Japan's TEPCO sees higher oil, coal use in 2009/10

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31 Mar 2009

Tokyo Electric Power Co (TEPCO) on Tuesday forecast higher consumption of oil and coal in the next business year, saying it was assuming there would not be a restart of its quake-hit nuclear plant. TEPCO expects to boost oil consumption by 23 percent to 10.8 million kilolitres (186,000 barrels per day) in the year that starts on Wednesday. It also projected less consumption of liquefied natural gas (LNG). Asia's biggest utility also expects its electricity sales to fall for a second straight year, down 0.3 percent, led by weak demand from the industrial sector amid a deepening recession.
All seven nuclear generators at the Kashiwazaki-Kariwa nuclear plant, the world's biggest, have been shut down after a magnitude 6.8 quake hit the region on July 16, 2007.
There has been speculation that the newest No.7 generator was getting closer to a restart after a local prefectural panel this month backed a central government ruling that quake-proofing of the unit was sufficient.
Analysts have said the heads of the three local governments may give the go-ahead for a restart of the plant's 1,356-megawatt No. 7 reactor in the coming weeks. The date for the next meeting of the three leaders has not been set.
A resumption of operations should help ease costly fuel use and reduce carbon dioxide (CO2) emissions.
TEPCO projected an average nuclear plant run rate of 40-45 percent for the year starting on April 1, compared with a run rate of about 44 percent in the current year to March 31.
TEPCO President Masataka Shimizu told reporters the company would incur 500 billion yen ($5.1 billion) a year in additional fuel costs if the Kashiwazaki-Kariwa plant stays shut for the entire business year.
But the company pledged to return to profit for the first time in three years in 2009/10 through additional cost cutting measures.
"We will conduct 50 billion yen worth of additional cost cuts in 2009/10," Shimizu said. TEPCO had estimated earlier that restarting operations at its No.7 generator would cut its costs for alternative fuel supplies including oil, liquefied natural gas and thermal coal by 83 billion yen ($845.9 million) assuming customs-cleared crude oil import costs of $47 a barrel.
DELAYS NUCLEAR PROJECTS
TEPCO on Tuesday postponed the start of commercial operations at four new nuclear power generators by at least one year due in part to delays in the government safety review process.
TEPCO estimated its total carbon dioxide emissions in 2008/09 to be around the same level as the 126.5 million tonnes emitted in the year ended March 2008.
The restart of one reactor at the Kashiwazaki-Kariwa nuclear plant alone will shave the company's CO2 emissions by millions of tonnes a year.

Source: Reuters