The cost of cleaning up fallout from the triple meltdowns at the Fukushima No. 1 power station and compensating those whose lives have been affected may double to some ¥10 trillion, Tokyo Electric Power Co. announced Wednesday.
“There is a view that we may need the same amount of additional money for the decontamination of low-level radiation areas and for the costs of temporary facilities for storing waste,” Tepco, which in April estimated decontamination work and compensation payments would amount to ¥5 trillion, said in a statement.
The utility, one of the world’s biggest, later that month received a ¥1 trillion bailout with taxpayer money in exchange for granting the government a controlling stake. The funds were intended to prevent the utility, which supplies electricity to millions of households and corporate customers in Tokyo and the Kanto region, from going under.
The survival of Tepco hinges on whether it receives more financial aid, according to Hirofumi Kawachi, an energy analyst at Mizuho Investors Securities Co.
“The government is likely to refuse to cover all the additional expenses,” which would inevitably come under scathing attack from the public, Kawachi said in an interview.
On May 11, industry minister Yukio Edano indicated the government would pay part of the costs to decontaminate areas around the Fukushima No. 1 complex, while Tepco would pay for the decommissioning and dismantling of its crippled reactors, a process expected to take decades.
Tepco plans to set up a regional head office in Fukushima Prefecture manned by more than 4,000 employees to oversee local reconstruction efforts, decontamination and compensation payments arising from the March 2011 nuclear disaster. The head of the office, who will be an internal appointment, will enjoy a status equivalent to that of a vice president at Tepco’s headquarters in Tokyo.
According to sources, Tepco hopes to demonstrate its commitment to fully handle the aftermath of the nuclear disaster through reinforcing its local presence in Fukushima, where discontent has been mounting.
Many of the prefecture’s municipalities and residents believe the utility is failing to incorporate their opinions and suggestions in decision-making related to rebuilding projects, decontamination work and victims’ compensation because all of these matters are currently overseen by its Tokyo headquarters.
In a related step, Tepco plans to triple the number of specialists overseeing decontamination to 300 and to dispatch all of its 38,000 workers to Fukushima Prefecture two or three times annually to help communities, including to perform manual labor such as moving furniture and scrubbing residents’ homes.
Solar power promotion
The feed-in tariff system introduced in July to facilitate the use of renewable energies has been prompting financial institutions to fund solar power projects amid sluggish overall demand for loans.
The program, which requires regional utilities to purchase all electricity created from renewable energy sources at premium rates, “makes it easier to forecast earnings” from power generation, an official at a major domestic bank said.
Mizuho Corporate Bank, a wholesale banking unit of Mizuho Financial Group Inc., will set up a ¥5 billion investment fund by month’s end for large-scale solar power generation projects. The fund will target solar power projects with a total cost of at least ¥10 billion, and cover 5 percent to 15 percent of the costs. The bank assumes the period for investments will span three to four years.
Mizuho Corporate Bank will also extend syndicated loans with regional banks to meet funding needs of participants in the projects. So far, the bank has decided to extend loans for a large-scale solar power project by JGC Corp. in Oita Prefecture, as well as a similar project in Kagoshima Prefecture by a group of companies, including Kyocera Corp.