Japan's Tepco offers gas discount to city retail customers

TOKYO (Reuters) -- Japan's biggest power utility, Tokyo Electric Power, on Tuesday offered city customers up to 8% cheaper gas prices than those charged by Tokyo Gas in a bid to win market share ahead of its formal entry into the sector in July.

The company, known as Tepco, also offered city customers a discount for electricity amounting to $11 a year if retail customers apply for a bundled service along with gas.

Power utilities are streaming into Japan's city retail gas market, after the over $20 B a year sector was opened up last month to companies beyond the regional gas firms that have traditionally supplied homes in the country.

Although Kansai Electric Power is looking 200,000 retail city gas customers in the first year of entry, Tepco plans only 40,000 retail city gas customers in its first year in the sector post-July, partly because it has limited availability of gas in the near term.

Reiji Ogino, senior analyst at Mitsubishi UFJ Morgan Stanley Securities, said Tepco's goals were at the low end of his expectations given that Tokyo Gas had acquired around 700,000 retail power customers from Tepco following the power sector liberalisation in April 2016.

Tepco is teaming up with Nippon Gas and possibly more firms to acquire 1 MM retail city gas users, or about 10% of Tokyo Gas' retail customers, by early 2020.

Reporting by Osamu Tsukimori, editing by David Evans

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