Tokyo Electric not keen on Transco contract

Power giant Tokyo Electric Power Co. (TEPCO) said it has no plans to bid for the concession contract of the National Transmission Corp. (Transco), a ranking company official told The STAR. 

In an interview arranged by the Foreign Press Center of Japan, TEPCO development manager for international affairs department Takao Onuki said the company may likely be more interested in the privatization of generation companies (gencos) of the National Power Corp. (Napocor).

"It may be tough for TEPCO due to the reason of cross ownership which is if we own assets in genco, we can no longer own Transco assets. This means that we may have some conflict of interest. That would be very controversial.  In many cases, there are some regulations which prohibit foreign investors from making an investments in different areas like in Australia and other countries.  So if we go in the Transco business, then we may be kept from investing in genco in the future.  Thus, this may be tough for us to go to the Transco business," Onuki said.

TEPCO’s name cropped up last year as it reportedly joined forces with San Miguel Corp. (SMC) in bidding for Transco, which controls the country’s $2-billion power transmission highway.

Onuki, however, said they are still in a "wait-and-see attitude" with regard to their participation in the genco sale process. "Nothing is keeping us from investing, we are just in a wait-and-see situation right now."

He said there may be opportunities in the Philippine power sector but it is really difficult to invest in Asia, especially where there are several risks like social and security problems. 

"If there is an opportunity, we would consider to invest in some kind of gencos. This is just a possibility, nothing is clear right now," he stressed. 

Though declining to identify which plant they want to buy, Onuki said one of TEPCO’s expertise is in the operation and maintenance of natural gas-run power plants. 

Aside from the possible purchase of genco assets, TEPCO is also offering consultancy services to Transco and Napocor for technology transfer in power reliability system to minimize energy losses and reduction of emission. 

"In the Philippines, we want to have a business of consultancy services but unfortunately, up to now, we have not yet have a major project," TEPCO general manager for consultancy services group Hitoshi Koyabu, for his part, said. 

Koyabu said TEPCO, for two to three years now, has been trying to convince Transco to enter into a contract.

For the past decade, TEPCO has been intensifying and diversifying its operation, abroad. TEPCO has invested in the overseas power industry, providing consulting services that utilize expertise and know-how developed in Japan. 

It  has invested in several overseas projects and is continually looking for further business opportunities. These projects include two thermal power projects in Australia (450 megawatt (MW) Tarong North and 2,200 MW Loy Yang A); independent power producer (IPP) project in Vietnam (715 MW Phu My 2-2); two IPP projects in Taiwan (490-MW Chang Bin/980 MW Fong Der); water and power project in United Arab Emirates (1,550-MW Umm Al Nar IWPP project). 

It currently holds a 60 percent stake in Eurus Energy Holdings Corp., one of the world’s leading wind power companies. 

TEPCO also offers international consultancy services using advanced technology and expertise developed as a result of the company’s activities in Japan.  The company has already established a solid track record with projects in a number of countries including India, Vietnam, Turkey, Malaysia and Indonesia. 

To conduct extensive exchanges at both top management and expert levels, TEPCO established an international network with Asian and other electric power utilities, including the State Grid Corp. of China, Korea Electric Power Corp. and Tenaga Nasional Bhd. of Malaysia, as well as with Electricite de France.  This network has been extended to incorporate the world’s major transmission system operators including PJM Interconnection LLC (United States) and Reseau de Transport d’ Electricite (RTE) (France) to improve technical exchanges in favor of reliable and efficient power grid management. 

TEPCO recently provides power to an area that accounts for 43 million people or approximately 30 percent of Japan’s total population and contributes Y184 trillion or 40 percent, to the nation’s economic output.