Tepco to humbly seek state nod to hike rates

Kyodo

Tokyo Electric Power Co. will seek permission from the government to raise household rates in March or later after discussing the matter with the government-backed entity providing financial support to the beleaguered utility, Executive Vice President Takashi Fujimoto said.

The operator of the crippled Fukushima No. 1 nuclear plant will also consider seeking an injection of public funds when it compiles a special business plan with the entity by March, Fujimoto told reporters Thursday.

Fujimoto’s remarks on electricity rates suggested Tepco has adopted a more humble approach to the contentious issue after Minister of Economy, Trade and Industry Yukio Edano criticized its argument in late December that hiking rates is a “business operator’s right.”

Fujimoto said the company will discuss rate hikes with the Nuclear Damage Liability Facilitation Fund and then make a request to the government.

Tepco plans to follow that procedure because it is “now receiving huge assistance from the government” to pay compensation to people and businesses affected by the nuclear crisis.

“The comprehensive special business plan is about the company’s medium- and long-term revenues and expenses. So we expect discussions (on electricity bill hikes) to take place there, and apply for hikes as soon as we gain approval,” Fujimoto said.

Tepco has already declared it plans to raise electricity rates for corporate users in April. This does not require government approval.

Although Tepco is receiving financial assistance from the government-backed entity in connection with compensation payments, it needs to address growing fuel costs stemming from boosting thermal power generation to make up for the shortfall in nuclear power.

It will also need massive funds to scrap the crippled reactors at the Fukushima plant.

In late December, Edano told Tepco President Toshio Nishizawa to consider putting the utility under temporary government control as one of the options to fundamentally bolster its financial standing.

Fujimoto said Thursday that Tepco also wants to discuss “the issue of allowing (the government) to increase its stake (in the utility) in the comprehensive special business plan.”

The discussions may be rough because Tepco could try to avoid giving the government a stake sufficient to control the company. The Nuclear Damage Liability Facilitation Fund would be the entity acquiring the stake.

Meanwhile, Tepco has decided not to ask for the submission of resident cards when paying compensation to around 1.5 million people living outside the government-designated evacuation zone, according to sources.

Tepco has asked around 150,000 people who have homes inside the evacuation zone to attach resident cards as a form of identification when seeking compensation, but it has been judged as difficult for local governments to send copies to a far larger number of people. Instead, Tepco will ask each local government to disclose information on residents, the sources said.