* Tepco president says not seeking a bailout
* Says wants help to avoid bankruptcy
* Fukushima cost overruns a concern
(Adds comments by source, context)
By Osamu Tsukimori and Kentaro Hamada
TOKYO, Oct 5 The operator of the nuclear power
plant destroyed in the Fukushima disaster five years ago has
asked Japan's government for help in avoiding the risk of the
utility going bankrupt should there be a sharp rise in the full
estimated clean-up costs.
Tokyo Electric Power Co Holdings Inc didn't specify
what kind of help it was seeking, but people familiar with the
matter said Japan's biggest utility is looking for new rules to
avoid having to book a huge loss in its accounts if it is
estimated that there will be big cost overruns for
decommissioning the power station.
"We don't want to receive national rescue measures but want
to bear the Fukushima responsibility ourselves," Tepco president
Naomi Hirose told a government panel, according the panel chief,
Kunio Ito, a professor at Hitotsubashi University.
"For that reason, we would like to undertake steps for a
further overhaul than we have had so far," Hirose was quoted as
In March 2011, one of the worst earthquakes in history
triggered a 10-metre high tsunami that crashed into the
Fukushima Daiichi nuclear power station, causing the world's
worst nuclear accident since Chernobyl 30 years ago. Meltdowns
in three reactors released radiation over a wide area,
contaminating water, food and air, and forcing more than 160,000
people to evacuate.
Dismantling the reactors is expected to take about 40 years,
but even five and a half years on, Tepco still struggles to
contain radioactive water from the plant and has said it can't
predict the eventual total costs of the clean-up and
After the panel meeting on Tepco reform and the Fukushima
Daiichi plant, Hirose told reporters that it was difficult to
accurately predict the costs of even a gradual decommissioning
of the crippled reactors, said a spokeswoman for the utility,
which generates about a third of the country's electricity.
"If the issue of recognising all the estimated losses at
once were to emerge, our company would fail, so we would like
some structural assistance from the government to be able to
avoid that risk," Hirose said.
Tepco wants the government to consider introducing rules to
avoid having to book a single huge exceptional loss as soon as
cost estimates for decommissioning become clearer, said a person
familiar with the situation.
Cost estimates could shoot up when the company and the
government, which owns 50.1 percent of Tepco, decide on how to
extract fuel debris at the plant in 2018 or 2019, said a person
with direct knowledge of discussions on restructuring Tepco.
A government official familiar with the deliberations said,
"In the event that Tepco can't shoulder the burden, it will mean
changing the fiscal-support system." As it's hard to imagine the
government letting the company go bust, "in the end it will have
to be a matter of either shouldering the burden with public
funds or responding by raising electricity prices."
The Mainichi newspaper said on Wednesday that Japan's
utilities lobby expects clean-up and compensation costs from the
Fukushima disaster to overshoot previous estimates by 8.1
trillion yen ($79 billion).
The Federation of Electric Power Companies of Japan has
informally asked the government to shoulder the extra cost, the
However, a federation spokesman said the group has not asked
the government to shoulder any extra costs and the Mainichi
estimates were not correct.
The new government panel also agreed that management reform
at Tepco was necessary at its first meeting earlier in the day,
panel chief Ito said.
Shares in Tepco ended down 3.3 percent after falling as much
as 7.9 percent on Hirose's remarks, which were initially
interpreted as a plea for additional financial aid.
"The stock market seems to have reacted to the headline that
it could become insolvent," said a credit analyst at a Japanese
brokerage. "But in reality, the president has just said what's
been known, that they need an accounting system that allows them
to write off the cost of decommissioning gradually because
posting the cost all at once could make it insolvent."
($1 = 102.8900 yen)
(Additioanl reporting by Takashi Umekawa, Yuka Obayashi,
Takashi Umekawa and Hideyuki Sano; Editing by Edwina Gibbs,
William Mallard, Greg Mahlich)