Catharina Klein
Research expert covering Japan
Natural gas industry in Japan - statistics & facts
Following the nuclear accident in Fukushima in 2011, Japan replaced nuclear energy with fossil fuels. Accounting for a share of close to 75 percent in energy production, fossil fuels remained the most important energy sources in Japan, with natural gas representing by far the largest source in electricity generation. Next to electricity generation, natural gas is further used for heating, as fuel for some vehicles, and as a chemical feedstock to manufacture plastics and other organic chemicals.
Natural gas is a flammable, naturally occurring hydrocarbon gas mixture that is found underground. It mainly consists of energy-rich methane and can further include other higher alkanes and carbon dioxide. Even though natural gas emits less carbon dioxide when combusted than coal and oil, its burning contributes to global warming and air pollution.
As the Japanese government currently intends to reduce the use of fossil fuels in energy production, the consumption volume of natural gas indicated a decrease in recent years.
In recent years, the share of renewable energy in electricity production increased to close to 20 percent, while the figures for greenhouse gas emissions started to indicate a downwards trend.
As the Japanese government currently intends to reduce the use of fossil fuels in energy production, the consumption volume of natural gas indicated a decrease in recent years.
Dependency on natural gas imports
Japan ranks among the largest global consumers of natural gas. But the country's production volume of natural gas continued its downwards trend throughout the past decade. Since the archipelago only has small reserves of fossil fuels, it is highly dependent on imports. With close to 98 percent of liquid natural gas (LNG) being imported, Japan ranked as the largest importer of LNG worldwide. Its main suppliers for natural gas were Australia, Malaysia as well as Middle Eastern countries such as Qatar. Even though Japan diversified its suppliers for LNG, in 2021, gas shortages resulted in increased electricity prices and decreasing LNG inventories, highlighting the vulnerability of the current system.Major Japanese gas companies
Due to the scarce domestic resources, Japanese gas companies mainly participate in exploration projects overseas. Tokyo Gas ranked as the largest Japanese gas company based on total assets and was followed by Osaka Gas. Both companies mostly participate in exploration projects in Southeast Asia, Australia, and North America. Domestically, they provide natural gas and sell electricity to the main cities and surrounding prefectures of Tokyo and Osaka, respectively.Energy policy in Japan
To be less dependent on fossil fuel imports, secure a stable electricity supply, and reduce greenhouse gas emissions, the Japanese government currently aims to replace fossil fuels with low-carbon energy sources such as renewables and nuclear energy. Japan recently announced that it raised its climate goals for 2030, intending to cut emissions by 46 percent compared to the level of 2013. An increase of the share of renewable energy to 38 percent is planned, while the target share of natural gas was lowered to 20 percent.In recent years, the share of renewable energy in electricity production increased to close to 20 percent, while the figures for greenhouse gas emissions started to indicate a downwards trend.
