Japan to Increase Coal Reliance Despite Solar Boost, BNEF Says

Don’t count coal out just yet in Japan.

Despite expectations that solar will triple its share of Japan’s power generation mix, the resource-poor country is set to increase its reliance on coal, casting doubt on whether Japan can meet the timetable to reduce greenhouse gas emissions it agreed to in 2015 as part of the Paris climate accord, according to Bloomberg New Energy Finance.

Since the Fukushima nuclear disaster in 2011, Japan has increased its reliance on fossil fuels. As part of a long-term energy outlook, London-based BNEF expects coal to be the only fossil fuel in Japan to increase its share of the nation’s generation mix through 2040. Gas, currently the largest generation source, is expected to fall behind coal and solar by 2040, BNEF said.

“The approval of new coal plants by Japan’s Ministry of Economy, Trade and Industry is putting the country on a path inconsistent with the government’s own proposed 2030 generation mix as well as its Paris Agreement emission reduction commitment,” Martin Tengler, a Tokyo-based analyst for BNEF, said by email.  

Between 2017 and 2040, Some $196 billion of investment in Japan’s generation capacity is expected to build 173 gigawatts of new capacity. Of that, 56 percent will go to solar, while 19 percent will be used for wind. Fossil fuels will account for 24 percent, according to BNEF.

Among the other forecasts:

Solar, which accounted for 5 percent of power generation in 2016, will increase to 15 percent by 2030, compared with a government target of 7 percent.
Investments in utility-scale solar will resume during the 2026-2030 period following a five-year hiatus amid expectations that an incentive program by the government would be phased out for solar power by 2020.
By 2040, renewables will account for 42 percent of Japan’s power generation, compared with 16 percent in 2016.
A total 18 gigawatts of coal will come online between now and 2040 unless the government cracks down on permits for new plants.
Japan’s emission reduction target of a 34 percent cut by 2030 from 2013 levels for the power sector won’t be achieved until 2032.
By 2030, coal will account for 38 percent of Japan’s electricity generation, compared with the government’s target of 26 percent. Nuclear will provide 10 percent, below the government’s target of 21 percent.
Japan and South Korea are the only two member countries of the Organization for Economic Co-operation and Development set to increase long-term reliance on coal.

About BloombergNEF

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