Impact of Electric Power Pricing Reforms on the Japanese Economy

Woojong Jung

Abstract


Following the Fukushima nuclear power plant accident, Japan found an opportunity to advance economic and energy policies based on the stable supply of energy, economic efficiency, environmental security, and safety. Furthermore, the accident not only caused concern about the safety of nuclear power plants but also raised awareness about the effect of increase in energy imports on the economy and related issues such as the impact of imports on international competitiveness. This study simulates the impact on electric power prices using three potential scenarios for Japan. According to the study results, the corporate goods price index (CGPI) was found to be larger than the consumer price index (CPI) for Japan in all cases, and the increase in electric power prices had a significant impact on industry. However, in general, the impact of both CGPI and CPI on firms is non-significant; therefore, these can be said to have limited impact in this analysis. The cost of policies that maintain safety, the increase in costs owing to overseas import of fossil fuels, and the cost of promoting renewable energy in conjunction with reutilization of nuclear power plants, leading to increased electric power prices, will also be considered in the future.


Keywords


input-output analysis; electric power price; corporate goods price index; consumer price index

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DOI: http://dx.doi.org/10.18282/bam.v0i0.764

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