Japanese firms try hard to cut electricity use

Japanese companies' efforts to formulate plans to save electricity will likely intensify, as the government has announced details of its restrictions on large-lot users for this summer.

Details of the restrictions in areas supplied by Tokyo Electric Power Company (Tepco) and Tohoku Electric Power Company were announced on Wednesday (May 25).

But if nuclear reactors around the nation that are currently suspended for maintenance are not restarted, power shortages could spread further and economic productivity could suffer.

Hitachi Ltd has announced that its production plants will operate in rotation and close on two weekdays instead of weekends from July to September as a way to use less energy at times of peak demand.

The scheduling of employees' summer vacations will also be adjusted during the three-month period.

If the plants are closed in rotation, the total length of operating hours will not change. Thus, a Hitachi official said: "Our production won't be negatively affected."

Among 14 automakers belonging to the Japan Automobile Manufacturers Association, 13 decided to change their plant closure days from weekends to Thursdays and Fridays.

NTT Docomo Inc also decided to change its employees' days off to Mondays and Tuesdays in principle.

An increasing number of companies have decided to change the days of the week that their employees will have off.

The government will allow two or more large-lot electricity users to join hands to achieve the 15 per cent cut goal. Thus collaborations among companies will likely proliferate.

For example, Sumitomo Chemical Company and Fuji Oil Company, which have plants close to each other in Chiba Prefecture, plan to jointly cut power consumption.

In July and August, Sumitomo Chemical will increase output from its own in-house power generator and supply electricity to Fuji Oil.

Then, in September, when Sumitomo Chemical's in-house generator is stopped for regular inspection, Fuji Oil will suspend operations of some of its production facilities to help make up for the outside power Sumitomo Chemical will have to consume.

If a company with plants or offices in areas served by Tepco or Tohoku Electric moves their operations elsewhere, the government will regard it as having cut power consumption in the shortage-affected areas.

Therefore, it is possible that an increasing number of companies will transfer their business bases to western Japan.

Honda Motor Company will transfer production of vans, which were to be manufactured in a plant in Saitama Prefecture, to a plant in Mie Prefecture.

Fujitsu Ltd plans to move computer servers in eastern Japan to western Japan.

Planned restrictions were relaxed for some business sectors, a decision that was welcomed by affected firms.

Companies with around-the-clock operations, such as railways, semiconductor makers, financial institutions and telecommunications firms, would find it difficult to drastically cut electricity consumption.

About the relaxation to be allowed in each of these business categories, an official of Renesas Electronics Corp said: "The government understood the special situations of semiconductor-manufacturing plants."

But there remains a risk that power shortages may spread across the nation.

Resumption of operations at many nuclear power plants around Japan, which have been stopped for regular checks, has become uncertain because of the crisis at Fukushima No. 1 nuclear power plant.

On May 18, Kyushu Electric Power Company announced that it would ask companies and households to cut electricity consumption by up to 15 per cent if the No. 2 and 3 reactors of its Genkai nuclear power station do not resume operation by summer.

The company also fears that fuel for thermal power plants may run short in mid-July. A company official said: "It's possible that our power supply may be 20 per cent to 25 percent short."

Kansai Electric Power Company (Kepco) also fears its power supply may fall short if four of its nuclear power reactors, including the No. 1 and 3 reactors at its Mihama nuclear power station, cannot resume operations by summer as initially planned.

If the nuclear reactors cannot be reactivated, Kepco's supply capacity in August will be only 0.6 per cent higher than the estimated maximum demand of 29.56 million kilowatts.

Chubu Electric Power Company expects to have smaller output capacity in summer because of the closing of its Hamaoka nuclear power station.

According to an estimate by the Dai-ichi Life Research Institute, if the 15 per cent cut in electricity consumption is fully implemented in areas supplied by Tepco and Tohoku Electric, it will push down gross domestic product in the regions by 0.3 percent.