Japan’s goal to greatly decrease the use of fossil fuels in energy production by 2030 may be hard to achieve. A Rystad Energy analysis shows that as development in the country expands, operators are making an effort to maintain coal-, oil- and gas-fired thermal generation by making it more cost-effective and less emissions-heavy, rather than switching to greener alternatives.
After the country shut most of its nuclear power generation following the Tohoku earthquake and tsunami in 2011, which caused a series of meltdowns and hydrogen explosions, the country’s share of coal, oil and gas use in the power mix has jumped to above 80%.
To alleviate this jump in hydrocarbon use, the Japanese government set a target to increase its non-fossil fuel energy share to 44% by 2030, as announced in a long-term strategy issued last June.
Although renewable energy projects are slowly increasing in the country and some planned coal-fired power stations have been cancelled, gas is still expected to see the most growth in the coming years, says Rystad Energy Management Consultant Walton Zhang.
“Despite the huge gains in coal-fired plant efficiency, even the most efficient coal-fired power plant will emit nearly twice as much carbon dioxide as a gas-fired power plant, a reality which Japan appears to be well aware of. An analysis of all thermal generation assets brought online in the country since 2010 shows Japan’s clear preference for gas-fired power solutions with advanced technologies,” says Zhang.
More than 6 gigawatts of capacity have been added since 2010, equipped with More Advanced Combine Cycle II technology. Chubu Electric’s Nishi Nagoya Power Plant Unit 1, powered by GE’s 7HA gas turbines, stands out with 63.08% thermal efficiency – thought to be a world record for gas-fired power generation efficiency.
Nevertheless, although burning gas has taken over coal in the power mix, the latter is still standing strong, retaining about a 30% share in power production. And that percentage does not look likely to shrink substantially anytime soon.
The continued pursuit of thermal efficiency innovation is driven by both the Japanese government and lenders alike. The Japanese government promotes the further development of technologies in order to enhance coal-fired generation efficiency and significantly reduce greenhouse gas emissions – prime examples include Integrated Coal Gasification Combined Cycle (IGCC) and Carbon Capture, Utilisation and Storage (CCUS) technologies.
The country’s Strategic Energy Plan allows coal-fired power plants designed at or above ultra-supercritical pressure to be eligible for approval. Furthermore, three of Japan’s largest banks announced recently that their lending policies would permit the funding of ultrasupercritical coal-fired power plants.
As Japan’s nuclear power generation slowly increases again and as the country is targeting the burgeoning hydrogen economy, hope remains for a greener future. That said, the same emissions-free hydrogen it plans to consume will still come from brown coal conversion in Australia, which is emissions-heavy in itself unless enhanced CCUS technology is utilised – currently a very pricey process.
Learn more in Rystad Energy’s Gas Market Analytics.