Two major utilities and a pair of power plant manufacturers are considering a four-way alliance on nuclear power operations, sources said Wednesday, as the industry grapples with rising costs related to decommissioning and safety.
Tokyo Electric Power Company Holdings Inc. and Chubu Electric Power Co. are in discussions with Hitachi Ltd. and Toshiba Corp. to possibly launch a joint company that would handle reactor maintenance. They are also considering jointly decommissioning obsolete reactors, the sources said.
Decommissioning and safety-related costs have been rising for power providers following meltdowns at Tepco’s Fukushima No. 1 nuclear plant following the 2011 earthquake and tsunami. Tougher safety rules have been introduced in the wake of the crisis.
Currently, various utilities and power plant-makers are coordinating reactor maintenance work. The four-way partnership aims to consolidate personnel and technology, and streamline costs and operations for better efficiency, the sources said.
The four firms are also expected to share knowledge on work related to their boiling-water reactors, the same type as those at Tepco plants.
Struggling under huge compensation payments over the Fukushima nuclear crisis and plant decommissioning costs, Tepco aims to rebuild itself by realigning its nuclear business.
Through the tie-up, Tepco is also looking into cooperating with other major utilities to resume the planned construction of the Higashidori nuclear plant in Aomori Prefecture.
Chubu Electric, for its part, aims to cut safety costs as it faces challenges in restarting its Hamaoka plant in Shizuoka Prefecture.
The two utilities have already agreed to merge their fossil-fuel operations next spring.
“It makes sense in the domestic arena to cooperate. Four balance sheets is better than one when it comes to nuclear risks,” said Tom O’Sullivan, the founder of energy consultancy Mathyos Japan.
The nuclear sector provided about 30 percent of the country’s electricity supply before the March 2011 meltdown.
All reactors had to be re-licensed by a new regulator after the disaster highlighted regulatory and operational failings in the industry.
Nine reactors have received approval to restart after undergoing expensive upgrades to meet new safety standards. Chubu Electric and Tepco have yet to restart any units.
Japan had 54 operational reactors before the disaster, but utilities have announced plans to decommission nine units in the aftermath, in addition to the six reactors at Fukushima, where a decadeslong clean-up is in progress.