By Risa Maeda and Yoko Kubota
TOKYO (Reuters) - Japanese Prime Minister Naoto Kan said on Friday that Chubu Electric Power Co should halt all operations at its Hamaoka nuclear plant in central Japan, due to worries a strong earthquake could cause another nuclear crisis.
The move to shutdown Hamaoka, seen at high risk to forecasts of a powerful earthquake in coming decades, follows pressure on the government to review Japan's nuclear energy policy after a March 11 quake and tsunami crippled another plant, triggering the world's worst nuclear accident in 25 years.
Kan, who has been under fire for his response to the crisis at Tokyo Electric Power Co's (TEPCO) Fukushima Daiichi plant in northeast Japan, said the government would try to prevent the halt of the Hamaoka reactors from causing power supply problems.
Companies in eastern and northeast Japan served by TEPCO and another quake-affected utility have already been asked to curb electricity usage this summer when demand peaks. The shutdown at Hamaoka raises the risk of power disruptions in the Chubu region, home to Toyota Motor Corp and other major manufacturers.
Kan said he made the decision "out of concerns for public safety," citing a forecast by government experts that put at 87 percent the chance of a magnitude 8.0 quake hitting the area served by Chubu Electric within the next 30 years.
"If there were a major accident at Hamaoka nuclear plant, it would have an enormous impact on the entire Japanese society," Kan told a televised news conference.
The Hamaoka decision signals a likely shift in Japan's energy policy, with the government now rethinking its target of boosting the country's reliance on nuclear to 50 percent of its power needs by 2030, up from 30 percent before the quake.
"The decision was made with safety as the priority, and it is the first step necessary to developing an energy policy," Noriyuki Mita, director at the Trade Ministry's Electricity and Gas Industry policy planning division, told a separate news conference.
The 3,617 megawatt Hamaoka plant accounts for about 7 percent of Japan's combined nuclear power generating capacity. It is located about 200 kilometres (120 miles) southwest of Tokyo and sits near an active earthquake zone.
Chubu Electric's President Akihisa Mizuno said in a statement that the firm will "promptly consider" the request. Kyodo news agency, citing a Chubu source, reported that the company would comply with the government's decision .
Last week, Chubu Electric said it was not committed to a July restart of the 1,100 megawatt No.3 reactor, which has been shut since November for planned maintenance. The 1,137 MW No.4 reactor and the 1,380 MW No. 5 reactor are currently operating.
If the No.3 unit is shut through March 2012 and the shortfall is made up only with gas-fired plants, Chubu has estimated it would have to buy an additional 1.08 million tonnes of liquefied natural gas from abroad.
"This is a bold move by the Kan administration and I am very surprised they would go as far as to ask for a nuclear plant to be shut simply because an earthquake could occur in its vicinity sometime during the next 30-40 years," said Osamu Fujisawa, an oil economist at industry consultant FE Associates.
"Obviously Chubu's power generation costs will rise since they will have to use more oil and natural gas, but they will likely be able to secure enough power by restarting mothballed oil plants and buying electricity from other utilities."
KAN UNDER FIRE
Local authorities have been concerned about safety at Hamaoka after the tsunami crippled cooling systems at TEPCO's Fukushima Daiichi plant, where engineers are still struggling to contain the crisis.
Chubu, Japan's third-largest utility after Tokyo Electric and Kansai Electric Power, would be able to complete in about two years construction of a tsunami wall and other measures to protect its Hamaoka plant from a tsunami of the same scale as the one on March 11, the trade ministry said.
Trade Minister Banri Kaieda, who in March ordered immediate steps to boost nuclear safety, said in a statement that operators have taken measures to ensure cooling system can keep working even if power is knocked out by a tsunami.
The trade ministry said it would not ask other plant operators to shutdown following the approval of such steps, paving the way for the restart of other reactors under maintenance, providing they can get the greenlight from local authorities.
Kan warned that some power shortages may occur in the summer when consumption peaks, but said he believed that efforts by the public to save electricity could prove sufficient to avoid serious problems.
Kaieda said he doesn't think Chubu will need to conduct rolling blackouts due to the halt at the Hamaoka plant. He said Chubu could rely on thermal and hydro power sources to fill the shortfall, and that Kansai Electric had been enlisted to support Chubu by providing it electricity.
Kan, already unpopular before the triple calamities struck, has come under criticism for his response to the disaster that has killed 14,800 people, left some 11,000 missing and led to radiation leaks at Fukushima Daiichi.
Opposition parties that have the power to block bills in the divided parliament want Kan to quit and rivals in his own party are also keen to oust the premier, especially after a thrashing in local elections last month.
On Friday, heavyweight ruling party rival Ichiro Ozawa blasted the government's handling of the crisis.
Environmental group Greenpeace issued a statement welcoming Kan's decision on Hamaoka but urged him to shut more plants.
"This is the first time a prime minister has directly requested a nuclear plant in Japan be closed, however, it cannot be the last," said Junichi Sato, Greenpeace Japan Executive Director in the statement.
(Additional reporting by Linda Sieg, Chikako Mogi, Mari Saito and James Topham; Editing by Chris Gallagher and Nathan Layne)
