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|TEPCO and Chubu Electric to Form Comprehensive Alliance|
|= To finalize agreement and JV set-up by March 2015 =|
Tokyo Electric Power Company, Incorporated (TEPCO) and Chubu Electric Power Co., Inc. (Chubu Electric) entered into a memorandum of understanding (MoU) on October 7 on the formation of a comprehensive alliance covering the entire energy supply chain, from upstream investments and fuel procurement through power generation (the "Alliance").|
The companies will begin negotiations for the details of the Alliance, in accordance with the MoU, aiming to conclude a final agreement and to establish a 50/50 joint venture within the second half of the fiscal year of 2015.
Underpinned by the world's largest LNG procurement scale of 40 million tonnes per year (25 million tpy by TEPCO and 15 million tpy by Chubu Electric), the Alliance will establish a fuel procurement portfolio that is outstanding in terms of economy, stability and flexibility. Using the enlarged scale of fuel procurement as a springboard, the Alliance will also jointly conduct on an expanded basis the upstream, transportation and trading businesses that the companies previously operated individually, thereby expanding earnings opportunities and further strengthening fuel procurement capabilities.
The two companies will, through the Alliance, apply combined management resources to replace old and energy-inefficient thermal power plants with the latest high-efficiency power generation facilities, yielding substantial thermal efficiency improvements and allowing the realization of low-cost power supplies, and will expand the coal-fired thermal power generation business using this relatively low-cost fuel, while giving due consideration to environmental matters.
|last modified : Tue 14 Oct, 2014 [10:14]|