Deadly Earthquake in Japan Sends Spot Power Rates Up 15

By Bloomberg

Jan 02, 2024

image is BloomburgMedia_S6KZF3T0AFB400_02-01-2024_05-11-40_638397504000000000.jpg

Firefighters extinguish a fire in Nanao, Ishikawa Prefecture, Japan, early on Tuesday, Jan. 2, 2024. At least six people were killed and others injured in a powerful earthquake that hit off the Noto Peninsula on Japan’s northwest coast, wrecking buildings, buckling roads and triggering fires.

(Bloomberg) -- A deadly earthquake off the coast of northwestern Japan took electricity generators offline, leading to a jump in the nation’s spot power prices.

The magnitude 7.6 quake, which hit off the coast of Noto Peninsula in northwestern Japan on Monday, has led to 13 deaths so far. About 33,000 people remained without power Tuesday morning, according to Hokuriku Electric Power Co.

The quake forced Hokuriku Electric to shut 1.2 gigawatts of coal-fired capacity at the Nanao Ohta power plant. It’s undecided when the units will resume operation, according to Japan Electric Power Exchange website. Power output also fell at the utility’s Toyama Shinko coal-fired power plant units, according to JEPX.

Power prices rose 15% to 10.36 yen a kilowatt-hour on Tuesday, the biggest one-day increase since Dec. 17, according to data from JEPX.

Japan’s power grid operator ordered Kansai Electric Power Co. to offer electricity supply to the affected area on Monday to avoid a shortage. Jera Co. also halted its gas-fired unit at Joetsu power station to inspect for impact from the quake, though it’s expected to restart operating on Tuesday, according to JEPX.

Still, even with the jump prices remain relatively low for this time of year. The government in late October predicted that Japan would have enough power supply for this winter, which came as a relief after consumers were asked to conserve electricity in summer of 2023 and the previous winter.

By Shoko Oda