Tokyo Electric Power Co. (TEPCO) secured government and bank support for its rebuilding plan. The plan is the latest in a recovery process for the company, which was hit hard after the nuclear disaster of 2011 that almost brought the company to ruins due to its mishandling of the Fukushima plant. TEPCO, now under government control, needed to cut costs of more than 1 trillion yen ($9.6 billion), under its agreement with lenders and banking institutions. To do this, it must restart two reactors at the Kashiwazaki-Kariwa nuclear plant by July.
The Kashiwazaki-Kariwa plant is considered the biggest nuclear power plant in the world. All of Japan’s 48 reactors are switched off for safety checks after the 2011 nuclear disaster. Most of the public is against restarting the reactors, including Governor Hirohiko Izumida of Niigata Prefecture, where the plant is located. NHK reported that the governor believes it’s too early to restart the reactors by July. Naomi Hirose, TEPCO president, said he would meet with the governor to discuss things. “As an electricity utility, we’d like to have nuclear power as an option to sustain a stable power supply,” said Hirose to Tokyo reporters. “If the Kashiwazaki-Kariwa plant restarts, the company will be able to generate electricity from sources that will allow us to cut rates,” he further stated. Chief credit analyst for BNP Paribas SA, Mana Nakazora backed Hirose’s claim saying, “if the plant remains idled, losses will incur and the public won’t agree on increases in electricity charges when the utility tries to cover losses.” Part of the restructuring plan also includes slashing 2,000 jobs from the current 37,000 employees of TEPCO. Turning it into a holding company will happen by 2016.
While a poll by national broadcaster NHK showed that 42% are against nuclear power, Prime Minister Shinzo Abe supported the idea, saying that such power is needed to provide lower costs in electricity to boost the economy’s growth. The prime minister’s decision was a stark contrast from his predecessors, who called for the abolition of nuclear power. The revised rebuilding plan was announced by TEPCO yesterday to garner support for its plan of restarting nuclear reactors in the Kashiwazaki-Kariwa plant.