Japan and fossil gas

From Global Energy Monitor

Japan has a population of 125.6 million.[1] It has the third largest economy in the world and has a projected GDP growth of 2.0% in 2022 and 1.1% in 2023.[2][3]

Japan had enjoyed the title of world's largest LNG importer since 2019 until recently when China surpassed it.[4][5] After the Fukushima incident in 2011, all of the country's nuclear reactors were taken offline pending clearance from the Nuclear Regulation Authority,[6] and therefore, Japan became much more reliant on LNG imports for its power generation mix.[7]

This article is part of the Global Energy Monitor coverage of fossil gas

Fossil Gas in the Fuel Mix

Total gas consumption in Japan in 2021 was 103.6 bcm.[8] It contributes about 24% to the total energy mix and makes up 36% of the power generation mix.[9] The remaining demand comes from the industrial, residential, and commercial sectors.[4]

In March 2022, LNG consumption for electricity generation was 3.47 million tonnes, which is a 6.5% reduction from March 2021.[10] LNG consumption for city-gas remained 2.95 million tonnes for the same period.[10]

Japan produced 1019.7 terawatt-hours (Twh) of electricity in 2021, out of which, 326.1 Twh were produced from fossil gas, 301.9 Twh from coal, 130.3 Twh from renewables, 77.6 Twh from hydropower plants, 61.2 Twh from nuclear plants, 31.3 Twh from oil, and 91.3 Twh from other sources [8] In response to high LNG prices, Japan announced plans in 2022 to accelerate the restart of seven nuclear reactors starting in mid-2023. This will bring the total number of operational nuclear units to 17.[11]

The country's 5th National Energy Plan was released in 2018.[12] The plan targets renewable energy to make up 22-24% of the power generation mix, 20-22% from nuclear, 26% from coal, 27% from LNG, and 3% from oil in 2030.[7] The plan also aims to cut Japan's carbon dioxide emissions by 26% by 2030 and by 80% by 2050. According to the plan, nuclear energy will recover to pre-Fukushima levels.[7]

In its recent NDC commitment, Japan committed to reduce its greenhouse gas emissions by 46 percent in fiscal year 2030 from its fiscal year 2013 levels, setting an ambitious target, which is aligned with the long-term goal of achieving net-zero by 2050. Furthermore, it reiterated its commitment to continue strenuous efforts to meet the lofty goal of cutting its emission by 50 percent.[13]

Fossil Gas Production, Imports, and Transportation

Japan has 738 billion cubic feet (Bcf) of proven gas reserves as of January 2020 [4] In 2019, Japan Petroleum Exploration (JAPEX) made a gas discovery in the offshore Hidako area of the Hokkaido region and planned to carry out further analysis to review the possibility of exploration opportunities.[14][15] INPEX corporation, with support from the government, intends to explore 1.4 Tcf of estimated recoverable gas reserves off the coast of the Shimane and Yamaguchi prefectures in the west that could produce 46.7 Bcf/year of gas after starting output in 2032.[16]

Japan has minimal domestic production of gas and predominately relies on LNG imports for its gas needs.[17]

LNG imports stood at 101.3 bcm in 2021.[8] The total import volume during the first half of 2022 was 37.54 million tonnes, which was a decrease of 4% from the same period in 2021. [10]

Japan's biggest LNG supplier is Australia at 36%, followed by Malaysia (14%), Russia (9%), and the United States (9%).[9] In August 2022, Japan imported 450,000 metric tons of LNG from Russia, marking a 211.2% increase from August 2021.[18]

There is no single gas transmission system operator (TSO) in the country, as pipeline networks have been developed separately around LNG terminals. The two biggest upstream companies, JAPEX and INPEX, have independent networks of high pressure pipelines stretching over 800 kilometers and 1500 km respectively.[19][20]

Japan has no gas import pipelines and relies on tanker shipments for importing LNG. [4]

As of the mid-2020s, Japan operates 37 LNG-import terminals, and its regasification capacity exceeds its gas demand.[4]

Government Agencies and other Key Players in Gas Sector

The Ministry of Economy, Trade and Industry (METI) is the regulatory agency that oversees Japan's energy sector. INPEX Corporation and Japan Petroleum Exploration Co Ltd. are the major exploration and production companies.[21][20][19]


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