Is Japan Heading For A Massive Economic Hit? All of Japan's Nuclear Power Plants About to Go Offline!

Here is an excellent report that was sent to me by my friend Aaron Egon Moser. I've written before about how it is possible that these events could seriously damage the Japanese (then world?) economy in Japan's Double-Edged Sword: What Happens When the Nuclear Power Plants Turn Off? 

To think that Japan can go on from here, into the next fews decades, in an era of declining oil production and rising oil costs and public debt coupled with an aging population problem without a cheap energy source is foolish and completely unrealistic....

In other words, it's not economical. The Center for Global Energy Studies says:

Despite high oil prices, fossil fuels will continue to trump renewable energy sources such as solar and wind power without massive government subsidies, a new investment bank says.

A report by Calgary-based AltaCorp Capital says the “economic realities” of oil and natural gas mean that the world will remain largely dependent on non-renewable energy sources for the foreseeable future.

Japan's government already has the highest debt to GDP levels in the world, it cannot afford to subsidize new industries like solar or wind farms... People will misunderstand what I have written here and say I'm pro-nuclear power. I am not. I am pro-business. I wish we didn't need nuclear power at all. My motivations are purely economical. I wish I could say it were true that Japan didn't need nuclear power to survive but it seems to me, that if I had to put it into a black and white perspective, it's a "damned if you do, damned if you don't" sort of problem for Japan.

Or could this be an opportunity for Japan to, once again, rise from the ashes of disaster? Watch this thought-provoking interview:

Let's hope that this summer is cool and geo-political problems give Japan breathing room and oil and natural gas prices remain at a relatively low cost. One can hope, right?... Not that "hope" has ever been a very good business plan... 

Japan's Future and Nuclear Power?

Since the March 11 disaster involving the earthquake, tsunami and subsequent nuclear accident at Fukushima, I have been consistently stressing at least two important points concerning the nuclear situation in Japan.

First, when dealing with news about Fukushima, we can only deal with the facts and must resist the temptation to be prodded into panic by sensationalist and hyper-reactive "reporting" that is actually nothing but conjecture. And, two, the worst thing that could ever happen to Japan is for us to lose a cheap and clean source of energy. (For an example of wild conjecture, read this. For a great example of factual reporting see here.)


Interestingly, The Diplomat has a story that echoes my exact words:

Last month, thousands of Japanese took to the streets to demand an end to nuclear power in their country. For more than half a century, Japan had been in the uncomfortable situation of being both the only nation that has suffered an atomic attack, but also one of the countries that are most reliant on atomic energy. The disaster at the Fukushima Daiichi nuclear power plant, though, has made it impossible to ignore this seeming paradox any longer. The Japanese people, known more for their restraint and willingness to endure than for their propensity to express outrage and challenge the status quo, appear to have found their voice. 

A newly empowered public voice would surely be a positive in a country whose democratically elected leaders have waffled with impressive ambivalence through Japan’s troubles over the last decade. However, if this public voice portends a new reality for Japan, Japanese political leadership will need to find the sophistication and fortitude to respect the difference between democratic leadership and popular capitulation. Notwithstanding the immediate task of bringing relief to hundreds of thousands of tsunami victims, perhaps the most important and imminent test for Japan’s leadership in this new era must be to defy the people’s demands and work immediately to ensure Japan’s nuclear energy supply. 

You can read more at the Diplomat.

From reading the above I flatter myself and imagine that this writer is a regular reader of this blog as I have made the exact same points for months, most recently in mid-June. But most probably not. It is common sense that Japan, a country that has little or no natural resources, as well as an aging society and massive debt to GDP; a country that is one of the most over crowded nations on earth; a country that went to war over resources just 55 years ago, needs nuclear power to survive.


What other choices are there except reverting back to the way things were 45 years ago with Japan's energy needs by burning fossils fuels and pollution? That would be a terrible and completely impractical choice. 

We must find a way to make nuclear power safe as well as economical or the land of the rising sun is a country of the setting sun. Japan is supposed to be a leader of the world in technology. We have no choice but to pursue the creation of safe and controllable nuclear power... Even if it means risking a Godzilla type creature rising up from Tokyo Bay (of course, I am joking!) 


If Japan does not pursue creating the technology and will to create safe nuclear power then Japan's time in the sun has passed.