Hopes within an anxious business community that Japan's idle nuclear power stations would be rapidly restarted will almost certainly have to be placed on the backburner despite last weekend's landslide election victory by a pro-nuclear party.
Shares of nuclear operators surged after the Liberal Democratic Party (LDP), with a reputation for close links to the nuclear industry, was returned to power. The reasoning was it would respond quickly to industry demands to get reactors going more than 18 months after the Fukushima nuclear disaster.
Tokyo Electric Power Co., operator of the crippled Fukushima plant, climbed 53 percent. Kansai Electric Power Co., the most nuclear reliant of the utilities, is up almost 18 percent.
But restarts are likely to be a slow process, subject to rules still to be drafted by a new nuclear regulator and to wary public opinion, mobilized against the industry since the March 2011 earthquake and tsunami that led to meltdowns at Fukushima.
"(Their) hopes might be a little premature, to the extent that they assume their travails are over and income streams ready to go right back into the black," said Andrew DeWit, a professor at Tokyo's Rikkyo University who researches energy policy.
And that will also mean continued high bills for fuel imports to run conventional power plants.
The Nuclear Regulation Authority (NRA), set up with more independence after the disaster discredited its predecessor, is expected to draw up safety standards by July 2013. It will judge whether plants are safe to restart, but its head says elected officials must take the final decision.
"It is unlikely the LDP-led government will want to interfere at an early stage with the operation of the recently established independent NRA, the creation of which they supported," said Tom O'Sullivan, a Tokyo-based energy consultant.
During its years of almost uninterrupted rule before the Democratic Party of Japan (DPJ) won power in 2009, the LDP helped foster Japan's "nuclear village," a web of vested interests including utilities, bureaucrats and lawmakers who promoted atomic power and kept independent oversight minimal.
Now the party says it will decide gradually on restarting reactors deemed safe by the watchdog over the next three years and devise an optimal energy mix over 10 years.
The LDP's caution may be explained in part by its coalition partner New Komeito's call to phase out nuclear power. Komeito's support is crucial for the LDP to maintain the two-thirds majority it needs in parliament's Lower House to overcome a policy deadlock as it has no majority in the Upper House.
Media surveys have shown a majority of Japanese want to abandon atomic energy by 2030, if not sooner. The outgoing DPJ government promised to end reliance on an energy source that supplied about 30 percent of Japan's needs before Fukushima.
The NRA has also signaled it will take a tougher stance on nuclear stations situated over possible seismic fault lines and prevent risky plants from restarting.
But pressure from business interests will be unrelenting.
Both the Keidanren, Japan's biggest business lobby, and the Federation of Electric Power Companies, called on the new government this week to bring nuclear back into the energy mix.
"They have opposed the policy of phasing out nuclear power which they claim is significantly increasing electricity charges for industrial and domestic customers, jeopardizing the international competitiveness of Japanese industry," O'Sullivan said.
Fossil fuel imports have risen sharply since the Fukushima meltdowns, helping push the country into a trade deficit that increased to the largest in 10 months in November.
Utilities have mostly increased purchases of natural gas. Liquefied natural gas (LNG) imports rose 11.6 percent to almost 80 million tons, in the first 11 months of 2012, from a year earlier, according to Ministry of Finance data issued on Dec. 19.
That is equal to one third of global trade in LNG in 2011.
The Fukushima disaster, the worst nuclear accident in the world in a quarter century, prompted the gradual shutdown of all Japan's nuclear reactors until there were none left operating in May 2011.
The DPJ government's decision to restart two reactors last July to prevent possible summer power shortages galvanized the country's previously dormant anti-nuclear movement and sparked the biggest demonstrations in decades.
With no evidence subsequently that the two reactors were vital to meet demand, protesters still gather en masse every week outside the prime minister's office and parliament.
"Any restarts might inflame public opinion, particularly in the large urban centers and those prefectures that do not host nuclear power facilities," O'Sullivan said.
Both political considerations and safety issues will probably mean no early decision on restarting reactors even if the NRA declares them safe, J.P. Morgan analysts said this week.
"It is uncertain if there will be restarts prior to peak summer power demand, as media polls suggest that over half of the Japanese population favors phasing out nuclear power," they said in a research note.
"The impending Upper House election, which takes place in July 2013, may also encourage policymakers to put off decisions to a later date."
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