JAKARTA - The Japanese government has decided to use 513.5 billion yen (Rp57.4 trillion) from the reserve fund for the current fiscal year to continue subsidies for energy bills during the summer to alleviate the impact of the Middle East conflict.
The subsidy, which will cover electricity and gas bills during the July-September period, when demand for air conditioners increases, will result in a reduction of around 5,000 yen (Rp560 thousand) for the average household.
The government said the subsidy would help keep bills below last summer's level.
"We are focusing on reducing the burden in August, when electricity use reaches its peak," Economy, Trade and Industry Minister Ryosei Akazawa said at a news conference, where he outlined energy-saving measures for household appliances and cars.
The government will provide assistance of 3.5 yen (Rp400) per kilowatt-hour of electricity in July and September and 4.5 yen (Rp500) in August by utilizing a reserve fund of one trillion yen (Rp112 trillion) recorded in the initial fiscal budget of 2026.
For gas, the Japanese government will offer subsidies of 14 yen (Rp1,600) per 1 cubic meter in July and September, and 18 yen (Rp2,000) in August. The subsidy program will also ease the burden of electricity bills for small and medium-sized companies.
Japan has periodically implemented subsidies for electricity and gas bills in recent years, especially during the summer and winter months when demand for cooling and heating increases, with the latest subsidies offered from January to March.
The program was first introduced in January 2023 in response to price hikes caused by Russia's invasion of Ukraine and has since used a total of 5.6 trillion yen ($46.5 billion) in funds, including the latest approved on Tuesday.
To offset the loss of more than 500 billion yen (Rp56 trillion) and restore the reserve fund, which is usually set aside for natural disasters and other emergencies, to one trillion yen (Rp112 trillion), the government plans to submit an additional draft budget worth more than three trillion yen (Rp336 trillion).
The head of parliamentary affairs for the ruling Liberal Democratic Party, Hiroshi Kajiyama, said he had told his counterpart from the opposition Center-Right Reform Alliance that an additional budget bill was expected to be submitted "around the middle of next week."
The additional budget will allocate reserve funds to overcome the impact of the situation in the Middle East.
The funds are expected to finance a new subsidy program that will keep gasoline prices at 170 yen ($19) per liter, a program that was resumed in mid-March.
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