Japan may push for closure of ageing reactors: Nikkei

TOKYO Fri Sep 5, 2014 5:54am EDT

A man on vacation dives into the sea as Kansai Electric Power Co.'s Mihama nuclear power plant is seen in the background in Mihama town, Fukui prefecture, July 2, 2011.   REUTERS/Issei Kato

A man on vacation dives into the sea as Kansai Electric Power Co.'s Mihama nuclear power plant is seen in the background in Mihama town, Fukui prefecture, July 2, 2011.

Credit: Reuters/Issei Kato

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TOKYO (Reuters) - Japan will push nuclear operators to draft plans to deal witholder reactors, including the option of scrapping those that are too old or too costly to refurbish to new standards imposed after the Fukushima disaster, the Nikkei reported on Friday.

The proposal affects a quarter of Japan's 48 reactors and the government is betting that by forcing the closure of older units, considered more vulnerable to disaster, it may gain public support to restart newer units, the newspaper said.

All Japan's reactors have been shut after the 2011 nuclear crisis at Fukushima caused by a major earthquake and tsunami.

Public opinion turned against nuclear power after the disaster, but the government wants to restart units deemed safe by a new, more independent regulator and cut Japan's reliance on expensive imports of fossil fuels.

Kansai Electric Power Co is likely to be the first to bite the bullet and consider scrapping two of its ageing nuclear reactors, the Nikkei reported.

Kansai Electric denied the report, saying it was still considering how to respond ahead of a looming application deadline to extend the operations of two ageing plants beyond a 40-year limit.

Kyushu Electric Power Co will also consider scrapping its 38-year-old 559-megawatt Genkai No.1 reactor, the

Nikkei reported later on Friday.

The company is weighing the extension of operations, rather than decommissioning, a spokesman said, when contacted by Reuters.

Japanese trade minister Yuko Obuchi said on Friday that operators should decide on their own whether to scrap the reactors, but the government would help with the smooth decommissioning of older units, besides trying to restart nuclear plants that clear the nation's new safety standards.

Nuclear safety rules make it tougher to upgrade and run older reactors, and as many as two-thirds of Japan's 48 idled nuclear units may not return to operation because of the high costs, local opposition or seismic risks, a Reuters analysis showed this year.

The more stringent safety checks on nuclear facilities adopted in July 2013 limit a reactor's operating life to 40 years in principle. But by clearing tough inspections, they could get a one-time maximum extension of 20 years.

Two reactors in southwest Japan have won initial clearance to restart under the new safety regime, but hurdles remain.

A dozen reactors will reach the 40-year limit within five years and the government is asking operators to evolve plans to decommission older units by the end of the year, the paper said.

Kansai Electric is considering decommissioning the 340-megawatt No. 1 and 500-megawatt No.2 reactors at its Mihama nuclear facility in western Fukui prefecture, the paper said.

Both Mihama units are more than 40 years old and have relatively small capacity, so restarting them would bring only a limited profit boost and cost several hundred billion yen for inspections and safety measures, the paper said.

If the company decides to scrap the reactors within the business year that ends in March 2015, it will probably be forced to book up to 30 billion yen ($285 million) in extraordinary losses in impairment charges, the Nikkei added.

Accounting rules were changed in 2013 to allow nuclear operators to book losses from decommissioning costs over several years rather than in a single year.

The company booked steep losses in its three previous business years, after the world's worst nuclear disaster in 25 years led to a gradual shutdown of Japan's nuclear industry.

($1=105.4500 Japanese yen)

(Reporting by James Topham, Kentaro Hamada and Osamu Tsukimori; Editing by Aaron Sheldrick, Michael Perry and Clarence Fernandez)

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