Japan Increases Renewable Investments to $100 Billion

Japan Increases Renewable Energy Investment to $100 Billion
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Japan has announced it will increase its investment into renewable energy to more than $100 billion by 2030 as it looks to produce a third of its energy needs by renewable sources before the turn of the decade. 

The news comes as Japan releases an updated version of its Strategic Energy Plan, increasing its original target from 22-24% renewable power to nearly 30% thanks to a $100 billion investment into wind and solar power generation by 2030. 

As it stands, in 2019, Japan generated 19% of its total energy needs with renewable sources, which included 9% from wind and solar sources. 

Main policies in its original strategic energy plan included generating 24% of its energy needs from renewable sources, decreasing its nuclear dependence from 25% to 20% by 2030, decreasing its fossil fuel-driven power generation from 65% to 56%, advancing its energy saving technologies to achieve a 35% drop in usage, as well as promoting hydrogen and battery storage systems for the energy grid. 

Key to Japan’s long-term vision for the country’s energy mix is an overall 80% drop in greenhouse gas emissions by 2050 as it moves away from carbon-intensive means of energy production. 

Japan Increases Renewable Energy Investment to $100 Billion

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Japan is set to produce more than four million tonnes of hydrogen this year, which, according to Matthew Farmer, Japan “uses hydrogen for removing sulphur and impurities from emissions.”

Alex Whitworth, research director of Wood Mackenzie has told Power Technology that while the costs associated with wind and solar power are set to drop, coal-fired power plants will remain the cheapest means of producing electricity for Japan, presenting the government with a challenge. 

“The next decade will be a balancing act to manage growth of renewables to reach environmental and energy security goals while keeping end-user power tariffs stable,” Whitworth said. 

“Fortunately, power supply costs in Japan have dropped by over 15% this year due to the coronavirus pandemic and oil price crash. This is a boon for Japan and should help the country more than double the share of wind and solar in the generation mix to 18% by 2030, without putting upward pressure on consumer power bills.”   

Whitworth concluded by stating that “even before recent announcements looking to accelerate retirements of coal power, Japan had a clear pathway to meet its 2030 renewable power target. Lower demand expectations are now aligning with falling renewable costs to accelerate Japan’s shift away from fossil fuels.” 

According to research from Global Data cited in a report from Power Technology “by 2030, GlobalData expects coal to generate a 26% share of the country’s power. The Japanese Government will retire all low-efficiency coal plants, leaving only 10% of its existing plants to generate more than a quarter of the country’s energy.” 

The author adds that “Japan has also pledged to stop supporting foreign coal projects after criticism of the government’s policy.” 

Research Director at Wood Mackenzie, Prakash Sharma has said that “Japan’s hydrogen fuel cell vehicle targets seem challenging to achieve in the timeframe. Cost is the biggest challenge, because green hydrogen currently costs 2-4 times more than fossil fuel hydrogen.” 

“This focus on hydrogen adoption makes perfect sense, though, because Japan has very few other options to reduce its non-power carbon emissions,” Sharma concluded. 

His colleague Alex Whitworth added that “even before recent announcements looking to accelerate retirements of coal power, Japan had a clear pathway to meet its 2030 renewable power target. Lower demand expectations are now aligning with falling renewables costs to accelerate Japan’s shift way from fossil fuels.” 

Japan Increases Renewable Energy Investment to $100 Billion

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