TOKYO, Dec 6 (Reuters) - The cost of nuclear generated electricity in Japan is set to skyrocket due to the Fukushima disaster but will remain cheaper than alternative energy sources, according to government estimates quoted by the Nikkei newspaper.
The government panel has estimated that nuclear generated electricity will soar by at least 50 percent and perhaps by as much as 70 percent by 2030 compared to 2004 levels, the Nikkei said, quoting a draft of the report.
The projections from the panel will help Japan formulate a new energy policy by next summer as its reassesses the role of nuclear power in the wake of the world’s worst atomic disaster in 25 years.
After the disaster, then prime minister Naoto Kan floated ambitious targets for renewable energy, pledging to wean Japan away from atomic power but his successor Yoshihiko Noda has not gone that far, only acknowledging that public concerns will make it tough to build new reactors.
Prior to the diaster, Japan had planned to raise the share or nuclear generated power to 53 percent from a third by 2030.
The government panel has estimated that cleaning up the Fukushima disaster and compensating its victims could cost as much as 20 trillion yen ($257 billion), which would boost he price of nuclear generated power by 8.9 to 10.2 yen per kilowatt hour compared to 2004 levels, the Nikkei said.
Government officials were not immediately available to comment on the report.
But nuclear power was still expected to be cheaper than fossil fuel like coal, liquefied natural gas (LNG) and oil, which are expected to rise in price over the coming decades due to higher global demand.
It estimated the cost of oil generated power would soar 135 percent to 38.9 yen per kwh, the Nikkei said.
The cost of renewable energy was expected to drop significantly in price by 2030 due to increased production and technological innovations but still be more expensive than nuclear and fossil fuels.
The panel forecast wind generated power costing between 8.3 yen to 15.8 yen per kwh in 2030, a decrease of 11 to 19 percent from 2010, while solar generated power was expected to cost 16.4 to 30.6 yen per kwh, a decrease of 38 to 51 percent.
$1 = 77.8200 Japanese yen Reporting by Shinichi Saoshiro; Editing by Edwina Gibbs