Impact of TEPCO raise on car manufacturing (for instance)

April 1, 2012

TEPCO raises electricity charges for some corporate customers

http://mdn.mainichi.jp/mdnnews/news/20120401p2g00m0dm022000c.html

TOKYO (Kyodo) -- Tokyo Electric Power Co. raised electricity rates for some of its corporate customers Sunday in an apparent effort to help finance fossil fuel costs stemming from boosting nonnuclear thermal power generation in the wake of the nuclear disaster at its Fukushima complex.

The utility, or TEPCO, had initially aimed to raise charges on all its 237,000 corporate customers at the same time, but only 11,000 of them had agreed to accept hikes as of March 22, citing lack of clarity over the reasons for the rate hike and insufficient explanations by the company.

TEPCO has come under fire for failing to generally explain that corporate customers can refuse to accept the rate hike if their current contracts with TEPCO have not yet expired. The utility gave the explanation only when customers made inquiries.

TEPCO President Toshio Nishizawa has said the company is ready to give a full explanation to unsatisfied customers, but some corporate managers are still expressing dissatisfaction.

Toshiyuki Shiga, chief operating officer of Nissan Motor Co., said, "We cannot pass the cost of the electricity rate hike on to car prices. I expect Tokyo Electric to understand how its move (to raise the charge) will affect manufacturing."

At Nissan's Tochigi plant, for example, the rate hike will add 3,500 yen to the electricity costs for making a car, according to Shiga.