Japan's METI seeks $5-bil budget in fiscal 2021-22 for energy transition push

Tokyo — Japan's Ministry of Economy, Trade and Industry is seeking a 15% increase in its fiscal 2021-22 (April-March) budget for the country's energy transition to Yen 490.2 billion ($4.6 billion), saying the coronavirus-led slump in fuel demand represents an opportunity to accelerate the move toward decarbonization.

Against the backdrop of intensifying global pressure for decarbonization, METI intends to lead Japan in a green recovery from the coronavirus-related drop in domestic fuel demand by supporting innovation.

Innovation a priority

METI's requested 2021-22 budget includes a push to phase out inefficient coal-fired power plants, starting to prepare for the liquefaction and transportation of carbon dioxide and speeding up the development of carbon-recycling technologies.

The ministry has requested a 25.8% year-on-year hike in its 2021-22 budget for phasing out inefficient coal-fired power plants to Yen 24.4 billion.

The move follows a July 3 directive by METI Minister Hiroshi Kajiyama to start drawing up a new, more effective framework to ensure the phasing out of inefficient coal-fired power plants by 2030 as part of Japan's strategic energy plan.

Burning ammonia

As part of the budget, METI is starting to prepare a pilot project to burn 20% ammonia at an ultra-supercritical coal-fired power plant in 2023, METI officials said Oct. 1.

Ammonia contains about 18% hydrogen by weight and is already a widely traded chemical globally, and it releases zero CO2 emissions when burnt in a thermal power plant.

In a separate development, Saudi Arabia recently shipped its first blue ammonia cargo to Japan to burn together with coal and natural gas for zero-carbon power generation, paving the way for the further use of hydrogen in the energy system.

The first blue ammonia cargo of 40 mt was shipped from Saudi Arabia to Japan to be used for power generation, with 30 mt of the CO2 captured during the process designated for use in methanol production at SABIC's Ibn-Sina facility, and another 20 mt of captured CO2 in the process being used for Enhanced Oil Recovery at Aramco's Uthmaniyah field.

CO2 transportation

METI has a requested a 2021-22 budget of Yen 6.53 billion for a CO2-transportation pilot project as part of a Yen 53 billion budget for carbon capture, utilization and storage and carbon recycling. The requested carbon recycling budget is 21.3% more than in 2020-21.

The CO2 transport pilot project would involve designing and constructing CO2 liquefaction, transportation and carbon recycling facilities as well as a 1,000-mt, dual-purpose tanker; according to the METI officials.

The project aims to transport liquefied CO2 in a low-temperature, low-pressure tank on the dual-purpose tanker from a coal-fired plant in Maizuru on the Ooura Peninsula in Kyoto Prefecture to Tomakomai in Hokkaido in 2024, the officials said.

Once transported to Tomakomai, CO2 will be used at a carbon recycling plant to produce methanol, the officials said. The transportation of CO2 at low temperatures and pressure would a world first, the officials said, adding that the dual-purpose tanker would also be used for transporting LPG.