Four of Japan's Power Companies Prepare for Rolling Blackouts This Summer

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Researched by Industrial Info Resources (Sugar Land, Texas)--Last year, just months after the Great East Japan Earthquake and tsunami, millions of homes across Japan suffered from rolling blackouts during one of the hottest summers on record. The earthquake damaged vital electrical infrastructure and caused the shutdown of a large portion of nuclear capacity throughout the country. On May 14, the Japanese government released the power supply deficit numbers for seven of Japan's regional power companies. Four of these seven companies have deficits of more than 5% and have begun preparing for instituting rolling blackouts this summer. However, if units 3 and 4 at Oi nuclear power station, which is owned and operated by Kansai Electric Power Company Incorporated (TYO: 9503) (Osaka, Japan) (Kanden), are restarted, the present numbers will be re-evaluated and rolling blackouts may not be necessary in some areas.

Kanden, along with Kyushu Electric Power Company Incorporated (TYO:9508) (Kyuden) (Fukuoka, Japan), Hokkaido Electric Power Company Incorporated (TYO:9509) (Hokuden) (Sapporo, Japan) and Shikoku Electric Power Company Incorporated (TYO:9507) (Yonden) (Takamatsu, Japan) are preparing for rolling blackouts this summer if Oi nuclear power station is not restarted. According to the adjusted numbers on the government's report, Kanden's supply will be short by 15%, Kyuden by 10%, Hokuden by 7%, and Yonden by at least 5%.

These adjustments include the sale of power between companies. For example, before adjustment, Kanden, if using only its own power, would be 20% short; however, it is adjusted on the premise that roughly 5% can be made up by power-lending from surrounding regional power companies with less stringent power demands. Similarly, Kyuden is also expected to receive power loans from other companies, although only enough to bring the company's shortage down from 12% to 10%.

The numbers presented in the report are subject to change, pending the approval of the restart of Kanden's Oi nuclear power station units 3 and 4. These two units are the only reactors in the country to have made it to the final round of approvals. Oi units 3 and 4 represent 2,360 megawatts of power generation capacity, enough to power more than 2 million homes.

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