2 JAPAN’S ENERGY POLICY AND COMMUNITY POWER …
33
Financial Risk for Utility
Companies and Plant Makers
Although TEPCO is still the largest private utility company in the world,
since the Fukushima accident it has been facing the threat of bankruptcy,
as it is obliged to pay a total of 8000 billion Yen (USD 72 billion),
or annually 300 billion Yen (USD 2.7 billion) as the cost for decommissioning the Fukushima reactors, and a total of 3900 billion Yen
(USD 35.1 billion), or 200 billion Yen (USD 1.8 billion) annually to
compensate refugees and other victims. Since the accident the Japanese
government has injected capital to prevent TEPCO from going bankrupt,
and as a result has taken a temporary controlling share of the company.
Citizens have come to see that if another nuclear accident happens the
national government will have to assume financial and managerial responsibility for the company owning that plant. “Nuclear energy is safe, clean
and cheap”: The Fukushima accident revealed this claim to be nothing
more than a myth and illusionary propaganda.
This accident also creates extra cost for implementing new and
improved safety standards. Toshiba, one of Japan’s leading giant electronics companies, also faced bankruptcy at of the end of April 2017 due
to the manipulation of accounts to the tune of 230 billion Yen (2.1 billion
Dollars), related losses of 500 billion Yen (4.5 billion Dollars) in FY 2015,
and losses stemming from its purchase of a US nuclear reactor manufacturer, losses that totaled another 700 billion Yen (6.3 billion Dollars) in
FY 2016. The trigger was buying the nuclear energy division of Westinghouse in 2006. Then Toshiba boasted that it had become the world’s
largest nuclear reactor manufacturer. However, this was misplaced pride
and the beginning of Toshiba’s downfall. Westinghouse used to be a
leading electric appliance manufacturer in the USA that had been considered a major rival to GE and developed pressurized-water reactors (PWR)
that were used by Kansai Electric Power Corporation (KEPCO) and some
other Japanese Electric Power Companies (EPCOs). Westinghouse gradually declined and became defunct in 1999. It sold its nuclear energy
division to BNFL in 1998. BNFL was driven to the brink of bankruptcy
and its owner, the UK government, decided to let Westinghouse go.
Toshiba won the bid for the company and paid five billion dollars, double
the estimated value, in anticipation of “the nuclear renaissance.” In 2009
Toshiba declared the goal of booking new orders for 39 reactors globally by 2015. In fact, Toshiba started construction of no more than eight
33
Financial Risk for Utility
Companies and Plant Makers
Although TEPCO is still the largest private utility company in the world,
since the Fukushima accident it has been facing the threat of bankruptcy,
as it is obliged to pay a total of 8000 billion Yen (USD 72 billion),
or annually 300 billion Yen (USD 2.7 billion) as the cost for decommissioning the Fukushima reactors, and a total of 3900 billion Yen
(USD 35.1 billion), or 200 billion Yen (USD 1.8 billion) annually to
compensate refugees and other victims. Since the accident the Japanese
government has injected capital to prevent TEPCO from going bankrupt,
and as a result has taken a temporary controlling share of the company.
Citizens have come to see that if another nuclear accident happens the
national government will have to assume financial and managerial responsibility for the company owning that plant. “Nuclear energy is safe, clean
and cheap”: The Fukushima accident revealed this claim to be nothing
more than a myth and illusionary propaganda.
This accident also creates extra cost for implementing new and
improved safety standards. Toshiba, one of Japan’s leading giant electronics companies, also faced bankruptcy at of the end of April 2017 due
to the manipulation of accounts to the tune of 230 billion Yen (2.1 billion
Dollars), related losses of 500 billion Yen (4.5 billion Dollars) in FY 2015,
and losses stemming from its purchase of a US nuclear reactor manufacturer, losses that totaled another 700 billion Yen (6.3 billion Dollars) in
FY 2016. The trigger was buying the nuclear energy division of Westinghouse in 2006. Then Toshiba boasted that it had become the world’s
largest nuclear reactor manufacturer. However, this was misplaced pride
and the beginning of Toshiba’s downfall. Westinghouse used to be a
leading electric appliance manufacturer in the USA that had been considered a major rival to GE and developed pressurized-water reactors (PWR)
that were used by Kansai Electric Power Corporation (KEPCO) and some
other Japanese Electric Power Companies (EPCOs). Westinghouse gradually declined and became defunct in 1999. It sold its nuclear energy
division to BNFL in 1998. BNFL was driven to the brink of bankruptcy
and its owner, the UK government, decided to let Westinghouse go.
Toshiba won the bid for the company and paid five billion dollars, double
the estimated value, in anticipation of “the nuclear renaissance.” In 2009
Toshiba declared the goal of booking new orders for 39 reactors globally by 2015. In fact, Toshiba started construction of no more than eight