Economy & Tech

EDITORIAL | Japan's Energy Security in Peril as Policy Gaps Persist

Japan must urgently address energy security by implementing its energy policy, restarting nuclear power, and ensuring a baseline supply for the nation's needs.

Published

7 months ago

October 10, 2023

Editorial Board, The Sankei Shimbun

Unit 2 (left) and Unit 1 at Kansai Electric Power Company's Takahama Nuclear Power Station in Takahama Town, Fukui Prefecture, in July 2023. (© Sankei by Kan Emori)

Fifty years have passed since the outbreak of the first oil crisis. That time, the global crisis was triggered by the fourth Middle East war (Yom Kippur War) in October 1973. Japan's energy security was badly hit, and it caused panic in the daily lives of the Japanese people. Even toilet paper disappeared from store shelves.

The rapid rise in oil prices also spawned an inflationary storm, with consumer prices jumping by more than 20% the following year. It was the first time in the postwar era that Japan's growth rate turned negative. That event marked the end of the nation's rapid economic growth.

Don’t Forget Precious Lessons Learned

In response to the oil crisis, Japan took measures to escape excessive reliance on petroleum for the nation's energy needs. One measure was a shift to nuclear power. Another involved securing access to liquefied natural gas (LNG).

At the same time, the government promoted energy conservation and laid the foundation for making Japan a world leader in environmental consciousness. But now, half a century later, Japan once again finds itself experiencing a serious energy crisis.

A New Crisis

Triggered by Russia's invasion of Ukraine and the spread of decarbonization around the world, soaring oil and other fuel prices and rising electricity and gas bills are taking a heavy toll on people's lives as well as industry. Electricity supply and demand have become increasingly tight in summer and winter when demand for cooling and heating increases. This is especially true in eastern Japan, centered around Tokyo.

Now, more than ever, it is the time to draw on the valuable lessons of 50 years ago. We must reaffirm and strengthen energy security as the foundation of the nation.

*Tohoku Electric Power's Niigata Thermal Power Plant in Higashi Ward, Niigata City (provided by the company)*

Energy Policy Needs to be Implemented

In a February 2023 Cabinet meeting, the Fumio Kishida administration approved the "Basic Policy for the Realization of GX (Green Transformation)." The goal of the plan is to attain carbon neutrality by the year 2050. In clear terms it promotes renewable energy and the use of nuclear power as the pillars of its efforts to achieve both a stable energy supply and decarbonization.

It begins with: "An invasion of Ukraine by Russia has occurred, and the global energy situation has changed dramatically." The basic policy also expressed a strong sense of urgency about the current situation in Japan: "We are facing an extremely tense situation, with fears of an energy crisis for the first time since the oil crisis of 1973."

It is significant that the Kishida administration views the energy situation surrounding Japan in such bleak terms. Unfortunately, however, there is no corresponding sense of crisis in the government's energy policies. This is because it is solely focusing on renewable energy for decarbonization.

Meanwhile, it is failing to achieve concrete results that contribute to the stable procurement of energy. And it is not ensuring a steady supply of electricity.

Prime Minister Kishida announced in 2022 that he would proceed with the restart of nuclear power plants where safety had been confirmed. Nevertheless, the restarting of nuclear power plants has been limited to Western Japan.

That has not changed since the accident at Tokyo Electric Power Company's Fukushima Daiichi Nuclear Power Plant following the Great East Japan Earthquake in 2011. In fact, not a single nuclear power plant has restarted in East Japan.

*Takahama Nuclear Power Plant Takahama Nuclear Power Plant, Units 1, 2, 3, and 4 (from the left). In Takahama Town, Fukui Prefecture. (© Sankei by Kan Emori via helicopter)*

Policy Failure Shows in Power Prices

Of particular importance to residents and businesses, electricity rates charged by Kansai Electric Power Co and Kyushu Electric Power Co have been kept down. This has happened as their nuclear power plants have restarted.

Meanwhile, Tokyo Electric Power Company, Tohoku Electric Power Company, and Hokkaido Electric Power Company have not restarted their nuclear power plants. In all three cases, these companies have moved to raise their rates significantly.

This could further widen the gap in the price of electricity between East Japan and West Japan. It is also likely to affect the sites chosen for factories and other industries in the future.

Russian oil — *A street monitor in the Shimbashi district of Tokyo announces the power supply shortage and blackout warning within the TEPCO service area, including all of Tokyo, on the evening of March 22, 2022.*

Nuclear Energy as the Baseline Power Source

The oil crisis taught us that achieving stable procurement and supply of energy requires diversification. That means not only sources of energy but also the power source mix. In fact, it is the key to strengthening energy security.

To achieve this, naturally, we must expand new renewable energy sources, such as offshore wind power. Meanwhile, we must promote the use of nuclear power as a baseload power source. This source should provide the minimum amount of electrical power needed to be supplied to the electrical grid at a given time.

Japan has once again become heavily dependent on the Middle East for its oil. Moreover, its dependency ratio is higher now than it was at the time of the oil crisis. Acquisition of oil and other overseas resource interests is a government responsibility. The Prime Minister's resource diplomacy is consequently being called into question.

*A tanker carrying LNG arrives from the Sakhalin 2 project to an area off the coast of Sodegaura City in Chiba Prefecture (April 2009, Kyodo.)*

LNG Stockpiling Being Considered

In addition, LNG imports from Sakhalin in the Russian Far East (Sakhalin) account for about 9% of total LNG imports. Therefore, expanding procurement sources for LNG is also an urgent issue. Russia is intentionally squeezing natural gas supplies to Europe in an attempt to strongly sway those countries, especially Germany. Japan must not make that same mistake.

After the first oil crisis, Japan introduced an oil stockpiling system as part of its energy security measures. At present, the public and private sectors have a stockpile of about 230 days' worth of oil. However, there is no stockpiling system for the LNG used for LNG-fired power generation. Yet, that has become a mainstay of the power supply mix.

As Japan moves toward decarbonization, gas and electric companies are reluctant to develop new sources or stockpiles of LNG. In particular, there are many technical issues that need to be resolved for stockpiling to become truly feasible. The Kishida administration should also consider providing its full support for LNG procurement and stockpiling.

(Read the editorial in Japanese.)

Author: Editorial Board, The Sankei Shimbun