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In post-Fukushima policy test, Japan town rallies for nuclear re-start

SATSUMASENDAI, Japan, April 14 (Reuters) - On the main road leading from the Sendai nuclear plant in southern Japan, a construction crew is laying down asphalt to widen the evacuation route in the event of a future disaster.

For many here, that's a hopeful sight. It means they are edging closer to re-starting two nuclear reactors that have been an economic engine for nearly three decades in a remote coastal town that has few other options.

Satsumasendai never felt the earthquake that triggered the Fukushima nuclear disaster some 1,600 kms (994 miles) to the north in March 2011. But residents saw their friends lose jobs and felt their future was threatened when the Sendai nuclear plant run by Kyushu Electric Power was idled along with the rest of Japan's reactors for a more stringent round of safety checks after Fukushima.

"I know it was a horrible accident, but right now I'm more concerned about the economy and my job," said Hiroya Komatsu, 28. "We saw it on TV, but it could very well have been the Philippines. It didn't feel like it was Japan."

Like Komatsu, many here support a pro-nuclear mayor who remains hopeful that a now-shelved plan to build a third reactor may some day be revived. The Sendai plant is on the fast-track for a safety review by the Nuclear Regulation Authority and could come back online as early as August. Proponents hope Satsumasendai will be a test case for a nationwide effort to bring other nuclear plants back onto the grid in coming months.

Prime Minister Shinzo Abe's government last week approved a long-delayed energy policy statement that describes nuclear power - which once generated 30 percent of the nation's power - as a key energy source. Currently, all 48 of Japan's reactors are shut down. Analysts see a good chance to bring at least 14 back online in a review process that begins with Satsumasendai, a remote town of about 100,000 people.

A quick re-start here would be good news for Kyushu Electric, which is seeking a $1 billion capital infusion from the government-run Development Bank of Japan. The shutdown has been costly. While reactors have been idled, Japan's nuclear plant operators, including Kyushu Electric, have had to spend around $87 billion to burn replacement fossil fuels. They have posted combined losses of close to $50 billion as of March and seen $60 billion wiped off their market value.

Satsumasendai, meanwhile, has received more than $250 million in government subsidies since 1974 for hosting the plant. Subsidies and tax income from the plant have paid to build community centres and parks and to repair roads, creating jobs in a prefecture where pay is around a fifth below the national average.

"We have the strictest regulatory standards in the world, and the fact that our plant is considered first in line to re-start means we have the most reliable power plant here," said Hideo Iwakiri, Satsumasendai's mayor. Iwakiri won his second term in 2012 after promising to lobby for a quick re-start.

"PEOPLE ARE AFRAID"

For now, shutters remain drawn on many city shop windows, a legacy of the 1980s economic downturn. Once-bustling motels, filled with plant workers, stand empty.

"This whole town used to be booked up and you couldn't get a room even if you made reservations months ahead," says Daisaku Fukuyama, the owner of Hotel Otori. Fukuyama, who heads the local hotel union, said several local motels have closed since 2011.

The local chamber of commerce says the Sendai plant contributes up to $25 million a year to the local economy, mostly from twice-yearly maintenance checks that bring around 3,000 workers to stay for up to four months.

A nearby Kyocera Corp plant also supports 4,000 workers and a paper pulp processing plant on the Sendai river employs a few hundred more. But for construction, hotels, restaurants and other service industries, the shutdown of the Sendai plant has meant a significant drop in business.

The winding road leading to the Sendai plant is surrounded by empty fields and sloping hills. A sign a few kilometres from the plant reads, "No Nukes!". Closer to the plant, another sign says, "Developing Towns With Nuclear Power".

The mayor and his supporters say those against nuclear power are outside agitators. Opponents say many are intimidated against speaking out. Local media have reported that in the past Kyushu Electric packed a government-sponsored town hall meeting, and some managers were found to have encouraged employees to send in fake emails of approval to re-start one of its nuclear plants in 2011.

Katsuhiro Inoue is a rare local dissenter. As one of two local city council members opposed to the Sendai re-start, Inoue holds a placard outside a darkened Kyushu Electric building on the city's busiest road, protesting with a handful of other local activists.

Inoue says many residents are worried about how the town would evacuate in the event of a Fukushima-style crisis, but many are afraid to speak up because of the town's economic dependence on the plant.

"I have a cousin who works for a subcontractor and we never talk about the re-starts," he said. "Every family knows someone who benefits from the plant and people are afraid to speak out against it."

Abe has said Japan will defer to the prefecture and host city for the final decision on any reactor re-start. The governor of Kagoshima says it will hold a few town hall meetings in Satsumasendai and cities that are closest to the plant.

Around 100 protesters gathered last week on a windy beach near the Sendai plant where activists released coloured balloons in a demonstration intended to show how far radioactive fallout could travel carried by the wind.

Yukio Nakano, 55, a nearby resident and a conservationist, says he knows the plant will eventually re-start. He lives alone in the mountains overlooking the plant. Most of his former classmates now work there, one as a security guard, many others as construction workers.

"Even if you're personally opposed, everyone has brothers, parents, friends who are in industries that benefit," says Nakano, who walks the beach behind the plant every day to pick up trash and protect turtle eggs from predators.

"I can't imagine not being able to go home like those people in Fukushima. The people in my village have lived on this land for 70, 80 years. I want to die here."

(Editing by Kevin Krolicki and Ian Geoghegan)