nuclear-news

  TEPCO’s rehabilitation plan delays expose limits to nuke power reliance.

It was unreasonable in the first place for the power company to draw up a rehabilitation scenario relying on atomic power despite having caused a serious nuclear plant accident.

April 9, 2025 (Mainichi Japan), https://mainichi.jp/english/articles/20250409/p2a/00m/0op/029000c

Tokyo Electric Power Company (TEPCO) Holdings Inc. has postponed the revision of its business rehabilitation plan, which it had scheduled to carry out by the end of fiscal 2024. The company attributed the postponement to a lack of prospects for restarting the Kashiwazaki-Kariwa nuclear power plant in Niigata Prefecture, which it had seen a trump card in improving its earnings.

Will the utility be able to fulfill its responsibility in the recovery from the Fukushima disaster and the stable power supply amid such a state of affairs?

TEPCO has borrowed money from the national government to deal with the aftermath of the Fukushima nuclear meltdowns. This includes funds needed for compensation payments to affected residents and the decommissioning of the Fukushima Daiichi Nuclear Power Station. It has also taken out bank loans to fund its electric power business. The rehabilitation plan was supposed to form the premise for this financial aid.

The plan was first formulated in 2012, the year after the onset of the Fukushima disaster, and has since been updated almost every three years. The cost for handling the nuclear catastrophe was initially estimated at 6 trillion yen (approx. $41.27 billion), but that figure swelled to 21.5 trillion yen (148 billion) under the current plan outlined in 2021. The cost further rose to 23.4 trillion yen (approx. $161 billion) when taking into account compensation for fishery operators due to the release of treated water from the stricken Fukushima nuclear plant, among other expenses.

The cap on borrowing from the national government was subsequently raised to 15.4 trillion yen (approx. $106 billion). Based on these developments, calls grew to update TEPCO’s rehabilitation plan.

While TEPCO is scheduled to repay 500 billion yen (approx. $3.45 billion) annually to the national government, the actual repayment amount has hovered around 400 billion yen (around $2.76 billion) on average in recent years due to the firm’s poor performance.

The primary factor behind TEPCO’s sluggish earnings is that the Kashiwazaki-Kariwa nuclear plant has yet to be restarted. TEPCO had initially expected to resume the plant’s operations in fiscal 2019, eyeing a balance improvement of 100 billion yen (approx. $688 million) per reactor brought back online. But following a series of scandals including inadequate antiterror measures at the plant, the prospect of gaining local consent for its restart has waned.

TEPCO’s injection of more than 1 trillion yen (approx. $6.88 billion) into safety measures has also taken a heavy toll on its management, weighing down its cash flow. There are concerns that the utility may not even be able to afford capital investment essential for a stable power supply.

It was unreasonable in the first place for the power company to draw up a rehabilitation scenario relying on atomic power despite having caused a serious nuclear plant accident. In the amendments to be made to the rehabilitation plan by the end of fiscal 2025, the utility should completely overhaul its strategy.

TEPCO must accelerate its business realignment to improve its earning capacity. Its thermal power generation sector was integrated into Chubu Electric Power Co. in 2019, yet TEPCO needs to expand collaboration with other firms in renewable energy and other sectors with high growth potential. It urgently needs to streamline operations to stave off deterioration of its finances.

The company is urged to carry out a rehabilitation plan that is not reliant on nuclear power generation.

April 13, 2025 - Posted by Christina Macpherson | business and costs, Japan