On Monday, February 4, Tokyo Electric Power Co. (TEPCO) announced that its new net loss projection for fiscal 2012 ending in March would actually fall to 120 billion yen (approx. $1.3 billion), almost triple than what was earlier forecasted at 45 billion yen. With the expanding fuel costs for thermal power generation, the operator of the Fukushima Daiichi Nuclear Power Plant, crippled after being hit by a massive tsunami after the Great East Japan Earthquake in 2011, is now seeing a bigger operating loss of 275 billion yen ($2.97 billion) instead of 225 billion yen, from sales of 6.01 trillion yen ($65 billion), down from 6.03 trillion yen.
This came after the Japanese government approved TEPCO’s requested 696.8 billion yen ($7.5 billion) in additional funding to be used to compensate the victims of the nuclear crisis. It means that the total government aid given to the company is now more than 3 trillion yen ($32.5 billion). This decision was added to TEPCO’s revised 10-year restructuring plan, one that was endorsed by the government in May to keep Japan’s biggest utility company clear off bankruptcy at a time when it is paying off its piling liabilities courtesy of the disaster. Remember that aside from the monetary aid given as bail-out fund, the government has also invested 1 trillion yen in TEPCO, effectively making it a public company.
Unfortunately, all this money is necessary for a number of reasons: to pay off individuals and businesses that were affected by the nuclear disaster, to scrap the 3 crippled reactors of the Fukushima no.1 plant, and to finance the up surging costs of fuel brought about by a sudden return to thermal power. TEPCO has already said that it will repay all the funds it received from the government; it’s just a matter of when it can even begin to do so.
[via Global Post]