Tepco bailout
November 4, 2011
The Japanese government has agreed to bail out Tepco with an initial installment of over 10 billion US dollars (900 billion yen) to help it tide over the nuclear crisis at Fukushima. The energy giant has been reporting major losses amid compensation payments to the victims of the nuclear disaster, cleanup efforts and higher fuel costs.
The bailout is being financed by a fund made up of Japanese nuclear plants, their operators and the government. Tepco has promised to reduce spending and to reduce its workforce by almost 15 percent by dismissing over 7,000 employees by the year 2014 in a bid to cut its costs.
On March 11, Japan was hit by a massive earthquake and an ensuing tsunami. Water flowed into Tepco's Daiichi nuclear power plant, causing the cooling units to shut down. The fuel rods in reactors 1, 2 and 3 melted either partially or completely, leading to an increase in radioactive leakage. The authorities had to evacuate thousands of people living within a perimeter of 20 kilometers around the plant after radioactive contamination was confirmed.
Agencies: dpa, AP / mg
Editor: Sarah Berning