TOKYO—The Japanese government approved a 1 trillion yen ($12.5 billion) public bailout for the operator of Japan’s tsunami-devastated nuclear power plant and put it under temporary state control.
In exchange, Tokyo Electric Power Co. has appointed new management and pledged to cut costs while raising utility rates on power from its other plants as it works to stabilize the crippled Fukushima Dai-ichi nuclear plant and compensate tens of thousands of victims of the worst nuclear disaster since Chornobyl.
Trade Minister Yukio Edano stressed the need for TEPCO to become more transparent amid criticism that it did not release complete and timely information about the disaster.
The plan calls for 3.3 trillion yen ($41.3 billion) of cost cuts over 10 years by TEPCO.
Still, the bailout may not be enough as compensation costs balloon.
The nuclear disaster has forced thousands of people to leave areas near the plant, and the livelihoods of farmers and ranchers have suffered as a result of radiation contamination.
The utility has already raised electricity bills for corporate customers. It plans to do the same for households, a move likely to be unpopular with taxpayers.
All of the country’s 50 nuclear reactors are currently shut down for routine maintenance checks. None can be restarted without passing new safety tests and receiving consent from local communities.
The government is eager to restart them because of the high costs of gas and oil now used to generate electricity and fears about power shortages.