Kansai Electric Gets Nod to Restart 3 Reactors, Shares Jump


TOKYO, April 28 (Reuters) – Kansai Electric Power received approval to restart three 40-year old and long-idled reactors, a move that could pave the way for a revival of Japan’s nuclear energy sector that has been dormant since the Fukushima disaster a decade ago.

Fukui Prefecture Governor Tatsuji Sugimoto’s approval on Wednesday, necessary before any return to operation is possible following the post-Fukushima shutdown, was the first such nod in four years.

Japan’s nuclear sector has spent billions of dollars to upgrade reactors but only started nine units since new regulations were imposed following the March 2011 catastrophe, less than a fifth of the pre-Fukushima fleet.

Further reboots will help the industry meet government targets that call for the decarbonisation of the country’s heavily industrialised economy as Japan embraces tough targets on climate change.

The move is likely to prove controversial due to the age of the reactors and their decade-long shutdown, following the worst civilian nuclear crisis since Chernobyl in 1986. The public remains highly suspicious of atomic power after the failings in operation and oversight exposed by the Fukushima disaster.

Shares of Kansai Electric jumped more than 4% on news of approval for the restarts. But with more regulatory steps and site inspections ahead, it could take as long as a year before the reactors begin operations.

Japan was once the world’s third-largest user of nuclear energy. Utilities are now decommissioning nearly 40% of the pre-2011 plants.

There are currently only seven reactors operating, down from typically around 47 before the 2011 earthquake and tsunami that caused the meltdowns in Fukushima.

Prime Minister Yoshihide Suga last week nearly doubled Japan’s emissions-reduction target by 2030 after pledging in October to achieve carbon neutrality in 2050. The targets are a major shift in stance by a country described even by allies as a laggard on climate change.

Getting more reactors going would give the world’s fifth-biggest emitter of carbon the chance to close polluting coal-fired power stations. The country is also setting higher targets for renewable power.

Under the nuclear regulatory framework put in place to address the failings of the regulators and operators over Fukushima, extending the standard operating permit for reactors was only be done in exceptional circumstances, said Tatsujiro Suzuki, a former vice-chairman of Japan’s Atomic Energy Commission told Reuters by phone.

“It’s still probably going to be a controversial issue over whether this is an exceptional case,” said Suzuki, who is a professor studying nuclear proliferation at Nagasaki University.

For Kansai Electric, a higher utilisation rate of its nuclear power plants may boost its recurring profits by as much as 42 billion yen ($386 million) in the year to March 2022 from a year earlier, a spokesman said when the company reported earnings on Wednesday.

Japan’s second-biggest electric utility by sales said recurring profit fell 27% to 153.85 billion yen and net profit dropped 10% to 108.98 billion yen in the year through March 2020.

Its shares closed 2.4% higher while its beleaguered industry peer Tokyo Electric Power fell 0.9% amid a wider market rise of 0.2%.

($1 = 108.9300 yen)

Reporting by Aaron Sheldrick; Additional reporting by Yuka Obayashi; Editing by Jacqueline Wong and Kim Coghill

Source: Reuters


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