May 18, 2012 / 1:51 AM / 6 years ago

UPDATE 3-Japan seeks 15 pct summer power savings in west

* Japan avoids mandatory power use limits for summer

* Concerns that power shortages could hurt recovery

* Critics doubt utilities’ shortage forecasts

By Yoko Kubota

TOKYO, May 18 (Reuters) - Japan urged at least 15 percent power cuts in its urban-industrial west this summer from 2010 levels to cope with shortages after all nuclear reactors shut down, but stopped short of the mandatory cuts seen in the east last year.

The government said on Friday that it aimed to avoid rolling blackouts in the region - home to many manufacturers including struggling electronics giants Panasonic Corp and Sharp Corp - although it needed to prepare just in case.

Power shortages could undermine a recovery in the world’s third-biggest economy and hasten manufacturers’ moves to shift factories overseas to avoid high production costs and an uncertain electricity supply.

Japan’s $5 trillion economy relied for nuclear power for almost 30 percent of electricity needs before the March 2011 Fukushima crisis. But all 50 reactors are now offline for maintenance checks and with the public wary of restarts due to safety concerns, the gap is being met by firing up costly fossil fuel facilities and through energy-saving steps.

Last year’s massive earthquake and tsunami wrecked the Fukushima Daiichi nuclear plant, triggering meltdowns that caused widespread contamination and forced mass evacuations.

Last summer, the government imposed mandatory usage cuts of 15 percent on customers of Fukushima plant operator Tokyo Electric Power and Tohoku Electric in the east of the country. Neither will face numerical targets this summer

as they are expected to meet demand by firing up thermal plants.

The reduction targets are compared to usage levels in 2010, when Japan suffered record high summer temperatures.

VOLUNTARY CUTS

This summer, customers of Kansai Electric Power, based in Osaka, western Japan, will be asked to cut usage by at least 15 percent.

The utility has projected a 14.9 percent shortfall in August if temperatures hit record highs seen in 2010. That would be the worst among the nine utilities that have nuclear plants.

Critics, however, have questioned Kansai Electric’s forecasts, suspecting it is exaggerating potential shortages to strengthen the argument for restarting offline reactors.

The government has yet to finalise a revamp of an energy mix programme that had called for boosting nuclear power above 50 percent of electricity supply from about 30 percent before the crisis, with options ranging from zero to 35 percent by 2030.

Kansai’s service area had relied on nuclear power for nearly half its electricity before the disaster.

Many big companies in the region have said they can manage with power saving steps, and some experts said voluntary steps would probably suffice to shrink the supply-demand gap given growing awareness of energy saving measures.

Panasonic, headquartered in Osaka, plans to set air conditioners at 28 degrees Celsius, while Sharp plans steps such as reducing lighting and letting employees dress casually. Ironically, weak demand for their LCDs and televisions has lowered output rates, which may help them achieve savings.

Osaka-based Sumitomo Electric Industries has invested 1.5 billion yen ($18.8 million) to build a cogeneration system that captures secondary heat energy from a thermal power plant. The wire-harness maker, which sells its products to the auto and telecommunications industries, expects to cut peak power consumption by 20 percent this summer compared with 2010.

The government sought voluntary cuts of 5 percent or more by three other utilities based in central and western Japan - Chubu Electric, Hokuriku Electric and Chugoku Electric - and 7 percent or more by Shikoku Electric , so they would have spare power to transfer to strapped Kansai Electric and Kyushu Electric Power in the south.

Kyushu Electric Power’s customers were asked to cut power use by 10 percent or more, while Hokkaido Electric’s service area in the north has been urged to make cuts of at least 7 percent.

The government is keen to restart two idled reactors at Kansai Electric’s Ohi nuclear plant.

But it faces an uphill battle in the face of public safety fears, especially in communities that are close enough to share the risk but too far away to reap the benefits of jobs and subsidies that host communities have obtained.

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