Resource-scarce Japan has long had to innovate to power its economy. Until recently, the country was the third-largest consumer of nuclear power after the US and France. However, following the 2011 nuclear disaster at the country’s Fukushima Daiichi plant, popular opinion led the country’s leaders to close or mothball nearly all of Japan’s nuclear plants. Nuclear power fell from providing 30% of electricity in 2011 to none in 2014, reveals data from BP’s Statistical Review of World Energy.
To fill the gap, Japan has embraced fossil fuels. Coal rose from providing 28% of the country’s electricity supply in 2010 to 32% in 2018, even as other economies turned their backs on it. The country also increased consumption of natural gas, with imports of liquefied natural gas (LNG) increasing 12% between 2011 and 2014, shows BP data.
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LNG is natural gas that has been cooled down to liquid form at around 1/600th of its volume in a gaseous state. Japan is the world’s largest consumer of LNG, using the fuel to generate electricity (around two-thirds of LNG demand), as well as to power its large industrial base, and heat homes and businesses.
The country’s energy landscape should begin changing rapidly over the next decade, however, as the country seeks to cut greenhouse gas emissions. A government report released in July 2021 shows Japan aims to produce 20% of its power from natural gas in 2030, down from 37% in 2019, and a significant decrease from its previous 2030 target of 27%.
Japan also seeks to increase generation from renewables from 18% in 2019 to 36–38% in 2030, while coal’s share of the power mix is set to fall from 32% to 19%. Japanese companies are the current global leaders in solar PV innovation.
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By GlobalDataJapan has been the world’s largest importer of LNG for the past half-century. In 2020, Japan imported 102 billion cubic metres (bcm) of LNG, says BP.
China ranks second, importing 94bcm in 2020, but the 10.8% growth in imports that China recorded compared with the previous year suggests the country will soon overtake Japan, whose LNG imports fell 3.6% over the same period. Norwegian consultancy Rystad estimates China will take the top spot in 2021.
The International Energy Agency’s Net Zero 2050 Pathway made it clear that natural gas, which produces around half the emissions of coal, can no longer be considered a ‘transition fuel’ as the world realigns towards net zero. Nevertheless, management consultant McKinsey’s Global Gas Outlook to 2050, released in February 2021, predicts global gas demand will grow 0.9% every year between 2020 and 2035, with LNG in particular set to see annual growth of 3.4%.
Recent analysis of upcoming gas projects from Energy Monitor revealed trillions of dollars of upcoming natural gas projects around the world, which experts warn are laden with climate and financial risk.
