Economists and manufacturers are predicting gloom and despair if all of the country’s nuclear reactors are offline this summer. But some energy experts say things won’t be so bad, while other companies are thriving amid the fears of power shortages.
Economists and manufacturers are predicting gloom and despair if all of the country’s nuclear reactors are offline this summer. But some energy experts say things won’t be so bad, while other companies are thriving amid the fears of power shortages.
All but three of the nation’s 54 reactors have been shut down due to problems or regular inspections since the March 11 quake and tsunami crippled the Fukushima No. 1 nuclear power plant in northeastern Japan last year.
The remaining three reactors are scheduled to go offline by the end of April.
According to an estimate by the Institute of Energy Economics, Japan, electric utilities’ fuel costs for thermal power plants to make up for the loss of nuclear energy will increase by 3.3 trillion yen ($42.3 billion) compared with the figure in fiscal 2010.
If those added costs are passed on to electricity charges, it would culminate in an 18-percent hike for households and a 35-percent increase for businesses.
Daiwa Institute of Research projects that Japan’s economic growth rate will edge down by 1.2 percentage point in fiscal 2012, compared with a year when reactors are operating.
The growth rate will likely decrease because businesses, affected by expected power rate increases and concerns over power outages, will reduce production, resulting in fewer exports.
“In addition to the appreciation of the yen and the high corporate tax rate, (the power supply situation) could push Japanese companies to further shift production abroad,” said Hitoshi Suzuki, chief researcher at the institute.
The institute also said the reduced output would result in nearly 300,000 more jobs lost in fiscal 2017, compared with a year when nuclear power stations are operating.
Nuclear power accounted for about 30 percent of the nation’s electricity output before the disaster.
But Masao Takano, associate professor of earth environmental systems at Nagoya University, is skeptical of arguments that nuclear power is indispensable for propping up the Japanese economy.
“It is mistaken to believe that (the economy) would not be able to survive without nuclear power,” he said.
He compared last summer’s peak electricity demand projected by each utility against its capacity to supply energy through power plants other than nuclear facilities.
Tokyo Electric Power Co., which serves the Tokyo metropolitan area and other parts of the Kanto region, had a surplus of 3.8 percent, and Kansai Electric Power Co., which serves the region covering the cities of Osaka, Kobe and Kyoto, had a surplus of 5.2 percent, according to Takano’s research.
Takano said overall, the utilities will have no problems supplying power this summer.
But officials at Nippon Shokubai Co., the world’s leading producer of water-absorption resin, which is used in disposable diapers, said fears about power shortages will significantly hurt its operations.
“The only option available for us will be to curtail our production if we are asked to achieve a cut more than the extent requested last summer,” Masanori Ikeda, president of Nippon Shokubai, said.
Its Himeji plant in Hyogo Prefecture uses about 1 gigawatt a day to heat and dry materials, an amount equivalent to the combined electricity use of 100,000 households.
The manufacturer achieved a 15-percent cut in power use last summer from the previous summer at the request of Kansai Electric. It met the target by using more gas generators and renting generators that run on light oil.
A government panel predicts a 20-percent shortage of power supply in the Kansai region this summer if nuclear reactors remain offline.
On the other hand, Eiwat Ltd., which supplies solar and wind power generation systems as well as light-emitting diodes to municipalities, said sales related to renewables in fiscal 2011 will grow 1.5 times from the previous fiscal year.
The company, which employs 15 and is based in Sakai, Osaka Prefecture, said inquiries grew threefold after the March 11 disaster.
According to the Japan Photovoltaic Energy Association, shipments of solar batteries in Japan in 2011 surged 30 percent from 2010.
Katsuhiko Machida, president of Sharp Corp., the leader in the market for solar batteries, said Japan should shift to renewables.
“If we continue to rely on nuclear power and petroleum, modern society will be destroyed,” Machida said.
(This article was written by Tetsuo Kogure and Tetsushi Yamamura.)