Tepco asked to explain rate rise

Japanese ministers have asked Tepco to justify a decision to raise the corporate electricity rate.

They were worried that the price increase could hurt the economy.

Tepco announced an average 17 percent rate increase for businesses from April but the government, which plans to effectively nationalise the utility, wants Tepco to scale back the planned rise later in the year, the Asahi newspaper said.

However, Trade Minister Yukio Edanoadmitted that the government did not have the right to decide the electricity rate but he wanted an explanation.

"I want the utility to appropriately disclose issues such as the basis of the rate hike," said Edano.

Tepco has the authority to raise rates for large-scale users without government approval, but some ruling politicians are worried about a public backlash against higher rates when the government is set to pump tax money into the utility.

Tepco President Toshio Nishizawa said last year raising rates to ensure a stable electricity supply was the utility's duty and right.

Edano said such an attitude was inappropriate. He was earlier reported to have criticised the decision as "one-sided".

Economics Minister Motohisa Furukawa told Nishizawa in a meeting later on Tuesday that he was worried about the impact of the rate increase.

"I am very concerned about the impact this would have on the economy," Furukawa told Nishizawa.

But Nishizawa said he had no plan to back down.

"As of now, I am not thinking of changing this," he told reporters after meeting Furukawa, adding that the utility would do its best to explain the decision to customers and prepare various rate menus that they could choose from.

For the source of this story, click here.