UPDATE: Japan struggling with energy shortage; seen shifting nuclear priorities

Updated On: Sep 09, 2011

Six months after the Fukushima Daiichi nuclear meltdown, Japan is still grappling with re-establishing power generation back to pre-quake levels.

Nationwide energy production is down 7% on the previous summer, while power generation in Greater Tokyo has dropped 20%.

To avoid power outages, the government called on major industrial energy consumers to cut power usage over the summer by 15%. All companies met or exceeded their targets, but electricity rationing has caused numerous hardships.

Nonetheless, energy shortages could continue for at least another year. Only 11 out of 54 of Japan’s reactors are currently online. Officials say that all reactors could be offline by May next year as more are closed for annual maintenance. This suggests further power rationing next summer and threatens corporate Japan with unstable energy supply, which, according to a Tokyo think tank, will force Japanese industry overseas with hundreds of thousands of job losses.

Prime Minister Yoshihiko Noda is making way for a new pragmatic nuclear policy to meet Japan’s energy needs, which calls for no nuclear plants to be built, but with nuclear power being part of Japan’s energy mix for coming years.

Noda supports the view that there should be no additional construction of nuclear plants because of safety concerns after the meltdown of the Fukushima plant, but maintained that the shift away from nuclear power should be gradual and that nuclear power will continue to be an essential power source for Japan in spite of the Fukushima disaster.

Analysts say Japan, which is dependent on the Middle East for 90% of its oil imports, will face difficulties meeting energy needs without nuclear power. According to Royal Bank of Scotland analysts, competition for scarce resources in Asia will intensify in coming years, and Japan is likely turn to liquid natural gas if it moves away from nuclear power.

Societe General economist Tak Okubo said Noda had cultivated ties with industry and is more sympathetic to the problems caused by high energy costs to businesses. Even if Noda is in favour of ending nuclear power, he is forging a broad support base, including strengthening ties with nuclear power groups, with his political legacy in mind, Okubo said.

But his position is not yet fully established, as he appointed veteran lawmaker Yoshio Hachiro – known for his anti-nuclear stance – as minister of Economy, Trade, and Industry, which oversees Japan’s nuclear policy.

Meanwhile, a new development has added to a scandal that has hindered Japan’s efforts to restart offline nuclear reactors after the Fukushima disaster.

Independent investigators discovered that the governor of Saga province told operator Kyushu Electric Power to send emails backing the restart of two reactors at the company’s Genkai Nuclear Power Station. The company has admitted to ordering employees to pose as regular citizens by sending emails during an online meeting in June held to decide on the restart of the reactors.

Report: After Fukushima: Japan’s energy crisis (CNN, 9 Sep 2011)

Analysis: Japan’s nuclear priorities seen shifting (Wall Street Journal, 8 Sep 2011)

Report: Japan Official Ordered Nuclear E-Mails, Inquiry Finds (New York Times, 8 Sep 2011)

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