28 Février 2013
February 28, 2013
Japan Atomic Power Co., an electricity wholesaler specializing in nuclear energy, has hit a dead end.
All its reactors remain idle without any prospect of being restarted in the near term. That includes reactors at the Tsuruga nuclear power plant in Fukui Prefecture. The company, jointly owned by nine major electric utilities, is hamstrung in its ability to refinance loans due in April.
For the time being, however, the power wholesaler will keep itself afloat through loan guarantees and financial assistance from four major utilities. The electric power companies are not only serving as the troubled entity’s shareholders but are also buying electricity from the firm.
But this is purely a stopgap measure, as officials have acknowledged.
All three off-line reactors owned by Japan Atomic Power face serious problems: One has a suspected active fault under its site and another has exceeded its operating life of 40 years. There is also fierce opposition to restart of the remaining one from the local governments. It should be assumed that there is little chance of putting the reactors back online.
In short, Japan Atomic Power must start working on ways to effectively liquidate itself.
This is easier said than done as Japan Atomic Power cannot avail itself to the usual liquidation process.
A major challenge concerns storage of spent nuclear fuel. Decommissioning a reactor takes many years. There are no short cuts to safely dismantling facilities contaminated with radioactive materials. Already, one of the company's four reactors is in the process of decommissioning.
Liquidating Japan Atomic Power will require an entity that is capable of carrying out the task of tackling all these negative legacies in a responsible manner.
Even if the creditor banks are held responsible for cleaning up the mess, ways must be found to raise the necessary funds.
Japanese regulations require operators of nuclear power plants to have reserve funds to decommission their reactors. But Japan Atomic Power has not set up sufficient reserves for the purpose, partly because the reactors will likely be decommissioned earlier than it had anticipated.
The electric power industry faces a severe business environment due to sharp increases in fuel costs. Utilities have been forced to sharply expand output at thermal power plants burning fossil fuels to compensate for the loss of power supplies from their nuclear facilities.
Protected by regional monopolies, the companies have been promoting their dependence on nuclear power generation together. Now, however, they are paying the price for the dependence. We fear that the collapse of one company could trigger a chain reaction of failures within the industry.
Successive governments promoted nuclear power generation as national policy. Politicians should now commit themselves to grappling with this challenge in order to avert any systemic crisis that disrupts stable power supply.
It would be absurd, of course, to try to restart nuclear reactors to prevent the problems afflicting Japan Atomic Power from hurting the financial health of other electric power companies.
The previous government, led by the Democratic Party of Japan, considered creating a new entity that would operate all nuclear power plants in Japan and take the responsibility for their safety and eventual decommissioning.
It is vital to dismantle Japan Atomic Power as part of measures concerning nuclear power policies.
Who should shoulder the burden? And, in what ways? The process of closing down reactors that have no prospects of starting up again must start immediately. The necessary technological and human resources for decommissioning must be secured. There is no time to waste.