Japan Utilities Plunge After Fault Found Under Nuclear Plant
Kansai Electric Power Co. led declines in Japan’s utilities after geologists said an earthquake faultline may be active under a nuclear plant that houses the country’s oldest reactor.
Kansai Electric shares fell as much as 9.7 percent, their biggest intraday decline since Oct. 23, and closed 4.4 percent lower at 742 yen in Tokyo. The Topix Electric Power & Gas Index fell 1 percent.
The company is the second-biggest stakeholder in Japan Atomic Power Co., which runs the Tsuruga nuclear plant on the coast 127 kilometers (79 miles) northeast of Osaka that was examined by geologists this month. The finding was announced yesterday and may lead to decommissioning of the unit.
“The assessment raises the risk” that the nuclear watchdog will come to a similar conclusion for other atomic generators under investigation, Reiji Ogino, a Tokyo-based analyst at Mitsubishi UFJ Morgan Stanley, said by phone today.
Kansai Electric’s Ohi plant, which houses Japan’s sole operating reactors, is among six nuclear facilities being investigated by the Nuclear Regulation Authority for possible active fault lines. The utility is carrying out additional investigations after an NRA team was divided over whether a fault under the Ohi station is active.
Under Japan’s guidelines for nuclear plants, active faults are defined as those that have moved in the past 120,000 to 130,000 years, the NRA said Oct. 23 in a statement.
The conclusion by the NRA panel on Tsuruga is “unacceptable,” Japan Atomic said in a statement yesterday. The company will carry out investigations to support its claim that the fault is not active, it said.
The government approved resumption of two reactors at the Ohi plant in July, sparking weekly protests outside Prime Minister Yoshihiko Noda’s official residence that attracted tens of thousands of people. The Ohi plant and the Tsuruga station are both located in Fukui prefecture, nicknamed the Nuclear Ginza for its 13 reactors, which is the highest concentration in the world.
Five scientists led by Kunihiko Shimazaki, a commissioner on the NRA set up after the Fukushima disaster, agreed the fault under the Tsuruga No. 2 reactor is very likely active. The No. 1 unit in the same plant started in 1970 and is the oldest commercial reactor in the country. Both reactors are offline for safety checks.
“There is no way we can carry out safety assessments to allow a restart as matters stand,” Shunichi Tanaka, the NRA chairman, said yesterday on the Tsuruga reactor.
The five scientists conducted a two-day on-site survey at the plant about 30 kilometers north of Lake Biwa, which supplies drinking water for the Kansai region, Japan’s second biggest metropolitan area. Japan Atomic is owned by the country’s 10 regional power companies. Tokyo Electric Power Co., the largest stakeholder in the utility, fell as much as 4.3 percent, before closing 1.4 percent lower at 138 yen.
The NRA will discuss the Tsuruga plant as early as tomorrow based on the finding by the scientists, spokesman Gyo Sato said by phone today.
All but two of Japan’s 50 reactors are offline for safety checks after the Fukushima disaster. The NRA has said it plans to set up new safety standards by July that will be used to assess whether more reactors can restart.
The Ministry of Economy, Trade and Industry may come to the aid of Japan Atomic by encouraging it to merge with another power utility or offering financial assistance for decommissioning, the Nikkei newspaper reported today, without citing anyone.
Japan Atomic would have 256 billion yen in losses if the company closes its three reactors, one at the Tokai Dai-Ni plant and two at the Tsuruga station, exceeding its 163 billion yen in net assets, the trade and industry ministry, which oversees the country’s power companies, estimated in June.
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