The Finance Ministry is contemplating a strategy that would enable the incorporation of construction expenses associated with new nuclear power plants into electricity rates, allowing these costs to be passed on to consumers. This move is intended to encourage the development of new nuclear facilities, a sector where electric power companies have been hesitant to invest due to burgeoning safety expenditures post the 2011 Fukushima incident. The inability to ensure the recovery of construction costs has hindered these companies from committing to building new nuclear plants.
Given the government's objective of enhancing decarbonized power sources in anticipation of growing energy demands, the proposed strategy to transfer the burden of nuclear plant construction costs to consumers could lead to a significant increase in public expenses. Drawing inspiration from the "RAB model" adopted in Britain to support nuclear plants, the plan involves the retail electricity company bearing construction and maintenance expenses once the government approves plant construction, with the costs later recuperated through electricity rate hikes. In cases where project construction is halted, the government would provide compensation to offset the incurred losses.