Nuclear Energy – Japan

Japan is an extremely fossil fuel resource poor country similar to the likes of India and South Korea. It needs to import billions and billions of dollar in coal, oil and gas every year to run its economy. The country’s leadership realized the problem of energy security early enough and invested heavily in building a large fleet of nuclear power plants, in days when building nuclear energy was not crazily expensive and considered a good idea. However, things have changed dramatically over the course of time. Building safe nuclear power plants costs a huge amount of money and takes many years. Apart from a few countries, new nuclear plants have almost stopped being built in most countries. In fact after Fukushima, many countries such as Germany and Belgium have become nuclear free as massive protests made the governments shut down their nuclear power reactors overnight.

Japan which was at the epicenter of the disaster too had closed down all 50 of its plants which used to produce 30% of its overall electricity. This led to massive imports of coal and gas in order to replace the nuclear power. Despite the surging imports and steep rise in electricity prices for retail consumers, most citizens did not want the nuclear power plants to restart. However, the country’s politicians and industrials wanted to use these stranded assets.

After numerous legal and parliamentary hurdles being crossed, Japan’s first nuclear reactor (Sendai Nuclear Power Unit No1, on the southern island of Kyushu) has been restarted. However, the ongoing protests by citizens means that most of the nuclear reactors are now bad assets for the utility companies and unlikely to be used again. Spending huge amounts of money in safety equipment may not be a wise option, given that solar power costs have fallen drastically making it competitive with grid power in a lot of places. Also fossil fuel prices especially of oil and gas have crashed. This will lower the burden on utility companies and the end consumers as well.