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University of Tokyo
Japan’s Seventh Strategic Energy Plan sets ambitious targets of 40–50 per cent renewables and 20 per cent nuclear by 2040, but slow reactor restarts, constrained renewable development sites and overwhelming dependence on Chinese solar panels mean the country’s decarbonisation trajectory remains deeply uncertain. The decarbonisation of thermal power generation through ammonia co-firing and hydrogen substitution offers the most realistic plan B should Japan’s primary energy transition pathways fall short of expectations.
Japan is the world’s fifth-largest energy consumer, yet it remains heavily dependent on overseas sources for its energy supply. A stable energy supply has long been regarded as a matter of critical national importance, and the government has pursued a policy of reducing its dependence on oil and diversifying its energy portfolio since the 1973 oil crisis.
As concerns over global climate change intensified from the 1990s, carbon dioxide emissions emerged as a key policy consideration, leading to a growing reliance on nuclear power and natural gas. Consequently, Japan’s oil dependency, which had accounted for nearly 80 per cent of primary energy supply in 1973, declined to approximately 40 per cent by 2010. During the same period, the country’s energy self-sufficiency ratio also improved from approximately 9 to 20 per cent.
This trajectory changed dramatically following the 2011 Great East Japan Earthquake. The earthquake and subsequent tsunami triggered a loss of power at the Fukushima Daiichi Nuclear Power Plant, resulting in a meltdown and substantial radioactive releases. All 54 nuclear reactors were progressively shut down and subjected to comprehensive safety reviews, while public confidence in nuclear energy fell drastically.
Nuclear power, which had supplied approximately 25 per cent of Japan’s electricity generation mix, fell to virtually zero by 2014. To compensate for the resulting supply shortfall, ageing thermal power plants were brought back into operation. Japan also sought simultaneously to ensure energy security and achieve decarbonisation by expanding renewable energy sources such as solar and wind power. The introduction of the Feed-in Tariff scheme in 2012, which guaranteed long-term and fixed-price purchases for renewable energy by electric utilities companies, stimulated rapid growth in renewable energy deployment, particularly solar photovoltaics.
By 2020, the share of renewables in Japan’s electricity generation mix had more than doubled to over 20 per cent. But this growth has slowed considerably and thermal power generation continues to account for 67.5 per cent of Japan’s domestic electricity supply.
In 2020, then prime minister Yoshihide Suga announced Japan’s aim to achieve carbon neutrality by 2050. As an interim milestone, the 2025 Seventh Strategic Energy Plan reaffirmed the target of reducing greenhouse gas emissions by 46 per cent relative to 2013 levels by 2030 — a target set earlier in 2021.
The critical question is how Japan can bridge the gap between this ambitious target and the reality that thermal power generation still accounts for almost 70 per cent of electricity production.
To address this challenge, the government revised its nuclear policy in 2024 from ‘reducing dependence’ to ‘maximum utilisation’. Still, the pace of reactor restarts has remained slow — only 11 reactors out of 33 have resumed operation.
At the same time, Japan is not well endowed with renewable energy resources — solar irradiance levels are well below those of major solar markets such as California. The country’s mountainous terrain also means that many of the most favourable development sites have already been exploited. In some cases, aggressive development of solar sites has generated local opposition, leading to renewable energy facilities being viewed by some communities as undesirable infrastructure.
Reflecting these constraints, Japan’s Seventh Strategic Energy Plan adopts a relatively modest target of approximately 20 per cent nuclear generation by 2040 while relying heavily on substantial expansion of renewables, particularly photovoltaic power generation, to achieve its overall objectives. It sets the target share for renewable energies at 40–50 per cent by 2040, meaning photovoltaic installations need to be expanded to more than 200 gigawatts nationwide — 2.5 times more than 2024 levels.
Whether such an ambitious strategy can be realised remains an open question. In 2011, the Japanese Ministry of Environment estimated that the maximum potential of non-residential photovoltaic generation is 150 gigawatts nationwide. Since then, efforts have been made to expand solar capacity, but many stakeholders still view the 200 gigawatts target as challenging.
Given the persistent public scepticism about nuclear safety, progress in nuclear expansion must be accompanied by transparent communication, demonstrated safety performance and sustained efforts to build public trust. Nuclear energy development also requires exceptionally long lead times, often spanning two to three decades, making a bold expansion strategy unrealistic. The government’s shift from a 20–22 per cent nuclear target for 2030 to around 20 per cent for 2040 reflects its recognition that rapid expansion is unlikely.
Renewable energy also faces mounting challenges. In addition to the depletion of suitable development sites, rising labour costs, raw material prices and equipment costs have increased project expenses, reducing investment attractiveness. The near depletion of domestic solar panel manufacturing has resulted in overwhelming dependence on imported products from China, raising concerns regarding economic security and supply chain resilience.
To achieve its decarbonisation and energy security targets, alongside promoting renewable energy and nuclear power, Japan must establish a robust Plan B should these approaches fail to deliver as expected.
An alternative plan lies in the decarbonisation of thermal power generation. In coal-fired power plants, carbon emissions can be reduced through the co-firing with ammonia in existing boilers. Substituting hydrogen for natural gas could also enable electricity generation without direct carbon dioxide emissions during combustion.
The technologies required for these approaches have already been developed and demonstrated. Though widespread adoption remains limited due to the high cost of low-carbon fuels, these technologies represent one of the most promising pathways for achieving large-scale decarbonisation of thermal power generation and are likely to become more important. The Japanese government has so far decided to provide subsidies to nine hydrogen/ammonia projects to accelerate the use of such low-carbon fuels.
Japan is among the few countries that possess both extensive experience in energy transition and a broad portfolio of advanced energy technologies, including nuclear power and renewable energy systems. Successfully navigating this transition would not only establish a new national normal for Japan but also position the country to accelerate energy transitions around the world.
Michio Hashimoto is Professor at the Research Center for Advanced Science and Technology, University of Tokyo.
This article appears in the most recent edition of East Asia Forum Quarterly, ‘Japan’s normalisation’, Vol 18, No 3.
EAF | Japan | Japan’s ambitious decarbonisation strategy needs a Plan B
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