Japan plans to develop a next-generation light-water nuclear reactor to pursue the highest economic efficiency possible in the business, government sources said Friday.

Under the government's first nuclear reactor development program in 20 years, the agency will try to cut construction costs, operating costs and radioactive waste by 20 percent from present levels to achieve the highest economic efficiency for such reactors in the world, they said.

The agency asked the Institute of Applied Energy to consider the development in January. It has concluded that the public and private sectors should aim for replacing its existing reactors sometime in the 2020s, the sources said.

The agency plans to base the next-generation nuclear reactor on the existing light-water type, because a program to develop a fast-breeder reactor that can generate electricity while producing more fuel than it consumes has effectively been stalled by accidents, misdeeds and litigation.