TEPCO President Steps Down, Suffers Record ¥1.24 Trillion Loss

TEPCO President Masataka Shimizu will resign to take responsibility for the nuclear crisis at the Fukushima Dai-ichi power complex, which was triggered by the March 11 earthquake and tsunami.

AsianScientist (May 20, 2011) – Japanese media reports said Tokyo Electric Power Co. (TEPCO) President Masataka Shimizu will resign to take responsibility for the nuclear crisis at the Fukushima Dai-ichi power complex, which was triggered by the March 11 earthquake and tsunami.

TEPCO company spokeswoman Ryoko Sakai declined to confirm the reports, which cited no sources.

Mr. Shimizu has received harsh criticism from all sides, which only intensified when the company disclosed he was absent from the office for nearly two weeks after the tsunami and later hospitalized. He will resign shortly after the blue chip utility’s shareholders’ meeting in June 28.

60 year old Toshio Nishizawa, a veteran from Tepco’s planning division, will assume the presidency after Shimizu relinquishes it. Mr. Nishizawa joined the company in April 1975, a month after he graduated from the prestigious Kyoto University School of Economics. Similar to Mr. Shimizu before his appointment as TEPCO President in 2008, Mr. Nishizawa has moved through the ranks at TEPCO’s elite strategic-planning division – where future executive leaders are groomed.

“I feel a grave sense of responsibility to take this large role in the face of an unprecedented crisis since the company’s establishment,” said Mr. Nishizawa at Friday’s earnings briefing.

Along with Shimizu, Vice President Sakae Muto, who has been in charge of the nuclear plant business, will also step down.

Chairman Tsunehisa Katsumata will continue to oversee the crisis.

Today, Yomiuri newspaper reported a record group new loss of 1.5 trillion ($18 billion) for the fiscal year of 2010. Other agencies such as the Kyodo News agency put TEPCO’s annual loss at 1.2 trillion yen ($14.7 billion).

TEPCO had a profit of nearly 134 billion yen in the previous fiscal year.

These losses did not include what are expected to be massive compensation payments to people who were forced to evacuate from their homes, and businesses such as farms whose products were damaged by the radiation. TEPCO must also resolve the issues with the reactors, as well as make up for the electricity shortfall from the beleaguered nuclear power plant.

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Source: The Daily Yomiuri, The Wall Street Journal.
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