Cost-benefit analysis of a green electricity system in Japan considering the indirect economic impacts of tropical cyclones

Global warming is likely to profoundly influence future weather patterns, and one consequence of this is the likelihood of an increase in tropical cyclone intensity. The present paper presents a cost‐benefit analysis of introducing significant amounts of green energy in the electricity system in Japan in the light of the economic damage that an increase in tropical cyclone intensity could have on GDP growth between 2010 and 2085. Essentially the passage of a tropical cyclone will result not only in physical damage but also on a decrease in economic productivity due to precautionary cessation of the economic activity, which has an effect on GDP growth. By comparing the economic performance of different electricity system scenarios with the indirect economic damage of tropical cyclones from 2010 to 2085, based on the yearly economic data of green electricity, fossil fuel, GDP and population, it can be seen that the green scenarios are generally a cost‐effective way of mitigating the effects of these weather systems, despite the large amount of initial investments necessary.