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KEPCO wants to raise the price of electricity

May 12, 2015

Kepco to raise household electricity rate by 8.36%




Kansai Electric Power Co. will raise the amount it charges households for electricity by an average of 8.36 percent starting June 1, industry minister Yoichi Miyazawa said Tuesday.

Higher imported fossil fuel costs are weighing on the firm’s earnings in the absence of nuclear power following the 2011 triple meltdown at Tepco’s crippled Fukushima No. 1 plant, Miyazawa said.

The Economy, Trade and Industry Ministry has judged the margin of the markup should be trimmed from the average 10.23 percent rise originally sought by the utility, reflecting recent drops in crude oil prices and other factors.

Miyazawa added the rate will be set at 4.62 percent during the four months through September to ease the burden on households. To keep the bill hike smaller than initially proposed, Kansai Electric will slash executive compensation and boost efforts to streamline business.

The ministry is expected to approve the rate hike soon.

Kansai Electric, which relied heavily on nuclear power to generate electricity before the Fukushima crisis, initially sought to raise prices starting in April. But its plan was delayed as discussions within the government dragged out on whether the proposed hike was appropriate.

All of Japan’s commercial reactors were offline by September 2013 amid heightened safety concerns in the wake of the meltdowns at the Fukushima No. 1 plant. They remain idled pending the nuclear regulator’s safety review, based on more stringent requirements.

Kansai Electric President Makoto Yagi told a press conference in Osaka the company plans to lower the rate when its nuclear plants go back online.

The utility, which serves Osaka and neighboring areas, last raised prices for household electricity by 9.75 percent in May 2013.

Hokkaido Electric Power Co. also raised its electricity prices last year.
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