This study assesses the environmental and economic impacts of the immediate shutdown
of all Japan's nuclear reactor fleet. For the assessment, we regard a gradual nuclear power
phase-out scenario as the basis for a 40-year operational time limit of plants as a reference sce-
nario. A multi-regional, recursive dynamic computable general equilibrium model based on
Version 8.1 of the Global Trade Analysis Project database is constructed. The simulation re-
sults indicate that an immediate nuclear shutdown increases CO2 emissions through an in-
crease in fossil fuel electricity generation and decreases real GDP losses in Japan. From a sec-
toral view, an immediate nuclear power shutdown has a negative impact on Japan's energy in-
tensive and trade-exposed sectors. In addition, we find that an immediate nuclear shutdown
has a negative after-effect on the economy. This is caused by shrinking investment spending
during the immediate nuclear power shutdown. Overall, we find that the Japanese economy
would face significant economic and environmental impacts from an immediate nuclear power
shutdown. However, our model does not incorporate potential negative costs associated with
nuclear usage, such as the risk of a nuclear accident or the cost of final disposal sites for nucle-
ar waste, which may be sizeable. To derive conclusions for Japanese energy policy, we must
consider the potential negative costs of nuclear usage. The results of this simulation study rep-
resent the first step in answering key questions on energy policy.
