In September, media reported that 20 executives of Kansai Electric Power Co. (Kepco) had, for a decade or so, received almost ¥320 million worth of cash and gifts from Eiji Moriyama, the former deputy mayor of Takahama, Fukui Prefecture, who died in March at the age of 90. The compensation was presumably paid in gratitude for Kepco contracts with a construction company close to Moriyama that had done work for Kepco’s Takahama nuclear power plant. The story caused a sensation and there has since been a steady drip of reports compounding Kepco’s complicity in the matter, but the only significant repercussion so far has been the resignation of Kepco’s chairman. No charges have been filed.
If the scandal doesn’t change the way business is carried out between Kepco and its partners, it’s because it’s been carried out that way for so long that no one expects it to. Although the story got out, as is often the case with these types of scandals, the vernacular press seems to have missed the signs until the story was actually handed to them in a form they couldn’t ignore — in this case a letter sent by a whistleblower. On Oct. 15, the Japan Newspaper Publishers & Editors Association cited Kyodo News for breaking the story on Sept. 26, though apparently, most major news outlets received a copy of the same letter at the same time.
Writing for the Shukan Asahi, reporter Noriyuki Imanishi provided an overview of how the scandal came to light. The letter received by the media was originally addressed to Kepco’s president on March 10, accusing the company of covering up the payments, which had been revealed by an internal audit prompted by an investigation by the Kanazawa Regional Taxation Bureau in January 2018. The whistleblower demanded that the 20 executives, including the president and the chairman, step down to take responsibility for the payments and, if they didn’t, he would forward the letter to other parties, including the cities of Osaka and Kobe, Kepco stockholders, and various news outlets.
Veteran freelance reporter Masao Awano wrote a firsthand on-site report about the background of the scandal for the November edition of the independent newspaper Uzumibi, focusing on Moriyama’s influence in a small town that hit the jackpot when it became the host of a nuclear power plant in 1970. As deputy mayor, Moriyama used the resources at his disposal to keep the Kepco contracts coming, and, especially in the wake of the 2011 accident at the Fukushima No. 1 nuclear power plant and the resulting public disillusion with nuclear energy in general, Kepco did everything in its power to please Moriyama, since it was he who most directly determined the Takahama plant’s fate.
Another journalist who dug deeper was Fumikazu Nishitani, who runs an internet radio program called “Rojo no Rajio” (“Radio on the Street”). The Oct. 11 installment featured an interview with former Kepco employee Jiro Hayami, who spoke in detail and at length about what exactly that ¥320 million represents in terms of influence and obligation.
Hayami’s overarching observation is that the money traveling in both directions between Kepco and Moriyama was directly tied to Kepco’s “obsession” with maintaining nuclear as one of the region’s — and, by extension, the country’s — primary sources of energy. Hayami never mentions radiation concerns, nor does he betray any bias against nuclear power in any terms other than economic ones. His main gripe is that people who hold the decision-making powers in the matter have become so used to these monetary incentives that they are incapable of making decisions in the public interest.
The origin of this dynamic is a set of laws passed during the administration of Prime Minister Kakuei Tanaka in 1974, which mandated a subsidy be paid to communities that host nuclear power plants as a means of helping them shoulder the burden. Tanaka wanted a nuclear plant built in Kashiwazaki in his home prefecture of Niigata, a plant the residents didn’t want. The subsidy was a form of bribery sanctioned by the Diet. Some ¥2.5 trillion was eventually distributed to local governments from the mid-1970s to 2010 throughout Japan to do with as they pleased.
The purpose of the Tanaka subsidy was to placate local governments so that regional power monopolies could reap the nuclear power whirlwind. At that time, power companies guaranteed themselves an 8 percent margin above and beyond all costs, so the bigger and more numerous the plants, the more money they could make. They would never make that much with renewables, even though Kepco produces more power now with renewable sources than it does with nuclear. That’s why they are addicted to nuclear and want idle plants reopened. As Hayami notes, nuclear power is much more expensive than the industry and its backers let on. Some front-end costs, such as uranium enrichment in the United States, aren’t factored in to calculations, and almost all back-end costs, such as decommissioning, are also ignored. Despite having been targeted by tax authorities and, at the time, their own internal investigation, Kepco executives demanded an estimated ¥800 million compensation increase at the company’s shareholders meeting in June 2018.
The point these different writers want to make is that this corruption, which isn’t called corruption since its illegality has not been tested by law enforcement, is endemic to the industry. An astute observer can see hints of it in isolated reports that reveal the industry’s arrogance — for example, Kepco’s flouting of government directives regarding anti-terrorist countermeasures — but major news outlets rarely connect the dots to show a pattern of wrongdoing, nor do they seem willing to go out on a limb to challenge a behemoth such as Kepco. For that, they need a letter from an anonymous insider who only contacts the press because this person feels they have no other choice. In fact, one could make the case that the person blew the whistle on Kepco out of concern for the company rather than enmity toward it. According to the Uzumibi article, they even refer to the fixer as “Moriyama sensei” — a term of respect.