UPDATE 4-Japan Feb power output dives 16 pct, biggest ever drop

* Feb generation plunges 15.8 pct due to weak industry
demand

* Thermal power generation down 30 pct, biggest ever fall

* Oil burn more than halves to lowest since Sept. '06

* LNG and coal use fall more than 10 pct
(Adds oil burn falling to lowest since '06)

By Osamu Tsukimori

TOKYO, March 13 (Reuters) - Japan's electricity generation
in February plunged 15.8 percent from a year earlier, marking
the biggest decline on record as demand slumped amid deep
recession and unusually mild weather, while consumption of oil
to generate power fell to its lowest in nearly two and a half
years.

The drop, which was bigger than many had expected, was a
reminder that the economy in the world's third-biggest power
consumer is in its sharpest contraction since the oil crisis in
1974, shrinking 3.2 percent in the last quarter of 2008,
weakening demand for coal, LNG and oil. [ID:nT374275]

"It's shocking. I didn't think (the fall) would top 10
percent," said an energy analyst at a Japanese brokerage, who
spoke on condition of anonymity.

And if electricity demand remains weak, consumption of
carbon fuels -- particularly oil -- could decline further once
top utility TEPCO restarts operations at the world's biggest
nuclear facility, which is expected to restart within months
after a nearly two-year shutdown following an earthquake.

The 10 utilities generated 74.47 billion kilowatt-hours of
electricity in February, marking the seventh straight monthly
decline, the Federation of Electric Power Companies of Japan
said. It was the first time since February 1997 that all the
firms had reported falls in electricity generation.

Japan's weather, which has been milder than normal since
late January, is projected to stay mostly warmer in the coming
month, the meteorological agency said on Friday.

Japan's industrial production -- which normally rises and
falls mostly in line with power output -- fell 10.2 percent in
January from a month earlier, the biggest fall on record, data
showed on Friday. The February data is due out later this
month.

Thermal power output plunged 29.6 percent, the biggest ever
drop, helped by a rise in the nuclear utilisation rate of 10.8
percentage points versus a year ago to 67 percent. That helped
more than halve consumption of oil, the most expensive fuel in
the energy mix, to its lowest level since September 2006.

For a graphic on the nuclear utilisation rate and oil
burning, click on:
here

Six of the country's 10 utilities reported their biggest
percentage falls in a generation, led by Chubu Electric Power's
(9502.T) 22.7 percent slide. Chubu's region includes the home
base of major user Toyota Motor Corp (7203.T).

EYES ON KK

Future demand for power plant fuel will hinge on whether
Tokyo Electric (9501.T) (TEPCO) is allowed to restart the No.7
generator at the Kashiwazaki-Kariwa nuclear plant, shut in July
2007.

Their plans were dealt a setback on Wednesday after a local
governor said he would not grant approval for a restart until
the company issues satisfactory plans on how to prevent
outbreaks of fire there, and some analysts now expect the unit
to resume operations only in the new fiscal year from
April.[ID:nT12704]

Industry researcher Japan Electric Power Survey Committee
projected last week that demand from the industrial sector,
which started falling in October due to the economic slowdown,
is unlikely to turn positive until February or March 2010.

For a graphic on the consumption of coal and LNG, click
on:
here

The five other firms that reported the biggest percentage
declines in power generation were Hokkaido Electric (9509.T),
Kansai Electric (9503.T), Chugoku Electric (9504.T), Shikoku
Electric (9507.T) and Kyushu Electric (9508.T).

Following is a table of energy consumption at Tokyo
Electric Power and the 10 utilities' total in February, based
on the data (volumes of crude, fuel oil and naphtha in
kilolitres; LNG and coal in tonnes; year-on-year percentage
changes in parentheses):

FEBRUARY

TEPCO INDUSTRY TOTAL
Coal : 341,153 (+1%) 4,123,116 (-15%)
Fuel oil : 436,819 (-36%) 653,184 (-52%)
Crude oil: 157,964 (-64%) 293,480 (-83%)
LNG : 1,432,664 (-18%) 3,018,538 (-18%)
NAPHTHA : 83 n.a. 83 n/a