Swollen Cost for Decommissioning

Estimation of the cost for decommissioning broken reactors in First Fukushima Nuclear Power Plant, or 1F, keeps on swollen. While it once was calculated to be ¥5 trillion, which was corrected to be ¥9 trillion, the government of Japan realizes it to be tens of trillion yen. Who is going to pay for that? Not only the owner of the reactors, Tokyo Electric Power Company, but Japanese citizens have to owe it? To avoid a sense of moral hazard, the government reluctantly begins to consider dismantlement of TEPCO by separating nuclear power business from its main body.

In the meeting of Committee for Reforming TEPCO and 1F Issue, Ministry of Economy, Trade and Industry revealed its estimation of annual cost for decommissioning 1F reactors as several hundreds of billion yen. Realizing difficulty of TEPCO to pay for all of it, METI presented four options: the government would pay, additionally injecting public money to TEPCO, leaving TEPCO alone, and separating nuclear power business to earn money for decommissioning. First three options were dropped, because of immorality to support an incompetent company with public money or additional burden to the consumers.

Separation option is an offer of the government to introduce new system for TEPCO to pay for the decommissioning. In that scenario, while TEPCO will maintain its job for decommissioning 1F and compensation for the accident five years ago, new subsidiary company for nuclear power generation will yield profit for decommissioning by resuming operation in Kashiwazaki-Kariwa Nuclear Power Plant. The government thought that it would justify resumption of Kashiwazaki-Kariwa, which Shinzo Abe administration has been hoping.

TEPCO has changed its business in April, separating thermal power generation, retailing electricity, and distribution of electricity under the umbrella of TEPCO Holdings. Separating nuclear power generation is supposed to be generating cooperation with other power companies in Japan. It is a good idea for the government to maintain Kashiwazaki-Kariwa plant with sacrifice of TEPCO being dismantled.

Is it true that all the cost for decommissioning 1F will be paid only through TEPCO reform? The experts still have not determined final cost for decommissioning 1F. It is possible for the government to begin to say that “Well, we did our best for the reform, though, it is still in short. People have to pay for the rest.” Perspective for resumption of Kashiwazaki-Kariwa is still unclear, because of opposition of new governor of Niigata, who was elected with support of the opposite party. Nuclear generation is not competitive in this country.