Power utilities should seriously take in criticism to restore trust
Nine electric power companies that own nuclear power plants held shareholders meetings Wednesday. Many shareholders called for management reform at the utilities.
Public opinion has turned strongly against power companies in the wake of the crisis at Tokyo Electric Power Co.'s Fukushima No. 1 nuclear power plant.
Concerns are mounting over the nation's electricity supply. There is no prospect of reactors other than two at Kansai Electric Power Co.'s Oi nuclear power plant being restarted although the searing summer heat is almost here.
Power companies should seriously take shareholders' criticism of the current situation into account and utilize it for their management reform.
About 4,500 shareholders attended TEPCO's meeting, which lasted a lengthy 5-1/2 hours, about the same as last year's meeting.
Proposals from TEPCO, including one concerning the appointment of its directors, were approved. The new management team in which outgoing Chairman Tsunehisa Katsumata will be replaced by Kazuhiko Shimokobe, former head of the Nuclear Damage Liability Facilitation Fund's steering committee, was decided.
An amendment to its articles of incorporation, which is necessary for strengthening TEPCO's financial standing through an injection of 1 trillion yen in public funds, also was approved. This paved the way for TEPCO's de facto nationalization.
TEPCO must be humble
The reborn TEPCO must steadily implement its comprehensive special business plan to reconstruct itself. The company also must fulfill its responsibility to decommission reactors at the Fukushima No. 1 nuclear plant, pay compensation to people and businesses affected by the nuclear accident and ensure a stable electricity supply. TEPCO should drastically improve its corporate culture.
Many people seeking compensation were bewildered when TEPCO sent them hefty tomes of application documents to fill out. TEPCO President Toshio Nishizawa provoked further ire late last year when he said, "Rate increases are a power company's right." At present, there is no likelihood that TEPCO can raise electricity rates for households.
TEPCO's insensitive responses were unsurprisingly lambasted as "a monopoly company's arrogance." It is important that the utility does not repeat such blunders.
At TEPCO's meeting, the Tokyo metropolitan government--a major shareholder in the utility--proposed that the company's articles of incorporation include a provision stipulating that putting customer service first is TEPCO's mission. At KEPCO's shareholders meeting, the Osaka city government, the company's largest shareholder, made a proposal demanding thorough information disclosure, among other things.
All these proposals were voted down. However, power companies should seriously take to heart public criticism of their tendency to give users short shrift and their closed management.
No N-power not an option
The meetings were used by many shareholders to call for the companies to end nuclear power generation. It was particularly disconcerting that the Osaka city government proposed KEPCO abolish all of its nuclear plants immediately. Osaka Mayor Toru Hashimoto also urged KEPCO to change its management strategy to one based on the assumption there will be no nuclear power.
Isn't Osaka, a city that consumes a massive volume of electricity, being irresponsible in taking the initiative in insisting that KEPCO abandon nuclear power generation?
Nuclear power is a fundamental power source for ensuring a stable energy supply. It was only natural that every proposal to dump nuclear power generation--including one put forward at the KEPCO meeting--was voted down.
Ensuring nuclear reactors are safe and restoring trust in the utilities are the most important factors in getting the reactors steadily reactivated. To this end, power companies must work hard to ensure air-tight safety at their nuclear plants and appropriately and thoroughly disclose information.
(From The Yomiuri Shimbun, June 28, 2012)