Royal Dutch Shell Plc  .com Rotating Header Image

Bloomberg: Showa Shell Gets License to Trade Wholesale Power in Japan

By Shigeru Sato

Oct. 15 (Bloomberg) — Showa Shell Sekiyu K.K., the Japanese unit of Royal Dutch Shell Plc, got a license to trade electricity on the nation’s wholesale power exchange, making it the 37th company to join the two-year-old bourse.

The Japan Electric Power Exchange granted the license to the petroleum refiner on Oct. 12 after a board meeting, Ryoichi Kunimatsu, the bourse’s deputy director general, said by telephone today.

Tokyo-based Showa Shell’s entry is part of the company’s plans to diversify its operations, as petroleum demand declines in the world’s second-largest economy partly because of a shift to cleaner-burning fuels such natural gas. Showa Shell and Tokyo Gas Co. are building a gas-fired power plant in Yokohama.

“Participation in the exchange would be part of the preparation for our electricity sales business,” Showa Shell said in a statement on its Web site. “First, we plan to gain such know-how from the market.”

The 1,200-megawatt power plant in Yokohama, near Tokyo, is slated to begin operation by March 2010, Showa Shell said. The station will be 75 percent owned by Tokyo Gas.

The exchange’s members include Nippon Oil Corp., the country’s largest oil refiner, and Osaka Gas Co., the second- largest gas distributor. The bourse, which opened in April 2005, enables utilities and new market entrants to trade 1,000 kilowatt-hours lots of electricity for delivery the next day or monthly as far as a year ahead.

The average day-ahead power price for delivery today during the peak hours of 1 p.m. to 4 p.m. was 15.5 yen a kilowatt-hour, up from 9.45 yen for electricity distributed yesterday, according to the exchange’s data.

The 10 regional utilities account for more than 80 percent of Japan’s retail power sales, even after the government opened 63 percent of the market to competition.

Factories, government offices and supermarkets using more than 50 kilowatts of electricity are able to choose their power suppliers. Deregulation of power wholesaling began in 1995, and retailing in 2000.

To contact the reporters on this story: Shigeru Sato in Tokyo at [email protected] ;

Last Updated: October 14, 2007 21:42 EDT

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “Bloomberg: Showa Shell Gets License to Trade Wholesale Power in Japan”

Leave a Comment

%d bloggers like this: