Tepco mandated to create fund for scrapping Fukushima plant — The Japan Times

” The Diet passed a bill Wednesday requiring Tokyo Electric Power Company Holdings Inc. to put aside extra funds to decommission its crisis-hit Fukushima nuclear power plant, as the state seeks to gain more financial control over the utility.

Under the revised law, the state-backed Nuclear Damage Compensation and Decommissioning Facilitation Corp. will also be involved in the decommissioning process.

Currently, Tepco has been using profits to pay for scrapping the Fukushima No. 1 plant, which was destroyed after a 2011 earthquake and tsunami triggered a triple meltdown.

The revised law is expected to take effect later this year. With the estimated cost of the decommissioning work already surging to ¥8 trillion from the previously forecast ¥2 trillion, a government panel has called for setting up a funding system that is not dependent on the company’s financial health.

The government projects the total cost to deal with the Fukushima nuclear disaster will reach ¥21.5 trillion, including decommissioning costs, compensation and decontamination work.

Under the new program, the state-backed organization will decide on the amount Tepco should store away each business year and the industry minister must approve it.

The utility must also formulate a financial plan and obtain the minister’s approval when it uses the reserve fund for its decommissioning work.

The new law will strengthen the monitoring power of authorities as well, enabling the industry ministry and the organization to conduct on-site inspections to check whether Tepco is putting aside the money.

The government has a major say in the utility’s operations after acquiring 50.1 percent of the company’s voting rights. Tepco faces huge compensation payments and decommissioning costs among other problems due to the 2011 disaster.

The industry ministry has projected roughly ¥300 billion will be needed annually for the next 30 years to complete the scrapping of the power plant, which involves the difficult procedure of extracting nuclear debris.

The costs could grow further. A study by a Tokyo-based private think tank has shown the bill for the decommissioning could balloon to between ¥11 trillion and ¥32 trillion assuming materials from the No. 1 to 3 reactors, which suffered core meltdowns, need to be specially treated for radioactive waste.

The Japan Center for Economic Research estimated the total cost of managing the disaster could reach ¥70 trillion, more than three times the government calculation. ”

by Kyodo, The Japan Times

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Six years after Fukushima, much of Japan has lost faith in nuclear power — The Conversation

” Six years have passed since the Fukushima nuclear disaster on March 11, 2011, but Japan is still dealing with its impacts. Decommissioning the damaged Fukushima Daiichi nuclear plant poses unprecedented technical challenges. More than 100,000 people were evacuated but only about 13 percent have returned home, although the government has announced that it is safe to return to some evacuation zones.

In late 2016 the government estimated total costs from the nuclear accident at about 22 trillion yen, or about US$188 billion – approximately twice as high as its previous estimate. The government is developing a plan under which consumers and citizens will bear some of those costs through higher electric rates, taxes or both.

The Japanese public has lost faith in nuclear safety regulation, and a majority favors phasing out nuclear power. However, Japan’s current energy policy assumes nuclear power will play a role. To move forward, Japan needs to find a new way of making decisions about its energy future.

Uncertainty over nuclear power

When the earthquake and tsunami struck in 2011, Japan had 54 operating nuclear reactors which produced about one-third of its electricity supply. After the meltdowns at Fukushima, Japanese utilities shut down their 50 intact reactors one by one. In 2012 then-Prime Minister Yoshihiko Noda’s government announced that it would try to phase out all nuclear power by 2040, after existing plants reached the end of their 40-year licensed operating lives.

Now, however, Prime Minister Shinzo Abe, who took office at the end of 2012, says that Japan “cannot do without” nuclear power. Three reactors have started back up under new standards issued by Japan’s Nuclear Regulation Authority, which was created in 2012 to regulate nuclear safety. One was shut down again due to legal challenges by citizens groups. Another 21 restart applications are under review.

In April 2014 the government released its first post-Fukushima strategic energy plan, which called for keeping some nuclear plants as baseload power sources – stations that run consistently around the clock. The plan did not rule out building new nuclear plants. The Ministry of Economy, Trade and Industry (METI), which is responsible for national energy policy, published a long-term plan in 2015 which suggested that nuclear power should produce 20 to 22 percent of Japan’s electricity by 2030.

Meanwhile, thanks mainly to strong energy conservation efforts and increased energy efficiency, total electricity demand has been falling since 2011. There has been no power shortage even without nuclear power plants. The price of electricity rose by more than 20 percent in 2012 and 2013, but then stabilized and even declined slightly as consumers reduced fossil fuel use.

Japan’s Basic Energy Law requires the government to release a strategic energy plan every three years, so debate over the new plan is expected to start sometime this year.

Public mistrust

The most serious challenge that policymakers and the nuclear industry face in Japan is a loss of public trust, which remains low six years after the meltdowns. In a 2015 poll by the pro-nuclear Japan Atomic Energy Relations Organization, 47.9 percent of respondents said that nuclear energy should be abolished gradually and 14.8 percent said that it should be abolished immediately. Only 10.1 percent said that the use of nuclear energy should be maintained, and a mere 1.7 percent said that it should be increased.

Another survey by the newspaper Asahi Shimbun in 2016 was even more negative. Fifty-seven percent of the public opposed restarting existing nuclear power plants even if they satisfied new regulatory standards, and 73 percent supported a phaseout of nuclear power, with 14 percent advocating an immediate shutdown of all nuclear plants.

Who should pay to clean up Fukushima?

METI’s 22 trillion yen estimate for total damages from the Fukushima meltdowns is equivalent to about one-fifth of Japan’s annual general accounting budget. About 40 percent of this sum will cover decommissioning the crippled nuclear reactors. Compensation expenses account for another 40 percent, and the remainder will pay for decontaminating affected areas for residents.

Under a special financing scheme enacted after the Fukushima disaster, Tepco, the utility responsible for the accident, is expected to pay cleanup costs, aided by favorable government-backed financing. However, with cost estimates rising, the government has proposed to have Tepco bear roughly 70 percent of the cost, with other electricity companies contributing about 20 percent and the government – that is, taxpayers – paying about 10 percent.

This decision has generated criticism both from experts and consumers. In a December 2016 poll by the business newspaper Nihon Keizai Shimbun, one-third of respondents (the largest group) said that Tepco should bear all costs and no additional charges should be added to electricity rates. Without greater transparency and accountability, the government will have trouble convincing the public to share in cleanup costs.

Other nuclear burdens: Spent fuel and separated plutonium

Japanese nuclear operators and governments also must find safe and secure ways to manage growing stockpiles of irradiated nuclear fuel and weapon-usable separated plutonium.

At the end of 2016 Japan had 14,000 tons of spent nuclear fuel stored at nuclear power plants, filling about 70 percent of its onsite storage capacity. Government policy calls for reprocessing spent fuel to recover its plutonium and uranium content. But the fuel storage pool at Rokkasho, Japan’s only commercial reprocessing plant, is nearly full, and a planned interim storage facility at Mutsu has not started up yet.

The best option would be to move spent fuel to dry cask storage, which withstood the earthquake and tsunami at the Fukushima Daiichi nuclear plant. Dry cask storage is widely used in many countries, but Japan currently has it at only a few nuclear sites. In my view, increasing this capacity and finding a candidate site for final disposal of spent fuel are urgent priorities.

Japan also has nearly 48 tons of separated plutonium, of which 10.8 tons are stored in Japan and 37.1 tons are in France and the United Kingdom. Just one ton of separated plutonium is enough material to make more than 120 crude nuclear weapons.

Many countries have expressed concerns about Japan’s plans to store plutonium and use it in nuclear fuel. Some, such as China, worry that Japan could use the material to quickly produce nuclear weapons.

Now, when Japan has only two reactors operating and its future nuclear capacity is uncertain, there is less rationale than ever to continue separating plutonium. Maintaining this policy could increase security concerns and regional tensions, and might spur a “plutonium race” in the region.

As a close observer of Japanese nuclear policy decisions from both inside and outside of the government, I know that change in this sector does not happen quickly. But in my view, the Abe government should consider fundamental shifts in nuclear energy policy to recover public trust. Staying on the current path may undermine Japan’s economic and political security. The top priority should be to initiate a national debate and a comprehensive assessment of Japan’s nuclear policy. ”

by The Conversation

source with graphics and internal links

Fukushima Bill — Asia Times

” Six years after Japan’s Fukushima nuclear accident three global nuclear corporations are fighting for their very survival.

The bankruptcy filing by Westinghouse Electric Co. and its parent company Toshiba Corp. preparing to post losses of ¥1 trillion (US$9 billion), is a defining moment in the global decline of the nuclear power industry.

However, whereas the final financial meltdown of Westinghouse and Toshiba will likely be measured in a few tens of billions of dollars, those losses are but a fraction of what Tokyo Electric Power Co. (Tepco) is looking at as a result of the Fukushima nuclear disaster.

If the latest estimates for the cost of cleaning up the Fukushima plant prove accurate, Tepco faces the equivalent of a Toshiba meltdown every year until 2087.

In November 2016, the Japanese Government announced a revised estimate for the Fukushima nuclear accident (decommissioning, decontamination, waste management and compensation) of ¥21.5 trillion (US$193 billion) – a doubling of their estimate in 2013.

But the credibility of the government’s numbers have been questioned all along, given that the actual ‘decommissioning’ of the Fukushima plant and its three melted reactors is entering into an engineering unknown.

This questioning was borne out by the November doubling of cost estimates after only several years into the accident, when there is every prospect Tepco will be cleaning up Fukushima well into next century.

And sure enough, a new assessment published in early March from the Japan Institute for Economic Research, estimates that total costs for decommissioning, decontamination and compensation as a result of the Fukushima atomic disaster could range between ¥50-70 trillion (US$449-628 billion).

Rather than admit that the Fukushima accident is effectively the end of Tepco as a nuclear generating company, the outline of a restructuring plan was announced last week.

Tepco Holdings, the entity established to manage the destroyed nuclear site, and the Nuclear Damage Compensation and Decommissioning Facilitation Corporation (NDF) are seeking ways to sustain the utility in the years ahead, confronted as they are with escalating Fukushima costs and electricity market reform.

The NDF, originally established by the Government in 2011 to oversee compensation payments and to secure electricity supply, had its scope broadened in 2014 to oversee decommissioning of the Fukushima Daiichi plant on the Pacific Ocean coast north of Tokyo.

The latest restructuring plan is intended to find a way forward for Tepco by securing a future for its nuclear, transmission and distribution businesses. If possible in combination with other energy companies in Japan.

But the plan, already received less than warmly by other utilities rightly concerned at being burdened with Tepco’s liabilities, is premised on Fukushima cost estimates of ¥21.5 trillion — not ¥50-70 trillion.

To date Tepco’s Fukushima costs have been covered by interest-free government loans, with ¥6 trillion (US$57 billion) already paid out. Since 2012 Tepco’s electricity ratepayers have paid ¥2.4 trillion to cover nuclear-related costs, including the Fukushima accident site.

That is nothing compared to the costs looming over future decades and beyond and it comes at a time when Tepco and other electric utilities are under commercial pressure as never before.

The commercial pressure comes from electricity market reform that since April 2016 allowed consumers to switch from the monopoly utilities to independent power providers.

Prior to the deregulation of the retail electricity market, Tepco had 22 million customers. As the Tepco president observed late last year “The number (of customers leaving Tepco) is changing every day as the liberalization continues … We will of course need to think of ways to counter that competition.”

Countering that competition shouldn’t mean rigging the market, yet Tepco and the other utilities intend to try and retain their decades long dominance of electricity by retaining control over access to the grid. This is a concerted push back against the growth of renewable energy.

Current plans to open the grid to competition in 2020, so called legal unbundling, are essential to wrest control from the big utilities.

The message of unbundling and independence, however, doesn’t seem to have reached the Ministry of Economy, Trade and Industry (METI) that oversees the electricity industry.

Current plans would allow Tepco to establish separate legal entities: Tepco Fuel & Power (thermal power generation), Tepco Energy Partner (power distribution) and Tepco Power Grid (power transmission).

Tepco Holdings will retain their stock and control their management, meaning the same monopoly will retain control of the grid. Where Tepco leads, the other nine electric utilities are aiming to follow.

Leaving the grid effectively still under the control of the traditional utilities will throw up a major obstacle to large scale expansion of renewable energy sources from new companies.

Such businesses will be ‘curtailed’ or stopped from supplying electricity to the grid when the large utilities decide it’s necessary, justified for example to maintain the stability of the grid.

The fact that ‘curtailment’ will be permitted in many regions without financial compensation piles further pain onto new entrants to the electricity market, and by extension consumers.

Further, METI plans to spread the escalating costs of Fukushima so that other utilities and new power companies pay a proportion of compensation costs. METI’s justification for charging customers of new energy companies is that they benefited from nuclear power before the market opened up.

The need to find someone else to pay for Tepco’s mess is underscored by the breakdown of the Fukushima disaster cost estimate in November.

When put at ¥22 trillion estimate, ¥16 trillion is supposed to be covered by Tepco. The Ministry of Finance is to offer ¥2 trillion for decontamination, and the remaining ¥4 trillion is to be provided by other power companies and new electricity providers.

The question is how does Tepco cover its share of the costs when it’s losing customers and its only remaining nuclear plant in Japan, Kashiwazaki Kariwa (the worlds largest), has no prospect of restarting operation due to local opposition?

What happens when Fukushima costs rise to the levels projected of ¥50-70 trillion?

The policy measures being put in place by Tepco, other utilities and the government suggests that they know what is coming and their solution for paying for the world’s most costly industrial accident will be sticking both hands into the public purse. ”

by Shaun Burnie, Asia Times

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Fukushima disaster sways former advocate of nuclear power — Bloomberg

” The man blocking the world’s largest nuclear plant says he grew opposed to atomic energy the same way some people fall in love.

Previously an advocate for nuclear power in Japan, Ryuichi Yoneyama campaigned against the restart of the facility as part of his successful gubernatorial race last year in Niigata. He attributes his political U-turn to the “unresolved” 2011 Fukushima Dai-Ichi disaster and the lack of preparedness at the larger facility in his own prefecture, both owned by Tokyo Electric Power Co. Holdings Inc.

“Changing my opinion wasn’t an instant realization,” Yoneyama said in an interview. “It was gradual. As people say, you don’t know the exact moment you’ve fallen in love.”

Yoneyama won’t support the restart of the Kashiwazaki-Kariwa plant in Niigata until an investigation is complete into the chain of events that resulted in the triple meltdown at Fukushima, which he plans to visit Wednesday. While utilities don’t need approval of local authorities to restart plants, Japanese power companies are tradition-bound not to move ahead until they get their consent.

Local Opposition

Yoneyama, a 49-year-old doctor and native of Niigata, is one of the highest-profile local opponents pitted against a political establishment led by Prime Minister Shinzo Abe, which sees nuclear power as crucial for the country’s long-term energy security and environmental goals. Regulations and public opinion are keeping nearly all of Japan’s atomic stations shut almost six years after the accident at Fukushima, where the search has barely begun for fuel that burned through to the bottom of the reactors.

“If the local governor remains firmly opposed to the restart, it will be very difficult for the reactors to come back online,” said James Taverner, an analyst at IHS Markit Ltd. “In addition to the local government, building the support and trust of local residents is key.”

A Kyodo News poll on the day of Yoneyama’s October election showed about 64 percent of Niigata voters opposed the restart of Kashiwazaki-Kariwa, known popularly as KK. The restart of the facility was one of the key issues in the race to replace Governor Hirohiko Izumida, who was famous for his tough stance on Tokyo Electric. He unexpectedly announced in August that he wouldn’t seek a fourth term.

To the residents of the prefecture, Yoneyama was the candidate who would make nuclear safety a priority, while his main opponent gave off the vibe that he was a member of the nuclear restarts camp, the former governor said by e-mail.

Switching Sides

In last year’s gubernatorial race for the southern prefecture of Kagoshima, where Kyushu Electric Power Co. operates the Sendai nuclear plant, a three-term incumbent was defeated by an opponent campaigning to temporarily close the reactors. A district court last year barred Kansai Electric Power Co. from running two reactors at its Takahama station in western Japan only weeks after they’d been turned back on.

Yoneyama supported bringing back online Japan’s reactors during his unsuccessful bid in 2012 for a seat in Japan’s lower house. The country was being forced to spend more on fossil fuel imports after the disaster, so restarting the plants was needed to help the economy recover, he said at the time.

Though Yoneyama’s position switch helped secure his first electoral victory after four failed campaigns for the country’s legislature, nuclear opponents see him driven by more than political opportunism.

“I had my reservations about Yoneyama,” said Takehiko Igarashi, an official at the Niigata division of the anti-nuclear group Nakusou Genpatsu. “But after he was vetted and endorsed by the Japanese Communist Party and other smaller parties that have an anti-nuclear slant, I knew that I could trust him.”

evTokyo Electric and Abe’s government see restarting KK as one way for Japan’s biggest utility to boost profits and help manage its nearly 16 trillion yen ($139 billion) share of the Fukushima cleanup. Resuming reactors No. 6 and No. 7 will boost annual profits by as much as 240 billion, the utility has said.

The economic argument, however, is beginning to hold less sway, with Yoneyama saying the benefits to the local economy are ‘overstated.’ While the prefecture risks missing out on 1.1 billion yen a year in government support without the restart, that represents a small slice of the prefecture’s budget, which tops 1 trillion yen, according to Yoneyama.

Abe, a strong backer of atomic power, leads a government aiming for nuclear to account for as much as 22 percent of Japan’s energy mix by 2030, compared with a little more than 1 percent now.

While restart opponents like Yoneyama demand the government guarantee the safety of the reactors, they’ve also criticized evacuation and emergency response plans as inadequate.

In his first meeting with Tokyo Electric executives since taking office, Yoneyama earlier this month told Chairman Fumio Sudo and President Naomi Hirose that he won’t support KK’s restart until a new evacuation plan is drawn up using the results of a Fukushima investigation. Tepco will fully cooperate with the probe and stay in communication with the governor, the company said in response to a request for comment.
“Once I realized that the Fukushima disaster couldn’t be easily resolved, of course my opinion changed,” Yoneyama said. “If another accident occurs, overseas tourism will become a distant dream. Even Japanese may flee the country.” ”

by Stephen Stapczynski and Emi Urabe

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The future of nuclear energy in Japan, nearly six years after the 2011 Fukushima disaster — ABC News

” Japan has been pursuing a dream of nuclear energy since the 1960s.

The country’s first nuclear reactor was completed in 1965 and between then and 2011, Japan invested hundreds of billions of dollars into the industry.

Money is still being funnelled into the industry, but these days it is mostly just for upkeep of idle reactors.

When disaster struck the Fukushima nuclear plantin Japan in March 2011, there were 54 nuclear reactors operating in the country and generating about one third of Japan’s power.

But with the triple, reactor-core meltdown at Fukushima came concerns about nuclear power in other areas of Japan. The government of the day ordered an immediate review of the safety aspects of the remaining reactors.

Today, there are just four reactors in operation across Japan (although one is “paused” while a legal challenge is heard).

Eleven are in the process of being decommissioned — six of these are at Fukushima — and decisions are yet to be made about 42 other reactors.

Tom O’Sullivan, an energy sector analyst in Japan, said five or six other reactors should come back online in 2017, but there were localised protests to some of those planned restarts.

“Some of the polling that has been done indicates that 60-70 per cent of the Japanese people actually oppose the restarting of the reactors,” Mr O’Sullivan said.

In April 2016, a major earthquake struck Japan’s southern-most island of Kyushu.

An operating nuclear reactor was just 120 kilometres from the epicentre of the quake. Roads and bridges were damaged and landslides cut off access to some areas — aggravating the fears of local people about how they would evacuate if another nuclear disaster was to occur.

Future energy needs quesitioned

In the years to come, the Japanese Government has major decisions to make about the future of the nuclear industry. Nuclear reactors have a natural operating life of 40 years.

“The average age of the Japanese reactors is now close to 30 years, so most of them have only a remaining operating life of 10 years,” Mr O’Sullivan said.

“Once they start hitting the 40-year time limit, they’re going to have to write off some of the residual costs associated with them. Then of course you have the additional, significant issue of having to decommission them and the costs in that regard are very, very significant.”

The Government has had very little to say in recent months about its energy policy.

The most recent utterings of Prime Minister Abe were back in March — when Japan was marking the five-year anniversary of the nuclear disaster. He said his Government was aiming to achieve 20-22 per cent of energy needs met by nuclear by 2030.

Environmental group Greenpeace said that aim would be close to impossible to achieve.

“The reality is, they will never get to that 20 or 22 per cent. I think inside Government, there are factions that basically believe that maybe we can reach that target, but a more realistic assessment says maybe it will be a lot less,” Greenpeace nuclear spokesman Shaun Burnie said.

“I think the Japanese Government will be forced to change its energy policy. This cannot go on indefinitely. Nuclear utilities are unable to operate their reactors.” ”

by Rachel Mealey

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Britain and Japan sign nuclear energy cooperation agreement — The Telegraph

” Britain and Japan have signed an agreement that significantly expands cooperation in the nuclear energy sector and paves the way for Japanese companies to construct nuclear plants in the UK.

It also covers cooperation in the areas of decommissioning and decontamination and it is anticipated that the deal will give British companies with advanced technologies greater access to projects at the Fukushima Daiichi nuclear plant, where three of the six reactors suffered melt-downs after the March 2011 earthquake and tsunami disaster.

The memorandum of understanding was signed in Tokyo on Thursday by Hiroshige Seko, the Japanese trade and industry minister, and Greg Clark, the business and energy secretary.

The agreement is the first of its kind for Japan, while Mr Clark described it as “vital” to the UK’s industrial strategy and the development of clean energy sources.

One of the key components of the agreement is the proposals by Hitachi and Toshiba to build new reactors in Britain.

Horizon Nuclear Power, bought by Hitachi from a German company in 2012, has delivered the outline of a project at Wylfa Newydd in Wales, and has plans to build as many as six reactors in the UK. Toshiba joint venture NuGeneration is planning a nuclear plant in Cumbria and is considering additional projects.

Speaking in Tokyo last week, Philip Hammond, the Chancellor, said: “The technology is proven and well-known. Hitachi and Toshiba have the technology. The challenge really is financing, not a technical or commercial challenge.”

The two governments are to review investment and lending for Horizon through the Japan Bank for International Cooperation and the Development Bank of Japan. Financing of the project from the Japanese side is expected to reach Y1 trillion (£7 billion).

Japan is particularly keen for the projects to go ahead after its previous attempt to export nuclear energy technology, to Vietnam, fell through.

Japan and Britain will also collaborate on nuclear research and development, as well as security.

The deal on nuclear energy with Japan has progressed smoothly, in contrast to the problems the £18 billion Hinkley Point C project encountered earlier in the year.

That scheme is a joint venture between EDF, which is 85 per cent owned by the French state, and China General Nuclear Power Corp. It was put on hold in July, over concerns about China’s involvement, before subsequently being given the go-ahead.

by Julian Ryall

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