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2.4 trillion yen to promote nukes

January 17, 2013


9 utilities spent 2.4 trillion yen to sell public on nuke power





Nine of Japan’s electric utilities spent a combined 2.4 trillion yen ($27.6 billion) to sponsor TV programs and run ads in print media over four decades to promote nuclear power and underscore the safety of their plants, The Asahi Shimbun has found.

The lavish campaign apparently helped utilities to expand their influence on media outlets and allowed them to hold considerable sway in objecting to negative reporting on nuclear power.

The utilities’ PR spending began to soar in the late 1970s and, in 1986, topped twice the level registered around the 1979 Three Mile Island nuclear accident in the United States, according to the investigation by The Asahi Shimbun. In 1986, the Chernobyl disaster occurred in what is now Ukraine.

The utilities are regional monopolies, meaning they have no competitors in the areas they serve.

But in fiscal 2005 through 2007, the combined annual spending by the utilities on PR topped about 100 billion yen, on par with the ad expenses of a leading automaker or electronics manufacturer.

An employee with an advertising agency that handled the promotion of nuclear power said electric power companies generously spread their PR money around.

“The nuclear industry paid exceedingly more to advertise than other industries did,” the employee said. “It was meant to get media organizations to support nuclear power.”

A public relations official at Tokyo Electric Power Co. (TEPCO), which owns the crippled Fukushima No. 1 nuclear plant, denied that the utility engaged in a high level of ad spending or pressured news outlets for favorable coverage.

“Our PR spending is not huge, compared with other companies,” the official said. “We have never exerted pressure on news organizations concerning their coverage.”

The exorbitant spending is potentially contentious because utilities had been allowed to calculate electricity rates by listing the expenditures as part of expenses to generate and transmit electricity, such as fuel and payroll costs.

In addition, utilities could also include expected profits as total costs before they applied to the government for approval of an electricity rate hike.

The Ministry of Economy, Trade and Industry, however, decided in March 2012 not to authorize ad expenses as part of costs unless they are considered absolutely necessary under the new rules.

Advertising expenses consist of expenditures to sponsor TV and radio programs and run ads in print media, including advocacy ads, as well as to run PR facilities.

In some cases, utilities spent some of the PR funds to wine and dine members of media outlets. They also ran ads in the mouthpiece publication of the ruling Liberal Democratic Party, which has long promoted nuclear power, and sponsored popular TV news shows.

The Asahi Shimbun examined utilities’ financial reports, in which advertising costs are posted, from fiscal 1970 to fiscal 2011, which ended in March 2012.

In fiscal 1970, Kansai Electric Power Co.’s Mihama plant in Fukui Prefecture became the first nuclear power station to be brought into service by a leading operator, and more nuclear plant construction projects were under way in the late 1970s.

The nine regional utilities together spent 2.42 trillion yen on ad campaigns over the 42-year period from fiscal 1970.

The utilities expended a combined 20 billion yen a year on their PR efforts until the Three Mile Island accident. Then, the spending doubled to top 40 billion yen following the Chernobyl disaster and continued to soar in the early 1990s.

Hiroyoshi Sunakawa, associate professor of media theory at Rikkyo University, said the surge reflects utilities’ intention to try to expand their influences on news organizations.

“It is easy to see that by spending a large sum on ads, utilities tried to keep a close eye on media organization’s negative reporting on nuclear power plants,” he said.

Sunakawa said utilities are obliged to explain to the public about ad spending because the costs were factored into their electricity rates. He also urged media outlets to examine if they considered it “taboo” to negatively report on nuclear power.

The investigation found that TEPCO spent more than any other utility, with 644.5 billion yen over the 42-year period. It was followed by Kansai Electric, which shelled out 483 billion yen.

Tohoku Electric Power Co., Chubu Electric Power Co. and Kyushu Electric Power Co. posted expenses somewhere between 250 billion yen and 270 billion yen, respectively. Of the nation’s 10 regional utilities, only Okinawa Electric Power Co. in Okinawa Prefecture does not own a nuclear power plant.

In April 2011, TEPCO released details of its ad spending for fiscal 2010, the first time it has done so.

The utility spent 7 billion yen to sponsor TV and radio programs, 4.6 billion yen on ads for print media and 4.3 billion yen to operate PR facilities.

In September 2012, household electricity rates were hiked in the area that TEPCO serves.

Criticism of media organizations flooded Twitter after the nuclear disaster occurred at the Fukushima No. 1 nuclear plant in March 2011.

“Media organizations have become a member of the ‘nuclear village’ after the nuclear industry shelled out huge sums for ads,” a user tweeted.

In November 2011, Tatsuo Hatta, visiting professor of economics at Gakushuin University, echoed the criticism at a meeting of a panel of experts with the industry ministry tasked to prepare a review of the electricity rate system.

“With advertising money, media organizations became dependent on utilities for revenue and found it hard to criticize nuclear power,” said Hatta, a member of the panel.

The late Tatsuru Suzuki, former head of the publicity department at the Federation of Electric Power Companies of Japan, reportedly told a meeting of presidents of utilities that promoting nuclear energy costs a lot of money.

“It is expensive to promote nuclear power,” Suzuki was quoted as saying in his book. “You should think of it as part of construction costs, not just publicity expenses.”

(This article was written by Atsushi Komori, senior staff writer, and Akemi Harada.)

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