By Yuko Inoue and Risa Maeda
TOKYO, Nov 9 Japan's power companies plan to add about 18 gigawatts of gas-fired electricity plants in the next ten years,
a capacity increase of 30 percent, a Reuters survey showed.
Some plants will replace older ones, with liquefied natural gas being the most preferred of the fossil fuels. The companies also plan
to add about 5 GW of coal-fired plants over the same period, boosting the capacity of these from 39.6 GW in March 2012.
Last week's survey of Japan's regional and wholesale power suppliers around the time of earnings announcements also shows they are more
inclined to use lower grades of Indonesian coal, known as sub-bituminous, and plan to step up efforts to delink LNG prices from oil.
But with Japan's stated policy of ending nuclear energy now in limbo, the most common note sounded in their responses is an inability
to set new fuel procurement plans or review station construction plans as they face a second business year with all, or most, of their
nuclear facilities idled.
Japan shut down its reactors as a safety measure after its worst nuclear disaster in 25 years, triggered by the devastating earthquake
and tsunami of March 2011 that caused three reactor meltdowns at Tokyo Electric Power Co's Fukushima Daiichi station.
The catastrophe forced 160,000 people flee from their homes and prompted the government to adopt a policy that aims to end reliance on
nuclear power and open up competition.
But when the government agreed a new energy policy in September, it rolled back an earlier commitment to abandon nuclear energy by the
All but two of Japan's 50 nuclear plants are idled as they go through safety upgrades that may not be finalized before next summer as a
new regulator formulates fresh operation standards. Japan's nuclear capacity amounts to 46 GW.
The questions in the survey focused on fuel use and procurement plans by type for the years through March 2013 and March 2014,
purchasing strategies and new station investment plans.
Tokyo Electric, or Tepco, on Wednesday announced it was considering building a coal-fired power plant in Fukushima to help rebuild
It also announced plans for auctions to contract out construction of 10 GW of total capacity of new fossil-fuel fired power generation
units, to phase out ageing power plants.
Reuters surveyed Tepco, Chubu Electric Power Co, Kansai Electric Power Co, Chugoku Electric Power Co,
Hokuriku Electric Power Co, Tohoku Electric Power Co, Shikoku Electric Power Co, Kyushu Electric Power Co
, Hokkaido Electric Power Co, Okinawa Electric Power Co, the only regional utility that doesn't have nuclear
capacity, and Electric Power Development Co, the nation's main electricity wholesaler, which is also known as J-Power.
Eight of the regional monopolies had combined losses of 674 billion yen ($8.44 billion) for the six months to Sept. 30 as they spent
more on fossil fuels to make up for idled nuclear capacity, earnings statements showed. Okinawa Electric, Hokuriku Electric and J-Power
Company Fuel Use Plans Comments on coal use Comments on LNG use
Tepco No comment on plans for Has used sub-bituminous Buys 60 pct of long-term LNG
2013/14 LNG spot and plans to increase contracts jointly with other
purchases but will tap use. utilities. Spot LNG purchase made
spot markets. up 25.9 pct of total LNG buys in
April to September period. Will
contract out construction of new
fuel plants. More than 18 GW of
capacity supplied by oil and LNG
plants older than 30 yrs.
Kansai No comment To cut fuel cost, has Turned to Russia, Africa and
bought LNG on spot Australia to diversify away from
basis and U.S. coal on traditional South East Asian crude
trial basis. suppliers. Has tied up long-term
LNG contracts using European-
and U.S.-gas linked pricing,
and aims to step up such contracts.
Chubu No comment, as nuclear Has used sub-bituminous Signed contract in July to build U.S.
plant restarts coal by up to 20 LNG plant with Osaka Gas, aims to
uncertain. percent and plans to change the structure of Asia's LNG
increase use. market by bringing in U.S .
Hokkaido No comment, as nuclear No concrete plan Diversifying fuels and introducing
plants restart LNG combined cycle plants to secure
uncertain. future power supply. Three LNG
plants with total capacity of 1,600
MW to start operations in 2019-2028.
Shikoku No comment as nuclear No comment Will consider new power station
plants restart plans after Japan's energy policy
uncertain. becomes clearer.
Chugoku No comment, as nuclear Decision to use Aims to diversify supply sources,
plant restart uncertain. sub-bituminous coal boost facilities for large-sized
will depend on prices LNG carriers and non-conventional
and plant capability. natural gas to cut costs.
Okinawa No comment on 2013/14 Expects sub-bituminous No plans to push to delink LNG
fuel plan. coal to make up 60 pricing.
percent of total coal
use in 2012/13.
Tohoku No comment on 2013/14 Has used sub-bituminous Buys 40 pct of LNG on spot basis in
fuel plan as nuclear coal and aims to step 2011/12.
plants restart up its use.
Kyushu No comment on 2013/14 Introduced No comment on pricing link.
fuel plan. sub-bituminous coal
since 2004/05, will
step up use of lower
grade coal to cut
($1=79.83 Japanese yen)
(Additional reporting by Osamu Tsukimori; Editing by Aaron Sheldrick and)