nuclear-news

Shareholder meetings could be the next impediment to restarting Japan’s nuclear power industry

Fukushima Watch: Next Nuclear Battleground — Utilities’ Shareholder Meetings, WSJ, June 13, 2012,   By Mitsuru Obe With the government inching closer to restarting the first nuclear reactors since last year’s Fukushima Daiichi nuclear disaster, a new battleground between Japan’s pro- and anti-nuclear camps is emerging: the annual shareholder meetings of the country’s big power companies in June.

Japan’s four biggest utilities hold their shareholder meetings on June 27. The meeting that’s drawing a lot of attention these days is that of Kansai Electric Power Co., which relied on
nuclear plants to supply around half of its electricity, and operates the Oi nuclear plant, whose No. 3 and 4 reactors are first in line to restart. Kansai Electric supplies energy to the region around the city of Osaka, Japan’s third-biggest metropolis and the utility’s largest shareholder, with 8.92% of outstanding shares.

And Osaka has submitted proposals to Kansai Electric that it exit nuclear power and separate
its power-generation operations from distribution and transmission — or control of the electricity grid.

On Tuesday, environmental group Greenpeace launched a campaign urging
people to tweet how other major shareholders of Kansai Electric are
responding to these proposals in the run-up to the shareholder
meeting, a move designed to publicize the efforts and put pressure on
the utility.
Greenpeace is calling special attention to Nippon Life Insurance Co.,
the country’s largest life insurer. Known as Nissay, the company has
the biggest combined stake in Japanese utilities, even after having
reduced its share in Tokyo Electric Power Co., the operator of the
Fukushima Daiichi nuclear plant, to around 2% from 3% recently. Nissay
says they decided to sell Tepco stock after having examined the
company’s value from a long-term perspective, and considering Tepco’s
importance as a public utility.

Nissay has around a 4.6% stake in Kansai Electric.

Traditionally a silent shareholder, Nissay usually makes little fuss
over the business plans of the companies they invest in. But Japanese
utility shares have plunged this year, halving in value since the
March 2011 accident and saddling Nissay with an estimated 230 billion
yen valuation loss as of late April, according to Gyorgy Dallos,
Greenpeace analyst and former Boston Consulting Group principal.
Nissay does not disclose valuation losses on individual stocks.
The losses are much smaller at Nissay’s rivals such as Dai-ichi Life
Insurance Co. or Meiji Yasuda Life Insurance Co., because of their
limited exposure to utilities, Mr. Dallos said, at a briefing for
foreign reporters in Tokyo.

If Nissay sells its utility shares, that could depress the market and
end up hurting its portfolio, said Mr. Dallos. Instead, Mr. Dallos
suggests Nissay become an activist shareholder, using its influence to
press utilities to reduce their reliance on nuclear power and
diversify into renewable energy. For instance, Nissay could suggest
utilities like Kansai Electric determine which units are too old to be
extended, how to shorten the life of other units, and come up with
robust safety measures for those that remain, Mr. Dallos said…..
http://blogs.wsj.com/japanrealtime/2012/06/13/fukushima-watch-next-nuclear-battleground-utilities-shareholder-meetings/

June 14, 2012 - Posted by Christina Macpherson | business and costs, Japan