, a Reuters survey showed, and 
about 15 percent off the record high recorded in the year to 
March 2008. 
    Sales are likely to slide more in the current business year, 
with all eight of the utilities that reported outlooks 
projecting another drop this year. 
    Industry-wide revenues fell 7.1 percent in the year through 
March to 18.06 trillion yen ($162 billion), with only Shikoku 
Electric, which has seen relatively little new competition, 
recording an increase. 
    Sales at Fukushima operator Tokyo Electric (Tepco)  9501.T  
tumbled 11.7 percent. The company has lost a hefty 1.81 million 
retail power customers on its home turf in the greater Tokyo 
area as new suppliers have jumped into the market. 
    To offset that, Tepco has attracted about 50,000 retail 
power customers outside of its home area in the first year of 
liberalisation, although that fell short of its target of 
200,000 accounts. 
    Overall, the 10 former big power utilities lost a combined 
3.43 million retail power customers in the year since the market 
was opened up, with the impact of liberalisation felt 
nationwide. 
    Chugoku Electric Power  9504.T , headquartered in Hiroshima 
in western Japan, was no exception, losing around 40,000 retail 
customers. 
    "More than 50 (new power entrants) have offered services in 
our home area, spurring full-fledged competition," Akira Sasaki, 
deputy general manager of Chugoku's Tokyo Office, told 
reporters. 
    All the former monopolies that own nuclear plants reported 
falls in recurring profit, or pre-tax earnings before one-off 
items, except for Kyushu Electric, which has restarted its 
Sendai nuclear plant. 
    A survey of the 10 utilities showed they had together lost 
3.43 million retail accounts as of the end of March. In return, 
they have acquired only about 168,000 retail customers in other 
utilities' areas. 
    To make up for the loss of customers, some are moving 
quickly into the city retail gas market, with the sector - worth 
more than $20 billion a year - having opened up this month to 
companies beyond the regional firms that have typically piped 
gas to homes around the country.  urn:newsml:reuters.com:*:nL3N1H732X 
    Kansai Electric Power Co  9503.T  is leading this pack, 
having gained about 140,000 city gas retail customers so far to 
compete with Osaka Gas  9532.T , which has picked up about 
320,000 of its retail power accounts in return. 
    The following table shows the number of switches to new 
power providers made by retail power users in each area of the 
former monopolies. 
    The percentages are the ratio of the number of switched 
accounts to each utility's total retail power accounts. The 
number of retail power accounts the utilities have gained in 
other firms' home turfs is mentioned in acquired column. 
                           Lost      ratio       Acquired 
           Utility    end-March  end-March    other areas 
 Hokkaido Electric     164,600        6.0%           n/a  
   Tohoku Electric     121,800        2.2%           260  
             Tepco   1,813,800        7.9%        50,000  
    Chubu Electric     295,100        3.9%       100,000  
 Hokuriku Electric      20,600        1.7%         1,650  
   Kansai Electric     721,500        7.2%        12,000  
  Chugoku Electric      40,300        1.2%         1,100  
  Shikoku Electric      32,900        1.7%           600  
   Kyushu Electric     217,300        3.5%         2,300  
  Okinawa Electric           0        0.0%           n/a  
                                             
                                             
             Total   3,427,900        5.5%       167,910  
 ($1 = 111.4400 yen) 
 
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Japan power utilities' power sales in decline over years    http://tmsnrt.rs/2qat1hP 
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 (Additional reporting by Aaron Sheldrick; Editing by Hugh 
Lawson) 
 ((osamu.tsukimori@thomsonreuters.com, +813 6441 1857, Reuters 
Messaging: osamu.tsukimori.thomsonreuters.com@reuters.net;)) 
 
Keywords: JAPAN UTILITIES/RESULTS