Understand your electricity bill in Japan

Have you ever wondered what your electricity bill is composed of in Japan? It is actually broken down into four components that you may not have known. While simply paying your bill as given is easy, you might want to take your time to understand its components to help you save some money.

The Breakdown of an Electricity Bill

Your electricity bill is composed of 4 elements. We will look at each component with detailed explanations.

1. The Basic Fees (基本料金:Kihon Ryokin)
2. Energy Use Charge (電力量料金:Kihon Ryokin)
3. Fuel Cost Adjustment Amount (燃料調整制額:Nenryo Choseihi Gaku)
4. Renewable Energy Power Promotion Surcharge (再エネ発電賦課金額:Saiene Hatsuden Fukakin)

And, simply put, your electricity bill in Japan is determined by this formula:

Electricity Bill = Basic Fees
+ Charge for the Amount of Electricity Used (including Fuel Cost Adjustment Amount)
+ Renewable Energy Power Promotion Surcharge

Basic fees (demand charge)

The demand charge is a flat rate that is charged regardless of usage. This charge is usually fixed according to your contracted amperage, but some companies have their own fixed charge as a minimum fee.

Which company follow which basic fee system?

Basic Fee - Understand the amperage system

As the table above states, Hokkaido Electric Power Company, Tohoku Electric Power, Tokyo Electric Power Company, Hokuriku Electric Power Company, Chubu Electric Power and Kyushu Electric Power adopt the amperage system as a basic fee.

As an example, we introduce below the table of base fees for the tariff of TEPCO 従量電灯 B (Juuryoudentou B).

As you can see, the higher the power of your meter, the more expensive the charge.

Basic Fee - Understand the minimum charge system

Kansai Electric Power Company, Chugoku Electric Power Company and Shikoku Electric Power Company follow the minimum charge system. (Contractors do not need to choose an amperage)

As an example, we quote the table of rate for KEPCO 従量電灯A (Jyuryodento A).

Charge for the Amount of Electricity Used

The energy use charge is the product of your monthly energy consumption and the per kWh rate. This charge fluctuates according to your usage; every kWh is priced differently depending on how much electricity you consumed. That is because many Japanese electric utilities have a three-tier or two-tier price system. In the graph below, we give an example of the rates for TEPCO. Overall, the more electricity you use, the higher your bill will be.

Fuel Cost Adjustment Charge

Even if you have the same amperage and the same consumption of electricity every month, your bill might slightly change. That is because there is a Fuel Cost Adjustment Charge that electric utilities apply on bills based on the price of fuel of coal during the period.

Since the price of oil fluctuates every month according to demand and supply, the cost of producing electricity changes accordingly. The fuel cost adjustment charge acts as a buffer of the fuel price fluctuations. It is determined by comparing the average fuel prices (oil, LNG, and coal) for a period of 3 months with a base fuel price.

If the price of fuel goes up, the charge also rises. Reversely, when the fuel price goes down, the charge drops. This charge is included in the energy use charge.

NOTE：Fuel cost adjustment charges differ depending on the historical electricity company

Same as the tariffs of the basic fee or Energy use charge, the fuel cost adjustment charge differs on each regional historical electricity company.

Renewable Energy Power Promotion Surcharge

Renewable energy power promotion is a levy used for the promotion of renewable energy production such as solar energy, hydraulic power, and wind power. In 2012, the Japanese government set an act on special measures concerning the procurement of renewable energy by operators of electric utilities. This act obligated electric utilities to buy a fixed amount of electricity produced by a renewable source for a fixed period of time.

NOTE：Renewable Energy Power Promotion Surcharges are common for all electricity companies.

The surcharge is imposed on the customers' bills to compensate for the expense enhanced by this consumption of renewable energy. This surcharge is fixed for a year and renewed every May.

• In case of the basic fee of amperage system : TEPCO
• In case of the basic fee of minimum charge system : KEPCO

How to Calculate your Electricity Bill?

How do we actually calculate an electricity bill? Let's take a look at an example to better illustrate the breakdown we have explained in this article.

For instance, we pick out TEPCO's Jyuryodento B, as a representative of the tariff with the amperage system.

In case of the basic fee of amperage system : TEPCO

Imagine a household who subscribed to the TEPCO Meter-lighting plan B(Jyuryodento B) and they used 360kWh with an amperage of 40A for a month.

• Amperage：40A
• Consumption：360kWh
• Fuel Cost Adjustment Charge*：JPY -4.85/kWh（*March 2021）
• Renewable Energy Power Promotion Surcharge*：JPY 2.98/kWh（*March 2021）

In this case, the calculation would be conducted as shown below.

1. Base Fee = JPY 1144.00
2. Charge for the Amount of Electricity Used = JPY 19.88 × 120kWh ＋ JPY 26.48 × 180kWh ＋ JPY 30.57 × 60kWh = JPY 8986.2
3. Fuel Cost Adjustment Charge = JPY -4.85 × 360kWh = JPY -1746
4. Renewable Energy Power Promotion Surcharge = JPY 2.98 × 360kWh = JPY 1072.8

▶  + + +  = JPY 1144.00 ＋JPY8986.2 - JPY1746 ＋ JPY1072.8 = JPY 9457

Here we use the tariffs of TEPCO to calculate the electricity bill. However, you can calculate your bill with exactly the same formula as long as your subscribed tariff adopts the amperage system system for its basic fee.

In case of the basic fee of minimum charge system : KEPCO

Imagine a household who subscribed to the KEPCO Meter-lighting plan B(Jyuryodento A) and they used 350kWh.

• Consumption：360kWh
• Fuel Cost Adjustment Charge*：JPY 0.165/kWh（*Dec 2021）
• Renewable Energy Power Promotion Surcharge*：JPY 2.98/kWh（*Dec 2021）

In this case, the calculation would be conducted as shown below.

1. Base Fee = JPY 341.01 (Until consumption of 15kWh)
2. Charge for the Amount of Electricity Used = JPY 20.31 × 105kWh(120-15) ＋ JPY 25.71 × 140kWh ＋ JPY 28.70 × 60kWh = JPY 7453.95
3. Fuel Cost Adjustment Charge = JPY 0.165 × 360kWh = JPY 59.4
4. Renewable Energy Power Promotion Surcharge = JPY 2.98 × 360kWh = JPY 1072.8

▶  + + +  = JPY 341.01 ＋ JPY　7453.95 - JPY　59.4 ＋ JPY1072.8 = JPY 8927

Here we use the tariffs of KEPCO to calculate the electricity bill. However, you can calculate your bill with exactly the same formula as long as your subscribed tariff adopts the minimum charge system for its basic fee.