Japan primary energy resources

Japan primary energy resources: March 11, 2011 disaster caused rapid changes

Japan primary energy: Liquified Natural Gas (LNG) imports

Japan switched about 30% of electricity capacity from nuclear to mainly natural gas powered thermal power stations within 13 months. We have analyzed Japan’s natural gas imports, which have skyrocketed to almost 2% of Japan’s GDP. Graphics and more details below in this newsletter. Find detailed analysis of Japan’s oil, coal and gas imports in report on Japan’s Electricity and Energy Landscape.

Japan primary energy: Japan's natural gas imports skyrocket
Japan’s natural gas imports skyrocket

Natural Gas (LPG and LNG) imports skyrocket to 2% of GDP:

Since Financial Year 2010 (ended on March 31, 2011, a few days after the March 11 disaster) Japan’s natural gas imports have skyrocketed to almost 2% of GDP – while gas imports were around 0.5% or below of GDP until 2003.

There are two reasons for Japan’s skyrocketing payments for LNG imports

  1. increased import volumes to replace nuclear energy by LNG fired thermal power stations, and
  2. a “Japan premium” on the LNG prices, Japan has to pay above world market prices because of Japan’s special situation, and relatively weak bargaining position.
    Japan is of course under big financial pressure to reduce the payments for LNG imports.

Our report on Japan’s energy sector includes detailed analysis of Japan’s oil, gas and coal imports, and many other data on Japan’s energy and electricity sector, which we continuously update.

Japan’s gas imports: +77.5% from Jan ’11 to Jan ’13 – all-out efforts to reduce energy costs

Japan replaced almost all nuclear energy with liquid natural gas imports at very short notice. Japan pays far higher costs for liquid natural gas imports than most other regions in the world (find a detailed explanation why this is so, and how Japan’s LNG import prices are composed, in our J-Energy report). ‘Abenomics’ (Prime Minister Abe’s economy policy package) have increased the costs of imports further due a decline in the value of the yen.

Consequently, Japan makes all out efforts to find the optimal energy mix, in particular searching for domestic sources of energy including renewables, and reducing the cost of imports. More below.

Detailed energy import data, including detailed analysis why Japan’s LNG import costs are so much higher than elsewhere, in our report on Japan’s Energy Landscape.

77.5% cost increase of gas imports since January 2011

Reason for this increase are increased import quantities, the very high prices Japan is forced to pay for gas imports, and the decrease of the value of the YEN due to ‘Abenomics’. These very high costs drive all-out efforts to secure new sources of natural gas to reduce costs, and also drive the sofar neglected development of renewable energy sources in Japan.

Japan primary energy: Japan's gas import costs increased by 77.5% from Jan '11 to Jan '13
Japan’s gas import costs increased by 77.5% from Jan ’11 to Jan ’13

Primary energy imports are a very substantial part (about 7% currently) of Japan’s GNP, and have increased by 34% in January 2013 compared to January 2011.

However, the figure above shows that current monthly costs of primary energy imports are below the peak just before the Lehman shock. Thus Japan’s primary energy costs are currently very substantial but not without precedent.
Detailed energy import data, including detailed analysis why Japan’s LNG import costs are so much higher than elsewhere, in our report on Japan’s Energy Landscape

Japan primary energy: Japan's primary energy import costs increased by 34% from Jan '11 to Jan '13
Japan’s primary energy import costs increased by 34% from Jan ’11 to Jan ’13

Japan primary energy: descent into crisis of Japan’s electricity operators started in 2007:

Figure above clearly shows that the decent of Japan’s electricity operators started years before the Fukushima nuclear disaster. Therefore we conclude that restarting the nuclear reactors alone will not cure the crisis of Japan’s electricity operators, which for many years have enjoyed a monopoly position, and are now increasingly under attack by competitors including Japan’s very successful gas companies.
We added approx. 50 pages analysis of Japan’s gas sector to our Japan-Energy-Report.

Japan primary energy: Oil

Detailed oil import data, including detailed analysis in our report on Japan’s Energy Landscape.

Japan primary energy: Coal

Detailed coal import data, including detailed analysis in our report on Japan’s Energy Landscape.

Japan primary energy: Hydropower

Renewable energy japan: Japan's renewable energy is overwhelmingly water power
Japan’s renewable energy is overwhelmingly water power

Detailed data on Japan’s hydropower and pump-power hydro installed capacity and generated power statistics and analysis in our report on Japan’s Energy Landscape, and our Report on Japan’s Renewable Energy.

Japan primary energy: Pump storage

Detailed data on Japan’s hydropower and pump-power hydro installed capacity and generated power statistics and analysis in our report on Japan’s Energy Landscape, and our Report on Japan’s Renewable Energy.

Japan primary energy: Nuclear energy

Japan’s energy architecture and electricity industry is regulated by laws and regulations established in 1952. Essentially, Japan’s energy and electricity architecture has been frozen in 1952, and has not been changed until the Fukushima nuclear accident now forces change. The contribution of “new” renewable energy to Japan’s energy mix is so minute (except for water power), that it would be too small to be seen on the figures below. Our Japan-Energy report explains the major issues facing Japan’s energy architecture and its structure.

Japan’s energy peak is in summer (because energy consumption in Japan for air conditioning in summer is higher than for heating in winter), there were no black-outs, or brown-outs – how did Japan manage successfully despite the sudden unplanned exit from nuclear power? Read below…

How did Japan cope with the sudden exit from nuclear power?

Japan primary energy: After the Fukushima nuclear disaster Japan effectively stopped nuclear power generation. There are no black-outs - how could Japan manage?
After the Fukushima nuclear disaster Japan effectively stopped nuclear power generation. There are no black-outs – how could Japan manage?
Japan primary energy: Japan's survived by reducing summer peaks, and by increasing traditional caloric power production
Japan’s survived by reducing summer peaks, and by increasing traditional caloric power production

How did Japan cope with the sudden shut-down of nuclear power?

Japan’s peak power consumption is in summer, all nuclear power (with 2 exceptions) was switched off since this spring, and there were no black-outs, no brown-outs, and no major problems. How did Japan achieve this?

As the lower figure shows, traditional caloric energy production was increased by installing new power plants, and by bringing back old caloric power plants which had already been switched off, and by reducing the summer peak compared to recent years through energy savings. It has been estimated that the additional costs for imported fuel are on the order of US$ 40 billion.

Japan primary energy: Renewable energy

more…

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