“Japan” gives the green light to 7 major electricity producers to increase household electricity prices by up to 42%.
Power companies in the resource-scant nation have been hammered by the global energy crisis as costs for importing fossil fuels surge. Photographer: Noriko Hayashi/Bloomberg
On May 16, 2566, Bloomberg NewsReportedly, the Japanese government will allow the country's seven major electricity generating companies to Household electricity prices have been increased since June. This is a move that is likely to increase inflationary pressures.
Hirokazu Matsuno, Chief Secretary It said the companies' price increases would be between 14% and 42%. Tokyo Electric Power Co, which supplies electricity to Japan's largest city It received approval for the fewest electricity rate increases among utilities in the region.
Electricity companies in the resource-scarce country were hit hard by last year's global energy crisis. This is because the cost of importing fossil fuels has skyrocketed. Higher electricity costs will increase the momentum of inflation. This is because the Bank of Japan is closely monitoring the sustainability of inflation.
Japanese utility stocks rose on the measure, with Tokyo Electric Co. rising as much as 3.9%. Hokuriku Electric Power Co., which will raise rates on most of its rivals, jumped 5.8% to its highest intraday in two years.
A surge in electricity tariffs from the UK to South Korea following Russia's invasion of Ukraine in 2565 has caused a stir in the fuel market. As a result, the prices of natural gas and coal surged to record highs. The government is trying to control the impact. with public utilities struggling to shore up their balance sheets
Japan's decision is an awkward one for Prime Minister Fumio Kishida amid speculation he may call early elections after this week's Group of Seven summit.
Meanwhile, a government measure due to expire in September is freezing electricity bills for households by about 20% as Kishida tries to ease the pain of soaring costs.
Real household wages fell in each of the 12 months through March. It points to the risk that consumer spending will fall once pent-up demand from the pandemic resumes. The depreciation of the local currency has aggravated the situation. This is because electricity producers need to procure fuel from abroad.
