Tokyo Electric Quake-Hit Reactor Safe, Governor Says

By Michio Nakayama and Shigeru Sato

May 7 (Bloomberg) -- Tokyo Electric Power Co.’s nuclear reactor in Niigata prefecture is safe to restart, the local governor said, paving the way to reopen the world’s biggest atomic power station, which was shut after an earthquake triggered a fire and radiation leaks.

Governor Hirohiko Izumida will meet Tokyo Electric officials in the prefecture tomorrow to grant approval for the restart of the No. 7 reactor, he told reporters after a meeting with local assembly members today. All seven reactors at the Kashiwazaki Kariwa plant were shut after the 6.8-magnitude earthquake in July 2007 shook it more than assumed possible in its design.

Asia’s biggest utility posted its second annual loss on April 30 because of costs related to the shutdown. Japan’s central government and two local mayors have already said the reactor is safe to restart, and assent by Niigata prefecture is the final approval needed. Izumida on April 10 postponed a decision on the reactor’s safety. The following day a fire broke out at the facility, the ninth since the shutdown.

Tokyo Electric pledged to make “safety the top priority,” it said in a faxed statement after the governor’s comments. Niigata’s approval is conditional on Tokyo Electric doing additional safety checks, Izumida said. The utility may run a test of the reactor as soon as this week and restart commercial operations in June, Nikkei English News reported yesterday without citing anyone.

Shares Rise

The company’s shares climbed 1.5 percent to 2,360 yen at the noon trading break on the Tokyo Stock Exchange. They’ve lost 17 percent in six months compared with a 0.7 percent gain in the benchmark Topix index.

The federal Nuclear and Industrial Safety Agency has signed off on the work done to strengthen the structure of the No. 7 reactor, and the mayors of Kashiwazaki city and Kariwa village have already agreed to the restart.

The trade ministry on April 13 ordered the utility to probe the cause of a blaze two days earlier at a warehouse at the station and prevent a recurrence. Kashiwazaki city also told the company to review fire safety.

The fire stoked mistrust among local residents, who were concerned about the plant even before the earthquake. In 2002 Tokyo Electric revealed it had fabricated safety reports as far back as the 1980s, and the chairman and president resigned. In February 2007, five months before the earthquake, then-president Tsunehisa Katsumata said the company had found hundreds more incidents of faked safety data.

After the quake, in December, 2007, the utility said it had known since 2003 that a fault running near the site was active, contradicting a survey previously submitted to the trade ministry.

Tokyo Electric posted its first loss in 28 years in the year ended March 2008 and had a 84.5 billion yen ($856 million) loss last year because of the cost of buying fossil fuel at peak prices to boost thermal generation. The 8,212-megawatt Kashiwazaki Kariwa station accounts for more than 10 percent of the utility’s total capacity.

To contact the reporter on this story: Michio Nakayama in Tokyo at mnakayama4@bloomberg.net; Shigeru Sato in Tokyo at ssato10@bloomberg.net