Japan to curb coal-fired power plant exports to cut CO2 emissions: METI minister

Tokyo — The Japanese government decided on July 9 to curb the export of coal-fired power plants depending on how badly potential importers need them and in return for commitments to decarbonize.

As part of its efforts to curb global carbon emissions Japan will also only allow high-efficiency coal technology to be exported.

"While there are developing countries around the world that have no choice but to use coal as an energy source, we believe it is important to face up to this reality and urge them to decarbonize effectively," Minister of Economy, Trade and Industry Hiroshi Kajiyama told reporters July 9.

"As part of our cooperation with developing countries, we will propose and present various options such as renewable energy, hydrogen, CCUS [carbon capture, utilization and storage], carbon recycling to reduce CO2 emissions and provide policy support for decarbonization under new strategic frameworks," Kajiyama said.

The minister was speaking after the government's new infrastructure system export strategy was decided at a cross-ministerial meeting.

"Instead of seeking divestment by squeezing funds to coal-fired thermal power, we propose engaging actively with countries' energy and climate change policies and changing their trajectory toward decarbonization by limiting export support just to the pinnacle of our country's technology," Kajiyama said.

"This way we will be able to contribute to effective global decarbonization by tightening our [coal-fired plant export] support -- the proposal, which was just approved by other ministries," he added.

Under the new strategic frameworks, Japan is looking to support exports of ultra-supercritical coal-fired power plants, using the country's advanced environmental technology, with more than 43% efficiency, or integrated coal gasification combined cycle, CCUS, carbon recycling that can reduce CO2 emissions to a level below IGCC.

Inefficient plants

METI's latest policy move on decarbonization came days after Kajiyama said July 3 that Japan would "fade out" inefficient coal-fired power plants as part of the country's strategic energy plan by 2030.

In his speech at the International Energy Agency's Clean Energy Transitions Summit July 9, Kajiyama said he had directed METI officials to start drawing up a more effective new framework to ensure the phasing out of inefficient coal-fired power.

The fifth strategic energy plan approved by the cabinet in July 2018 promotes conversion to high efficiency and next-generation coal thermal power generation in Japan in return for phasing out inefficient coal use.

Coal currently accounts for 32% of Japan's energy mix. Coal's share was around 23% before the Fukushima nuclear disaster in 2011 and rose to 31% by 2015 to make up for shuttered nuclear plants. Japan plans to cut the share of coal-fired capacity to 26% by 2030.

S&P Global Platts Analytics estimates 7.5 GW of coal-fired capacity in Japan will come online between 2020 and 2024. Of this, about 7 GW are ultra-supercritical units, while the remainder are subcritical.

"If METI decided to phase out all supercritical units and subcritical units, there would be an estimated 20% drop in coal-fired capacity from the current level in Japan," a trader estimated.