Japanese market liberalisation loses momentum

22 August 2017, Week 33, Issue 589

More than a year after the full liberalisation of Japan’s retail electricity market, customers are becoming less interested in changing their power suppliers, a survey showed. 

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According to the survey, 7.9% of respondents intend to change their power suppliers, down 1.4 percentage points from 9.3% in a previous survey conducted in November 2016. The survey was conducted by Dentsu, Japan’s top advertising agency, in June and released on August 18. It covered 5,600 men and women aged between 20 and 69 across the country.

The survey also shows that 9.8% of respondents have already changed their power suppliers, up 2.4 percentage points from 7.4% in the November 2016 survey.

But the percentage of respondents who have already changed their power suppliers varies greatly across regions. The highest percentage of 17% was seen in TEPCO’s service area, followed by 14.9% in Kansai Electric Power Co.’s area.

Japan’s retail electricity market was fully liberalised on April 1, 2016. More than 300 companies have since broken into the market, spurring competition to offer better services and lower rates.

Japanese households and other small-lot electricity users can now choose their suppliers freely. They had previously been allowed to purchase electricity only from 10 major electric power companies in their own regions.

Kansai Electric Power lost its status as Japan’s second-largest electric utility in terms of power sales volume for the first time in the fiscal year ended March 31 2017 as it lost some of its customers to new market entrants amid intensifying competition. Kansai Electric Power lost the second slot to Chubu Electric Power.

In fiscal 2016, Kansai Electric Power’s power sales totalled 121.5 billion kWh, down 4.7% from a year earlier, while Chubu Electric Power’s power sales amounted to 121.8 billion kWh, down a paltry 0.2% year-on-year. TEPCO’s power sales also shrank 2.2% in fiscal 2016 from a year earlier to 241.5 billion kWh.

 

Edited by

Richard Lockhart

Editor

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