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Voluntary power-saving plan risky if heat, economy collide

Kyodo

In anticipation of tight electricity supply conditions this summer without nuclear energy, the government has taken the unusual step of setting numerical targets for power usage in extensive areas served by seven of the nation’s 10 utilities.

But the move is risky, as it is uncertain how effective such steps will be when they are nonbinding. The areas served by Tokyo Electric Power Co. and Tohoku Electric Power Co. are not included.

Considering the time needed for companies to prepare, such as by revising plant operation schedules, a government official said the “deadline” had come for the government to decide on this summer’s measures.

Last year, in the early days of the Fukushima nuclear crisis, summer power consumption conservation measures were drawn up on May 13.

In planning for this summer, some government officials were initially cautious about slapping numerical reduction targets on areas served by utilities with excess capacity, such as Chubu Electric Power Co.

Chubu Electric provides electricity to the central Japan area, including Nagoya, a region heavily dependent on the auto industry. “Would it be possible to win (the industry’s) approval just when Toyota Motor Corp. is trying to increase production?” asked a senior official at the Ministry of Economy, Trade and Industry.

As demand arising from postquake reconstruction and generous government subsidies for green cars have just begun to spur a positive growth cycle for the auto industry, some officials preferred not to hamper the momentum with power-saving targets.

But the course of discussion took a turn as industry minister Yukio Edano and others came to feel strongly that the regionalized power supply network created by the utilities and the former ruling Liberal Democratic Party is an impediment to the sharing of capacity to avert power shortages.

Similarly, members of a government expert panel to verify the balance of power supply and demand also stressed the need for the involvement of all utilities.

Response from industrial and local government leaders, however, was mixed.

Nippon Steel Corp. President Shoji Muneoka on Monday stood up for the cause, declaring that his company as a whole would fashion ways to “avoid” heavy demand at peak hours of power usage.

Accordingly, Nippon Steel, the country’s biggest steelmaker, plans to adjust operations at its mills in line with power supply and demand trends in their areas.

But many small and midsize companies are balking at the costly power-saving measures.

Last year, numerous companies in eastern Japan relocated operations to Kansai and other areas due to power shortages and the threat of rolling blackouts in Tepco’s service area b ecause of the Fukushima No. 1 disaster.

Such an escape route may not be possible this year as the power-cut policy spans the nation.

The government hopes that by setting conservation targets throughout the country, it can get utilities with excess capacity to supply electricity to others so the nation can get through the summer power crunch. It is unclear how big a burden will be put on households, hospitals and administrative operations in areas with excess capacity.

There is also no guarantee there will be sufficient surplus to fill the gap, especially if the summer turns out to be usually hot.

Last winter, when users in Kansai Electric’s service area were asked to voluntarily reduce power usage by 10 percent, a cut of only 5 percent was achieved.

Heading into this summer, local officials around the country are not certain what impact appeals to conserve power will have on households, hospitals and government offices.

“I can’t just say (to the central government) ‘alright I understand,’ ” said Aichi Gov. Hideaki Omura.

Within the power industry, there is also growing concern that more equipment problems and malfunctions may occur as utilities are forced to activate old thermal power plants and operate them to the limit.

In a reflection of its sense of impending crisis, the government is preparing for possible rolling blackouts for the four utilities serving the Kansai, Hokkaido, Shikoku and Kyushu regions.

At the same time, the government and Kansai Electric are betting on the possibility of alleviating the supply shortage if two idled reactors at the utility’s Oi nuclear power plant in Fukui Prefecture can be restarted.