Give nuclear power a larger role

by Shinji Fukukawa

Roughly a year and a half after the Great East Japan Earthquake, the Japanese government at a Cabinet meeting on Sept. 19 adopted its basic policy on new energy and environment strategies crafted as a response to the Fukushima No. 1 Nuclear Power Plant accident. The government had initially intended to give Cabinet endorsement to the “Innovative Energy and Environment Strategy” adopted earlier by Cabinet ministers concerned, which called for ending nuclear power plant operations by the end of 2030s.

Faced with strong objections from business circles, certain Western governments and local governments hosting nuclear plants, however, the Noda Cabinet ended up issuing a vague statement saying that, on the basis of the strategy, it will hold “responsible discussions with local governments concerned and the international society and, while seeking public understanding, carry out (the strategy) with flexibility, constant examination and review.” In the eyes of people, the conclusion appeared to reflect the government’s wavering position on the issue.

Still, Prime Minister Yoshihiko Noda emphasized that he has not deviated from the policy of nuclear phaseout by the end of 2030s, and his Democratic Party of Japan will likely stick to that position to maximize its chances in the next general election, to be held “in the near future.”

I have several doubts about the plan itself. In the first place, the plan fails to take into account changes in the global energy structure. In fact, the Fukushima nuclear accident raised strong doubts about Japan’s previous policy course, which attempted to resolve the problems of energy shortage and global warming through the expanded use of nuclear energy. Following the Fukushima accident, Germany, for example, made a decision to phase out nuclear power generation by 2022.

The International Energy Agency (IEA), however, predicts that the world’s energy demand will grow by about one-third from the current level over the 2010-2035 period. It points to the need to ensure an adequate energy supply through an appropriate mix of natural gas, atomic power and renewable sources to cope with an estimated increase in demand for oil as automobile usage rises in emerging economic powers such as China and India.

In the United States and Canada, efforts to exploit vast shale oil and shale gas deposits are mounting. Some people suggest the U.S. will become a key energy supplier, which in turn would help it achieve an economic revival. Despite the presence of these resources, the U.S., given the global energy outlook, has not changed its policy of maintaining nuclear power generation. France at one point considered reducing its dependence on nuclear power, but in recent years has deepened its technological confidence in nuclear energy. China, South Korea and Taiwan, for their part, are stepping up efforts to improve safety of nuclear power as a key pillar of a low-cost energy supply.

The world’s energy structure is thus moving in a direction different from what is being envisioned by the Japanese government. Under such circumstances, it seems obvious that Japanese industries will be at a disadvantage in the global economic competition.

Second, the plan gives no consideration to the need for an optimum structure of energy supply. Nobody disputes the idea of raising the nation’s reliance on renewable energy sources, but the problem is that renewable sources cost more than fossil fuels and nuclear power, and are less stable in terms of output because they will be subject to changes in natural conditions.

To compensate for these problems, development of new technologies will be needed, such as more powerful batteries or the smart city. This will require huge investments and a long period of development. Even if more efficiency is achieved in energy use, fossil fuel prices will remain high due to finite resources.

The government, the Diet, the private sector and Tokyo Electric Power Co. have so far tried to determine the causes of the Fukushima plant accident, but their analyses have not been able to fully expose what actually triggered the disasters. Still, because there is extensive international cooperation on nuclear safety taking place, it is possible that Japan’s nuclear power plants will be able to operate safely. Therefore, it is possible to create an optimally varied energy structure. Its wordings aside, the energy plan of the government and the DPJ takes an essentially conservative position.

Third, the government has taken a populist approach in the process of formulating the policy. In the process, the government created three scenarios — in which Japan’s reliance on nuclear power in 2030 will be either zero percent, 15 percent or 20-25 percent — and solicited opinions from the public. In a debate-style opinion survey held as part of the effort, 46.7 percent of the people polled favored the “zero” scenario, 15.4 percent picked the “15 percent” course and 13 percent favored the “20-25 percent” choice. The result suggested that much of the general public rejected the dependence on nuclear power due to safety concerns.

A country’s energy policy is built on multiple components and should therefore have flexibility. If those in power sound out public opinion solely on nuclear energy, which is just one component of the policy, and on the basis on that make a decision on the energy policy as a whole, their very existence as politicians would be called into question.

Energy policy constitutes the basis of economic management, industrial activities and stable living conditions. The new policy of the government and the ruling party could weaken Japan’s industrial competitiveness, lower its growth potential, increase unemployment and raise the cost of living. My hope is that the government’s plan will be put to a serious review in the next Lower House election.

Shinji Fukukawa, formerly vice minister of the Ministry of International Trade and Industry (now the Ministry of Economy, Trade and Industry) and president of Dentsu Research Institute, is senior advisor for the Global Industrial and Social Progress Research Institute in Tokyo.