The Energy Mix Review in Japan – a Glimpse of the Future


The Energy Mix Review in Japan – a Glimpse of the Future

18 March 2021 – by Viktor Tachev

Japan is often seen as a benchmark for technological advancements and innovativeness. As a trend-setter, the country’s efforts in every aspect are monitored by the whole world. The case will be no different when it comes to the ongoing energy mix review in Japan. Its outcome will determine whether the country will embrace the path of sustainability and how quickly it plans to escape the grasp of fossil fuels.  

Japan’s Energy Mix

According to IEA, fossil fuels accounted for 88% of Japan’s total primary energy supply in 2019. This is the 6th largest share among all IEA countries. More importantly, the country imports foreign resources to satisfy over 96% of its current energy consumption needs.

Total Energy Supply by Source in Japan as a Percentage graph
Source: IEA

As a result of the heavier reliance on fossil fuels, Japan ranks 5th on a global scale in terms of carbon intensity. Although the figures have been gradually decreasing since 2011, they remain among the highest within the IEA member countries.

Trends in the Total Energy Supply in Japan graph
Source: IEA

On the bright side, the last couple of years have seen Japan significantly diversify its energy mix. The country embarked on a journey to reform its energy policy and system by turning the focus to renewable energy. The results so far are satisfying, although the country has significant room for improvement.

Japan’s current energy policy plans

To remain on track with its goals to reduce emissions by 26 per cent (or more) by 2030 and achieve carbon neutrality by 2050, Japan plans to significantly increase the share of renewable energy power generation sources in its total energy mix.

The current plans, introduced in 2015, aim at renewables meeting up to 22% – 24% of Japan’s electricity needs by 2030. Due to the substantial recent progress, the country managed to reach the target in 2020, 10 years ahead of schedule.

Yet, the share remains much lower when compared to many European countries, especially considering the country’s high renewable energy potential. The discrepancy becomes even more glaring when compared with Asia’s leaders in renewables adoption, like Myanmar (68%), Sri Lanka (51.3%), the Philippines (47.5%), and Indonesia (47%).

Overall Share of Energy from Renewable Sources in the EU
Source: Eurostat

Achieving the goal earlier than expected provides Japan with the unique opportunity to increase its 2030 energy mix renewable energy target and aim at even better results. Business leaders within the country don’t see it just as an opportunity but more of a necessity.

A “Green Call” From the Corporate Sector

In the wake of the latest energy mix review in Japan, the Japan Climate Leaders’ Partnership (JCLP) urged the government to raise its 2030 renewable energy target to 50% so that the country can remain in line for meeting the net-zero goal by 2050. Besides, the coalition of over 170 of Japan’s leading companies demanded authorities to prioritize the environment over economic efficiency. JCLP also requested the government to carry through the phase-out of inefficient coal-fired power plants and halt the construction of new ones.

In December 2020, alongside the local business community, Japan presented its new “Green Growth Strategy in line with Carbon Neutrality 2050” strategy. It aims at combining economic growth and environmental protection.

The strategy sees renewables accounting for between 50% and 60% of the electricity demand in 2050. Nuclear and thermal plants with carbon capture utilisation and storage (CCUS) (30-40%) and 10% of hydrogen and ammonia generation will supply the remaining share. However, such a plan can jeopardize Japan’s 2050 net-zero society goal.

2050 Zero Carbon Cities in Japan, Source: Ministry of the Environment
2050 Zero Carbon Cities in Japan, Source: Ministry of the Environment

The Importance of the Energy Mix Review in Japan

October 2020 marked the start of the latest energy mix review in Japan. The initiative reflects the Ministry of Economy, Trade, and Industry’s intention to accelerate renewable energy adoption and update its medium- and long-term energy plans.

The outcome of the review is a topic of global interest. The reason is that it will shed light on Japan’s determination for carbon neutrality by 2050. The country’s next moves can provide valuable lessons to the international energy community and cement renewable energy as the way to go ahead. Japan is perfectly positioned to push for an internationally shared vision on speeding up the green energy transition.

Renewable energy can expand faster and at a lower cost compared to all other energy sources. That is why it is safe to say it holds the answer to many of Japan’s current issues. This makes the energy mix review a topic of utmost importance, not only for Japan but for the whole region.

JCLP’s report concludes that Japan needs strong political leadership to create visions for the future. It remains to be seen whether the government will address the corporate sector’s push for a 50% renewable energy share by 2030, instead of 2050. What is known for sure is that the world is watching.

by Viktor Tachev

Viktor has years of experience in financial markets and energy finance, working as a marketing consultant and content creator for leading institutions, NGOs, and tech startups. He is a regular contributor to knowledge hubs and magazines, tackling the latest trends in sustainability and green energy.

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