* Restarts would be first after Fukushima disaster
* Japan's policy to reduce nulcear dependence intact-trade min
* Nuclear safety considerably enhanced after Fukushima-trade min
* Greenpeace says restart decision risks health of people, economy
By Linda Sieg and Kiyoshi Takenaka
TOKYO, June 16 (Reuters) - Japan on Saturday approved the resumption of nuclear power operations at two reactors despite mass public opposition, the first to come back on line after they were all shut down following the Fukushima crisis.
Prime Minister Yoshihiko Noda, his popularity ratings sagging, had backed the restarts for some time. He announced the government's decision at a meeting with key ministers, giving the go-ahead to two reactors operated by Kansai Electric Power Co at Ohi in western Japan.
The decision, despite public concerns over safety after the big earthquake and tsunami crippled the Fukushima plant, could open the door to more restarts among Japan's 50 nuclear power reactors.
"There is no such thing as a perfect score when it comes to disaster prevention steps," Trade Minister Yukio Edano told a news conference after the announcement.
"But, based on what we learned from the Fukushima accident, those measures that need to be taken urgently have been addressed, and the level of safety has been considerably enhanced (at the Ohi plant)," he said.
Edano, who holds the energy portfolio, said the government policy to reduce Japan's dependence on nuclear energy in the medium- to long-term was unchanged despite the decision.
The decision is a victory for Japan's still-powerful nuclear industry and reflects Noda's concerns about damage to the economy if atomic energy is abandoned following the world's worst nuclear disaster since Chernobyl.
The push to restart the two Ohi reactors, before a potential summer power crunch, also underscores the premier's eagerness to win backing from businesses worried about high electricity costs that could push factories offshore. Kansai electric says it will take six weeks to get both reactors running fully.
But the decision risks a backlash from a public deeply concerned about nuclear safety. As many as 10,000 demonstrators gathered outside Noda's office on Friday night amid a heavy police presence to denounce the restarts, urging the premier to step down and shouting "Lives matter more than the economy."
"Prime Minister Noda's rushed, dangerous approval of the Ohi nuclear power plant restart ignores expert safety advice and public outcry, and needlessly risks the health of Japan's environment, its people and its economy," environmental group Greepeace said in a statement.
PM'S FUTURE UNCERTAIN
Noda's own future is murky as he struggles to hold his fractious party together after cutting a deal with opposition rivals to double Japan's sales tax to 10 percent by 2015.
"I imagine there will be a fair number of (reactor) restarts by next year. The government under Noda is surprisingly eager," said Jeffrey Kingston, director of Asian studies at Temple University's Japan campus.
Nuclear power supplied almost 30 percent of electricity needs before the March 2011 disaster, which triggered meltdowns at Fukushima, spewing radiation and forcing mass evacuations.
The accident destroyed public belief in the "safety myth" promoted by Japanese nuclear power advocates for decades.
Activists have collected more than 7.5 million signatures on a petition urging an end to atomic power. Protesters have poured into the street almost daily over the past week.
All 50 reactors were shut down for maintenance or safety checks in the months since the accident. The government had placed a priority on gaining the approval of local communities for the Ohi restarts to avert July-August power shortages.
Critics say the government was too hasty in signing off on the restarts, especially given delays in setting up a new, more independent nuclear regulatory agency.
Public trust in regulators was tattered by evidence that cosy ties with utilities were a key reason Fukushima operator Tokyo Electric Power Co was unprepared for the tsunami, and subsequent signs that relations remain far too snug.
Parliament's lower house on Friday approved legislation to create a new atomic regulator, but getting it up and running will take months. That could force the government to go slower on restarts, though some politicians are keen to forge ahead.
"We can no longer go back to a life that depends on candles," ruling party heavyweight Yoshito Sengoku said in an interview with the Sankei newspaper this week.
The Nuclear and Industry Safety Agency, the current watchdog, has approved stress tests for Shikoku Electric Power Co Inc's 890-megawatt No.3 reactor in Ikata, southern Japan. Next on the list for possible approval are two Hokkaido Electric Power reactors in Tomari, northern Japan and Hokuriku Electric's two in Shika, western Japan.
"Basically he (Noda) doesn't want to wait but ... it would attract criticism so the government would be cautious if they are clever," said Hiroshi Takahashi, a Fujitsu Research Institute fellow and member of a panel advising the government on energy policies.
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