The cost to taxpayers to help Tokyo Electric Power Co. compensate victims of the Fukushima nuclear disaster and clean up radioactive contamination could total 79.4 billion yen ($810 million), according to Board of Audit estimates.
The figure is based on the assumption the government will lend 5 trillion yen, which is the maximum amount under a framework to support TEPCO, and is repaid over 31 years.
Under the setup, the government will lend the money to the operator of the crippled Fukushima No. 1 nuclear power plant through the Nuclear Damage Liability Facilitation Fund.
TEPCO and other power companies will pay back the principal by making “general contributions” to the fund that they will primarily finance through electricity rates.
TEPCO will additionally make “special contributions” from its earnings if its financial condition improves. Still, interest payments will be borne by the government.
It is almost certain that the loans will reach the 5-trillion-yen ceiling. The government has already provided more than 3 trillion yen for compensation, while nearly 1.3 trillion yen has been budgeted for decontamination.
Government auditors have warned that the public financial burden could grow further if compensation payouts and decontamination expenses increase.
“(The government) can gain public understanding (for its assistance to TEPCO) only by forecasting the total amount and timing of compensation with greater accuracy as soon as possible and providing a definite projection for the financial burden,” a Board of Audit report concluded.
The board estimates that it will take 31 years for the government to recoup the 5 trillion yen if the fund receives no special contributions from TEPCO. Interest payments will reach 79.4 billion yen.
The estimates also show that the collection period will shorten to 17 years and interest payments will drop to 45 billion yen if TEPCO allocates half of its net earnings projected under its rehabilitation plan to the special contributions.
TEPCO has yet to make a special contribution.
The estimates are based on the assumption that the government will borrow money from private-sector financial institutions at an ultra-low interest rate of 0.1 percent. The board has warned that the public financial burden will increase if interest rates rise.
This is the first time the Board of Audit has looked at the financial health of TEPCO, which was effectively brought under state control after the Fukushima nuclear crisis unfolded in March 2011.
Still, it remains unclear how much compensation to the victims and decontamination will total in the end, meaning taxpayers may shoulder a far greater financial burden if those costs snowball.
(This article was compiled from reports by Motoki Kaneko and Takashi Ebuchi.)
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