How realistic are Japan's coal-fired power plans?

10 Oct 2017 Jonathan Pascoe

Japan has more than 40 coal-fired power units in various stages of planning. But with a number of obstacles in their way-returning nuclear power capacity, strong environmental commitments, and a weak outlook for power demand growth-IHS Markit examines how realistic it is that all of these plans will come to fruition and how coal burn levels will develop.

  • Significant new coal-fired capacity is planned. Japan has a raft of new coal plants in the pipeline, with more than 20 GW of capacity under construction, under assessment, or in planning. Some 6 GW is currently under construction and is expected to come online during the next four years.
  • Construction of new coal plants is threatened by Japan's commitment to climate change. Japan aims to reduce energy-oriented carbon dioxide emissions to 26% below 2013 levels by 2030. The addition of significant net coal-fired capacity is at odds with this target, and, as a result, some of the planned projects currently under assessment are at risk of not being built.
  • Nuclear restarts and weak power demand growth will curb coal burn. IHS Markit expects nuclear capacity restarts, along with weak power demand growth and stricter environmental policy, to weaken coal-fired generation and consequently drive down steam coal imports.

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Jonathan Pascoe is a Senior Research Analyst at IHS Markit.
Posted 10 October 2017

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