Tepco Widens Loss Forecast as $7.5 Billion in State Aid Approved
Tokyo Electric Power Co., taken over by the government after the Fukushima atomic disaster, widened its net loss forecast to 120 billion yen ($1.3 billion) or more than double the previous estimate.
The forecast by Japan’s biggest power company for the year ending March 2013 compares with the 62 billion yen mean estimate of 3 analysts surveyed by Bloomberg. The utility known as Tepco had a previous loss projection of 45 billion yen.
Tepco and eight other regional power companies face mounting losses as they import more fuels for gas-fired plants and others after the disaster on March 11, 2011, caused a shutdown of all but two of Japan’s 50 reactors. The utilities will have to pay a fuel bill of about 6.8 trillion yen this fiscal year, almost double that in fiscal 2010, according to the government.
The utility posted a loss of 2.2 billion yen for the nine months ended Dec. 31, compared with a 623 billion yen deficit a year earlier.
Tepco shares fell 1 percent to close at 209 yen on the Tokyo Stock Exchange, a 90 percent decline since the day before the March 11 disaster caused a meltdown of three reactors at the Fukushima plant. The company released the earnings report after the market closed.
The government today approved additional aid of 696.8 billion yen to help the utility pay compensation to those who lost jobs, homes and livelihoods in the disaster, said Trade and Industry Minister Toshimitsu Motegi, who oversees the power industry. The utility requested the additional aid in January after raising the estimate on payouts to 3.2 trillion yen from 2.5 trillion yen.
The total cost of decontamination and compensation may exceed 10 trillion yen, twice the 5 trillion yen allocated by the government, Tepco said in November. Decommissioning the damaged reactors at the Fukushima Dai-Ichi plant may “far exceed” 1 trillion yen the utility has allocated, it said at the time.