A government panel says in a draft report that nuclear power generation costs ¥8.9 per kilowatt hour when including expenses associated with nuclear accidents, higher than a 2004 projection of ¥5.9 per kwh.

The new estimate, calculated by considering the result of the catastrophe at the Fukushima No. 1 power plant, shows that nuclear power is still one of the cheapest energy sources, the panel said. But its draft report, released Tuesday, notes that ¥8.9 is the "minimum" cost of nuclear power as the total financial damages from a severe nuclear accident are still unclear.

According to the draft report, coal-powered thermal plants generate electricity at ¥9.5 per kwh, while the rate for liquefied natural gas-powered thermal plants is ¥10.7 per kwh.