Just last week, we commented that it would be a wasted opportunity if the main TEPCO restructuring were to go ahead as a split of TEPCO into "good" and "bad" companies, in order to hive off the Fukushima decommissioning and compensation burdens, shift them onto the taxpayers and provide comfort that the work will have adequate expertise and funding.
So it was a relief to read in Friday (November 8) press reports that TEPCO indeed is planning a further restructuring, as part of the quid pro quo for additional public help with Fukushima.
The restructuring will divide TEPCO's main businesses into 3 subsidiaries under a common holding company -- a fuel and traditional generation company, a transmission company, and a retail company. Such an organizational separation is not contemplated by current Japanese law, but would be permitted under the electricity reform legislation expected to pass the Diet next year with support of the ruling LDP.
Division of utility assets into separate entities under a holding company is not the last step in reorganization, but it is essential. And if implemented it will show the way for Japan's other electric utilities and their financial institutions.
A related announcement involves a plan to eliminate 10 of TEPCO's 80 regional branch offices. Apparently 1000 out of 4000 related jobs would be eliminated, while the remaining employees would be reassigned.