Electric power: T&D firms seek fee hikes given inflation

Research evidence excerpt

Electric power: T&D firms seek fee hikes given inflation

13 July 2026

Mizuho Securities Equity Research Utilities / Electric Power

Industry Overview

Entire sector to benefit as T&D profits hit by inflation, higher rates recover

Senior Analyst: Summary

Norimasa Shinya We see potential sector-wide benefits now that the transmission & distribution

+81 3 6202 8313 (T&D) subsidiaries of eight major electric power companies (Tokyo Electric

norimasa.shinya@mizuho-sc.com Power Company Holdings, Chubu Electric Power, Kansai Electric Power,

Tohoku Electric Power, Shikoku Electric Power, Kyushu Electric Power,Analyst:

Hokkaido Electric Power, and Okinawa Electric Power) have applied on 10Kanato Isobe

July to the Minister of Economy, Trade & Industry for approval to revise their+81 3 6202 8140

kanato.isobe@mizuho-sc.com revenue projections for wheeling/other services. Wheeling charge levels were

originally scheduled to be reviewed every five years under the Revenue Cap

System introduced in FY23, but the rates are now to be revised based on a

government-prescribed formula, given the heavy impact from higher interest

rates and inflation during the current regulatory period (FY23–FY27). This

may well benefit the entire electric power sector, as the initiative improves

earnings in T&D operations, where profits have been sluggish due to inflation,

rising interest rates, and other external headwinds. We highlighted this in our

June earnings reports on the Chubu, Kansai, Tohoku, and Kyushu electric

power companies as a development that, while not reflected in our forecasts,

could boost earnings and drive share price re-ratings. We will watch to see

whether the proposed revisions win government approval and take effect from

November.