(Bloomberg) — Japan’s government plans to decisively back the expansion of nuclear power, dropping a decade-long policy of reducing dependence on the energy source and reversing curbs initiated following the 2011 Fukushima meltdown.
Most Read from Bloomberg
The nation, which relied on coal and natural gas for more than 60% of electricity generation last year, set out a proposed new energy strategy on Tuesday, which urges both nuclear and renewables to be utilized “to the fullest extent” to maintain growth and help curb emissions. The draft policy, which is expected to be adopted, also recommends the construction of entirely new reactors.
Nuclear should account for around 20% of the nation’s energy mix by fiscal 2040 and renewables for around 40% to 50%, according to the strategy, drafted by the trade ministry and advised by a 16-person panel of experts. Renewables accounted for about 23% of the power mix in fiscal 2023 and nuclear made up roughly 8.5%, according to the latest trade ministry data.
Nations globally are driving a nuclear power renaissance as governments and power-hungry industries seek to bolster energy security by limiting dependence on fuel imports, and secure a reliable supply of emissions-free power.
Adding more emissions-free power is seen as crucial to allow Japan to attract more data center operators and advanced manufacturing like semiconductor factories. Alphabet Inc.’s Google and Nvidia Corp.-backed cloud services firm Ubitus K.K. have both flagged an interest in using nuclear power in the nation, while companies including Microsoft Corp. have invested in building local solar plants.
The revised energy strategy should also enable Japan, the fifth-largest carbon dioxide polluter, to boost decarbonization efforts that have been criticized by scientists and climate groups as insufficient. Japan is currently considering a new target to cut emissions by 60% by 2035 from 2013 levels, though that remains less ambitious than countries like the UK.
Nuclear previously accounted for roughly a third of Japan’s power mix, and all 54 of the nation’s reactors were taken offline following the 2011 disaster at the Fukushima Dai-ichi power plant. Of 33 still operable reactors, only 14 are so far back online. A policy first introduced in 2014 had called on the nation to reduce its dependence on nuclear power.
Japan should consider replacing decommissioned plants with new, advanced reactors, the advisory panel recommended. Still, boosting nuclear output is likely to be challenging, as stringent regulations remain in place following the Fukushima disaster. Utilities must also go through a lengthy process to win public consent and other approvals.
Fossil fuels are seen accounting for 30% to 40% of Japan’s power mix by 2040, according to the panel, and compares to 69% in fiscal 2023. The strategy highlighted a continued importance of coal and liquefied natural gas, and called for the government to continue to develop resources at home and overseas.
Overall, Japan’s annual power demand is also expected to reverse recent declines, driven by rising electrification and demands from AI. Total power generation is seen rising to as much as 1,200 terawatt hours a year in 2040, up 20% from 2023.
–With assistance from Stephen Stapczynski.
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.