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Finance GreenWatch » 8.Eathquake & Nuclear accident » TEPCO to seek 1 tril. yen public fund injection: sources(The Maincihi Daily News)

TEPCO to seek 1 tril. yen public fund injection: sources(The Maincihi Daily News)

TOKYO (Kyodo) — Tokyo Electric Power Co. plans to seek an injection of 1 trillion yen in public funds from a state-backed entity by the end of the month to avoid insolvency, as it struggles with the Fukushima Daiichi nuclear power plant crisis, sources close to the matter said Tuesday.

The utility known as TEPCO also plans to request some 800 billion yen of additional financial assistance, which will be used for ballooning compensation payments stemming from the world’s worst nuclear accident since the 1986 Chernobyl disaster.

But it is not certain that the company’s comprehensive restructuring plan, which is expected to stipulate both the capital injection and the additional aid, will be submitted by Saturday’s deadline because the issue of who should take over from outgoing TEPCO Chairman Tsunehisa Katsumata remains undecided.

The company is facing a heavy financial burden amid increasing fuel costs for thermal power generation to make up for the sharp drop in nuclear power generation following the nuclear accident.

It is also expected to need about 1 trillion yen in the first 10 years of a decades-long process toward scrapping the crippled reactors at its Fukushima plant, according to an estimate drawn up by the utility and the Nuclear Damage Liability Facilitation Fund.

Bolstering TEPCO’s financial standing is believed to be important so as not to adversely affect ongoing compensation payments and the challenging task of decommissioning the crippled four reactors, three of which have suffered meltdowns.

How many shares the government should acquire in return for the capital injection is expected to be discussed by reflecting the views of whoever succeeds Katsumata, the sources said.

The government expects the next chairman to play a leading role in reforming TEPCO.

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