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The Private and External Costs of Germany's Nuclear Phase-Out

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Listed:
  • Stephen Jarvis
  • Olivier Deschenes
  • Akshaya Jha

Abstract

Many countries have phased out nuclear electricity production in response to concerns about nuclear waste and the risk of nuclear accidents. This paper examines the impact of the shutdown of roughly half of the nuclear production capacity in Germany after the Fukushima accident in 2011. We use hourly data on power plant operations and a novel machine learning framework to estimate how plants would have operated differently if the phase-out had not occurred. We find that the lost nuclear electricity production due to the phase-out was replaced primarily by coal-fired production and net electricity imports. The social cost of this shift from nuclear to coal is approximately 12 billion dollars per year. Over 70% of this cost comes from the increased mortality risk associated with exposure to the local air pollution emitted when burning fossil fuels. Even the largest estimates of the reduction in the costs associated with nuclear accident risk and waste disposal due to the phase-out are far smaller than 12 billion dollars.

Suggested Citation

  • Stephen Jarvis & Olivier Deschenes & Akshaya Jha, 2019. "The Private and External Costs of Germany's Nuclear Phase-Out," NBER Working Papers 26598, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:26598
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    References listed on IDEAS

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    1. Olivier DeschĂȘnes & Michael Greenstone & Joseph S. Shapiro, 2017. "Defensive Investments and the Demand for Air Quality: Evidence from the NOx Budget Program," American Economic Review, American Economic Association, vol. 107(10), pages 2958-2989, October.
    2. Duncan S. Callaway & Meredith Fowlie & Gavin McCormick, 2018. "Location, Location, Location: The Variable Value of Renewable Energy and Demand-Side Efficiency Resources," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(1), pages 39-75.
    3. Stefan Wager & Susan Athey, 2018. "Estimation and Inference of Heterogeneous Treatment Effects using Random Forests," Journal of the American Statistical Association, Taylor & Francis Journals, vol. 113(523), pages 1228-1242, July.
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    More about this item

    JEL classification:

    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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