The cost of closing nuclear reactors in Japan

From the New York Times:

As Japan moves to cut back on nuclear power after the disaster last year in Fukushima, it is finding that removing a political liability could lead to a harsh economic reality.

If the country’s 50 nuclear reactors are permanently closed, power companies will be hit with losses totaling ¥4.4 trillion, or $55.9 billion, rendering at least four of them insolvent, according to calculations by the government’s Agency for Natural Resources and Energy.

The extraordinary costs have emerged as a major concern for the Japanese government, which has struggled to balance the desire for improved nuclear safety with the bottom-line realities of the big utilities. Nuclear plants generated about one-third of Japan’s electricity before the Fukushima accident, but most remain at least temporarily offline.

“People talk easily about shutting down Japan’s nuclear power plants, but the economic and financial consequences are severe,” said Reiji Takeishi, professor in environmental economics at Tokyo International University.

The government is now considering at least three options to reduce the country’s dependence on nuclear power: One option being considered by the government would reduce the country’s dependence on nuclear power to 20 percent to 25 percent of electrical needs by 2030. A second option would cut the segment to 15 percent over the same time frame, and a third would eliminate nuclear power entirely.

Read the complete story here.

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