The shift in sentiment, already visible in newspaper headlines and protests across the globe over the weekend, means plans to build dozens of new nuclear reactors could be derailed, to the benefit of alternative energy sources like solar energy and wind power.
Meanwhile, demand for uranium, which is used to fuel nuclear plants, could drop sharply, while gas prices have started to creep up on expectations that Japan will need to import more liquefied natural gas to make up for the nuclear shortfall.
The end of the atomic era?
Evidence of an abrupt turnaround on nuclear power is gathering quickly, even as the situation in Japan continues to evolve and no one has a firm handle on the eventual outcome of the crisis engulfing several reactors.
“The end of the atomic age,” proclaimed the latest cover of Germany’s major news weekly, Der Spiegel, as some 40,000 protesters gathered in Stuttgart on Saturday to call for an end to nuclear power. Chancellor Angela Merkel was forced to appear on television Sunday night to address the turmoil and reaffirm the country’s commitment to phasing out nuclear.
On Monday, she went a step further and suspended for three months a plan to extend the life of the country’s nuclear plants. Read more on the German nuclear plan’s suspension.
In Germany, where important regional elections are taking place next month, the pressure of public opinion seems to have been too much.
“The sentiment in Germany has completely changed overnight,” said Gerard Reid, head of clean-technology research at Jefferies.
In the U.S., Sen. Joe Lieberman and Rep. Ed Markey, among others, called for a moratorium on any new nuclear-power projects. The U.S. has more than 100 nuclear reactors currently operating.
In Japan, lessons had not yet started to emerge, as plant operators and scientists were working Monday to avert a meltdown at the stricken Fukushima Daiichi plant, which could result in a massive leak of radioactive material and contamination on a wide scale. All reactors at Fukushima were shut down after the earthquake Friday, but the loss of power at some units has meant that the cooling systems needed to stop the reactor cores from overheating are not functioning.
As an emergency measure, three reactors were flooded with seawater to help them cool — a costly sacrifice, as it means they can never be used again.
With more than 50 reactors, Japan is one of the world’s top nuclear-power countries, alongside the U.S. and France.
Over the past decades, safety fears about nuclear plants have focused on potential terrorist attacks. New reactors have been conceived to be able to resist the impact of a jet crash, for instance. The current crisis, however, is exposing the vulnerability of nuclear plants to natural — and unpredictable — disasters.
“The events in Japan show that all you need to create a nuclear disaster is impair the cooling system,” said Reid.
New safety measures are likely, once more is understood about how Japanese plants could have better coped with the earthquake, but the price of building a nuclear plant will go up significantly.
“The damage has been done, and there’s only one very simple question: Who would insure a nuclear power station?” said Reid.
“While the ultimate impact to the penetration of nuclear is unknown at this early stage as the emergency unfolds, one thing for sure is that the timing of new plants, and the cost of capital, has surely increased,” he added. “On the other side, virtually overnight, the economics of solar and renewables have significantly improved,” Reid said.
Echoes of Chernobyl
As Germany’s hesitation on its plants’ extension shows, the scale and seriousness of the Japanese events are already leading countries to reassess their position on nuclear power, annihilating 25 years of efforts by the nuclear industry to improve its image after the Chernobyl disaster in Ukraine.
“Political acceptance could dramatically change in some countries following this incident and threaten nuclear revival, the possibility of lifetime extensions or even reduce the existing planned lifetime of some nuclear assets,” Cheuvreux analysts said in a note to clients.
Previous nuclear accidents, such as the one at Three Mile Island in the U.S. in 1979, had major consequences for the industry. In Finland, for instance, it prompted a referendum to phase out nuclear power. Hostility toward the technology was reinforced in Europe after the Chernobyl disaster of 1986, leading to phaseout decisions in Germany, Italy and Belgium. See a map of notable nuclear incidents.
“What’s for sure is that people who already didn’t like nuclear power aren’t going to like it more after this,” said Adam Forsyth, head of electricity and utilities research at Matrix Group. He noted that while the U.K. has committed to building new reactors, construction has not yet begun. Switzerland on Monday suspended the approval process for three nuclear-power stations so standards can be reviewed and the lessons of the Japan crisis absorbed.
In emerging economies like China and India, where energy needs are soaring and nuclear power is set to become a bigger part of the energy mix in coming years, pressure will increase to ensure that new reactors meet the highest safety standards. But they are unlikely to turn their backs on the technology entirely. China has around 50 reactors in planning stages.