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information about Fukushima published in English in Japanese media info publiée en anglais dans la presse japonaise

Economics & decisions on nukes

December 25, 2017


EDITORIAL: Oi reactors scrapped as nuke power losing cost advantage



In a landmark step toward the goal of lowering Japan's dependence on atomic energy, Kansai Electric Power Co. has decided to scrap the No. 1 and No. 2 reactors of its Oi nuclear power plant in Fukui Prefecture.


The pair are the largest in output capacity of all 14 of the fleet of nuclear reactors in Japan that have been designated for decommissioning following the 2011 meltdowns at the Fukushima No. 1 nuclear power plant.


Electric utilities are under the pressure of a rule, introduced in the wake of the Fukushima disaster, saying that nuclear reactors have a service life of only 40 years, in principle. Kansai Electric initially sought an exception to that rule to win extended operation of the Oi No. 1 and No. 2 reactors, whose age limit will expire in 2019, but has given up on that plan in the end.


It could be said the 40-year rule, which was intended to reduce the risk of accidents at aging nuclear reactors, fulfilled its function this time.


There is, however, something unintelligible in the explanations provided by Kansai Electric on its decision to scrap the Oi reactors.


Shigeki Iwane, president of the utility, said in January that his company was planning to apply to the Nuclear Regulation Authority for an extended operation of those reactors.

“Doing so is sufficiently rational in economic terms,” he said.


Kansai Electric’s latest announcement, however, emphasized that, because the two reactors have a unique design, work to implement required safety measures on those reactors would make it difficult to conduct maintenance checkups once they are restarted. The company had never assessed economic efficiency, Iwane said.


One could only imagine what made him change his rhetoric.


The costs of safety measures that would be required to have the Oi No. 1 and No. 2 reactors restarted appeared likely to amount to some 200 billion yen ($1.77 billion) per reactor. And they could have been allowed to operate only for a maximum of 20 additional years. A significant dent in economic efficiency appeared inevitable even if both reactors were to be brought back online.


In all likelihood, the company made allowances for the industry ministry and fellow electric utilities, which fear that public attention on the faltering cost advantage of nuclear power could frustrate their move to have more nuclear reactors restarted.


All major utilities are facing an increasingly tough situation surrounding nuclear power generation in the wake of the Fukushima disaster.


The more stringent safety regulations mean enormous additional costs are required to have nuclear reactors restarted. Sales of electricity are also on a downtrend, partly because power-saving efforts have taken root, and partly also because liberalization of the retail power market has intensified competition. There is strong public opposition to nuclear restarts, and court procedures are going on across Japan over the wisdom of operating nuclear reactors.


The major utilities should face up squarely to the reduced profitability of, and the risks inherent in, their nuclear power businesses and part with their management style of continuing to rely on atomic energy.


The service life limit of 40 years is ticking down on other nuclear reactors as well.

The utilities should calmly evaluate the total prospective cost of continuing to operate them, which include everything from additional safety measures through the decommissioning process to the disposal of radioactive waste. They should also level-headedly assess if they can dispel the safety concerns among local residents. Doing so will help them decide which reactors should be decommissioned.


That process should be followed over and over to steadily reduce the number of nuclear reactors in the country.


The government should also reorganize its nuclear power policy. It should shift its focus from measures to keep the nuclear sector alive longer to those that befit an age when nuclear decommissioning processes are going into full swing.



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