Nuclear disaster: A very expensive business

March 11, 2014

Fukushima nuclear disaster taking toll on corporate and family finances

http://mainichi.jp/english/english/perspectives/news/20140311p2a00m0na018000c.html

Businesses and households in Japan have been forced to shoulder greater financial burdens since the outbreak of the crisis at the Fukushima No. 1 Nuclear Power Plant as the shutdown of all the country's nuclear reactors and the rising costs of dealing with the atomic disaster have pushed up electricity prices.

The government of Prime Minster Shinzo Abe intends to go ahead with reactivation of idled nuclear reactors, but public trust in nuclear power has not been restored and evacuation plans for local residents and other emergency measures have not been fully drawn up based on the assumption that accidents could occur. There are many people who stand against any move to place top priority on near-term economic benefits to reactivate nuclear reactors.

"We will thoroughly examine nuclear reactors based on regulation standards of the Nuclear Regulation Authority (NRA) that are the strictest in the world and proceed to reactivate those reactors that are confirmed to be conforming with them," Prime Minister Abe said at a news conference on March 10.

Following the shutdown of the nuclear reactors, utility firms in the country have been operating their thermal power plants at full capacity, resulting in an increase in imports of fossil fuel such as liquefied natural gas (LNG). Japan's imports of fossil fuel stood at 7.1 trillion yen in 2013 -- double the pre-disaster level in 2010 -- due in part to a devaluation of the yen and the rising prices of natural resources. The costs of responding to the Fukushima nuclear disaster, including those for decommissioning the Fukushima nuclear plant, paying compensation and conducting decontamination work, are likely to increase to 11 trillion yen as of now.

Most of the sharp rises in the costs for fuel and handling of the nuclear disaster are to be added to electricity bills. Six power firms, including Tokyo Electric Power Co. (TEPCO), have already raised electricity charges, and Chubu Electric Power Co. is applying for government permission to raise electricity prices. The average household is expected to spend 7,476 yen in April 2014 -- the average monthly electricity rate charged by nine utility firms across the country (except for the power firm in Okinawa Prefecture) -- a rise of slightly less than 20 percent from the pre-disaster level. Power demand dropped about five percent from the pre-disaster level on the backdrop of not only well-established energy-saving efforts but also from cost-cutting efforts among households and corporations.

The reactivation of nuclear reactors is the last resort for utility firms to curb electricity price hikes. TEPCO anticipates that by reactivating just one nuclear reactor it will improve its earnings by 120 billion yen a year and thus reduce costs such as those for importing LNG. Conversely, if nuclear reactors were to remain offline, utility firms would find it difficult to keep going. As Hokkaido Electric Power Co. has decided to consider raising electricity prices again, other utility firms could also raise electricity charges, threatening to cast a chill over the economy that has been on a recovery track.

Nevertheless, the country remains split over whether to use nuclear power in the future. The Abe administration, which regards the new regulations as "the world's highest standards," wants to give endorsement to the safety of nuclear power. But nuclear consultant Satoru Sato says, "We can't say Japan's safety standards are 'the world's best' because of insufficient standards for anti-terrorism measures and protection against fires. To say they are the world's best will have a negative effect such as causing carelessness."

Efforts have not progressed to deal with the country's nuclear policy based on the assumption that accidents could occur. The government requires 135 municipalities within a 30-kilometer radius from nuclear plants across the country to work out evacuation plans. But according to the NRA secretariat, only 58 of the municipalities, or 40 percent of them, had drawn up such plans as of Jan. 28, underscoring the manifestation of the negative effect stemming from the government's stance to leave the matter to local governments.

The mechanism remains ambiguous as to how the central and local governments should coordinate with one another and make important decisions in emergencies, including a decision to start evacuating. A senior official of a power firm says, "With the current size of our company, it is difficult to secure manpower to deal with an accident." Therefore, it is not clear whether the central and local governments and utilities will actually be able to respond properly in emergencies.

Learning lessons from the Fukushima disaster, the government pledged to make a clean break from the "safety myth" of nuclear power. In reality, however, the government is leaving the job up to the NRA. The government is far from regaining public trust in nuclear power largely because it has failed to take necessary measures.

March 11, 2014(Mainichi Japan)

Fukushima nuclear damage costs are mounting

http://www3.nhk.or.jp/nhkworld/english/news/20140311_26.html

Three years after the earthquake and tsunami that crippled the Fukushima Daiichi nuclear power plant, total costs for dealing with the damage are estimated to exceed 11 trillion yen, or 107 billion dollars.

NHK obtained the figure by adding up the latest estimates released by the government and the plant's operator, Tokyo Electric Power Company.

The costs include 24 billion dollars for decontamination of areas around the plant, and 11 billion dollars for construction of temporary storage facilities for radioactive waste and debris. 19 billion is earmarked for decommissioning and disposal of contaminated water. Compensation for damages is forecast by TEPCO to exceed 48.5 billion dollars.

Other costs, including those of building public housing for evacuees and ongoing health checks for the people of Fukushima Prefecture, will amount to 5.5 billion dollars.

But the total costs are believed to be far larger than these estimates. That's because the current figures don't include costs for the final disposal of waste from cleanup operations, and expenditures for government personnel who handled the disaster.

Analysts say that costs for decommissioning projects, which would continue for 40 years, and damages paid to residents will inflate the total costs still further.

Mar. 11, 2014 - Updated 09:14 UTC