The private and external costs of Germany’s nuclear phase-out

Jarvis, Stephen ORCID: 0000-0001-9039-3407, Deschenes, Olivier and Jha, Akshaya (2022) The private and external costs of Germany’s nuclear phase-out. Journal of the European Economic Association, 20 (3). 1311 - 1346. ISSN 1542-4766

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Abstract

Many countries have phased out nuclear power in response to concerns about nuclear waste and the risk of nuclear accidents. This paper examines the shutdown of more than half of the nuclear production capacity in Germany after the Fukushima accident in 2011. We use hourly data on power plant operations and a machine learning approach to estimate the impacts of the phase-out policy. We find that reductions in nuclear electricity production were offset primarily by increases in coal-fired production and net electricity imports. Our estimates of the social cost of the phase-out range from €3 to €8 billion per year. The majority of this cost comes from the increased mortality risk associated with exposure to the local air pollution emitted when burning fossil fuels. Policymakers would have to significantly overestimate the risk or cost of a nuclear accident to conclude that the benefits of the phase-out exceed its social costs. We discuss the likely role of behavioral biases in this setting, and highlight the importance of ensuring that policymakers and the public are informed about the health effects of local air pollution.

Item Type:	Article
Official URL:	https://academic.oup.com/jeea
Additional Information:	© 2022 The Authors
Divisions:	Geography & Environment
Subjects:	H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HC Economic History and Conditions
JEL classification:	C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C53 - Forecasting and Other Model Applications Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q4 - Energy > Q41 - Demand and Supply Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q53 - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
Date Deposited:	04 Feb 2022 15:24
Last Modified:	12 Dec 2024 02:50
URI:	http://eprints.lse.ac.uk/id/eprint/113634

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