Shikoku Electric will raise low-voltage retail electricity rates starting in November 2026, fully passing through transmission costs to consumers. The company submitted a revision notice to the Minister of Economy, Trade and Industry today.
Shikoku Electric (9507) announced it will revise rates for low-voltage customers (households and small businesses) starting November 1, 2026. This change reflects fluctuations in transmission charges imposed by its subsidiary, Shikoku Electric Power Transmission and Distribution. The company has completed legal procedures by filing a revision of the Special Retail Supply Terms with the Ministry of Economy, Trade and Industry, clearly outlining its strategy to pass infrastructure cost increases onto end users.
While specific impacts vary by usage pattern, all plans will see price hikes. For example, the Standard Plan A with monthly consumption of 260 kWh will rise from 8,894 yen to 9,372 yen, an increase of 478 yen per month. The "Tokutek e Plan" for 300 kWh will go from 10,310 yen to 10,819 yen (509 yen increase). For larger households using the "Denka e Plan" (6 kW contract) at 592 kWh, the monthly bill will jump from 20,005 yen to 20,777 yen, adding 772 yen.
Large-voltage and extra-high-voltage customers will also face higher demand-side transmission rates from November 1. For low-voltage free-rate plans, these changes apply to usage after the November meter reading date, with adjustments reflected in December bills.
Regarding the impact on consolidated financial results, Shikoku Electric expects revenue increases from transmission charges to offset costs, though detailed calculations are ongoing. The subsidiary's rate revision is projected to generate an additional 23.9 billion yen annually in transmission fees for fiscal years 2026 and 2027, totaling 33.8 billion yen over two years. How this revenue boost affects sales and operating profit will depend on future assessments, but it is a key factor in maintaining profitability amid cost pressures.
This revision highlights the risk of rising grid usage fees in the deregulated power market. While applying rate hikes across all regulated plans carries the risk of customer churn among price-sensitive users, the company frames it as an essential measure for infrastructure maintenance. Future monitoring of consumer acceptance and competitor actions will be crucial.
The trend of covering grid cost increases through retail rate hikes is accelerating in the power sector. Shikoku Electric's move represents a standard response to protect its revenue base under deregulation, likely influencing other regional utilities and new entrants. This indicates a confirmed upward trend in industry-wide pricing.
For investors, the key question is whether customers will stay. The ability of the price pass-through rate to offset demand reduction will directly impact stock performance and dividend capacity. In the competitive low-voltage market, service differentiation and cost management are vital.
For job seekers, changes in the power business model are shifting talent needs. While infrastructure investment and supply management were previously central, skills in price competition strategy and customer engagement (churn prevention) will become more valuable. Understanding institutional changes like transmission fee revisions will also provide a career advantage.
Analyst take
The completion of full transmission cost pass-through clarifies the company's profit assurance strategy. Focus shifts to customer retention strategies considering price elasticity, signaling a sustained upward pricing trend across the industry.
