Japanese utilities face 1.2 trillion yen burden every year nuclear plants shut down

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Hamaoka Nuclear Power Plant in Japan

In Japan, a fierce debate is taking place over the future of the nation’s energy supply.  Protests in Tokyo last July held more demonstrators than the 1960s protests against a security treaty with the United States.  While the previous administration under Prime Minister Noda had passed a policy which phased out nuclear power in the coming decades, current Prime Minister Abe has expressed interest in changing his predecessor’s policy.

In Tokyo, representatives from Parliament have been holding “nuclear zero meetings” to discuss the impact of Japan’s future energy policies.  This week, experts from the Ministry of Economy, Trade, and Industry estimated that it costs utilities some 1.2 trillion yen annually to keep the nation’s nuclear power plants shut down.  While they did not release individual expenses for each company, officials did explain that the costs are high because even when the plants are not operational there are labor costs and depreciation; and ultimately as the facilities cannot just be abandoned or scrapped, the costs will continue to rise over time as they must be decommissioned, which is a costly and lengthy process.

One utility in Japan in particular, the Japan Atomic Power Company, has already  been greatly affected by the unforeseen shutdown of its nuclear reactors, and is currently working to gain the support of Japanese creditor banks like the Development Bank of Japan and Mizuho Corporate Bank, in order to garner a deal which would allow the utility to be able to refinance 100 billion yen of loans.  Despite the deal being arranged, Japan Atomic Power officials admitted that they expected to need further support, because it is uncertain whether the company will be able to restart its nuclear reactors.

For Prime Minister Abe, the economy seems to be a larger concern than the safety of the nuclear industry.  His post-election policies have been working to stop the nearly two decades of economic deflation in Japan, and this week the Prime Minister agreed with the central bank to set a goal of 2% inflation.  This week, Haruhiko Kuroda, newly appointed central bank chief, spoke at an Upper house committee meeting where he said that the current debt of more than 200% of Gross Domestic Product in Japan is abnormal and not sustainable.

Source: Power Engineering

Source: NHK

Source: Tokyo Web

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