TEPCO’s cost structure drawing scrutiny by monitoring panel

• 12 years ago (2011-07-29)
• David Flin

Asia 850

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A Japanese government panel has said that it will thoroughly check Tokyo Electric Power Company’s (TEPCO’s) cost structure and how it has been reflected in electricity bills to see if its rates are appropriate.

Kazuhiko Shimokobe, Head of the Review Panel monitoring TEPCO’s operations and reviewing its assests, said: “Although the time is very limited, we will take out all the things from the basket and review them to check if any wasteful costs are reflected to the current power charge system.”

The panel has asked three private firms in a ¥440 million contract to scrutinise TEPCO’s business operations. They will finish their scrutiny by mid-September, and the panel will submit a report on TEPCO’s operations, the validity of its billing structure, and long-term structure.

Shimboke also said that while the separation of TEPCO’s power generation and distribution businesses is not a focus of the panel’s discussions at this point, it will examine TEPCO’s cost structure by looking at the two areas separately. He said: “The figures that TEPCO have disclosed have always been based on the assumption that power generation and distribution are handled together. But that won’t be how it is done this time.” He added that the decision as to whether the generation and distribution businesses should be separated should be discussed based on the figures from this review.