Ministry of Economy, Trade and Industry
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Statement by Minister Motegi on Applications for Approval of Electricity Rate Increases from Power Companies

February 20, 2013

  1. We received applications for approval of electricity rate increases from Kansai Electric Power Company and Kyushu Electric Power Company in November 2012 and from Tohoku Electric Power Company on February 14, 2013. Today, we have also received an application for approval from Shikoku Electric Power Company to raise the electricity rate for the regulated customer by 10.94% on average, starting from July 2013. We are aware that other power company is currently considering applying for approval of rate increases.
  2. Electricity rates have a significant impact on people's living and industrial activities. With this in mind, and based on the examination at the Expert Committee on Reviewing Electricity Rate from an neutral, specialized and objective perspective, we will conduct a strict examination of power companies' applications for approval of their electricity rate increase in accordance with the Electricity Business Act in order to verify whether their proposed rates have taken into account maximum business efficiency. At the same time, we will also have a variety of opinions from the public reflected in our examination by holding public hearings as stipulated in said Act and calling for "the opinion of the public" via the Internet.
  3. The major factor behind these recent applications for electricity rate increases is the growing fuel costs for thermal power generation, resulting from the suspended operation of nuclear power plants. In such situation, it is important to make our best endeavors to reduce fuel costs through partnerships between the public and private sectors by taking measures such as attempting to import gas from the United States, which is currently experiencing declining gas prices thanks to shale gas production, and by proactively utilizing thermal power generation plants that use relatively cheap fuel. From this viewpoint, we will make a strict assessment while taking into account the effect of the fuel cost reductions expected from these efforts being made by power companies, including Kansai Electric Power Company and Kyushu Electric Power Company, which have both applied for an electricity rate increase.
  4. We will work on electricity system reform to achieve both the promotion of competition and stability in power supply, and thereby bring about a decrease in electricity costs in the medium term.

Division in Charge

Electricity Market Division, Electricity and Gas Industry Department, Agency for Natural Resources and Energy

Last updated:2013-02-25
Ministry of Economy, Trade and Industry
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