Phasing out nuclear power could reduce Japan's GDP by 7%

June 30, 2012


Japan risks taking a 45-trillion-yen ($564 billion) hit to its economy if it does away with nuclear power generation by 2030.

That is the figure presented at a panel of Cabinet ministers overseeing the rewriting of the nation’s energy strategy.

The complete abandonment of nuclear energy is only one of three policy options chosen by the Energy and Environment Council as the basis of a two-month public consultation on energy policy that started on June 29.

But estimates by four research organizations reported at the panel make clear the likely costs of going nuclear-free, predicting that the average monthly electricity bill for a family of two or more would increase from the current 10,000 yen to between 14,000 yen and 21,000 yen.

That bill is likely to be between 14,000 yen and 18,000 yen if nuclear power is still shouldering 15 percent of the nation’s electricity supply in 2030, and 12,000 yen to 18,000 yen if it accounts for 20-25 percent of supply.

According to the estimates, Japan’s gross domestic product (GDP) in 2030 would be 8 trillion yen to 45 trillion yen less in the case of zero reliance than when the current energy policy is maintained.

The decline would be 2 trillion yen to 30 trillion yen under the 15-percent scenario and 2 trillion yen to 28 trillion yen if the ratio falls to 20-25 percent.

The top end of the estimated impact of a nuclear-free policy represents a 7.4-percent cut in GDP, compared with the 2030 projection when the current policy is maintained.

Greenhouse gas emissions would fall 25 percent from 1990 levels if nuclear power accounts for 20-25 percent in 2030, more than the 23 percent in the other two scenarios, under which increased use of thermal power generation would push up carbon dioxide and other gas emissions.

If the total phase-out option were chosen, the council says the government would abandon its current nuclear recycling policy and instead bury spent nuclear fuel.

However, it postponed a decision on what to do under the other two scenarios, saying that the government could reprocess or bury spent nuclear fuel, or combine both methods.

“A decision will be made based on the energy policy option to be adopted in August,” national policy minister Motohisa Furukawa, who chairs the council, told a news conference.

A change in the nuclear recycling policy would require large expenditures on a range of measures including a review of the future of the reprocessing facility at Rokkasho, Aomori Prefecture.

Nuclear power accounted for 26 percent of Japan’s electricity supply in 2010, before all of the nation’s reactors were shut down following the disaster at the Fukushima No. 1 nuclear power plant last year.

The decision on the ratio of nuclear power in 2030 will form the basis of the nation’s future energy policy.

The government will use the 15-percent case as a baseline scenario in its consultation. That ratio represents the use of nuclear power if reactors older than 40 years are decommissioned in line with government policy.

Ministers plan to decide on one option by the end of August after analyzing people’s opinions through public hearings and a new “deliberative polling” method, under which a nationwide poll of 3,000 people will be followed by discussions among selected respondents and additional surveys.

Asked if the two-month consultation period is sufficient to foster a genuine national debate, Furukawa said the government is doing all it can, noting that national discussions have already been conducted on the issue.

(This article was written by Toru Nakagawa and Mari Fujisaki.)

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National policy minister Motohisa Furukawa (Asahi Shimbun file photo)

National policy minister Motohisa Furukawa (Asahi Shimbun file photo)

  • National policy minister Motohisa Furukawa (Asahi Shimbun file photo)

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