Rethinking Japan’s Energy Security 8 Years After Fukushima

It’s been eight years since the Great East Japan Earthquake and the Fukushima nuclear disaster. Since then, the utilization of nuclear energy, which accounted for more than one-tenth of Japan’s energy mix before 2011, has become a controversial issue in Japan. Japan thus started to face the severe challenge of energy security.

First, due to the shutdown of most nuclear power plants, Japan’s energy self-sufficiency rate plummeted from 20.2 percent in 2010 to 11.5 percent in 2011. Since then, the self-sufficiency rate has remained under 10 percent, which is extremely low compared to other countries.

Japan has significantly increased its energy imports from overseas. The reliance on foreign energy not only deteriorates the government budget deficit, but also brings increasing political risk. More than 80 percent of Japan’s imported oil comes from the Middle East. It is not easy to assure a stable supply of oil from a politically unstable region.

Second, Japan is highly dependent on fossil energy compared to other advanced countries. Fossil energy accounted for 94 percent of Japan’s energy mix when the oil crisis happened in 1973. Since then Japan has made great efforts to reduce that share, which dropped to 81 percent in 2010. However, the degree of dependence on fossil energy rebounded to 89 percent in 2016, approaching the level of the 1970s oil shock. The increased use of fossil energy is meant to fill the gap caused by the suspension of nuclear energy. Japan now is extremely vulnerable to another oil shock as crude oil accounts for more than 40 percent of its energy sources.

Third, the price of electricity in Japan has risen greatly due to soaring energy costs. Electricity rates peaked in 2014, when rates for household increased by about 24 percent and those for industries increased by about 38 percent over rates in 2010. Although the cost is on a downward trend, rates of electricity for both households and industries remain over 10 percent higher than 2010 rates.

The rising price for industries means increasing cost for companies, negatively influencing their performance. The rising price for households starts to jeopardize affordability for ordinary people, damages people’s consumption incentives, and eventually reduces people’s quality of life.

Fourth, increasing the development of renewable energy is another means to meet Japan’s energy demands. But currently renewables are far from being able to substitute for nuclear and fossil energy to assure Japan’s energy security. According to data from Japan’s Agency for Natural Resources and Energy under the Ministry of Economy, Trade and Industry, the proportion of renewable energy has slightly increased, from 4.3 percent in 2010 to 7.0 percent in 2016. Given the high costs of equipment such as solar panels, it will take a long time for Japan to achieve the universal use of renewable energy.

How should Japan tackle the challenges of energy security, then? It will take another round of strategic efforts for Japan to develop new alternative energy sources. To bring back its energy self-sufficiency rate to the 2010 level or even higher, renewable energy is the only possible solution as Japan has a very low primary energy reserve. Also it is not practical to reopen most nuclear power plants while the decommissioning of Fukushima Daiichi doesn’t appear to be going smoothly and many people near Fukushima still haven’t been able to return to a normal life

In July 2018, the government of Japan formulated the Strategic Energy Plan in order to show the public the basic direction of Japan’s energy policy. The Plan set the goal to raise Japan’s energy self-sufficiency rate from around 8 percent in 2016 to 24 percent in 2030. This looks unrealistic, but it’s not impossible if Japan can concentrate on the development and spread of renewable energy.

However, the Strategic Energy Plan stays ambiguous about Japan’s future energy policy, despite its aim to shed light on that very subject. One big problem with the plan is that the priority of the energy policy is not clear. The government aims to use renewable energy as the major power source by 2030, according to the plan — but at the same time, the plan also attempts to restore nuclear energy and raise its share to 20 to 30 percent.

Former Prime Minister Koizumi Junichiro is well known for advocating the “zero nuclear energy” campaign after the 3.11 triple disaster. He continues to argue that Japan must be able to live without nuclear energy. In a recent talk show, he questioned the current Japanese government’s energy policy and said it was a lie to claim that nuclear energy is safe, low-cost, and clean.

Some commentators criticize Japan for being poor at decisively changing track when necessary. When the time came for Japan to give up nuclear energy once and for all, the government was not ready to make a tough political decision. In the wake of the Fukushima nuclear accident, countries such as Germany declared they would abandon nuclear energy. However, it is ironic that Japan, the direct victim of the nuclear disaster, still doesn’t dare to say goodbye to nuclear energy completely.

The Fukushima nuclear accident caused a crisis for Japan’s energy security. But it is this very crisis that could provide an opportunity for Japan to redirect its energy policy and accelerate the development of renewable energy. Despite the government’s hesitation, many Japanese already believe that nuclear energy is outdated and renewable energy is the correct direction for Japan. As recent TV programs have reported, some ordinary people are starting to invest in solar energy and sell electricity to power companies.

Japan must build confidence that renewable energy has the potential to secure its energy supply. For example, it is said that during the golden week in May 2018, 93 percent of the electricity supply in the Kyushu area was from renewable energy. If Japan could get through the past eight years nearly without nuclear energy, then it must be able to do better in the future with the spread of renewable energy.

Finally, to solve the energy problem, Japan also needs revolutionary innovation. For example, Toyota has just launched the new generation of its Mirai (Future) hydrogen fuel cell vehicle. The new Mirai not only has zero emissions, but also can produce and store electricity to provide energy in an emergency. The Toyota automobile is not only an energy consumer, but also an energy supplier. Mirai points to the future for Japan’s energy policy. Similar innovation should take place in other industries.