TOKYO: Tokyo Electric Power Company Holdings Inc. is considering raising regulated electricity prices for households, a move that requires the Japanese government’s approval, it was learned Tuesday.
The company is planning to apply by the end of this year to gain state approval for the move, in hopes to implement revised prices from fiscal 2023.
Five other power utilities, including Tohoku Electric Power Co. and Hokuriku Electric Power Co., are also considering such price hikes, in the face of deteriorating earnings due to surging fuel prices and the yen’s weakening.
After the liberalization of the retail electricity market in Japan, there are two types of household electricity rates: regulated rates and discretionary rates, which power companies can revise freely.
At TEPCO, regulated rates account for over half of household electricity contracts. TEPCO last raised regulated rates in 2012.
In Japan, power companies are allowed to reflect higher fuel costs in electricity bills to a certain extent. Since September, however, TEPCO has seen rises in fuel costs top the upper limit under the price adjustment system and has been forced to shoulder costs that cannot be covered by the system.