Taxpayers pay the tab, and get rate hike

¥1 trillion OK’d for Tepco rehab

Kyodo

Public funds totaling ¥1 trillion are part of a 10-year restructuring plan the government approved Wednesday for Tokyo Electric Power Co. as it struggles with the meltdown-stricken Fukushima No. 1 nuclear plant.

Cabinet ministers, including industry minister Yukio Edano and Environment Minister Goshi Hosono, met to discuss the plan Tuesday evening.

Based on the restructuring plan through 2021, Tepco will be put under temporary state control and continue to deal with three key tasks: paying trillions of yen in compensation related to the disaster, scrapping the Fukushima plant’s crippled reactors and providing a stable supply of electricity to areas including Tokyo.

The plan, compiled by Tepco and a state-backed bailout fund, and submitted to the government on April 27, addresses the need to raise electricity rates for households by 10 percent and to provide Tepco with additional loans by financial institutions.

Under the plan, the utility will cut more than ¥3.36 trillion in costs over 10 years and shake up its management team, leading to the resignations of Chairman Tsunehisa Katsumata and President Toshio Nishizawa.

Kazuhiko Shimokobe, a lawyer and a key figure in the Nuclear Damage Liability Facilitation Fund, will become the next Tepco chairman, while Naomi Hirose, a Tepco managing director in charge of compensation issues related to the Fukushima crisis, will be promoted to president.

Tepco will receive the ¥1 trillion in taxpayer money from the Nuclear Damage Liability Facilitation Fund after necessary proposals are approved at the company’s annual shareholders’ meeting in June, paving the way for the government to take over 50 percent of the company’s voting rights to intervene in management.