Economics of Energy and Environmental Policy, Vol. 1, No.2, pp. 1-30, 2012
Paul L. Joskow and John E. Parsons, Economics of Energy and Environmental Policy, Vol. 1, No.2, pp. 1-30, 2012
This paper analyzes the impact of the Fukushima accident on the future of nuclear power around the world. We begin with a discussion of the "but for" baseline and the much discussed "nuclear renaissance." Our pre-Fukushima benchmark for growth in nuclear generation in the U.S. and other developed countries is much more modest than many bullish forecasts of a big renaissance in new capacity may have suggested. For at least the next decade in developed countries, it is composed primarily of life extensions for many existing reactors, modest updates of existing reactors as their licenses are extended, and modest levels of new construction. The majority of forecasted new construction is centered in China, Russia and the former states of the FSU, India and South Korea. In analyzing the impact of Fukushima, we break the effect down into two categories: the impact on existing plants, and the impact on the construction of new units. In both cases, we argue that the accident at Fukushima will contribute to a reduction in future trends in the expansion of nuclear energy, but at this time these effects appear to be quite modest at the global level.