All-out efforts to restart, including expensive safety measures

February 18, 2014

Eager to restart reactors, utilities increase spending on safety by 60%

http://ajw.asahi.com/article/behind_news/social_affairs/AJ201402180067 

THE ASAHI SHIMBUN

Electric power companies are pouring hundreds of billions of yen into safety measures at nuclear power plants to ensure their reactors can be restarted and to pull themselves out of their business slump.

The companies, hit hard by ballooning fossil fuel costs and a weaker yen, see nuclear energy as a sure ticket back to profitability, and the one thing that might stand in the way are the new safety standards for nuclear power plants.

“We will make all-out efforts to restart nuclear power plants as soon as we can,” Makoto Yagi, chairman of the Federation of Electric Power Companies of Japan and president of Kansai Electric Power Co., said at a news conference on Feb. 14.

According to a survey by The Asahi Shimbun in January, nine regional utilities and Japan Atomic Power Co. were expected to spend a combined 1.62 trillion yen ($16 billion) to reinforce their nuclear power plants, up 60 percent from 998.2 billion yen for the same month in 2013.

The costs are likely to rise further because some operators are planning additional work.

But there is no guarantee that the Nuclear Regulation Authority (NRA) will approve the operators’ requests to restart their reactors. Many reactors are either decades old or sit above potentially active seismic faults, or both.

The utilities could lose huge sums spent to bolster preparedness for a disaster if the reactors cannot be put back online. However, it is a gamble the utilities are willing to take.

The power industry estimates a utility can save 100 billion yen annually in fossil fuel costs if it can restart a single reactor.

Currently, 17 reactors are subject to the NRA’s safety screening process.

The costs for added safety are particularly high at Tokyo Electric Power Co., Tohoku Electric Power Co., Chubu Electric Power Co. and two other utilities that own boiling water reactors, the same type as those destroyed in the March 2011 accident at TEPCO’s Fukushima No. 1 nuclear power plant.

Under the more stringent safety standards set last July by the NRA, electric power companies must install filtered vents for boiling water reactors to curb the release of radioactive substances in the event of a serious accident.

Chubu Electric reported the largest price tag for safety of 300 billion yen, double its estimate from a year earlier.

The company on Feb. 14 applied for NRA safety screening for the No. 4 boiling water reactor at its Hamaoka nuclear power plant in Omaezaki, Shizuoka Prefecture. The plant is located near the Nankai Trough, where a huge earthquake is expected to strike in the near future.

Chubu Electric is taking safety measures for the plant, including the construction of a 22-meter-high breakwater to protect against tsunami.

TEPCO’s safety costs shot up nearly fourfold to 270 billion yen from 70 billion yen to enhance its preparedness against fires at its Kashiwazaki-Kariwa nuclear plant in Niigata Prefecture, one of the largest in the world.

The company submitted applications to the NRA for safety screenings of the plant’s No. 6 and No. 7 reactors, both boiling water types, in September.

Chugoku Electric Power Co. was expected to double its spending from a year earlier to 100 billion yen for safety measures at its Shimane nuclear power plant in Matsue, the capital of Shimane Prefecture, including the installation of a filtered vent.

The company applied for NRA screening of the No. 2 boiling water reactor at the plant in December.

Spending estimates by Kansai Electric and Shikoku Electric Power Co. remained at the same levels of a year earlier, at 285 billion yen and 83.2 billion yen, respectively.

They operate pressurized water reactors that have larger containment vessels and can withstand more pressure than those for boiling water reactors.

For this reason, operators of pressurized water reactors are allowed to delay the installation of filtered vents for five years.

Both Kansai Electric and Shikoku Electric filed their safety screening applications as soon as the NRA laid out the new standards.

Some utilities would not give specific timeframes on when they will apply for NRA screenings, despite the ongoing work to strengthen their nuclear plants.

Hokkaido Electric Power Co., Chubu Electric, Kansai Electric, Chugoku Electric, Shikoku Electric and Kyushu Electric Power Co. reported a combined pretax loss of 270 billion yen for the first nine months of the current fiscal year through December.

The losses are expected to shrink year on year due to increases in electricity rates.

But utilities that depend heavily on nuclear power, such as Kansai Electric, have been hit particularly hard financially.

To make up for the loss of electricity generated by nuclear power plants, the companies have sharply increased imports of liquefied natural gas and other fossil fuels to run their thermal power plants.

Their financial problems were exacerbated by a weaker yen, a result of the Japanese government’s economic policy to spur exports.

Overall costs to import fossil fuels by the 10 companies rose to 5.5 trillion yen between April and December in 2013 from 5.1 trillion yen over the same period in 2012.

After TEPCO announced the decommissioning of the Fukushima No. 1 plant, Japan was left with 48 commercial reactors. They have all been idle since September 2013.

The Abe administration is set to restart reactors as soon as the NRA gives the green light, saying nuclear energy is indispensable for the Japanese economy.