27 March, 2002 – Tohoku Electric Power Co has signed two power supply contracts for the Tohuku regional city of Sendai in Japan, beating off a challenge by Tokyo Electric Power (Tepco).
One contract is to supply 3.1 MW of power to the central agricultural wholesale market which is worth 179 157 110 yen ($1.35m). the second contract was a 6.5 MW power supply contract at a sewage processing plant.
Tohuku was able to outbid Tepco in both cases and offer a reduction on the previous year’s contract pricing.
Tepco was able to offer a bid only about 9 per cent below the previous year’s level, due to projected costs to pay Tohoku Electric as a backup supplier should an accident occur.
A Tohoku Electric official said it would work to further improve management efficiency in order to win over customers, suggesting further price cuts.
Tepco says it plans to sell power to private sector firms in the Tohoku region.
The competition may bring down power prices, which remain very high in comparison to international standards.