TOKYO, Dec 3: Japan’s Trade Ministry has lost a vocal ally in its effort to deregulate Japan’s power market with the disintegration of US energy trader Enron Corp, but the ministry on Monday vowed to push ahead with liberalization.
Japan’s vice trade minister, Katsusada Hirose, said Japan will proceed with liberalization of its power market while learning lessons from Enron’s collapse, the Kyodo news agency reported.
Enron which filed for Chapter 11 bankruptcy on Sunday burdened with at least $16.8 billion in debt obligations — had been aggressively trying to enter Japan’ power market in anticipation of further deregulation.
It had announced plans to build several large-scale power plants, which are now unlikely to go through.
The US energy trader’s aims matched those of the Ministry of Economy, Trade and Industry (METI), which is eager to introduce competition in Japan’s power industry in a bid to bring down high electricity costs, blamed as one factor sapping Japanese industries’ global competitiveness.
A METI official said on Monday that liberalization was not a matter that could be swayed by one company alone.
Deregulation will move forward, the official said.
I will not say that (Enron’s collapse) will have no impact on Japan’s move to deregulate the industry...but it will be limited, he said.
The METI official added that there would be no actual impact on Japan’s power market because Enron had not built a power plant and started supplying the Japanese market.
Despite pressure by Enron, Japan wasn’t quickening its pace to open up the power market in the first place, he said.
Japan’s power industry has pointed to California’s power supply crisis as an example of the possible problems that could arise if deregulation measures were not conducted cautiously.—Reuters
