Kan bent on taking down utility interests with him
Although embattled Prime Minister Naoto Kan seemingly is just clinging to power with a desire to remain prime minister as long as possible, what put a charge in him is his long-held grudge against electric industry interests.
As a graduate of the Tokyo Institute of Technology, Kan has long had a strong interest in science.
But he now appears to be more interested in destroying these electric industry interests, made up of electric power companies that have interfered with the spread of natural energy sources by protecting their regional monopolies, bureaucrats at central government ministries and the Liberal Democratic Party.
One weekend in June, Kan touched upon the significance of a special measures bill to promote renewable energy sources by introducing a feed-in tariff system for electricity generated by natural energy sources.
“We have to change the structure of having the electric power industry deeply involved in politics,” Kan said.
As an example, these electric industry interests have put a bulls-eye on Kan to remove him from power. But the prime minister is deftly turning the power struggle into a major debate in Japanese society for the first time over its choice of electricity and clear alternatives.
Having his roots in the citizens’ group movement, Kan won his first term to the Lower House in 1980 on his fourth attempt to gain a Diet seat.
Shortly after that election, Kan visited Miyakejima island and stood atop a 40-meter-high windmill.
Tokyo Electric Power Co. had constructed two wind power plants on an experimental basis, with each capable of generating 100 kilowatts of electricity.
In 1982, Kan appeared at a Lower House science and technology committee session and in asking questions for the first time argued for the spread of wind power.
“It can be reused infinitely,” Kan said then. “We will be able to open up a new future in our energy issues forever.”
However, Ichiro Nakagawa, who was science and technology agency chief at the time, brushed off Kan’s suggestion.
“There should be no excessive emphasis so it can be used as an excuse to say we don’t need nuclear energy,” Nakagawa said.
The electric industry interests were already wary about any spread of natural energy that could provide ammunition to those calling for a move away from nuclear energy.
TEPCO officials subsequently concluded that the Miyakejima project would never be profitable and pulled out of the project after about six years.
Kan would later tell his close associates how electric power companies would deliberately set up examples of failure to prevent any spread of natural energy.
“Their way of doing things is to begin a project and then crush it,” Kan said.
Kan called for a move away from nuclear energy when he was still a member of the Social Democratic Federation. He then moved to New Party Sakigake and what is now the Democratic Party of Japan.
In the 2003 Lower House election, the DPJ, with Kan as its head, included a pledge to introduce a feed-in tariff system in the campaign platform. However, the party failed to gain a majority.
The same plank was included in the manifesto for the 2009 Lower House election. A bill for renewable energy sources was approved by the Kan Cabinet on the morning of March 11.
After Kan became prime minister last year, he showed a strong interest in raising the consumption tax rate. In comparison, he never pushed to have natural energy become a centerpiece of his administration.
In fact, the government began pushing for exports of nuclear power plants.
Kan avoided a direct confrontation with the electric industry interests in an attempt to maintain his hold on power.
That all changed after the Great East Japan Earthquake struck on March 11.
As the accident at the Fukushima No. 1 nuclear power plant operated by TEPCO spread, Kan told his close associates that the opportunity had arisen to reform the electric industry.
On May 6, he asked Chubu Electric Power Co. to stop operations at the Hamaoka nuclear plant.
At a May 10 news conference, Kan said the government’s basic energy plan would be drastically reviewed from zero.
He also proposed splitting up electric power companies into entities in charge of power generation and power transmission.
At the Group of Eight summit in France on May 26, Kan presented a proposal to install solar panels in 10 million Japanese homes.
It was after those developments that major efforts were made in Japan to topple Kan from power.
LDP officials presented information that Kan had rejected a proposal to pump in seawater to deal with the Fukushima nuclear accident.
Banri Kaieda, the minister of trade, economy and industry, said he had never heard about Kan’s solar panel proposal made in France.
The LDP submitted a no-confidence motion against the Kan Cabinet on June 1, ahead of original plans. DPJ power broker Ichiro Ozawa also indicated that he would vote in favor of the motion.
On June 2, Kan was forced to state his intention of stepping down as prime minister once progress had been made in the rebuilding process from the quake.
He told close associates, “The TEPCO and industry ministry alliance engaged in a fierce counteroffensive after the request to stop operations at the Hamaoka plant.”
The political mudslinging has continued as Kan continues to remain in office with no signs of resigning any time soon.
Choosing the source of electricity has for a long time not been a major issue of political confrontation in Japan. It never was a major topic for debate even as the government changed hands from the LDP to the DPJ.
Nuclear energy has been pushed as national policy and can be considered a large-scale, concentrated form of power generation. In contrast, natural energy is more small-scale and dispersed so even individuals and small regional companies can take part.
There will also have to be discussions over whether to continue with a structure that pursues securing highly efficient energy for the sake of economic growth or shifting to a society that stresses safety, even if that meant a greater financial burden, and emphasizes consuming energy generated in the local community.
There is also the possibility of seeking out a third course that went beyond a choice between two alternatives.
However, before any public debate on the choice of electricity, there has already begun a heated exchange on energy policy between Kan and his associates, on one side, and the Ministry of Economy, Trade and Industry (METI), on the other.
Even before the March 11 quake and tsunami, close associates to Kan were meeting with scholars and individuals from the private sector to discuss energy policy.
In April, after crisis management of the Fukushima nuclear accident had settled down, Kan instructed his aides to compile legislation on energy policy.
Secret meetings were held about once a week, with Kan participating as well.
On May 17, the Kan Cabinet approved a policy promotion guideline that included a proposal to review energy and environmental policies.
On May 19, a meeting of the Council on the Realization of the New Growth Strategy was resumed with Kan serving as chairman. The council decided to push discussions for a review of energy policy to further stress natural energy.
Planning and writing of legislation for energy policy has been the domain mainly of METI.
However, Kan is now trying to have the Prime Minister’s Official Residence be in charge of reviewing energy policy, rather than METI, which oversees the electric power industry.
The secretariat for the Council on the Realization of the New Growth Strategy is the National Policy Unit, which is part of the Cabinet Secretariat.
Close associates of Kan said, “The prime minister holds a deep distrust of METI.”
For their part, METI officials are having an increasing sense of danger because energy policy and administration is considered the key policy base of METI.
Concerned about what was going on, METI officials strengthened cooperation with those ministry officials who have been dispatched to the National Policy Unit.
The National Policy Unit is made up of about 50 members. There is one team in charge of overall coordination and planning of legislation, while another makes policy proposals to Kan.
Sources said there has emerged a smaller team dominated by METI officials, including a high-ranking official.
Five of the 10 team members are originally from METI and they are clearly in charge, even though a number of Environment Ministry officials are also part of the team.
The team prepared the draft of a document to be presented to a June 7 meeting of the Council on the Realization of the New Growth Strategy.
The document proposed setting up an energy and environment committee under the council that would play a leading role in the energy policy review discussions. The committee would be made up of DPJ lawmakers with close ties to METI.
Kan was clearly displeased with the document, describing it as a move by METI to topple his Cabinet.
In the document that was actually distributed to the council meeting, no mention was made of having the committee serve as a leading force for debate, and the DPJ members expected to be on the committee were replaced.
Having run into problems at the council, METI officials turned their attention to an advisory panel to Kaieda looking into comprehensive natural resources and energy policy.
Kan had called for a comprehensive review of the government’s basic energy plan that initially called for constructing 14 new nuclear reactors by 2030.
However, by law, the basic energy plan is compiled by the industry minister after consulting with the advisory panel.
METI officials have now established a subcommittee under the advisory panel that will consider the fundamental direction for energy policy from this month.
Akio Mimura, chairman of Nippon Steel Corp., is expected to serve as chairman of the subcommittee.
Mimura was involved in the compilation of the original basic energy plan put together in June 2010. If he is in charge of the new subcommittee, there will likely not be a major revision of energy policy.
In preparatory documents that included the topics to be discussed by the subcommittee, renewable energy sources are described as a “new pillar” for electricity supply. However, the document also calls for maintaining nuclear energy by “securing the highest levels of safety possible.”
No mention is made of splitting up electric power companies into power generation and transmission entities.
The major reason METI is so concerned about playing a leading role in energy policy is because the business sector is calling for a stable supply of electricity and maintaining order in the situation surrounding the electric industry.
Electric power companies play a huge role in the business world.
Before the Fukushima nuclear accident, a TEPCO executive was always assured of holding the post of vice chairman of Keidanren (Japan Business Federation). Gaishi Hiraiwa, a former TEPCO president, once served as then Nippon Keidanren chairman.
The heads of regional business organizations are almost inevitably the chairman of an electric power company.
The source of influence for electric power companies is their huge plant investment figures.
In fiscal 2009, the 10 electric power companies had a combined total of about 2 trillion yen ($24.8 billion) in plant investment. In fiscal 1993, that figure approached 5 trillion yen.
Orders are placed not only with major electric machinery manufacturers and construction companies, but many smaller local companies as well.
There are also major questions about the extent to which natural energy sources can be relied on in Japan.
According to the energy white paper, annual electricity generation in 2009 totalled about 950 billion kilowatt-hours.
Of that amount, 62 percent was generated by thermal power plants, while 29 percent was generated by nuclear power plants and 8 percent by hydropower plants constructed near large dams.
Natural energy, such as wind and solar power, only accounted for about 1 percent of the total.
In April, the Environment Ministry made calculations about the possible levels of electricity that could be generated using current technology.
Among the conditions used in those calculations were the location of the equipment, the profitability of the power generation project and the introduction of the feed-in tariff system that would require all electricity generated by natural energy to be purchased at a fixed price.
If each kilowatt-hour of electricity was purchased for 20 yen over a 15-year period, the ministry calculated that a total of about 210 billion kilowatt-hours of wind power and about 30 billion kilowatt-hours of geothermal power generation could be installed in Japan.
The total would represent 25 percent of all electricity generated in fiscal 2009.
Under those calculations, there was no possibility of installing any solar power generation facilities.
One reason is that with the high cost of generation, even if the feed-in tariff amount was set at 36 yen per kilowatt-hour, the project would not be profitable for any company, according to the calculations.
For that reason, there will be a need to encourage the spread of installing solar cells on homes as well as reducing generation costs through technology development.
If the profitability of solar power generation was improved and solar power could be included as a feasible natural energy source, the total amount of electricity generated by natural energy could approach 29 percent and make possible a move away from nuclear energy.
At the same time, a move away from fossil fuels as a way of dealing with global warming is another issue that has to be taken into consideration.
In the government’s basic energy plan compiled in June 2010, one goal was to increase the ratio of electricity generated by nuclear energy to at least 50 percent by 2030. The basic plan called for the ratio of electricity generated by hydropower and natural energy to reach a combined 20 percent.
Those goals are closely tied to the objective of reducing greenhouse gas emissions in 2020 by 25 percent in comparison with 1990 levels.
One way of achieving that objective is to increase nuclear energy generation that does not emit carbon dioxide and reduces the ratio of thermal power generation, which emits large amounts of carbon dioxide.
The high generation cost of natural energy is one issue that will have to be dealt with because electricity rates will increase if there is an increase in high-cost energy.
Work will also be required to stabilize electricity supplied from natural energy, which is heavily influenced by weather conditions.
Shinji Muramatsu, Atsushi Komori and Yoshikazu Hirai, Assahi Shimbun, June 29, 2011
http://www.asahi.com/english/TKY201106280233.html
Saga town hosting nuclear plant OKs reactors’ restart to minister
SAGA (Kyodo) — The mayor of a Saga Prefecture town home to the Genkai nuclear power plant on Wednesday told visiting industry minister Banri Kaieda that he approves of the resumption of two nuclear reactors at the plant which are currently suspended for regular checkups.
Mayor Hideo Kishimoto of Genkai town made the remarks after Kaieda sought approval for the resumption in person, to address the looming power shortage stemming from strong public concerns over nuclear safety in the wake of Japan’s worst nuclear accident in Fukushima Prefecture.
“I know that this is a tough decision for a local government (hosting a nuclear power plant), but I hope you accept the resumption,” Kaieda said.
Kishimoto told the minister that he wants the central government to issue a “state guarantee” about the safety of the reactors as a precondition for the resumption, and added that he hopes to convey his view to plant operator Kyushu Electric Power Co. “without much delay.”
The minister, who made his first visit to a local government hosting a nuclear power plant over the reactor resumption issue, also met Saga Gov. Yasushi Furukawa later in the day and stressed that the safety of the Genkai plant has been confirmed.
Approvals from local governments are not legally required to resume the operation of reactors that have undergone regular inspections, but Kyushu Electric, which serves the Kyushu main island in southwestern Japan, has made it a rule to first obtain approval.
The Nos. 2 and 3 reactors of the Genkai plant were initially expected to have been reactivated by now, but reactivation has been postponed following the nuclear disaster at Tokyo Electric Power Co.’s Fukushima Daiichi power plant, which was triggered by the powerful March 11 quake and tsunami.
Kyodo, June 29, 2011
http://mdn.mainichi.jp/mdnnews/national/news/20110629p2g00m0dm115000c.html