Hitachi to cut back on new nuclear power projects
BY SATOSHI DAIGUJI STAFF WRITER
2011/04/08
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Hitachi Ltd. will scale back its nuclear power projects following the crisis at the Fukushima No. 1 nuclear power plant, but will continue this key business line by strengthening safety features for current and planned reactors.
Hiroaki Nakanishi, president of Hitachi, said in an interview Wednesday that the company will take a fresh look at its nuclear power projects due to rising public alarm.
"We have to review (the projects)," he said. "It would be difficult to gain public understanding for the projects."
Hitachi is a leading maker of nuclear-related facilities, along with Toshiba Corp. and Mitsubishi Heavy Industries Ltd. Hitachi built the No. 4 reactor at the Fukushima No. 1 plant.
Utilities will likely be forced to postpone construction of nuclear power facilities after the fallout of the nuclear crisis caused by the March 11 earthquake and tsunami that damaged the Fukushima No. 1 plant.
Tohoku Electric Power Co. has already decided to freeze construction of a new reactor at its Higashidori nuclear power plant in Aomori Prefecture, which was about to get under way.
Nakanishi indicated a grim outlook on exports of nuclear power infrastructure to Vietnam, which is being jointly pushed by Tokyo Electric Power Co., operator of the crippled Fukushima No. 1 plant.
"(The nuclear crisis) has various impacts," Nakanishi said.
Hitachi expected to receive orders for more than 38 new reactors in and out of Japan by 2030, drawing on a favorable view of nuclear power generation in recent years as a way of slowing global warming.
With this goal, Hitachi's estimate for nuclear-related sales was put at 380 billion yen ($4.47 billion) by fiscal 2020, 1.8 times the figure for fiscal 2009.
Nakanishi said the extent of the anticipated fallout will vary from country to country his company is targeting, but he stressed that nuclear-power projects will remain a key business for his company despite the Fukushima disaster.
"It's impossible not to use nuclear power at all in the world," he said. "We are not thinking of giving up nuclear power plant projects."
He also said Hitachi will bolster safety measures for all the reactors it is involved with--those in service and planned--to withstand massive earthquakes and tsunami to help sustain nuclear-power generation.
"We need to equip the reactors with features that will never fail to activate minimum emergency procedures despite a tsunami comparable to or more powerful than the latest one," Nakanishi said.
He added that Hitachi is not liable for the damage as a builder of the troubled reactor at the Fukushima No. 1 plant.
"We have not given it a thought because our design was based on national standards," he said.
Nakanishi said Hitachi's consolidated financial results for fiscal 2010 ending in March will be "significantly" reduced due to extensive damages it has incurred at many of its factories in Hitachi, Ibaraki Prefecture, the company's birthplace, and in the stricken region.
Most of the factories in the affected region, including those in Ibaraki Prefecture, had been idle after the disasters. Nakanishi said that the company faces a possible shortage of parts from suppliers, although about 90 percent of its key factories have resumed operations.
Another potential headache is a shortage of electricity in eastern Japan this summer, where Hitachi's factories and offices are concentrated.
Utilities in eastern Japan have projected limited power supplies after their nuclear and non-nuclear power plants have been damaged in the quake and tsunami.
As for dividends, Nakanishi promised the payout of a dividend of 3 yen per share.
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