Emilie Jones | Senior Sustainability Consultant
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In our previous article, we discussed how Japan’s 7th Strategic Energy Plan is driven by the government’s need for secure, sufficient, reliable energy to meet economic development pathways around the digital and green transitions (DX, GX). Corporations realizing these transitions require substantially increased amounts of electric energy to support data center build-up and replace localized fossil fuel heat sources such as burners.
Meanwhile global stakeholders demand corporations demonstrate significant progress towards their net-zero commitments, with financing on the line in some cases. The 7th Strategic Energy Plan proposes greater integration of low-emission energy supply into the grid to meet these needs, primarily through solar and nuclear capacity development.
This article will examine the current status, emerging technologies, investment and sustainability tradeoffs, and likelihood of target capacity achievement for both nuclear and solar to ask the question:
In setting a transition roadmap, should corporations rely on Japan’s grid decarbonization or invest in their own greenfield projects?
Nuclear
What is the current status of nuclear power in Japan?
Japan’s energy grid currently receives about 14 GW of electricity from nuclear power sources per year. In the 7th Strategic Energy Plan, Japan outlined a goal of developing at least 14 more GW of nuclear energy generation capacity by 2040 to achieve 20% nuclear power.
Of the 33 nuclear units still operable, 14 (~14 GW) have been reactivated, 10 (~10.7 GW) have applied for restart permissions, and 2 (~2.9 GW) are resuming construction. Twenty-one of these plants will be older than their designed age limit by 2040.
Nuclear power remains controversial in Japan due to concerns over its safety, waste generation, and inaccurate representations of renewability. For more details, please see our previous article.
Figure 1：Status of nuclear power plants in Japan (Agency for Natural Resource and Energy)
Can Japan achieve the targeted 20% energy mix deployment by 2040?
Technically possible, but highly unlikely.
There are only 15 years left until 2040, however reactor restart requires an average of 3 years from application and new reactor development can require 6-8 years for construction alone. To meet the 2040 goal, every reactor that has applied for restarting approval and those in construction must be reactivated.
Three of the 33 reactors are unlikely to restart due to seismic damage and the presence of seismic faults.
Another three reactors were permitted but never completed construction. One site has not even had the base foundation poured. These sites provide the greatest opportunity for implementing emerging Gen IV nuclear technologies. Gen IV technologies address many of the concerns regarding nuclear power safety and waste generation.
What are some emerging nuclear technologies?
Japan has already begun investing in emerging nuclear technologies. Much of the design impetus for Gen IV technological development directly addresses safety and waste handling concerns – the main issues highlighted by the Japanese public. In addition to high profile long-shot nuclear fusion investments, Japan has expressed interest in Gen IV nuclear technologies including high temperature and thorium reactors, Small Modular Reactors (SMR), and Sodium-cooled fast breeder reactors like GE Hitachi’s S-PRISM design.
There are many Gen IV nuclear technologies. For this article we will highlight 4 types.
- Small Modular Reactors (SMRs) are reactors designed to generate <1 GW power and be mass produced. The design should allow for faster build out in more areas. Decentralized power generation can reduce energy infrastructure development requirements. They are in the development stage.
- Thorium Reactors use a different fuel than previous reactors, creating benefits. Thorium is more abundant than uranium. It has high energy generation efficiency. It produces a nuclear waste product that is more difficult to use for weapons. They are in the prototype stage.
- Breeder Reactors convert spent waste into new fuel. Completely spent fuel has lower radioactivity. Breeder designs can be applied to both uranium and thorium-based reactors. They are in the prototype stage.
- High-Temperature Gas-Cooled Reactors innovate on a early reactor design. Modern reactors use ceramic coated fuel pebbles and helium coolants. These innovations improve fuel efficiency and safety. China currently operates two.
Some market followers like the Renewable Energy Institute believe that emerging nuclear technologies are unlikely to see grid deployment before 2040. Within the region, however, China is operating a high-temperature gas cooled reactor and is constructing a thorium molten salt reactor set to operate in 2029.
It is possible Japan will be able to build out some emerging nuclear technology capabilities by 2040 through strong political support and an expansive public education campaign. These first new nuclear power plants can bridge the gap to achieving Japan’s 2040 nuclear energy share target.
What are the sustainability and investment tradeoffs to consider?
Nuclear reactors, even small, modular ones, are the quintessential “locked-in asset“. Investment choices made now will determine the energy mix and emissions profile of Japan’s grid for the next 50 years. Regardless of the technical choice, for corporations considering their own transition plans, nuclear power provides some certainty.
Figure 3：Gen IV Technologies Comparisons (created by Codo)
Gen IV breeder reactors offer possibilities of significant waste reduction. Thorium reactors have the potential to reduce weaponizable waste products. Gas-cooled reactors offer industrial heat with high safety considerations. For corporations who will need to rely on nuclear power due to investment constraints, energy consistency requirements, or quality heat needs, these emerging technical solutions offer a middle path if developed in Japan.
Solar
What is the current status of solar generation in Japan?
Japan has invested heavily in localized solar generation for decades achieving approximately 87 GW (as of 2023) of installed solar capacity on readily available sites (building roofs, fields, infrastructure easements, etc). To continue expanding, second priority sites will need to be developed. Advances in solar technology and innovations in solar siting make this possible.
For more information, please refer to our previous article.
Can Japan achieve the targeted 150 GW deployment by 2040?
Possible, but would require redoubled efforts to leverage innovations.
Japan has extensive solar potential, but the siting of solar installations requires energy infrastructure buildout to transport and store generated electricity, local support for land use and landscape change, and technical suitability. These restrictions limit the real availability of solar sites. To increase installed solar capacity, at least one of these restrictions must be mitigated.
Figure 4：Solar Siting Considerations (created by Codo)
Integration of solar systems with a battery electricity storage system (BESS) allows for stable energy supply regardless of local conditions. BESS are important parts of solar infrastructure development with exciting developments of their own, but are not the focus of this article.
What are some emerging solar technologies?
Research and development efforts have resulted in many emerging solar technologies, but for clarity’s sake we will focus on three: perovskite, mega solar, and agri-solar (solar sharing).
- Perovskite is a new formulation of solar converter that uses less tin and reduces overall manufacturing carbon emissions by 16%. Its lightweight and flexible capabilities make it suitable for siting on building walls and previously unsuitable roofs.
- Mega-solar is a general term which refers to any solar project that can generate over 1 MW of electricity. Consolidated siting allows for efficiencies of scale in energy infrastructure buildout and maintenance requirements. Depending upon the site design, it can have severely negative impacts on local and global ecosystems. In cases where mega solar is replacing forest land, the land use change can cause landslides and animal displacements.
- Agri-solar (or solar-sharing) is a siting design which installs solar panels above or alongside productive farmland. Both renewable energy and crops can be gathered at the same time. Various agri-solar designs are in use in Japan, with some classifying as mega-solar. Alternative farm use can be controversial in rural Japan but provides many social and tax benefits for both farmers, local governments, and investors.
What are the sustainability and investment tradeoffs to consider?
The Japanese national government continues to provide support for solar developments through the Feed In Premium (FIP) program. Local governments also offer various subsidies. Paid Purchase Agreements (PPA) can also ensure lower long term energy prices and ROI. With such significant investment support, the challenge is ensuring proper siting and navigating stakeholder engagement.
Solar siting influences the environmental impact of solar developments. Siting on non-developed land (greenfield) can disrupt local ecosystems, change local micro-climates, displace animals like bears and boars, and increase risk of natural disasters. Instead, new solar developments should target previously developed or currently in-use sites. Examples include urban sites (buildings, infrastructure), previously urban sites (abandoned plots), farmland, and reduced productivity farmland.
Agri-solar is of particular interest as it offers both environmental and social benefits. Agri-solar sites must be designed to generate solar electricity while also allowing enough sunlight for crops to grow. This can be achieved through crop selection and site design. Studies have demonstrated that agrisolar is compatible even with the Japanese staple crop of rice. Integrating solar generation with agricultural production allows for urban companies to support rural communities not only through monetary payments, but also by fostering continued agricultural developments.
We have compared the siting and other sustainability concerns of solar innovations in the table below.
Figure 5：New Tech vs Sustainability Concerns (created by Codo)
Solar development design must consider not only development but also end of life and waste collection. Panels and other infrastructure must be monitored to ensure they are not leaking harmful chemicals. Solar sites that are not properly managed with waste treatment can pollute the surrounding environments with heavy metals and plastics.
Companies should ensure proper recycling facilities are available and panels and cables can be accessed and removed at the time of site development.
So, Grid or Greenfield?: Codo’s Insights
Every company must confront their own challenges in designing a realistic, yet ambitious net zero roadmap. Yet no matter the industry sufficient supply of reliable low-carbon energy is critical. By 2040, Japan will achieve a lower emission factor for grid energy but is unlikely to achieve their target emissions profile. With this consideration, companies are left to balance on-site or off-site renewable energy investments with investments in business model shifts.
How strict a company’s commitments, their scope 1 vs scope 2 emissions profile, and their business model can all affect which is the right choice for them. For companies pursuing RE100 credentialization, Japan’s grid energy will never meet their needs, instead they should plan for vertical integration through renewable development. For those with high heat demands like the steel sector, emerging nuclear developments may supply co-generated heat from the cooling system. For companies with sustainability goals beyond just carbon emissions, renewable investments can also provide social benefits.
Greenfield renewable development on untouched land can cause significant environmental harm. By contrast, agri-solar installations appear to be among the most holistically beneficial and balanced energy supply. They serve to address both energy generation concerns as well as social welfare and abandoned land issues. Private-public initiatives with strong local support have demonstrable success across multiple metrics. The revenue provided by taxes and energy sales can support landowners, local governments, and provide income for younger generations returning to the countryside.
The right choice is dependent on your company’s specific needs. Codo Advisory can support you in identifying the right solutions for your transition plan. Learn more about our transition planning services here, and set up a consultation with our consultants.
Sources and Additional Information
- Transitioning Photovoltaics to All-Perovskite Tandems Reduces 2050 Climate Change Impacts of PV Sector by 16% – Bingzheng Wang, Xueyu Tian, Samuel D. Stranks, Fengqi You
- Ecological and environmental effects of global photovoltaic power plants: A meta-analysis – Hang Chen, et al.
- Effects of solar panels and management on pollinators and their interactions with plants in Southern French solar parks – Arnaud Lec’hvien, et al.
- Analysis of the Rice Yield under an Agrivoltaic System: A Case Study in Japan – Ruth Anne Gonocruz, et al.
Codo Advisory helping companies in Japan at all stages of their sustainability journey.