TEPCO must regain public trust to ensure Fukushima’s steady recovery — The Yomiuri Shimbun

” To ensure the steady recovery of Fukushima, Tokyo Electric Power Company Holdings, Inc.’s revised business plan must not be allowed to end up as pie in the sky.

TEPCO has compiled a new business plan. The utility has strengthened its steps to improve profitability to raise funds for costs including decommissioning reactors and compensation related to the March 2011 accident at its Fukushima No. 1 nuclear power plant. This is the second time the plan has been revised.

The total cost of cleaning up the nuclear accident has ballooned from ¥11 trillion to ¥21.5 trillion. TEPCO will shoulder ¥16 trillion of this amount over about 30 years. The ¥300 billion TEPCO spent in fiscal 2016 on compensation and reactor decommissioning costs will be increased to ¥500 billion annually.

TEPCO must boost its “earning power” to secure sufficient capital to meet those costs. Restarting reactors at TEPCO’s Kashiwazaki-Kariwa nuclear power plant in Niigata Prefecture will be essential for this. Each reactor brought back online will raise TEPCO’s earnings by ¥40 billion to ¥90 billion per year.

TEPCO is working to gradually restart all seven reactors at the Kashiwazaki-Kariwa plant from fiscal 2019. However, as things stand, high hurdles remain in its way. This is because even if a reactor passes safety screenings conducted by the Nuclear Regulation Authority, local government authorities also must agree to the reactors’ restart.

The recent revelation that TEPCO did not disclose data about the insufficient earthquake-resistance of the main quake-resistant building at the plant has further heightened local distrust of the utility. Niigata Gov. Ryuichi Yoneyama is not budging from his cautious stance because he believes safety measures at the plant are insufficient. “At the moment, I can’t agree to the restart” of the reactors, Yoneyama said.

An expert panel of the Economy, Trade and Industry Ministry also had some stinging criticism for TEPCO, saying it “has not earned enough trust from the public.”

Transparency vital

On June 23, TEPCO will switch to a new leadership lineup when Hitachi, Ltd. Honorary Chairman Takashi Kawamura becomes TEPCO’s chairman. Kawamura will need to work hard to regain trust in TEPCO so restarting its reactors can become a reality.

Strengthening cooperation with other electric utilities and launching new operations, such as gas retailing, also will be effective in solidifying TEPCO’s revenue base. Another issue that needs to be addressed is the overseas development of its thermal power business, in which TEPCO is pursuing integration with Chubu Electric Power Co.

The new plan stipulates TEPCO will “prepare a basic framework for cooperation with other companies” by around fiscal 2020, keeping in mind the Higashidori nuclear plant TEPCO is constructing in Aomori Prefecture.

TEPCO is considering working with Tohoku Electric Power Co., which has a nuclear power plant in that region. If this tie-up comes to fruition, it will be useful for establishing a stable supply of electricity. TEPCO’s intentions on this issue are understandable.

Other utilities that could become partners with TEPCO during a realignment in the industry hold deep-rooted concerns that cooperating with TEPCO could result in the costs of dealing with the nuclear accident being shunted on to them. TEPCO must lay the groundwork to dispel such concerns.

TEPCO and the government will, as soon as this autumn, establish a forum at which they can listen to the opinions of other electric utilities on steps to reorganize nuclear power and electricity transmission businesses.

Profits will be distributed based on the capital contribution ratio in a joint venture. Other companies should not be forced to shoulder the costs of the Fukushima nuclear accident. Highly transparent rules such as these will need to be drawn up. ”

by The Yomiuri Shimbun

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In Fukushima, a land where few return — The Japan Times

” A cherry tree is blooming in the spring sunshine outside the home of Masaaki Sakai but there is nobody to see it. The house is empty and boarded up. Weeds poke through the ground. All around are telltale signs of wild boar, which descend from the mountains to root and forage in the fields. Soon, the 60-year-old farmhouse Sakai shared with his mother and grandmother will be demolished.

“I don’t feel especially sad,” Sakai says. “We have rebuilt our lives elsewhere. I can come back and look around — just not live here.”

A few hundred meters away the road is blocked and a beeping dosimeter begins nagging at the bucolic peace. The reading here is a shade over 1 microsievert per hour — a fraction of what it was when Sakai’s family fled in 2011.

The radiation goes up and down, depending on the weather, Sakai says. In gullies and cracks in the road, and up in the trees, it soars. With almost everyone gone, the monkeys who live in the forests have grown bolder, stopping to stare at the odd car that appears instead of fleeing, as they used to.

A cluster of 20 small hamlets spread over 230 square kilometers, Iitate was undone by a quirk of the weather in the days that followed the nuclear accident in March 2011. Wind carried radioactive particles from the Fukushima No. 1 nuclear power plant, which is located about 45 kilometers away, that fell in rain and snow on the night of March 15, 2011. After more than a month of indecision, during which the villagers lived with some of the highest radiation recorded in the disaster (the reading outside the village office on the evening of March 15 was a startling 44.7 microsieverts per hour), the government ordered them to leave.

Now, the government says it is safe to go back. With great fanfare, all but the still heavily contaminated south of Iitate, Nagadoro, was reopened on March 31.

The reopening fulfills a pledge made by Mayor Norio Kanno: Iitate was the first local authority in Fukushima Prefecture to set a date for ending evacuation in 2012, when the mayor promised to reboot the village in five years. The village has a new sports ground, convenience store and udon restaurant. A clinic sees patients twice a week. All that’s missing is people.

Waiting to meet Kanno in the government offices of Iitate, the eye falls on a book displayed in the reception: “The Most Beautiful Villages in Japan.” Listed at No. 12 is the beloved rolling patchwork of forests, hills and fields the mayor has governed for more than two decades — population 6,300, famous for its neat terraces of rice and vegetables, its industrious organic farmers, its wild mushrooms and the black wagyu cow that has taken the name of the area.

The description in the book is mocked by reality outside. The fields are mostly bald, shorn of vegetation in a Promethean attempt to decontaminate it of the radiation that fell six years ago. There is not a cow or a farmer in sight. Tractors sit idle in the fields. The local schools are empty. As for the population, the only part of the village that looks busy is the home for the elderly across the road from Kanno’s office.

“The village will never return to how it used to be before the disaster,” Kanno says, “but it may develop in a different way.”

Recovery has started, Kanno says, wondering whether returnees will be able to start building a village they like.

“Who knows? Maybe one day that may help bring back evacuees or newcomers,” Kanno says. “Life doesn’t improve if you remain pessimistic.”

Even for those who have permanently left, he adds, “it doesn’t mean that their furusato can just disappear.”

The pull of the furusato (hometown) is exceptionally strong in Japan, says Tom Gill, a British anthropologist who has written extensively about Iitate.

Yearning for it “is expressed in countless sentimental ballads,” Gill says. “One particular song, simply titled ‘Furusato,’ has been sung by children attending state schools in Japan since 1914.”

The appeal has persisted despite — or perhaps because of — the fact that the rural/urban imbalance in Japan is more skewed than in any other developed nation, Gill says; just 10 percent of the nation’s population live in the country.

This may partly explain the extraordinary efforts to bring east Fukushima back to life. By one study, more than ¥2.34 trillion has been spent decontaminating an area roughly half the size of Rhode Island.

There has been no official talk of abandoning it. Indeed, any suggestion otherwise could be controversial: When industry minister Yoshio Hachiro called the abandoned communities “towns of death” in September 2011, the subsequent outrage forced him to quit a week later.

Instead, the area was divided into three zones with awkward euphemisms to suggest just the opposite: Communities with annual radiation measuring 20 millisieverts or less (the typical worldwide limit for workers in nuclear plants) are “being prepared for lifting of evacuation order,” districts of 20-50 millisieverts per year are “no-residence zones” and the most heavily contaminated areas of 50 millisieverts or more per year, such as Nagadoro, are “difficult-to-return.”

In September 2015, Naraha, which is located 15 kilometers south of the Fukushima No. 1 nuclear plant, became the first town in the prefecture to completely lift the evacuation order imposed after the triple meltdown. Naraha has a publicly built shopping street, a new factory making lithium batteries, a kindergarten and a secondary school.

A team of decontamination workers has been sent to every house — in some cases several times. Of the pre-disaster 7,400 residents, about 1,500 mainly elderly people have returned, the local government says, although that figure is likely inflated.

In Iitate, the cost of decontamination works out at about ¥200 million per household. That, and the passage of time, has dramatically reduced radiation in many areas to below 20 millisieverts a year. However, Kanno says, the cleanup extends to only 20 meters around each house, and three-quarters of the village is forested mountains. In windy weather, radioactive elements are blown back onto the fields and homes.

“All that money, and for what?” asks Nobuyoshi Itoh, a farmer and critic of the mayor. “Would you bring children here and let them roam in the fields and forests?”

Itoh opted to stay in one of the more heavily toxic parts of the village after everyone fled, with little apparent ill effect, although he says his immune system has weakened.

One of the reasons why Iitate was such a pleasant place to live before the nuclear crisis, he recalls, was its unofficial barter system. “Most people here never bought vegetables; they grew them,” he says. “I would bring someone potatoes and they would give me eggs. That’s gone now.”

At most, he says, a few hundred people are back — but they’re invariably older or retired.

“They alone will not sustain the village,” Itoh says. “Who will drive them around or look after them when they are sick?”

As the depth of the disaster facing Iitate became clear, local people began to squabble among themselves. Some were barely scraping a living and wanted to leave, although saying so out loud — abandoning the furusato — was often difficult. Many joined lawsuits against the government.

Even before disaster struck, the village had lost a third of its population since 1970 as its young folk relocated to the cities, mirroring the hollowing-out of rural areas across the country. Some wanted to shift the entire village elsewhere, but Kanno wouldn’t hear of it.

Compensation could be a considerable incentive. In addition to ¥100,000 a month to cover the “mental anguish” of being torn from their old lives, there was extra money for people with houses or farms. A five-year lump sum was worth ¥6 million per person — twice that for Nagadoro. One researcher estimates a rough figure of ¥50 million for the average household, sufficient to leave behind the uncertainties and worries of Iitate and buy a house a few dozen miles away, close enough to return for work or to the village’s cool, tranquil summers.

Many have already done so. Though nobody knows the true figure, the local talk is that perhaps half of the villagers have permanently left. Surveys suggest fewer than 30 percent want to return, and even less in the case of Nagadoro.

Yoshitomo Shigihara, head of the Nagadoro hamlet, says many families made their decision some time ago. His grandchildren, he says, should not have to live in such a place.

“It’s our job to protect them,” Shigihara says. He lives in the city of Fukushima but returns roughly every 10 days to inspect his house and weed the land.

Even with so much money spent, Shigihara doubts whether it will bring many of his friends or relatives back. At 70 years of age, he is not sure that he even wants to return, he says.

“I sometimes get upset thinking about it, but I can’t talk with anyone in Fukushima, even my family, because we often end up quarreling,” he says. “People try to feel out whether the others are receiving benefits, what they are getting or how much they received in compensation. It’s very stressful to talk to anyone in Iitate. I’m starting to hate myself because I end up treating others badly out of frustration.”

Kanno has won six elections since 1996 and has overseen every step of Iitate’s painful rehabilitation, navigating between the anger and despair of his constituents and the official response to the disaster from the government and Tokyo Electric Power Company Holdings (Tepco), operator of the crippled nuclear plant.

He wants more money to complete decontamination work (the government claims it is finished), repair roads and infrastructure. Returnees need financial support, he says. However, it is time, he believes, to end the monthly compensation, which, in his view, induces dependency.

“If people keep saying that life is hard, they will not be able to recover,” he says. “What we need is support for livelihoods.”

A new system gives seed money to people who voluntarily come back to start businesses or farms.

“We don’t want to give the impression that we are influencing people’s decisions or forcing them to return,” the mayor says, using the phrase “kokoro ni fumikomu,” which literally means “to step into hearts.”

Yet, next year, thousands of Iitate evacuees will face a choice: Go back or lose the money that has helped sustain them elsewhere for six years. Evacuation from areas exposed to less than 20 millisieverts per year will be regarded as “voluntary” under the official compensation scheme.

This dilemma was expressed with unusual starkness last month by Masahiro Imamura, the now sacked minister in charge of reconstructing Tohoku. Pressed by a freelance reporter, Imamura tetchily said it was up to the evacuees themselves — their “own responsibility, their own choice” — whether or not to return.

The comment touched a nerve. The government is forcing people to go back, some argued, employing a form of economic blackmail, or worse, kimin seisaku — abandoning them to their fate.

Itoh is angry at the resettlement. For him, politics drives the haste to put the disaster behind.

“It’s inhuman to make people go back to this,” he says. Like the physical damage of radiation, he says, the psychological damage is also invisible: “A lot of people are suffering in silence.”

Itoh believes the government wants to show that the problems of nuclear power can be overcome so it can switch the nation’s idling nuclear reactors back on. Just four are in operation while the fate of 42 others remains in political and legal limbo. Public opinion remains opposed to their restart.

Many people began with high hopes in Iitate but have gradually grown distrustful of the village government, says Kenichi Hasegawa, a farmer who wrote a book titled “Genpatsu ni Furusato o Ubawarete” (“Fukushima’s Stolen Lives”) in 2012. Right from the start, he says, the mayor desperately tried to hide the shocking radiation outside his office.

“Villagers have started losing interest,” Hasegawa says.

Meetings called by the mayor are poorly attended.

“But they hold meetings anyway,” Hasegawa says, “just to say they did.”

Kanno rejects talk of defeatism. A tourist shop is expected to open in August that will attract people to the area, he says. Some villagers are paving entrances to their houses, using money from the reconstruction budget. As for radiation, everyone “has their own idea” about its effects. The lifting of the evacuation is only the start.

Itoh says he once trusted public officials but those days are long gone. By trying to save the village, he says, the mayor may in fact be killing it. ”

by David McNeill and Chie Matsumoto, The Japan Times

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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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80% of voluntary Fukushima evacuees unwilling to return home, survey — RT

” A vast majority of Fukushima voluntary evacuees are not planning to move back to their homes out of fear of radiation despite the government declaring living conditions in the prefecture to be “good”, a new government survey has discovered.

Some 78.2 percent of “voluntary” evacuees households have no intention of returning to their previous places of residence and plan to “continue living” in the area they had evacuated to, results of a Fukushima Prefectural Government survey released on April 24 show.

Only 18.3 percent of households said they intended to move back to the Fukushima prefecture.

On their own accord, some 12,239 households left areas that were not covered by the government’s evacuations orders that were issued following the tsunami and the subsequent meltdown of Fukushima No. 1 nuclear power plant in March 2011.

Unlike people who were forced to relocate under evacuation orders, voluntary evacuees only received a fraction of the payment of at least 8.5 million yen ($77,300) that the government offered in compensation to mandatory evacuees.

For six years, most of them lived in other parts of Japan through government sponsored subsidies which ended in March this year after the government claimed that the “living environment (in Fukushima Prefecture) is in good order.”

Despite the official assessment, the environmentally wary refugees “still worry about radiation, and many of them have shifted the foundations of their lives to the places they’ve evacuated to,” the prefectural official in charge of the survey told Mainichi, Japan’s national daily.

Fukushima Governor Masao Uchibori pledged to work closely with local governments where the evacuees’ old and new homes are located to help them.

“It’s essential to respect the evacuee’s intentions” about returning home, Uchibori told reporters after the release of the survey. “However, we will work to create an environment where people can live with peace of mind, so evacuees can return home in the future.” “

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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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Japan’s power industry at crossroads as Fukushima decommissioning costs rise – The Mainichi

” The Economy, Trade and Industry Ministry’s plan to add the increased costs of decommissioning the tsunami-hit Fukushima No. 1 Nuclear Power Plant was scrapped before the end of the year due to a public backlash.

It is estimated that the costs of decommissioning the crippled power station would snowball from 2 trillion yen to 8 trillion yen. An internal document that the ministry had compiled by September last year stated that the costs of compensation payments as well as the decommissioning expenses should be added to power transmission fees that new power companies pay for the use of major utilities’ power grids.

If the decommissioning costs that are expected to increase by trillions of yen were regarded as TEPCO’s debts, the utility would fall into a state of capital deficit — in which the company’s debts surpass its assets. It could force TEPCO to delist its stock on stock markets and make it difficult for banks to continue loaning to the firm.

To avoid such a situation, the Economy, Trade and Industry Ministry has decided to change the accounting rules to allow TEPCO to book the decommissioning costs in separate years. To do so, however, it is necessary to guarantee that the costs can be recovered from TEPCO every year. Two plans surfaced to enable this.

One is to accumulate money to be saved through TEPCO’s cost-cutting measures and management reform at the Nuclear Damage Compensation and Decommissioning Facilitation Corp. (NFD), which would control the decommissioning costs. The other is to add part of the decommissioning costs to transmission fees.

In October, a senior ministry official told LDP legislators behind closed doors, “It’s safer to add the costs to the transmission fees than relying on TEPCO’s management reform.”

However, experts as well as the general public intensified their criticism of the plan to add decommissioning expenses to the transmission fees despite the earlier plan to make sure that TEPCO fully secured funds for decommissioning the plant.

In response, the ministry changed its policy. In a Nov. 8 document that the ministry released when briefing LDP members, it stated the two plans as ways to certainly secure enough funds for decommissioning the plant. However, in its Dec. 1 document, the plan to add the costs to transmission fees was dropped.

“We considered the use of transmission fees but we can’t implement it because of mounting criticism of the plan,” said a ministry official in charge of the matter.

On the other hand, major power suppliers besides TEPCO have footed the costs of paying compensation to those affected by the Fukushima nuclear crisis. An expert committee dealing with the matter proposed at the end of the year that the increase in the amount of compensation payments should be raised by adding the amount to transmissions fees.

Saying that power companies that own nuclear plants should have saved money to respond to nuclear accidents, the panel recommended that new power companies should shoulder part of the costs because their customers had previously benefited from nuclear power run by major utilities.

The committee also proposed that major power suppliers be obligated to supply less expensive electricity, such as power generated at nuclear plants, to new power companies. In other words, the panel attempted to take the carrot-and-stick approach to convince new market entrants.

In response to the recommendations, the Economy, Trade and Industry Ministry will implement the proposals after soliciting public comments. As a result of the implementation of the plan, the monthly electric power bill for a standard household in Japan, excluding Okinawa Prefecture where there are no nuclear plants, would rise an average of 18 yen over a 40-year period from 2020.

The ministry patiently and carefully formed consensus among legislators over the plan. The committee’s conclusion was based on its explanatory document that the panel presented to the LDP shortly before.

House of Representatives member Taro Kono and a few other LDP legislators calling for an end to Japan’s reliance on atomic power voiced opposition, but they fell far short of a majority.

Minako Oishi, an adviser on consumer affairs who sits at the experts’ panel, repeatedly voiced opposition to adding compensation costs to transmission fees on the grounds that it would run counter to the purpose of liberalizing the power market. She also released a written statement to that effect. However, she was unable to overwhelm the firm alliance between politicians and bureaucrats.

“I have the impression that the conclusion had been drawn in advance. Such a serious matter as the additional financial burden of dealing with the Fukushima accident should’ve been discussed at the Diet,” Oishi said.

On Dec. 20, 2016, the ministry’s expert committee compiled its recommendations estimating that TEPCO needs to shoulder 16 trillion yen of the cost of dealing with the Fukushima nuclear crisis. The recommendations urged TEPCO to merge each of its divisions, including nuclear power and power transmission, with those of other companies — effectively leading to a split of the utility — and advance into the global market.

On the same day, a message by TEPCO President Naomi Hirose was released through the company’s in-house computer network. “If we steadily continue our work without hesitation, we can open up new opportunities. This is something that only TEPCO can do,” the message said.

However, the message reflects Hirose’s anxiety. Hirose told TEPCO executives the following day at the headquarters, “I’m worried whether employees can maintain their morale. Please try not to make them feel weak.”

TEPCO failed to achieve its goal of getting out of state control as early as fiscal 2017 by improving its business performance — because there are no prospects that its idled Kashiwazaki-Kariwa Nuclear Power Plant in Niigata Prefecture can be reactivated in the foreseeable future.

TEPCO Director Keita Nishiyama sat at the news conference on July 28 with Chairman Fumio Sudo and President Hirose, and read a statement saying that “the government needs to clarify its policy” on how to shoulder the costs of dealing with the nuclear crisis, which is expected to worsen. Nishiyama is a bureaucrat that the ministry loaned to TEPCO as a board member after placing the utility under state control.

His tough statement indirectly asks the government for assistance. A TEPCO executive said, “It’s not a type of statement written by a private company insider.”

At the news conference, the ministry suggested that it would take the opportunity of discussions on how to shoulder the costs of dealing with the Fukushima nuclear crisis to embark on its long-cherished goal of restructuring the electric power and atomic energy industries.

About two months later, the ministry set up two expert panels — one on TEPCO reform and the other on the reform of the electric power system.

“In Japan, the demand for power has stagnated. In particular, regulations on the atomic energy business are stiff. Therefore, the power industry is a declining industry. There’s no time to lose in promoting business tie-ups and overseas expansion. Discussions shouldn’t be limited to TEPCO reform,” said a ministry official.

However, some TEPCO officials have expressed displeasure at the move. “Infrastructure companies like us are different from manufacturers. It’s important to ensure stable power supply. It’s not true that we should just increase our profits,” one of them said.

At the same time, executives of other major power companies reacted coolly to TEPCO.

“We don’t know how much of the costs of dealing with the Fukushima accident we’ll be required to shoulder,” one of them said.

“TEPCO’s arrogance that stood out in the industry is still fresh in our memory,” another commented.

The ministry and the expert panel on TEPCO reform share the view that TEPCO needs to carry out the largest-scale reforms since Yasuzaemon Matsunaga, the “king of the power industry” who established major power companies’ regional monopolies in order to ensure stable power supply.

However, Japanese semiconductor and liquid crystal manufacturers and other companies that were integrated on the initiative of the Economy, Trade and Industry Ministry have not grown as the ministry had aimed.

As such, it remains to be seen whether TEPCO will join hands with other power companies and gain entry into the global market as the ministry envisages. “

by The Mainichi

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