Japan, Australia’s biggest coal and gas customer, to adopt 2050 zero emissions target

Japan, the biggest international buyer of Australian coal and gas exports, is set to accelerate its efforts towards decarbonisation with new prime minister Yoshihide Suga to announce a commitment to a target of net zero emissions by 2050.

Japan purchases around 45 per cent of Australia’s coal exports, and around the same proportion of Australia’s LNG exports, but according to the influential Nikkei Asia, is about to unveil its 2050 net zero emissions target in a speech to be delivered to the National Diet, Japan’s parliament, next week.

Japan is also expected to implement a series of new policies to support the accelerated uptake of renewable energy technologies, as well as introducing new measures to reduce emissions across transport and industrial manufacturing.

Suga, who replaced the ailing Shinzō Abe in September, leads Japan’s more conservative Liberal Democratic Party, which had previously taken a softer approach to its climate targets and had attracted criticism as a laggard on climate action.

Japan ramped up the use of gas and coal for electricity generation to meet a gap in supply following a suspension of its nuclear power fleet after the Fukushima Daiichi nuclear disaster in 2011.

Nuclear power had previously supplied around one-third of Japan’s electricity, but most of the fleet remains offline and domestic political pressures have delayed its re-commissioning.

Associate Dean for Research at the ANU’s College of Asia and the Pacific, Llewelyn Hughes, told RenewEconomy that the commitment to a more ambitious emissions target is likely, at least in part, motivated by a desire of the Japanese government to accelerate the re-commissioning of Japan’s nuclear power fleet.

But Hughes added that the commitment would also effectively rule out investments in new coal and gas generators in Japan even if there is any shortfall in nuclear power capacity, with Japan to become more reliant on investments in renewable energy and energy efficiency.

The zero emissions target would also help to unlock new investment in low carbon technologies, including encouraging an expansion of Japan’s push into green hydrogen and fuel-cell technologies, as the country works to remain at the forefront of technology innovation.

Japan’s push into hydrogen provides a positive opportunity for Australia to position itself as a leading supplier of green hydrogen.

A shift away from coal has already started in Japan, with the country’s largest power company, JERA, announcing last week that it would move to decommission all of its inefficient coal generators by 2030. It is a significant announcement, with JERA currently operating a 67,000MW thermal generation fleet.

The announcement would see JERA close an unspecified number of coal plants, in line with Japanese government policy, but would look to close all coal plants that were deemed “supercritical or less” in terms of efficiency. JERA said that it would replace the shuttered coal plants with a mix of new wind and solar capacity, and would trial the use of hydrogen fuels in its remaining thermal generators.

JERA’s announcement formed part of a commitment by the Japanese utility to its own zero emissions target by 2050.

“As Japan’s largest power producer, JERA is in a position to actively lead the way in realising a low-carbon society. To further accelerate its initiatives so far, and to clarify its long-term vision, JERA has established “JERA Zero CO₂ Emissions 2050″, the goal of achieving zero CO₂ emissions by 2050,” JERA president Satoshi Onoda said.

Japan’s impending commitment to a zero emissions target by 2050 would follow China’s own commitment to a zero emissions target by 2060, with China also sitting behind Japan as Australia’s second largest customer for both coal and gas.

Japan and China’s combined commitments alone could see Australia ultimately lose around 80 per cent of its demand for LNG exports, and a majority of its demand for exported coal.

China has already started to intervene in the market for coal being sent to the country, recently halting the imports of Australian coal as it begins to impose quotas on coal sourced from outside of China. While the recently announced halt is likely to be temporary, it is a sign that China’s demand for Australian coal is starting to be controlled, and will almost certainly be reduced as the country begins to take measures to meet a zero emissions target.

With the prospect of a Joe Biden victory in the United States presidential election in a couple of weeks time, with Biden also promising to commit the United States to a zero emissions target, Australia is becoming increasingly isolated in its refusal to adopt a long-term zero emissions target.

Eminent Australian economist, Ross Garnaut, recently told the Australian Clean Energy Summit that a future Biden presidency could relegate Australia to the ‘naughty corner’ over climate change policy, and would be expected to use its influence to pressure laggards like the Morrison government to increase its climate change ambition.

Australia will face increased pressure due to its refusal to adopt a zero emissions target, with major trading partners, in Japan and China, as well as geopolitical allies in the United Kingdom, the European Union and potentially the United States all making commitments to a 2050 zero emissions target.