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The Business Structure of Japan s Electric Industry for 1963-2016: Analysis on the Revenues and Expenditures throughout before and after the Deregulation

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Listed:
  • Hidekazu Aoki

    (Independent Researcher, 601 Diapalace-Motomiyacho, Motomiyacho 4-83-2, Showa-ku, 4660851, Nagoya, JAPAN,)

  • Nobuo Kawamiya

    (Dr of Engineering, Professor Emeritus of Chukyo University, Fujimori 2-188, Meito-ku, 4650026, Nagoya, JAPAN.)

Abstract

The Federation of Electric Power Companies (FEPC) of Japan has long been releasing the detailed financial statements of their member corporations (on their web site). We have analyzed the FEPC s financial data over half a century and have clarified the problems and distortions built in Japan s power industry through the dual pricing mechanism for the industrial use and the home-use sectors. In fact the former shares two thirds of the power demand and yields only small profits or even losses; and the latter, sharing one third of the demand, yields nearly all of the industry s profits. After the full retail deregulation, however, this home-use sector (the industry s treasure box) seems now suffering diminution of profitability: because the power majors have began to raise a cutthroat competition against each other. This price-cutting war might be considered very dangerous for the sustainability of this industry because this business is highly equipment-intensive and so severely vulnerable to any revenue instability.

Suggested Citation

  • Hidekazu Aoki & Nobuo Kawamiya, 2019. "The Business Structure of Japan s Electric Industry for 1963-2016: Analysis on the Revenues and Expenditures throughout before and after the Deregulation," International Journal of Energy Economics and Policy, Econjournals, vol. 9(1), pages 316-325.
    • Handle: RePEc:eco:journ2:2019-01-40
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    References listed on IDEAS

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    1. Paul L. Joskow, 2006. "Markets for Power in the United States: An Interim Assessment," The Energy Journal, , vol. 27(1), pages 1-36, January.
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    More about this item

    Keywords

    Electricity demand; Dualistic pricing; Income statement; Power retail deregulation;
    All these keywords.

    JEL classification:

    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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