The hidden costs households must pay for nuclear disaster in 2011

feb 28 2017 nuclear disaster paid by  households.jpg

There’s more to monthly electricity charges than meets the eye. For one thing, there’s a hidden cost.

This is charged to help Tokyo Electric Power Co. and other utilities meet costs for damages arising from the Fukushima nuclear disaster.

Annual amounts range from an estimated 587 yen ($5.25) to 1,484 yen, and although paltry, may raise eyebrows as the utilities offer no breakdown in their monthly charges.

The utilities are obliged by the government to pitch in on grounds that a kitty is needed in case of future nuclear accidents. But in reality, the money is being swallowed up to help TEPCO pay compensation.

Of the 7.9 trillion yen in estimated compensation costs for the triple meltdown at TEPCO’s Fukushima No. 1 nuclear plant in 2011, as calculated by the government, 5.5 trillion yen is being borne by the company and six other utilities across the nation as “general contribution” costs.

The other utilities are those based in Hokkaido; the Tohoku region; the Chubu region; the Kansai region; Shikoku; and Kyushu.

The amount of compensation each utility bears depends on the overall capacity of the nuclear power plants they operate, and other factors.

The Asahi Shimbun estimated that these general contributions, which are included in regular household electricity bills, range between 0.11 yen and 0.26 yen per kilowatt-hour, depending on the utility. These figures were then multiplied with the average amount of annual household electricity consumption, as based on a national survey, to ascertain how much each household was paying into the compensation program in a given year.

Households supplied by Shikoku Electric Power Co. bear the heaviest annual burden at 1,484 yen. They were followed by residents supplied by Kansai Electric Power Co. at 1,212 yen and TEPCO at 1,159 yen. Users of Kyushu Electric Power Co. pay 1,127 yen per household, while those using Hokkaido Electric Power Co. pay 1,034 yen. The smallest amounts were charged by Tohoku Electric Power Co. and Chubu Electric Power Co., at 774 yen and 587 yen per household, respectively.

The majority of household residents may be unaware of the hidden fee, or at least how much is being charged, as electricity bills basically just state the amount to be paid each month by a given date.

Utilities generally calculate electricity rates via what is known as the fully-distributed cost method, which means that all expenses necessary in generating and delivering power to households are implemented in the price.

Household electricity payments proved to be a direct source of funding for Fukushima compensation payouts when expenses toward the general contribution program were included in basic cost for calculating electricity rates after the seven utilities increased their charges in fiscal 2012-2014.

The Asahi Shimbun calculated annual general contributions paid by households by figuring out how much of the overall generation cost of utilities was covered by regular households. In the case of TEPCO, ordinary households were responsible for paying 26.9 billion yen, or 47.25 percent of the overall 56.74 billion yen.

Dividing this figure by the estimated amount of electricity that will be consumed by these households in a year reveals how much it costs to generate 1 kWh of electricity.

Representatives of the Kansai and Chubu utilities told The Asahi Shimbun that they make estimates on how much it costs to do this.

Applying the approach used by the two companies, The Asahi Shimbun estimated the costs for the five remaining utilities, all of which confirmed that the methodology was correct.

In the case with TEPCO, the cost was 0.25 yen, after the 26.9 billion yen that households paid was divided by 105.7 billion kWh.

The figure was then multiplied by the amount of electricity annually used by each household with two or more people, information that was obtained through the government’s household financial survey. With Tokyo residents consuming an average of 4,568 kWh in 2016, the amount of compensation paid by each household supplied by TEPCO was calculated to be 1,159 yen.

Hokuriku Electric Power Co. and Chugoku Electric Power Co. are also paying for the general contributions, meaning that all nine utilities in mainland Japan are participating in the compensation effort. However, the two companies have neither raised their rates following the nuclear crisis nor included compensation costs in their monthly bills to households.

Utilities will soon be scrambling to find more money, as the government plans to include an additional 2.4 trillion yen worth of compensation costs in fees to use power lines starting in 2020.

The government estimates expenses in dealing with the aftermath of the nuclear disaster six years ago, which include compensation, as well as costs to decommission reactors and decontaminate vast areas of land, at 21.5 trillion yen. These costs will be covered not only by TEPCO, which had paid a “special contribution” fee of up to 180 billion yen by the end of fiscal 2015, but taxes as well.


One thought on “The hidden costs households must pay for nuclear disaster in 2011

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s