Reuters Two months of baking heat will test Japan's resolve to wean itself off nuclear power and show whether an energy-saving drive set off by meltdowns at the Fukushima plant will bring lasting efficiency gains the way the 1970s oil crisis did. There are some signs that there is no going back to the pre-March 11 status quo as businesses and consumers change behavior in ways that will last beyond the summer electricity crunch. Japan's immediate challenge is to avoid disruptive power blackouts in July and August when air conditioners work in overdrive and energy demand peaks. Most of the country's nuclear reactors will be shut. Utilities' forecasts of supply and demand suggest Japan should just scrape through with voluntary and government-ordered power savings. Companies are changing work schedules to spread out demand, turning off lights and elevators and adopting a more casual dress code that allows people to keep cooler. The Bank of Japan and many private economists also believe that losses in output can be avoided as companies aim to cut their peak usage by 15 percent without denting production. The big question is what will happen after the summer. The radiation crisis triggered by the March 11 earthquake and tsunami shattered the nation's trust in nuclear energy. A poll last month showed nearly 70 percent of Japanese opposed restarting reactors currently shut for maintenance. Out of 54 reactors, 35 are off-line and the remaining 19 are scheduled for inspection by April 2012. If those now idled did not restart it would lead to a complete shutdown of the sector, which used to supply nearly a third of Japan's energy, by next spring. The government is desperate to avoid that even as it says reducing reliance on nuclear power is inevitable. Fukushima operator Tokyo Electric Power and other power utilities may hope the tide of public opinion will swing back in their favor. The official weather agency sees a 50 percent chance that July will be hotter than normal, while August is forecast as average, meaning maximum temperatures in parts of Japan will be above 30 degrees Celsius. The sweltering heat, reports that heat strokes are on the rise and fears of shortages when demand soars again in winter may erode public resistance to restarting nuclear reactors. Analysts doubt it. They say the Fukushima crisis is such a deep scar on the nation's conscience that a return to the pre-disaster status quo is impossible. “Given the scale of damage at Fukushima, sentiment isn't likely to swing back in favor of nuclear power soon,” said Shuji Tonouchi, senior fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities. Some analysts even suspect some utilities may be overstating the risk of blackouts to make the case for sticking with nuclear power. Politicians from both the ruling party and the opposition, often seen as hopelessly out of touch, appear to recognize there is no turning back. Unpopular Prime Minister Naoto Kan, who has promised to resign but fudged when he will actually go, has embraced a bill on renewable energy as his pet project. The opposition Liberal Democratic Party – which during half a century of nearly uninterrupted rule had championed nuclear power as a cheap, reliable and clean alternative to the fuels that resource-poor Japan must import - is also changing tack. “Our party does not feel our past nuclear policy was wrong as it allowed the industry access to affordable electricity that enabled the economy to grow,” Yasutoshi Nishimura, LDP's shadow energy and trade minister told Reuters this week. “But we were not expecting such a disaster and feel strongly responsible for not anticipating such an event to happen.” Kan's government has said Japan should boost the share of renewable energy in its energy mix to more than 20 percent by the 2020s from about 10 percent now, while reducing reliance on nuclear energy. Earlier plans talked about boosting the share of nuclear power to more than 50 percent by 2030. The government has yet to produce a specific plan, but dozens of communities across Japan, including those that have for years depended on nuclear plants for jobs, tax revenues and subsidies, are already trying to diversify into solar, hydro and wind energy. Indeed, there are about 80 Japanese communities judged to be producing enough energy from renewable resources to cover demand from households and small businesses. Many have seen a surge in visits from researches and government officials looking to emulate their success on a bigger scale. Japanese industry reached energy efficiency unparalleled among major industrial nations after the 1970s Arab oil embargo exposed the West's reliance on oil to power their economies. After the nuclear shock this year, Japanese firms are again thinking ahead to an era of less affordable and reliable energy supply. While there is a risk that some manufacturers may shift operations abroad, speeding up the “hollowing out” of Japan's manufacturing, others are taking steps to conserve energy that will last beyond summer or developing new technologies that address Japan's energy insecurity. For example, Japanese automakers including Mitsubishi Motors , Nissan Motor and Toyota Motor Corp are looking to develop a function that would enable electric vehicles to discharge electricity directly to homes. That would allow households equipped with solar panels to charge their vehicles during the day and then use the power stored in the car's batteries to supply the household at peak hours. Companies are also taking steps that aim to cut their energy bills in the long-run, not just during the peak season. Electronics giant Panasonic last week established a “corporate electricity saving division”. Retailer Seven & I Holdings, which operates more than 13,000 Seven-Eleven convenience shops in Japan, plans to switch to energy-efficient LED lighting at thousands of its stores. It will set up solar panels at some. Households are also doing their part, snapping up energy-saving appliances. Japan's No.2 retailer Aeon Co said on Wednesday sales of electric fans in March-May soared five times over last year and air conditioners were also selling well as consumers switched to newer, more efficient units. There are also investors willing to bet on payoffs of Japan's energy retooling. Shares of NEC Corp scaled 3-1/2 month highs this week on news it would start selling home power batteries that will let households better manage their electricity use. __
