Japan Finds it Hard to Abandon Nuclear Energy

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Credit: Wikimedia CommonsBy Richard Johnson
IDN-InDepth NewsReport

LONDON (IDN) - The restart of the Ohi nuclear reactor on July 1 in Fukui prefecture, near the centre of the Japan Sea Coast, points to a momentous trend nearly 15 months after the Fukushima meltdown, particularly as this is the first nuclear site to go back online since Japan shut down the last of the country's nuclear reactors in May 2012 because of security concerns.

The Ohi reactor was restarted not only despite massive public protests in Tokyo, but also against the wish of the Osaka city's mayor Toru Hashimoto. At a shareholder meeting, Hashimoto asked the plant operator Kansai Electric Power Co (Kepco) to change its management strategy to one based on the assumption that the company does not operate any nuclear power plants.

According to a news agency report, he told the Kepco meeting: "We are facing an epochal shift in the energy supply framework. I would like executives to keep that in mind and aim to build a new energy supply system." Osaka's city government holds a 9.5% stake in Kepco.

However, Kepco shareholders voted against motions calling for the company to either end or reduce its use of nuclear energy. A total of 28 proposals had been put forward calling for the company to shift from nuclear power and fossil fuels to renewable energy sources. A motion backed by the mayors of Osaka, Kobe and Kyoto would have obliged Kepco to permanently shut down all reactors.

Company executives, however, warned that not restarting Kepco's reactors would add some $11.3 billion) in annual fuel costs. Kepco president Makoto Yagi said that nuclear power should continue to serve a key role in the country's energy supply and stated that the company needs to restart some of its reactors to stay afloat, another news agency report said.

Following recent approval from Prime Minister Yoshihiko Noda, Kepco is slated to restart another nuclear reactor on July 17.

An analysis by the World Nuclear News (WNN) also the ill-famed Tokyo Electric Power Co (Tepco) has taken an adamant stance as was underlined at a meeting of some 4500 shareholders on June 27, which lasted about five-and-a-half hours. During the meeting, shareholders voted against a proposal for the company to permanently shut down its seven-unit Kashiwazaki Kariwa plant in Niigata prefecture, replacing it with advanced gas-turbine generators.

Following government approval of an amendment to Tepco's ten-year special business plan in May 2012, the company's shareholders endorsed a transaction under which the government will provide Tepco with $12.5 billion in state funds in return for a majority stake in the company.

This will provide the government more than half of Tepco's voting rights and enable it to push through reforms at the company. The transaction brings the total amount of public funds provided to Tepco to some $43.8 billion, reports WNN. Also, the move could avoid the collapse of the utility, which is struggling to meet massive compensation and clean-up costs following the Fukushima accident last year.

Tokyo vice governor Naoki Inose told the company's meeting, "Public confidence in Tepco has been damaged," an agency report said. He added: "What is needed from now is an awareness on the part of Tepco that it must completely reform itself through transparency." Tokyo's city government holds a 2.7% stake in Tepco.

Following the meeting, WNN said, Tepco's board formalised the appointment of a new government-approved chairman and president. Naomi Hirose, currently a managing director of the company and deputy general manager of its Fukushima response division, has been appointed as the company's new president, replacing Toshio Nishizawa. Kazuhiko Shimokoube, former head of the Nuclear Damage Liability Facilitation Fund's steering committee, takes over from Tsunehisa Katsumata as company chairman.

Tepco's losses have been put at $9.8 billion for financial year 2012. About half of this stems from the cost of compensation and cleanup; the other half is from the higher cost of generation in Japan's shaken power market. Assuming that substantial electricity price hikes and reactor restarts are approved, Tepco anticipates returning to profitability in financial year 2013/14.

Energy Needs

According to the World Nuclear Association, Japan needs to import about 84% of its energy requirements. Its first commercial nuclear power reactor began operating in mid-1966, and nuclear energy has been a national strategic priority since 1973. This is has been under review following the 2011 Fukushima accident.

The country's 50 main reactors have provided some 30% of the country's electricity and this was expected to increase to at least 40% by 2017. Japan has a full fuel cycle set-up, including enrichment and reprocessing of used fuel for recycle.

Despite being the only country to have suffered the devastating effects of the atomic bombs dropped on Hiroshima and Nagasaki in World War II (1939-1945), Japan has embraced the peaceful use of nuclear technology to provide a substantial portion of its electricity. Early in 2011, nuclear energy accounted for almost 30% of the country's total electricity production (29% in 2009), from 47.5 GWe (gigawatt of electricity) of net capacity to March 2011, and 44.6 GWe (net) from then. There were plans to increase this to 41% by 2017, and 50% by 2030.

In 2010 Japan generated 1080 billion kWh (kilowarr hour) gross, 27% from coal, 27% from gas, 27% from nuclear, 9% from oil, and 7% from hydro, though some nuclear capacity remained shut down for checks following an earthquake in mid-2007. Final consumption was about 965 billion kWh, or about 7500 kWh per capita.

Capacity at end of 2009 was 48.9 GWe nuclear, 47.2 GWe hydro, 35.3 coal, 44.8 GWe gas, 41.2 GWe oil, 48.9 GWe oil or coal, 2.6 GWe solar, 2.0 GWe wind and 0.55 GWe geothermal.

As Japan has few natural resources of its own, it depends on imports for some 84% of its primary energy needs. Initially it was dependent on fossil fuel imports, particularly oil from the Middle East (oil fuelled 66% of the electricity in 1974).

This geographical and commodity vulnerability became critical due to the oil shock in 1973. At this time, Japan already had a growing nuclear industry, with five operating reactors. Re-evaluation of domestic energy policy resulted in diversification and in particular, a major nuclear construction program. A high priority was given to reducing the country's dependence on oil imports.  A closed fuel cycle was adopted to gain maximum benefit from imported uranium.

Nuclear power has been expected to play an even bigger role in Japan's future. In the context of the Ministry of Economy, Trade and Industry (METI) Cool Earth 50 energy innovative technology plan in 2008, the Japan Atomic Energy Agency (JAEA) has modelled a 54% reduction in CO2 emissions (from 2000 levels) by 2050 leading on to a 90% reduction by 2100. This would lead to nuclear energy contributing about 60% of primary energy in 2100 (compared with 10% now), 10% from renewables (now 5%) and 30% fossil fuels (now 85%). This would mean that nuclear contributed 51% of the emission reduction: 38% from power generation and 13% from hydrogen production and process heat.

In June 2010 METI resolved to increase energy self-sufficiency to 70% by 2030, for both energy security and CO2 emission reduction. It envisages deepening strategic relationships with energy-producing countries. Nuclear power would play a big part in implementing the plan, and new reactors will be required as well as achieving 90% capacity factor across all plants.

However, following the Fukushima accident, in October 2011 the government published a White Paper confirming that "Japan's dependency on nuclear energy will be reduced as much as possible in the medium-range and long-range future." It also highlights weaknesses in the energy system and says that a new energy policy will be developed by mid-2012. [IDN-InDepthNews – July 02, 2012]

2012 IDN-InDepthNews | Analysis That Matters

Picture: The Fukushima I Nuclear Power Plant after the 2011 Tōhoku earthquake and tsunami | Credit: Wikimedia Commons

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