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Friday, June 8, 2012

Public to Tepco: Don't hike rates


Staff writer

Citizens attending the first public hearing Thursday on Tokyo Electric Power Co.'s request to increase electricity rates for households voiced opposition to the plan and urged the utility to cut costs instead.

Masaaki Sakai, one of 10 members of the public given the opportunity to speak, expressed dismay at media reports that Tepco is planning to increase the annual salaries of employees by an average of ¥460,000 in the next fiscal year. He also criticized Tepco's plans to pay a winter bonus this year.

"Tepco is a company that needs public funds (to survive), and the issues of compensating disaster victims and proceeding with decontamination work are far from resolved. How is it possible for the company that caused the (Fukushima No. 1 plant) accident to give its employees higher salaries than average large companies?" Sakai asked attendees of the session at the industry ministry, which included Tepco President Toshio Nishizawa.

In fiscal 2013, Tepco employees' average annual salaries are expected to be about ¥5.71 million, which is ¥280,000 higher than the average salaries of companies that have more than 1,000 workers.

Because of their monopoly on the power supply business in each region, utilities must get permission from the industry ministry to raise rates for household users. The ministry must ensure the rates have been calculated appropriately, based on proper estimates of operating costs.

Mandatory public hearings are part of this process. Thursday's session was the first of two.

Tepco aims to increase the rate it charges households by an average of 10.28 percent from July 1.

In all, 25 people gave their opinion of the hike: the first 10 from the general public and the rest from municipal, business and consumer-based associations.

Many expressed their doubts about Tepco's request, arguing the utility should do more to optimize operating costs and disclose more information about its cost structure.

They also questioned Tepco's business model. Households pay about 90 percent of the utility's income but use only about 40 percent of the total supply.

Utilities by law can set rates that keep revenues above operating costs. Tepco argues it needs to raise rates to offset increased fuel costs from the switch to thermal from nuclear generators.

The second public hearing will be Saturday in Saitama Prefecture.



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The Japan Times

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