Tohoku Electric, Shikoku Electric won’t hike rates until August at earliest

JIJI

Tohoku Electric Power Co. and Shikoku Electric Power Co. will likely be able to raise their household rates in August at the earliest, later than the two companies initially planned, due to a delay in the government’s approval procedures, informed sources said Tuesday.

Tohoku Electric filed Feb. 14 for government approval for raising its electricity rates by 11.41 percent on average. Shikoku Electric made its request Feb. 20 for a 10.94 percent hike.

Both utilities were aiming to implement the rate hikes on July 1. To do that, they would need to obtain approval no later than June 20.

However, a panel at the Ministry of Economy, Trade and Industry is expected to take a long time finishing its study of the increases, the sources said. The rate hike plans then need to be checked by the Consumer Affairs Agency.

While the METI panel’s study on requests for electricity rate hikes usually takes four months, its work has been bogged down by a flood of such requests by power utilities, according to the sources.

The two utilities’ rate hikes may be eventually delayed into September as some officials are cautious about hikes in August, when electricity demand soars, the sources said.

Tohoku Electric is considering postponing its hike for business users, also planned for July, if the increase for households is delayed. Rate hikes for corporate users do not require government approval.

“We want the government to speed up the approval process,” Tohoku Electric President Makoto Kaiwa said.