Five Utilities To Loan Japan Atomic Power $2.6 Billion

Five power companies in Japan with support from various banks are expected to loan the Japan Atomic Power Company $2.6 billion for safety upgrades at the Tokai NPP in advance of a tentative 2023 restart of the No. 2 reactor there.

Tokai NPPThe Japan Times reported that criticism for the plan was expected. Of the five companies discussing the loan package, the Tokyo Electric Power Co. (TEPCO) is to be the major participant, coming up with a reported $1.9 billion of the loan package that it plans to borrow from banks. TEPCO is also expected to purchase electricity from the Tokai NPP in the Ibaraki Prefecture.

The companies involved include the Tohoku Electric Power Co., Kansai Electric Power Co., Chubu Electric Power Co., and Hokuriku Electric Power Co.

Tohuku Electric is expected to use cash reserves to come up with $210 million of the loan package. How the other companies will finance the deal was not reported.

There is financial risk involved. The Japan Atomic Power Co. has to be granted permission to restart the Tokai Unit 2. If local municipalities refuse to allow the restart, various creditors could see losses.

Kansai Electric, Chubu Electric and Hokuriku Electric have no plans to purchase electricity from the Tokai Plant, but are discussing a commitment to provide $210 million in debt guarantees to Japan Atomic Power, the report said.

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