Kansai Electric Expands Outside Home Region With Tokyo Plant Buy

Kansai Electric Power Co. purchased its first thermal power plant outside its home region, as the company prepares for the deregulation of Japan’s electricity market.

The nation’s second-largest power utility bought the 110,000-kilowatt plant, located about 15 kilometers (9 miles) from Tokyo Bay in Chiba prefecture, from Electric Power Development Co. and Mitsui Engineering & Shipbuilding Co., according to a statement June 26.

Japan recently implemented new laws to increase competition in the electricity sector by loosening the control of the 10 regional utilities in their respective areas. The Kanto region around the capital is served by Tokyo Electric Power Co., while Kansai Electric’s operations are based around the central industrial hub of Osaka.

The new legislation liberalizes the retail electricity market from April 2016, and requires utilities to break their generation, transmission and retail operations into separate entities in April 2020. By severing ties to their existing distribution arms, utilities are expected to seek more customers in other regions.

Kansai didn’t disclose the price paid for the plant. The cost may be several billion yen, according to the Sankei newspaper, which didn’t say where it got its information.

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