Kansai Electric Power Co. (9503), which supplies Japan’s second-biggest metropolitan area, may cut its crude consumption by more than half after it resumes two nuclear reactors to ease the threat of a summer power shortage.
“Theoretically, the restart of the two reactors at Ohi plant would reduce Kansai Electric’s crude-oil requirement roughly by 60,000 barrels a day,” Osamu Fujisawa, an independent oil economist in Tokyo who worked for Saudi Arabian Oil Co. and Showa Shell Sekiyu K.K. (5002), said in a telephone interview yesterday. Kansai Electric used 510,000 kiloliters of crude in May, or about 103,000 barrels a day.
Kansai’s two 1,180-megawatt reactors at its Ohi plant northeast of Osaka will be fully operational this month, Japan’s Chief Cabinet Secretary Osamu Fujimura told reporters today in Tokyo. That ends a two-month period when all the country’s 50 reactors were offline for safety checks following the March 2011 Fukushima disaster. Without atomic power, Kansai’s output may fall 14.9 percent short of peak demand in a heat wave similar to the one in 2010, a government panel said in May.
Osaka-based Kansai also consumed about 20,000 kiloliters of fuel oil, 590,000 metric tons of liquefied natural gas and 400,000 tons of coal in May, Takahiro Senoh, a company spokesman in Tokyo, said by telephone today. Japanese utilities’ crude use rose 148 percent to 1.19 million kiloliters in May from a year earlier, according to the Federation of Electric Power Companies.
“Crude oil accounts for 90 percent of our oil consumption for electricity generation,” Senoh said. “The restart of the two reactors will reduce the company’s fuel consumption. Logically speaking, the reduction will be on the most expensive crude oil.”
Kansai started electricity generation at its No. 3 reactor at the Ohi plant today, Japan’s trade ministry said in an e- mailed statement, citing the utility. The unit will be fully operational as early as July 9, according to Senoh. The No. 4 unit will begin power generation as early as July 21 after a restart scheduled for between July 18 and July 20, he said.
Thousands of people opposing the restart of the Ohi plant protested in the streets outside the prime minister’s office in Tokyo on June 29, Kyodo News reported.
Japan’s LNG imports may rise 6.5 percent to about 88.6 million tons in the fiscal year ending March 2013, compared with the prior year, if no more reactors are brought back online after Kansai, a group of five researchers at the Institute of Energy Economics, a government affiliated think-tank, said in a July 2 report.
Fuel-oil sales to power utilities in the same period may rise by 43 percent to 21.3 million kiloliters, or about 367,000 barrels a day, Yu Nagatomi, an economist said in the report.