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Vanand Meliksetian

Vanand Meliksetian

Vanand Meliksetian has extended experience working in the energy sector. His involvement with the fossil fuel industry as well as renewables makes him an allrounder…

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Why Japan Isn’t Rushing To Reform Its Energy Mix

The departure of Shinzo Abe as Japan’s Prime Minister created political shock waves across the world. The succession by his righthand man, chief cabinet secretary Yoshihide Suga, ensures the continuation of Abe’s policies. This means that Japan’s not so ambitious plans for decarbonization won’t be shaken up as some were hoping.

Ever since the Asian country industrialized after its ‘opening’ in the late 19th century, energy security has been an issue. Natural resources are notoriously scant from the Japanese archipelago. The attack on Pearl Harbor during the Second World War and the conquest of southeast Asia were instigated by the need to secure a steady supply of oil. Except for Japan's pacifism, not much has changed in the 21st century.

Nuclear technology was long viewed as the best available solution. The disaster at Fukushima in 2011 changed the situation when massive protests diminished the public’s support for the nuclear industry. Although some reactors have temporarily been restarted, the future of the sector remains bleak.

When Japan's environment minister Koizumi arrived in Madrid last December to attend the COP25, he was met by protestors who were calling for an overhaul of Tokyo’s energy policies. Especially the financing of coal-fired power plants in developing countries was the focus of much anger. Recently, Tokyo has announced it has reviewed the policy and halted its financing of coal-related technologies in the developing world. The falling costs of renewables, however, were more important for the overhaul than an actual change of heart.

This is reflected most in Japan’s achievements thus far when it comes to reducing CO2 emissions. Although Tokyo announced the closure of 100 coal-fired power plants by 2030, the rate of reduction is far lower than one could expect from a highly developed and industrialized democracy. Although Japan plans to increase the share of renewables by 2030, the target is far from ambitious.

The densely populated country lacks an abundance of space for wind farms and solar fields. Also, the rugged terrain rules out the use of more inland areas. Furthermore, Japan is surrounded by deep oceans with few shallow coastal regions where wind turbines can be installed.

Despite these setbacks, the island nation has several major advantages that should work in its favor. Japan is a highly innovative country that has often shown its ability to develop cutting edge technologies. The country’s corporate achievements are envied by many around the world and still produce products of an exceptionally high level. One would think that the lack of resources is an incentive to develop technologies and lead the renewable energies industry.

According to Shuli Goodman, executive director at San Fransisco-based non-profit LF Energy, "they [Japan] have the industrial, digital, and economic power to do it. It would put the country in a position of leadership instead of vulnerability."

Instead, others have taken a clearer line when it comes to policies concerning clean energies such as the EU and more recently China. Beijing's environmental goals, support for domestic industries, and an innovative companies have propelled the Asian giant to the forefront of renewable technology development. President Xi's recent commitment for a CO2-neutral society by 2060 has further strengthened China’s position.

Japan, however, does possess another advantage that could be exploited to strengthen its position. Hydrogen related technologies have for years been the focus of corporate giants such as Toyota. In recent years an increasing number of countries are convinced of the indispensable role hydrogen could play in future energy systems. Japanese firms possess an early movers advantage.

The 2020 Olympic Games in Tokyo were named the ‘hydrogen games’ to highlight the country's technological prowess. An agreement with Australia has been struck to produce hydrogen in the desert and transport the super-cooled energy with ships to the Japanese archipelago. Although it concerns relatively small amounts, the ability to produce and transport the hydrogen using new technologies highlights the ability of Japanese firms to dominate the future industry. 

However, what is necessary to supercharge these developments is a long-term strategy by the government in Tokyo to support these developments in the early stages. Luke-warm announcements on the closure of coal-fired power plants won't help. Japan is best served by a radical overhaul of its energy policies where new technologies have an advantage over the slowly decaying fossil fuel industry.

By Vanand Meliksetian for Oilprice.com

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