Japanese electric companies have regional monopolies. They own the transmission infrastructure, and would not allow anybody else to use them.
Electricity price, therefore, is worked out by adding an “appropriate profit” to all the costs. This “appropriate profit” is 4.4% of all the costs. So, bigger the cost, bigger the profit is. This “cost” includes huge retirement money for the senior management and generous pension packages. It also includes about $200 million PR cost – TEPCO is the largest sponsor of the Japanese Media beyond Toyota – plus separate “entertainment expenses,” using which senior journalists, academics, politicians and high-class civil servants, etc., are invited for golf, nights out in Ginza (classier version of Roppongi,) or “study trips” overseas. Separate to both PR cost and entertainment expenses, they also make donations, to universities, research labs, political parties, etc. All that money. The more they spend, the bigger their profit is. I didn’t know this till quite recently. Unbelievable.
Anti-nuclear environmentalist described the electric companies as the one who really rules Japan. Perhaps it wasn’t too much of an exaggeration. According to him, electric companies borrow money from banks at a high interest rate. This is because interest also becomes the cost – once again, bigger the better. They go and buy out the politicians, the media, the academics, the banks, the investors, and we ordinary consumers have no choice but to foot the bill.
No wonder TEPCO is behaving the way it is. They’ve already bought much of the central nervous system of the country. No wonder the main TEPCO spokesman speaks as with “I’m the government. Does anybody have a problem?” written on his forehead and don’t hesitate to glare, with loath, at journalists who dare tries to corner him.
You can see well that the structure was asking for a catastrophe. Then again, I wouldn’t just blame on the structure. There is an ongoing serious deterioration of things like human decency, sensibility and independent thinking on a global scale. Any structure will deform itself enough when people are corrupt.