Japan cuts 2030 thermal power target

Japan has set a new target to reduce thermal power generation in the country's power mix to 41pc by 2030, part of its strategy to expand renewable power energy and achieve decarbonisation by 2050. This is likely to further weigh on demand for thermal fuels such as coal and LNG over the next decade.

The trade and industry ministry (Meti) today unveiled a draft proposal for the country's new power mix portfolio in the April 2030-March 2031 fiscal year, which aligns with a tougher 46pc greenhouse gas (GHG) emissions reduction target by the same year, based on 2013-14 levels.

Under the draft target Japan plans to generate 41pc of power output from fossil fuels, down from 56pc in the previous 2030-31 goal, which was initially decided in 2015. Total power output goal in 2030-31 was revised down to 930-940mn MWh, lower by 11.7-12.7pc from the earlier target of 1.065bn MWh.

Power output from direct coal burning will account for 19pc in the new power mix, down from the previous 26pc goal. Meti set a more ambitious coal target, although the ministry said last week that it would be difficult to cut the ratio of coal-fired capacity to 20-25pc by 2030-31, given that it has to ensure supply security and limit the impact to in-house power generators in the industry sector.

The ratio of LNG has fallen to 20pc from 27pc, while the country aims to reduce expensive oil-fired capacity further to 2pc from 3pc.

Japan's coal consumption for power generation in 2020-21 fell by 2.5pc from a year earlier to 106mn t, while LNG use rose by 1pc to 47mn t. Burning of oil, including fuel oil, diesel and crude, edged up by 1.4pc to 61,412 b/d during the period. Thermal power capacity accounted for 76pc in 2019-20, including coal at 32pc, LNG at 37pc and oil at 7pc, according to Meti.

Renewables boost

The fall in thermal power dependence contrasts with an increase in renewable power output. Meti has lifted the renewable ratio in the new 2030-31 power mix goal to 36-38pc, up from 22-24pc. The renewable goal includes 15pc solar, 6pc wind, 10pc hydro, 5pc biomass and 1pc geothermal. The renewable target is double the 18pc in 2019-20.

The biggest increase in renewable target is solar power energy at an 8 percentage point increase. The government is accelerating installation of solar power facilities that are relatively easy to install with shorter lead times.

Meti has maintained its previous 2030 nuclear target of 20-22pc, as Tokyo continues promoting the restart of nuclear reactors while keeping safety as its first priority. The goal is still far from the 6pc actual share in 2019-20.

Meti has also set a goal to achieve a 1pc share of hydrogen and ammonia for the first time in the 2030-31 power mix.

The preliminary power mix goal was presented as part of the country's basic energy policy, which is reviewed every three years. Meti started discussions on latest revisions in October last year, forming a key part of efforts to update its 2030 goal to reduce GHG emissions by 46pc from 2013-14 levels and achieve carbon neutrality by 2050.

By Motoko Hasegawa