Why "No Nuclear Power" Is No Solution

States like Japan and Germany are courting disaster by letting the Fukushima debacle frighten them away from nuclear power for good.

Japan’s response to the March 11 Fukushima Daiichi nuclear disaster has been truly remarkable, particularly in managing the loss of nearly 20 percent of the country’s electricity generation with the shutdown of thirty-eight of the country’s fifty-four nuclear reactors. This impressive success in handling the short-term consequences of the massive disruption of its energy systems has led many—in Japan, Germany and elsewhere—to the conclusion that they can do without nuclear power. This view ignores the potential costs of a shift away from nuclear energy in Japan or other major economies.

Prior to the crisis, Japan was the world’s third-largest generator of nuclear electricity, with nuclear power producing nearly 30 percent of the country’s electricity supply. Thus losing more than two-thirds of its nuclear plants—some damaged, others originally shut down for inspections but now mired in national and local politics—was a devastating blow. The crisis was far more severe for Japan than would have been the case for most other nations; as an island, its electricity system is self-standing and lacks connections to neighboring countries’ electrical grids that could have provided electricity imports. Despite a serious political crisis in the months after March 11, Japan’s government generally handled this effectively through a combination of mandatory electricity-supply reductions for major industrial consumers, decreases in the government’s own electricity use and consumption in office buildings in general, and other conservation measures. I experienced this firsthand in August, visiting the darkened—and rather warm—halls of Japan’s Foreign and Defense Ministries as well as a number of universities and think tanks.

While these measures have been successful for a few months, it is far from clear that Japan’s response to its electricity crisis is sustainable—particularly if Tokyo were to forgo any more of its nuclear-power generation. The coming year may well demonstrate this.

For all its success in the face of adversity, Japan’s electricity system is stretched to its limits. Moreover, the sixteen nuclear power plants that are still operating in the country are scheduled to shut down for routine inspections between now and June 2012. Based on the experience of the last six months, it is far from clear when or if the plants will resume operations. Removing them from service could eliminate close to 10 percent of Japan’s pre-March 11 electricity supply.

Japan’s respected Institute for Energy Economics (IEEJ) estimates that this could increase costs for households by 18 percent and for industry by 36 percent, with “a serious adverse effect on the competitiveness of Japanese industries.” The direct cost for additional fossil fuels alone would be 3.5 trillion yen, or roughly $50 billion. Those concerned about climate change should also note the IEEJ forecast that Japan’s fiscal year 2012 carbon dioxide emissions will soar to 18.7 percent over 1990 levels; under the Kyoto Protocol, Tokyo committed to reduce its greenhouse gas emissions to 6 percent under 1990 levels by that time. Given that Japan produces about 4 percent of the planet’s total greenhouse-gas emissions, if all of Japan’s nuclear plants are shut down, the March 11 disasters and their aftermath could directly add approximately 1 percent to the world’s total greenhouse-gas emissions.

Of course, the Fukushima Daiichi nuclear accident has also had a substantial impact outside Japan, including on Germany’s decision to shut down its remaining nine nuclear-power stations by 2022. Eight of Germany’s older nuclear plants were already shuttered after March 11. Ending nuclear power will be easier for Germany, where the nuclear share in electricity generation was 20.7 percent in 2010 (and 29.5 percent in 2000) and where there is easy access to (largely nuclear-generated) electricity imports from France. Still, whether Berlin will follow through—the current policy is already the second recent attempt to ban nuclear energy—is an open question. Even for Germany, prematurely closing down nuclear plants with substantial remaining service lives will be costly; Berlin’s Ministry of Economics and Technology forecasts that total real expenditures on primary energy will increase by one-third by 2030 even as consumption declines. For a government to which many look to rescue Europe’s finances (at a considerably greater potential cost), this may ultimately be viewed as a needless indulgence. In her first weeks on the job, the International Energy Agency’s new executive director, Maria van der Hoeven, has already called the decision “risky” and predicted that Germany’s power grid could be seriously strained this winter.

Opponents of nuclear power frequently argue that it is a costly technology made viable only through government intervention. However, while government support often plays a role in building nuclear-power plants because of their massive capital-investment needs, these plants are relatively inexpensive to operate once they exist. Shutting them down before the end of their useful lives—as Germany plans to do and some in Japan advocate—is from this perspective an extremely expensive decision that forces new investment in electricity generation to replace capacity that could last for decades. And the alternatives carry their own costs, whether in the form of considerable government subsidies for solar and wind (neither of which provides consistent power due to natural variations in sunlight and airflows) or in the form of greenhouse-gas emissions from fossil fuels.

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