Japan Sees Little Scope for Power Price Cuts

Japan will find it difficult to reduce electricity costs to levels last seen before the Fukushima nuclear plant disaster, the head of the panel deliberating the country's 2030 targets for power generation said on Wednesday.

The closure of Japan's nuclear plants after the 2011 disaster has raised utilities' reliance on fossil fuel-fired power generation and pushed up electricity costs for businesses and households by about 30 percent and 20 percent respectively.

However, the chairman of the country's energy mix panel, Masahiro Sakane, offered little hope for swift relief as Japan prepares to set its longer-term energy targets before a meeting of the Group of Seven (G7) industrialised nations in early June.

"We've heard the cry for help (from industries) for current power costs," Sakane, who also serves as an adviser for construction machinery company Komatsu, told the panel. "Cost is important, but it's very difficult to return electricity costs to pre-March 11 (2011) levels."

Nuclear and renewables have tumbled from 20 percent of Japan's energy mix before the Fukushima disaster to only 6 percent, one of the lowest levels among developed countries, he added.

The country's ruling party has suggested a return to nuclear power, but any such moves are likely to meet stiff opposition from the Japanese public.

The energy mix targets, however, will be further complicated by carbon emmissions targets, with climate change expected to be on the agenda at next month's G7 meeting.

Reporting by Osamu Tsukimori