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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Nuclear industry in crisis, Japan overview — Reneweconomy.com

” … Japan: Only two of the country’s 42 ‘operable’ reactors are actually operating. The future of Japan’s nuclear program remains a guessing game, but projections are being steadily reduced. According to the OECD’s Nuclear Energy Agency and the IAEA, installed capacity of 42.4 GW in 2014 could fall to as little as 7.6 GW by 2035 “as reactors are permanently shut down owing to a range of factors including location near active faults, technology, age and local political resistance.”

Another reactor was permanently shut down in 2016 (Ikata-1) in addition to five shut-downs in 2015 and the six Fukushima Daiichi reactors shut down in the aftermath of the March 2011 disaster. Japan also decided last year to permanently shut down the troubled Monju fast breeder reactor. For all the rhetoric about Generation IV fast reactors, and the A$130+ billion invested worldwide, only five such reactors are operating worldwide (three of them experimental) and only one is under construction.

(Australia’s nuclear lobby ‒ all three of them ‒ are promoting Generation IV fast reactors yet their arguments were rejected by the pro-nuclear Royal Commission. The Commission’s final report said that advanced fast reactors are unlikely to be feasible or viable in the foreseeable future; that the development of such a first-of-a-kind project would have high commercial and technical risk; that there is no licensed, commercially proven design and development to that point would require substantial capital investment; and that electricity generated from such reactors has not been demonstrated to be cost competitive with current light water reactor designs.)

Late last year, Japan’s Ministry of Economy, Trade and Industry revised the estimated cost of decommissioning the Fukushima Daiichi nuclear plant, and compensating victims of the disaster, to around A$244 billion. The latest estimate is four times greater than estimates provided in 2011/12. Indirect costs (e.g. fuel imports, adverse impacts on agriculture and fishing, etc.) are likely to exceed the direct clean-up and compensation costs. … ”

by Jim Green

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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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For 6,000, the daily bus ride takes them to Fukushima plant — The Asahi Shimbun

” NARAHA, Fukushima Prefecture–Despite the predawn hour, few people are sleeping on a bus that steadily makes its way north on National Route 6.

Some passengers are planning for the work ahead. One is looking forward to chatting with his colleagues. And a few wonder if today will be the day when their annual radiation doses reach the safety limit.

Every day, buses like this take 6,000 workers to the Fukushima No. 1 nuclear power plant. And every day, the same buses take the exhausted and mostly sleeping workers back to their base at the Japan Football Village (J-Village) in Naraha.

Although the Fukushima plant is still decades away from being decommissioned, without this daily routine of the workers who toil amid an invisible danger, the situation at the site would be much more difficult.

407 Daily Bus Rides

One of them, the 49-year-old leader of a group of metal workers from Iwaki, Fukushima Prefecture, has been working at nuclear plants, including the Kashiwazaki-Kariwa power station in Niigata Prefecture, for nearly 20 years.

He was at the Fukushima No. 1 nuclear plant when the Great East Japan Earthquake and tsunami triggered the triple meltdown there in March 2011.

“Nobody can get close to the area where the melted nuclear fuel remains due to high radiation doses,” the man said. “Even if we could approach the area, we would have no way out if something happens. The situation is harsh.”

Those metal workers install tanks for the contaminated water that keeps accumulating at the plant.

Although there are plenty of empty seats, the young workers sit in front and the older workers take the back seats.

Thousands of workers are staying at temporary dormitories set up in J-Village, a soccer training complex.

Tokyo Electric Power Company Holdings Inc., operator of the nuclear plant, hired a local bus company to transport the workers to the plant because securing parking areas near the site has been difficult since the 2011 disaster.

The company provides 407 services a day to and from the plant. Each trip takes about 30 minutes.

The first shuttle bus departs from J-Village at 3:30 a.m., while the last bus leaves the Fukushima plant at 9:45 p.m.

In mid-November amid torrential rain, one bus picked up a man taking shelter under the eaves of a bus stop.

He said he is in charge of managing data related to radiation doses of fittings and other equipment at the plant.

“We have many different types of work here,” the man proudly said.

Also on the way to the nuclear plant, a 53-year-old employee of a security company was thinking about personnel distribution.

Like other workers there, security guards must be replaced when their annual radiation doses reach a certain level set by the government.

He said he has difficulties making ends meet with a limited number of guards who have knowledge about radiation.

Suddenly, the man’s cellphone rings, and the caller orders the deployment of additional security guards to the plant.

A 52-year-old TEPCO employee was on the way to the nearby Fukushima No. 2 nuclear power plant to provide a safety training program for workers, many of whom are victims of the triple disaster.

“I want to convey to workers how precious their lives are and how important safety is in a way that doesn’t make me sound hypocritical,” the employee said.

The triple meltdown has been called a “man-made disaster” caused by the failure of both TEPCO’s management and the government’s regulatory authorities.

The TEPCO employee will use props, such as a ladder, and pretend to be a worker to explain dangerous cases at the No. 1 plant.

Premium Seats

On the trip back to J-Village, a different atmosphere exists on the bus.

Although dazzling sunlight shines through the windows and stunning views of the ocean are available, most of the workers are fast asleep in their wrinkled uniforms.

“Few people stay awake. I don’t even switch on the radio. They must be tired after their work,” said Nobuyuki Kimura, 52, who has driven the shuttle bus for one-and-a-half years.

In Kimura’s bus that departed the plant at 2:30 p.m., all 50 seats and some of the auxiliary seats were filled. The few passengers who stayed awake remained quiet.

By early evening, fewer workers boarded the bus at the plant.

Window seats at the back of the bus are desirable on all rides because they have an enough room for the seats to recline, allowing passengers to cross their legs.

A 21-year-old worker from Iwaki went for a window seat at the back after standing at the front of a line waiting for the bus.

“I can relax sitting here. This is the premium seat,” said the man who collects waste materials, such as boots and socks, at the site.

Although he works in protective gear in an area with high radiation levels, he said he has never thought about quitting his job.

He said he became fed up with school as a junior high school student, and did not bother going to senior high school.

At the age of 18, he joined his current company, and his first assignment was at the Fukushima No. 1 plant.

“I became acquaintances with more and more people. It’s fun to speak with people at work,” he said.

Through his work at the nuclear plant, his weight has dropped from 115 kilograms to 93 kg.

Thirty to 40 years are needed to decommission the Fukushima No. 1 plant, according to the mid- and-long-term roadmap compiled by the government and TEPCO.

To reduce the groundwater flowing into the buildings housing the No. 1 to No. 4 reactors, TEPCO installed coolant pipes this year to create an underground frozen soil wall to divert the water into the ocean.

TEPCO announced in October that the ice wall on the sea side was nearly frozen, but groundwater is believed to be seeping through it.

The utility plans to start removing spent fuel from the No. 3 reactor building in fiscal 2017. It also has plans to begin the daunting task of removing the melted fuel from the No. 1 to No. 3 reactor containment vessels in 2021.

However, extremely high radiation levels have prevented workers from approaching and understanding the condition of the melted fuel. The removal method has yet to be decided.

The estimated cost of work for decommissioning and dealing with the contaminated water has ballooned to 8 trillion yen ($68.1 billion). ”

by Aya Nagatani

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Japan decides to scrap trouble-plagued Monju prototype reactor — Nikkei Asian Review

” TOKYO (Kyodo) — The Japanese government formally decided Wednesday to decommission the Monju prototype fast-breeder nuclear reactor in western Japan’s Fukui Prefecture, which has barely operated over the past two decades despite its envisioned key role in the country’s nuclear fuel recycling policy.

The decision in a ministerial meeting Wednesday, concluding a process that has included discussion of Japan’s overall fast-reactor development policy by a government panel, comes despite failure to obtain local support for the plan.

The government has invested more than 1 trillion yen ($8.5 billion) in research and development for the reactor, having originally hoped it would serve as a linchpin of nuclear fuel recycling efforts as it was designed to produce more plutonium than it consumes while generating electricity.

With resource-poor Japan relying on uranium imports to power its conventional reactors, the government will continue to develop fast reactors in pursuit of a nuclear fuel cycle in which Japan seeks to reprocess spent fuel and reuse plutonium and uranium, extracted through reprocessing.

But Monju’s fate is sure to prompt further public scrutiny of the fuel cycle policy, with many nuclear reactors left idled after the 2011 Fukushima nuclear power plant disaster. The public also remains wary of nuclear power generation after the disaster.

With the facility’s decommissioning, and the accompanying loss of jobs and subsidies, the central government also risks damaging its rapport with Fukui, which hosts a number of other currently shuttered nuclear plants along the Sea of Japan coast.

The government has calculated it will cost at least 375 billion yen over 30 years to fully decommission Monju. It plans to remove the spent nuclear fuel from the reactor by 2022 and finish dismantling the facility in 2047.

Monju achieved sustained nuclear reactions, technically called criticality, in 1994. But it experienced a series of problems including a leakage of sodium coolant the following year and has been largely mothballed for the subsequent two decades.

Restarting operations at the plant would have cost at least 540 billion yen, according to government forecasts.

“We will decommission Monju given that it would take a considerable amount of time and expense to resume its operations,” Chief Cabinet Secretary Yoshihide Suga told Wednesday’s meeting.

“The nuclear fuel cycle is at the core of our energy policy,” Economy, Trade and Industry Minister Hiroshige Seko told reporters after the meeting. His ministry will take over from the science ministry in overseeing the development of more practical fast reactors.

“We will make full use of the highly valuable knowledge and expertise acquired at Monju as we move forward with fast reactor development…first by concentrating on creating a strategic roadmap,” Seko said.

Earlier Wednesday, the central government held a consultation meeting with Fukui Gov. Issei Nishikawa, who told reporters afterward that he remains opposed to the scrapping of the facility.

Nishikawa said in the meeting that decommissioning cannot begin without the approval of both the prefecture and the city of Tsuruga, where Monju is based.

“The governor told us today…that he wants a more thorough explanation of the specific mechanisms by which decommissioning will be carried out,” Seko said after the decision was made.

“We will create opportunities for dialogue with the local area.”

Nishikawa had said at a similar meeting Monday that the central government had not given enough justification for decommissioning Monju or considered the plant’s operation history sufficiently.

He has also argued that the Japan Atomic Energy Agency, which operates Monju, is incapable of safely dismantling the reactor.

A nuclear regulatory body recommended last year that the JAEA be disqualified from operating the facility following revelations of mismanagement, including a massive number of equipment inspection failures in 2012.

Science minister Hirokazu Matsuno instructed JAEA President Toshio Kodama on Wednesday to come up with a decommissioning plan by around April next year. The government has said it plans to take third-party technical opinions into account in working out how the decommissioning will take place. ”

by Nikkei Asian Review

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Editorial: Cost estimate needed first to decommission Fukushima plant — The Asahi Shimbun

” An industry ministry panel of experts is tackling two key questions concerning the decommissioning of the crippled Fukushima No. 1 nuclear power plant.

One is how much money will be needed to decommission the plant’s reactors, three of which melted down. The other is who should foot the bill and how.

However, there are some serious flaws in the way the expert panel is working on these knotty questions, which could lead to a huge financial burden on the public.

First of all, the panel’s meetings are not open to the public. The main points of the discussions are published later, but many details, including who made specific remarks, are omitted.

The fate of Tokyo Electric Power Co., which operates the Fukushima plant and is responsible for its decommissioning, will be largely determined by whether it can restart its Kashiwazaki-Kariwa nuclear power plant in Niigata Prefecture.

Panel members include many business leaders who have been promoting nuclear power generation.

The outcome of the recent Niigata gubernatorial election underscored the strong opposition of local residents against TEPCO’s plan to bring the plant back online.

The panel’s lineup raises concerns that its discussions may be based on the assumption that the Kashiwazaki-Kariwa nuclear plant will eventually be restarted, despite the situation in the prefecture.

Another troubling fact is that the government has yet to announce any estimate of the total decommissioning cost.

In the panel’s first meeting, some members urged the government to swiftly present an estimate of the cost. In the second meeting, however, the Ministry of Economy, Trade and Industry only said that annual spending could grow to several hundreds of billions of yen from about 80 billion yen ($703 million) spent now.

The ministry says a specific estimate of the total cost will be announced as early as the end of the year, along with a plan for management reforms at TEPCO and a package of related measures the government will take.

But this timetable doesn’t make sense. Pinning down the overall decommissioning cost should be the starting point for the panel’s discussions.

With the conditions of the melted nuclear fuel remaining unclear, it is certainly difficult to accurately estimate the cost.

Still, an estimate should first be shown to ensure substantive debate on whether the method used for the work is appropriate and whether there are ways to curb the cost.

As for financing, the panel has supported the proposal that TEPCO should secure the necessary funds on its own through management reform over other options, such as the utility’s liquidation involving debt forgiveness by its creditors, tax financing by the government and a continuation of the current state control of TEPCO.

In an apparent attempt to stress the importance of TEPCO’s own efforts to save itself, the panel has also recommended that the Kashiwazaki-Kariwa nuclear plant should be spun off from TEPCO and integrated with the nuclear power business of another utility.

There is no disputing that TEPCO should push through thorough management reforms to prevent the public from shouldering part of the cost through tax financing or hikes in electricity rates.

The question, however, is whether the embattled utility’s own efforts will be enough to cover the entire decommissioning cost, expected to reach several trillions of yen.

If a plan based on the company’s own efforts fails and disrupts the decommissioning process, the reconstruction of disaster-hit areas in Fukushima Prefecture could be seriously delayed.

It is vital for the panel to win broad public support for its proposals on the national challenge of decommissioning the Fukushima No. 1 nuclear power plant.

This requires careful, exhaustive and reasonable debate, open to the public, on the cost and the financing method. ”

by The Asahi Shimbun, Oct. 27

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