Sanpo-yoshi Communication

President's Column] Electricity Charges

Electricity rates continue to soar.

Electricity rates are calculated based on the basic charge + electricity volume charge + fuel cost adjustment + renewable energy surcharge. The main reason is that the fuel cost adjustment, which is easily affected by the soaring prices of natural gas and coal, has reached its maximum limit. Due to Russia's invasion of Ukraine, natural gas prices have roughly doubled and coal prices have tripled.

Kyushu Electric Power has posted a huge deficit of over 40 billion in the first quarter, and there is a possibility that the company will remove this cap on fuel cost adjustments in the future. In other words, there is a strong possibility that it will go up more. It is expected that the government will take more aggressive measures such as operating nuclear power plants and introducing subsidies, but the situation is still uncertain.

Several major listed food supermarkets have also cited soaring electricity costs as the leading factor in their profit decline this fiscal year, casting a dark shadow over the overall economy of the food industry.

Since before Corona, we have been working to conserve energy by converting UV lamps for printing drying to LED as part of our SDGs efforts and replacing more than a dozen old air conditioners with newer, more energy-efficient models using energy-saving subsidies this term. However, electricity rates for the first eight months of the current fiscal year are still 140% higher than last year's level. Although there are limited steps we can take, we will continue to explore the possibility of investing in energy conservation.

We understand that many companies have facilities that consume large amounts of electricity, such as refrigerators and freezers. If the price of electricity rises further, it may be necessary to "pass on the cost of electricity to customers, consider installing solar panels, invest in energy-efficient air conditioning and refrigeration/freezer equipment, and consolidate operating facilities. In addition to the soaring prices of raw materials, other cost-increasing factors will continue to rise, such as higher minimum wages and increased application of social insurance premiums.

Although what we can do to address this issue is limited, we are committed to providing information on subsidies and subsidies, and changing the specifications of packaging materials and printed materials to reduce prices. Please contact us.