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2007 Electric Power Supply Plan and Nuclear Industry Developments

At the end of March the Agency for Natural Resources and Energy released the 2007 Electric Power Supply Plan. The Plan brings together the plans of all the electric power companies. However, it is quite divorced from reality and is a "plan" in name only. The inherent inconsistencies are clearer than ever in Fiscal Year 2007.

In regard to predicted electricity demand, for the 10-year period to 2016 the average growth rate is set at 0.9% for both total capacity and peak demand. In last year's Plan the growth rate was 0.9% for total capacity, while peak demand was predicted to grow at a rate of just 0.8%. There is a clear trend that even when total capacity grows, peak demand does not grow with it. Indeed, the Plan analyses both the expected outcome for FY2006 and the estimate for FY2007 in this way. The reason for going against the trend and predicting growth in peak demand is presumably that this is the basis for increasing electricity generation capacity. In order to justify plans to build large-scale nuclear power plants, there must be demand to match this increased capacity.

It is difficult to adjust the output of nuclear power plants, so if large-scale plants continue to be built, the percentage of nuclear in total electric power generation will become even larger. According to the Plan, the electricity generated by nuclear power plants in FY2006 is expected to be 30.6% of total electricity generation. The Plan predicts that this will rise to 41.2% in 2016. However, nuclear is not the only area where capacity is predicted to increase. Over the next 10 years nuclear capacity is predicted to increase by 11.91 GW, while capacity is predicted to increase by 2.94 GW and 4.46 GW for coal-fired plants and LNG plants respectively. But even though capacity increases, electricity generation falls by 26.5 TWh for coal and 10.3 TWh for LNG. The reason for this is that electricity generation from nuclear increases by 142.2 TWh. The net result is that whereas in 2006 the capacity factor for coal-fired plants was 74%, this is predicted to fall to 61% in 2016. Although this might be good from the point of view of CO2 emissions, it is very wasteful economically. In the case of LNG the reduction is smaller - from 49% to 44%. That is because coal is competing with nuclear for base-load generation, so it is affected more by increased nuclear capacity.

This assumes, of course, that the Plan should be taken at face value. The increased nuclear capacity of 11.91 GW in ten years is calculated on the basis that 12.262 GW will be gained from nine new plants and 0.357 GW will be lost when Tsuruga-1 closes. However, besides the two reactors currently under construction, the predicted start-up dates for the other seven planned reactors have all been pushed back year after year.

The predicted start-up date for Ohma is the same as last year, but the date for commencing construction has been pushed back one year. The predicted start-up date has been delayed sixteen times so far and further delays are inevitable. As a result of more scandals involving Tokyo Electric Power Company (TEPCO), the stance of the governor of Fukushima Prefecture has hardened, so it is impossible to predict when, if ever, Units 7 & 8 at the Fukushima I plant will be built. The start-up dates for these reactors were postponed for the twelfth time in the latest Plan. Up until the year before last, Kaminoseki-1 had been postponed six times. The fact that there is no change this time is just a pose. TEPCO's Higashidoori-1 has been postponed for the tenth time. Tsuruga-3&4, which had been postponed five times up until the year before last, were not further postponed in last year's Plan, but it seems that the two-year postponement this year is making up for the undue optimism of last year.

In other words, the expansion of nuclear power predicted in this year's Plan exists only on paper. This can also be seen in the nuclear industry sales forecast (figure 1), even though this forecast itself is based on wishful thinking.

The nuclear industry is well aware that it need not concern itself about extravagant predictions of growth in peak demand, nor about extraordinary reductions in the capacity factor of coal-fired plants. We can safely assume that there are two predictions in existence: the prediction shown in the FY2007 Electric Power Supply Plan, and the one on which industry bases its business plans.

Nishio Baku (CNIC Co-Director)

GW = gigawatts = 106 watts
TWh = terawatt hour = 1012 watt hours

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