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