"Japan has embarked on a new experiment in its energy system, encompassing changes to the mix of fuels used domestically and the corporate organisation of energy production.
Oil continues to make up the largest share of Japan's primary energy supply because of the lack of substitutes for gasoline and diesel available at competitive prices. In electricity, on the other hand, for six decades energy planning has operated under the assumption that nuclear power, in conjunction with efforts to reduce the energy intensity of economic activity, provides the safest, most secure and most cost-effective way of powering the economy.
The most coherent statement of this policy prior to the 11 March disaster is the June 2010 Strategic Energy Plan (SEP) produced within the Ministry of Economy, Trade and Industry. It established a series of targets focused on expanding the role of nuclear power in electricity generation by building 14 new nuclear units by 2030, increasing the use of renewable energy, and subsidising the deployment of low-carbon technologies through the commercial, residential and transport sectors.
It was estimated that this would lead to a substantial reduction in aggregate energy demand, as well as a shift away from the consumption of coal, oil and natural gas to a lesser degree, in favour of nuclear power and renewable energy.
First, despite differences in rhetoric, there is a surprising degree of continuity in the approaches taken by the Liberal Democratic Party (LDP) and the former government (the Democratic Party of Japan, or DPJ) towards the energy mix. DPJ officials adopted strong language against the nuclear industry and initially proposed aggressive targets for banishing nuclear power from Japan's electricity generation. Final legislation showed they were willing to accept a longer-term role for nuclear power.
Second, the LDP has decided to move ahead with a deeper restructuring of Japan's system of regional electricity monopolies.
Third, the establishment of a Nuclear Regulation Agency (NRA), which is charged with ensuring the safety of the nuclear industry, is fundamentally changing energy policy making. Japan has historically not placed great emphasis on independent regulatory agencies.
The precise mix of fuels and demand-side changes that will account for the reduction of nuclear power remains unclear.But what is certain is that new investment patterns and regulatory complexity are already ensuring that nuclear power is set to play a reduced role in Japan's energy supply picture moving forward".
Source: NewsonJapan
