A government-appointed panel of experts Tuesday recommended freeing up of both electrical power production and distribution to outside competition in Japan 's first major review of the utilities industry in almost a decade.

The proposal is aimed at dealing with chronic power shortages since the March nuclear disaster and high electricity rates in the country.

The Japanese government is set to begin discussions next month to craft a bill to liberalize the market that has been long dominated by a few regional monopolies.

The key points of discussion released by the panel include a review of the current regional monopoly structure that allows utilities to operate integrated services of power generation, transmission and distribution.

In particular, the panel said equal access to transmission networks should be ensured to promote new entries in the power production business.

It called for more flexible pricing structures to allow utilities to charge higher rates as demand goes up, so that excessive usage can be curbed.

The panel also proposed freeing up the market for power supply to the household sector and encouraging existing regional monopolies to compete in each other's markets.

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