Japan shutters 52 of 54 Nuclear Reactors because of Fukushima, Energy Imports cause Trade Deficit

Posted by PITHOCRATES - March 11th, 2012

Week in Review

The two oil crises in the Seventies hurt Japan’s economy.  Because the Japanese have little domestic energy sources.  Which means they have to import most of their energy.  Coal.  Natural gas.  And, of course, oil.  After suffering the economic fallout of two oil crises in one decade they made a decision to prevent that from happening a third time.  By diversifying their energy industry.  And going nuclear.  Increasing the amount of electricity produced by nuclear power to almost 25%.  Which helped to insulate them from another economic shock.  But that all changed with the 2011 Fukushima nuclear disaster (see Japan reports record current account deficit posted 3/7/2012 on BBC News Business).

Japan has reported a record current account deficit because of rising energy imports, as the country’s economic recovery remains fragile…

In the aftermath of the 11 March 2011 tsunami and earthquake that triggered a meltdown at the Fukushima nuclear reactor, Japan shut 52 out of 54 reactors.

This led to shortages of fuel for generating electricity, which meant more of it had to be imported…

The yen slipped to trade at 81.26 to the US dollar, as the trade deficit raised fears about how long Japan would be able to manage its large public debt.

The massive earthquake created the massive tsunami.  The tidal surge of the tsunami caused the Fukushima nuclear disaster.  An extremely rare event.  It has only happened once in the era of nuclear power.  In fact, the nuclear part of the reactor survived all of this.  It was the old technology that didn’t.  The electrical distribution equipment.  Because it was located in the basement.  Which became flooded with sea water.  Which disabled the electrically driven cooling pumps from operating.  Despite backup generator power being available. 

The technology exists to move electrical distribution equipment to higher ground.  And to waterproof it.  There exists power cables rated for underwater use even.  There is no technological hurdle preventing the kind of electrical updates to prevent another extremely rare event causing another electrical failure like at Fukushima again.  And they’re simple projects, really.   Build new distribution equipment on high ground where a tidal surge can’t reach it.  And rerouting critical systems to this new distribution equipment.  You could do this.  Or you could shut down 52 of your 54 reactors for political reasons.  And import more fossil fuels (coal, natural gas and oil) to make up for the energy shortfall.  Increasing your trade deficit.  And risking your ability to pay one of the highest debt loads of any state (as a percentage of GDP).

One thing you can’t do, though, is make up this energy shortfall with solar or wind power.  Because the cost of building the infrastructure to produce that much energy is prohibitive.  And the power it produces is too unreliable.  For sometimes the sun doesn’t shine.  And sometimes the wind doesn’t blow.  So to please the antinuclear environmentalists who fear another extremely rare event from happening they have to replace clean energy (nuclear generated) with dirty energy (fossil fuel-generated).  Which doesn’t make a lot of sense.  Then again, political decisions rarely do.

To put this into perspective consider this.  Your odds of lightning striking you are greater than you winning the lotto.  Yet your chances of winning the lotto are greater than another Fukushima from happening.  And people will buy lotto tickets.  But they shun nuclear programs.  Unless, that is, a rogue regime is using it to enrich uranium that could also be used to make a nuclear bomb.  And that regime is Islamist.  Which wants to conquer the world.  Strange how Japan has to shut down their nuclear program while Iran doesn’t.  A country, incidentally, that sits on huge petroleum reserves.  And doesn’t need nuclear power.

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