January 19, 2012 / 4:12 AM / in 6 years

UPDATE 1-Govt denies agreeing Tepco hike in household fees

* Govt to allow 5-15 pct rise, Tepco wants 10-20 pct -Asahi

* Govt agrees rise needed to keep Tepco afloat -Asahi

* Tepco hit by Fukushima costs, loss of nuclear power

* Household price rise to follow rise for firms

* No truth in report -govt spokesman Fujimura (Updates with denial by govt spokesman)

TOKYO, Jan 19 (Reuters) - Japan’s government is likely to let Tokyo Electric Power Co raise electricity fees for households to help cover fuel costs due to the loss of nuclear power, the Asahi newspaper said on Thursday, but the top government spokesman denied the report.

The operator of Fukushima Daiichi nuclear plant, where the March 11 earthquake and tsunami triggered a radiation crisis, is likely to be allowed to charge households 5-15 percent more for electricity, the paper said.

Tokyo Electric, known as Tepco, is struggling with a surge in costs to pay for extra fossil fuel to replace lost nuclear power, and also faces huge compensation and cleanup costs due to the radiation leaks, which caused mass evacuations and widespread contamination.

The utility is seeking a rise of 10-20 percent in charges to households, the newspaper said.

Tepco announced this week an average 17 percent rise in electricity charges for companies, and will start implementing it from April.

Unlike rate rises for corporate users, those for households need government approval, which Tepco will apply for after submitting a business reconstruction plan in March, the paper said.

The government accepts that a rise for households is needed to keep Tepco afloat, but will demand that the utility take drastic restructuring steps as a condition for allowing it, the paper said.

Chief Cabinet Secretary Osamu Fujimura denied the report at a news conference. “It is not true that the government and Tokyo Electric have started coordinating on price hikes for households,” he said.

Public anxiety sparked by the Fukushima crisis has prevented the restart of reactors shut for routine checks, and only five of the nation’s 54 reactors remain online, prompting utilities to import more fossil fuels to bridge the gap.

The government is keen to bring existing reactors back into operation to avert a power crunch and ease the impact on the economy. (Reporting by Taiga Uranaka; Additional reporting by Tetsushi Kajimoto and Rie Ishiguro; Editing by Michael Watson)

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