TOKYO (AP) — Japan's Cabinet has approved a proposal to revamp its troubled electricity industry and foster more competition by obliging utilities to split power generation and distribution into separate businesses.
The plan is meant to encourage more innovation and modernization of the power grid as the country grapples with its energy policy following the shut-downs of almost all its nuclear power plants after the March 2011 tsunami disaster at the Fukushima Dai-Ichi plant.
The plan approved Tuesday requires parliamentary approval. First proposed years earlier, it was included in a slew of economic reforms being discussed by Prime Minister Shinzo Abe's administration that are intended to improve Japan's competitiveness.
The power companies face soaring costs for imported fuel and for maintaining nuclear plants closed for checks after the Fukushima disaster.
Abe told a meeting of his economic advisers that he wants to expedite restructuring of Japan's industries to eliminate bottlenecks and facilitate more business activity and investments, according to a summary of the meeting posted on the government's website.
Such reforms are part of Abe's three-pronged strategy for revival of the stagnant economy, along with more aggressive monetary easing and stronger government spending to stimulate growth.
Abe instructed Industry Minister Toshimitsu Motegi to submit the power reforms bill to the parliament as soon as possible.
He also urged Motegi and Environment Minister Nobuteru Ishihara to work together on strengthening environmental impact assessments to promote use of environmentally friendly and high-efficiency thermal power.
Abe said the next five years would be a time of "emergency structural reforms" for Japan. "We plan to commit as many resources as possible" to that effort, he said.