Seventh Plan’s the Charm
Expectations for Japan’s updated energy plan include a nuclear renaissance.
“Never look back unless you are planning to go that way.” – Henry David Thoreau (maybe)
If there’s one country that understands the need for a comprehensive energy strategy, it is Japan, mostly because it has never possessed much exploitable energy of its own. No nation can be a globally relevant power without reliable access to cheap energy, and the Japan of a century ago certainly had such ambitions. Its imperial goals were the driving force behind its brutal invasion of China in the 1930s, the geopolitical scars of which still sting across the region. As its empire grew, so did its need for oil, which caused it to look south in search of supplies. This ultimately led to the Pearl Harbor attack and the destruction that followed, all now well-trodden history.
In the decades after World War II, the reconstruction of Japan presented the same thorny question of energy supply, as virtually all fossil fuel demand would still need to be met with imports. Despite being the only country to have been bombed with nuclear weapons during the war, Japan’s leaders were wise enough to differentiate between using nuclear energy for civilian rather than military purposes. Beginning in the mid-1960s, a wave of nuclear reactors was built. At its zenith, nuclear energy accounted for 30% of Japan’s total electricity generation, a bedrock of stable baseload supply and a cornerstone of the country’s booming manufacturing sector. All that changed on March 11, 2011.
The natural disaster that led to the meltdown at the Fukushima Daiichi Nuclear Power Plant had a profound effect on Japan’s energy outlook. From 2010 to 2012, electricity produced from nuclear reactors dropped 93%. By 2014, the country produced none. During this suspension of activity, additional fossil fuels were imported, citizens were asked to participate in massive efficiency drives, and plans for a large-scale rollout of renewable energy sources such as wind and solar were drafted.
The domestic and international reaction to the Fukushima disaster was wildly overblown, much to the detriment of the Japanese people. Hydroelectric dam failures, which are far more frequent, deadly, and environmentally destructive, aren’t met with a fraction of the hyperventilation that transpired in the weeks and months after the accident. Within Japan, calmer leadership eventually reasserted itself, and a slow reopening of the country’s reactors began in late 2015. As of the time of this writing, 14 of Japan’s 33 operable reactors have reconnected to the grid, and a further 11 are seeking restart approval. Two additional reactors are under construction, but the timing of their completion is uncertain.
In the coming weeks, whether and how quickly these reactors will be brought into service will be significantly influenced when Japan’s Ministry of Economy, Trade and Industry publishes the Seventh Strategic Energy Plan (SEP), a pivotal document outlining the country’s energy policy over the next 3-4 years. Comprehensive in scope, the SEP will address energy mix targets, sector-specific plans, energy efficiency measures, decarbonization targets, and international collaboration agendas. It will also shape public-private investment initiatives, with vast sums of money directed toward achieving the country’s collective energy goals that could have an outsized impact on the global nuclear power sector. Let’s take a closer look.