Japan has switched off its last nuclear reactor and will have to rely on imported oil and gas to power its industrial machine for the rest of the year, bowing to anti-nuclear sentiment as controversy rages over the botched handling of the Fukushima clean-up.
Failure to revive Japan's nuclear industry is a major setback for premier Shinzo Abe, who had hoped to restart at least eight of the country's 50 reactors this year to cut reliance on ruinously expensive crude oil and liquefied natural gas (LNG). While a surge in output from solar and other renewables has plugged a gap equal to three reactors, it too comes at a high cost.
Mr Abe's dash for growth after 15 years of deflation and perma-slump depends crucially on affordable energy, but Japanese companies must now pay three times as much as US rivals for power.
Tokyo says it costs four time more produce power from oil compared to coal or nuclear reactors, creating an incentive to build new coal plants.
The cost squeeze threatens to offset gains from a 20pc fall in the yen against the dollar since Mr Abe first signalled his monetary blitz last year. It has also wiped out Japan's trade surplus, leading to deficits in 2011 and 2012 for the first time in over 30 years. Junko Nishioka from RBS said this takes away a key shield protecting Japan against a bond market crisis.
Nuclear power provided a third of Japan's electricity before the Fukushima melt-down in February 2011, when all plants were switched off.
For now, at least, Mr Abe's broader economic gamble is working. The Bank of Japan's vow to purchase $75bn a month of Japanese bonds and double the monetary base by mid-2014 has been electrifying. Growth was 4.1pc in the first quarter and 3.8pc in the second quarter, making Japan the fastest-growing economy in the G7 so far this year.
The question is whether it is a monetary "sugar rush" or a genuine revival. Failure to find affordable energy quickly could prove the Achilles Heel of Abenomics
David Fuller's view I maintain that Abenomics is a winning formula for Japan but energy costs are the biggest obstacle. Given Japan's long history of nuclear horrors - from Hiroshima and Nagasaki in 1945 to Fukushima in 2011 - it is understandable that its citizens will not tolerate the reopening of these plants.
Ironically, inexpensive and easy to build coal-fired power stations could quickly resolve Japan's energy problem, albeit possibly at a greater risk to its citizen's health than the remaining nuclear power plants. Therefore, the solution may be a combination of coal, fracking and solar.
Japan is a highly inventive country and I doubt that Abenomics has been blindsided by the current energy problem. However, I would welcome insights and articles from members of the Collective who know more about the Japanese government's energy plans.