By Michio Yoshida
Minister of Economy, Trade and Industry Hiroshige Seko indicated at a news conference on Feb. 7 that he will visit the U.S. during the Abe-Trump summit. The government is arranging for Seko to be present at the summit meeting and have him propose joint marketing of nuclear plants in the newly emerging countries with the U.S. However, the market for nuclear power plants has been shrinking since the accident at the Fukushima Daiichi Nuclear Power Plant and companies in this industry have suffered significant losses. Experts voice doubts about this plan, pointing out that “the scenario of profiting from selling nuclear plants is unrealistic.”
Joint marketing of nuclear plants aiming at “developing a market of $50 billion in 10 years” is included in the “Japan-U.S. growth and employment initiative” for bilateral economic cooperation to be presented at the summit meeting. Japanese manufacturers Toshiba and Hitachi have joint ventures with American companies, and this is meant to show that nuclear plant projects are mutually beneficial for the two countries.
However, stricter regulations have been imposed in the U.S. and Europe since the Fukushima accident, resulting in a sharp rise in construction costs. Many projects have been suspended or cancelled. Furthermore, prices of crude oil and other fuel for thermal power generation are expected to be stable for some time to come, partly due to the shale gas revolution in the U.S., causing the nuclear power plant market to shrink.
Toshiba is considering withdrawing from the nuclear plant business in the U.S., while Hitachi has stopped R&D in the nuclear sector.
Yet, Seko still claimed at a news conference on Feb. 3 that “many countries are planning to build new nuclear plants.” The Ministry of Economy, Trade and Industry says that the International Atomic Energy Agency (IAEA) projects an increase of 30-330 nuclear plants by 2030, especially in the newly emerging economies. However, in reality, new nuclear plant projects are becoming difficult even in the newly emerging countries. The Vietnamese government has given up on its plan due to opposition from its citizens and fiscal difficulties.
Prof. Yoichi Nakano of Kyushu International University, who specializes in international economics, points out, “The world came to know the danger of nuclear power plants after the Fukushima accident. They are now inferior to renewable energy or thermal power even in terms of cost. It will be difficult for Japan to win contracts even if it makes marketing efforts by riding on the U.S.’s coattails.” (Slightly abridged)