JAPAN | Government faces reality of limited power supply

Posted on July 31, 2011

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JAPAN | YOMIURI SHIMBUN | 31 July 2011

The government has been forced to face the reality that the nation will experience a prolonged power shortage from winter onward if it cannot draw on nuclear power.

The government’s energy and environment panel drew up measures Friday on the supply and demand of energy, in which the government clarified it would scale back dependence on nuclear energy, but also made it clear that nuclear power plants would be allowed to restart operations after their safety has been confirmed.

The policy showed the government had modified the optimistic policy toward “denuclearization” earlier suggested by Prime Minister Naoto Kan.

However, it remains extremely difficult to restart nuclear power reactors due to opposition from local governments hosting nuclear power plants.

The main policies mapped out by the government for immediate power supplies are to curb the use of electricity rather than increase the supply capacity–in what a Democratic Party of Japan member called an “energy-saving policy of endurance.”

To decrease the use of electricity, the government plans to promote the introduction of smart meters into homes–next-generation gas and electricity meters that offer usage data in real time.

The government also urges community-based efforts to conserve electricity.

The measures are heavily dependent on cooperation from households and companies, but do not guarantee a stable supply and demand balance. Without energy to spare, the government will just continue to walk a tightrope.

“Stopping even one thermal power plant will jeopardize the balance of power supply and demand,” a senior official of the Economy, Trade and Industry Ministry said.

The cost of generating power is expected to increase by more than 3 trillion yen due to higher fuel prices, and electric companies will have to raise their rates.

If the 3 trillion yen is passed onto power rates, monthly electricity bills in areas serviced by Tokyo Electric Power Co. will rise by an average of about 1,300 yen per household.

The power shortage and higher electricity prices are expected to hinder production, which will encourage the hollowing out of industry because companies will transfer production overseas.

According to the Institute of Energy Economics of Japan, if the nation’s nuclear power plants are not restarted, the real gross domestic product in fiscal 2012 will drop as much as 3.6 percent, or 20.2 trillion yen. This would increase the number of unemployed people by as much as 197,000.

On July 13, Kan announced a major shift toward denuclearization. As alternative power sources, he considered making full use of private power-generation systems owned by companies.

He also wanted to utilize so-called pumped-storage hydroelectricity–in which surplus power is used at night to pump water from a lower reservoir to a higher one. The water is released through turbines to generate electricity at times of peak demand.

Kan thought the economy ministry had underestimated the amount of electricity to be generated by such measures and sharply rebuked a senior ministry official, saying: “[These alternative energy sources] must be able to put out more power,” according to sources.

However, the government’s National Policy Unit conducted a close examination and found that the amount of “hidden electricity” was significantly smaller than Kan expected.

Fukutaro Yamashita and Takashi Asako / Yomiuri Shimbun Staff Writers

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