A panel from Japan’s Consumer Affairs Agency has advised Tokyo Electric Power Co. (TEPCO) that employee salaries should be cut by a minimum of 30% before increasing the rates of electricity for households. TEPCO’s current salary cuts stand at 20% for regular workers, and 25% for management. The utility company responsible for managing the Fukushima nuclear plant was also found to have tried passing on 48.7 billion yen (approx. $615.6 million) in yearly disaster costs to its customers in the form of increased fees.
The consumer panel’s final analysis stated that utility companies are able to make up their costs of generating and distributing electricity when appropriate management is used. Last year’s nuclear crisis was the result of TEPCO’s mismanagement, and its costs should not be included in the prices customers pay. TEPCO originally sought the approval of industry minister Yukio Edano back in May to increase electricity rates for homeowners by just over 10%. The Ministry of Economy, Trade, and Industry (METI) is the body that usually oversees any price increases from utility companies, but after last year’s disaster, public distrust for TEPCO and METI still looms large, which is why the Consumer Affairs Agency is making its voice heard.
The utility company had originally hoped to raise the electricity rates by this month, but it remains unknown when the government will make its decision. Members of the consumer panel feel METI is being too soft on TEPCO, as evidenced by the quick approval of the 20% and 25% pay cuts. Representatives from METI have also commented that TEPCO should be able to pass on the disaster costs to its customers, in order for the company to remain stable.