Although Japan has reopened 14 nuclear reactors since the Fukushima accident, its overall energy policy embodied in the Sixth Strategic Energy Plan of 2021 saw a limited role for nuclear and a heavy emphasis on renewable energy and emissions reduction. The Plan states: “Having experienced the accident at Tokyo Electric Power Company Holdings’ (TEPCO) Fukushima Daiichi Nuclear Power Station, Japan will reduce the dependence on nuclear power as much as possible, while giving the highest priority to safety and expanding decarbonized renewable energy with economic independence.” Although the current Prime Minister Shigera Ishiba had previously opposed nuclear power, the new Ishiba government is poised to approve a new plan in March which is highly supportive of nuclear power development. The draft of this Seventh Plan reflects the changed geopolitical situation since the previous plan in 2021 and emphasizes energy security as well as efforts to achieve a 73% reduction in GHG by 2040. In a major shift, it includes an ambitious strategy to reopen an additional 19 nuclear units and build new reactors at decommissioned sites in order to achieve about 20% of total electricity generation from nuclear by 2040.
Energy security and the cost of fossil fuel imports of oil, gas, and coal that account for most of Japan’s fossil fuel consumption have always been a concern to Japan. According to the Energy Institute’s Statistical Review of World Energy 2024, these sources accounted for 83% of primary energy and 65% of electricity generation in 2023. The new plan sees a reduction of fossil fuels in the power mix to 30-40% by 2040, especially for coal, which was 30% of electricity generation in 2023. A major factor for the future is the assumption that power demand, which has declined by about 0.7% per annum over the last decade, will increase by as much as 22% over the 15 years to 2040. This forecast parallels the trend in the United States, which is seeing an increase in demand spurred by AI, data centers, and new semi-conductor and other high-tech industries.
To meet this demand and reduce both imports and emissions, renewable energy generation, including advanced geothermal and offshore wind, is targeted to increase from the current 22% to between 40-50% in 2040. LNG will continue to constitute a mainstay of the power sector, at about a third of generation, although some blending with hydrogen may be economically possible over the period. The ambitions of the new Trump Administration to expand LNG exports may complement Japan’s needs and desire to diversify LNG import sources, depending on the price.
In sum, Japan has a difficult challenge ahead in reconciling energy security and environmental objectives within a growing electricity sector. Although electricity’s share of the total final energy use is expected to grow to 40% by 2040, the need to decarbonize the non-power sector is also of vital importance to achieving Japan’s stated goal of net zero emissions by 2050. Japan’s bet on nuclear power is a big one but could pay off in terms of energy security, climate change, and economic competitiveness objectives. The new Trump Administration should continue to support the ongoing cooperation between the US government and private companies with Japanese counterparts in a range of nuclear energy technology and development fields, including developing new nuclear fuel sources to reduce dependence on Russia, as agreed to in the Sapporo Five, $4 billion commitment announced at the 2023 G-7 meeting in Japan.