Japan Energy Summit: leading the way in accelerating energy transformation

Ahead of Japan Energy Summit and Exhibition 2025, Energy Connects spoke to Nobuo Tanaka, Executive Director Emeritus of the International Energy Agency (IEA) and the Chair of the Executive Committee for the event, on what awaits energy leaders and delegates convening from around the world at Tokyo Big Sight later this week. Excerpts from the conversation:

Tanaka-san, this year’s Japan Energy Summit and Exhibition is the first such global energy event taking place after the highly anticipated release of Japan’s Seventh Strategic Energy Plan. What are your key takeaways from that?

The seventh Basic Plan accommodates lots on energy security because of the Ukraine conflict, creating a major energy supply uncertainty in Europe. And that triggers the price of oil, price of gas, coal, electricity – everything is skyrocketing. So, energy security has lots of momentum in the seventh Basic Plan.

Of course, Japan is aiming at net zero by 2050, but this Basic Plan now prepares a risk scenario. If something went wrong and Japan needs more time to achieve net zero, how do we prepare for that? In that situation, the demand for liquefied natural gas (LNG) could be 30% more, 20 million tons more. So, in that situation, who is going to invest in the development of natural gas facilities, liquefaction, transportation?

So far in the energy Basic Plan, they didn't have any kind of derivative scenarios. Now they have this very interesting scenario – an alternative plan if the transformation does not happen as scheduled. It's a new inclusion in this Basic Plan and very interesting.

Of course, Japan needs to invest a lot in renewables, wind, solar, and nuclear energy. But only those options won’t work to fulfil the demand by 2050. Therefore, the role of LNG will be critical – not only for Japan, but for other developing countries too. India, for example, needs more LNG. Luckily, the United States is now saying they are going to produce more LNG. We need to see how we can accommodate all these elements into our future scenario.

One of the elements also mentioned in the new plan is return to nuclear energy, which you have spoken about quite often. What are your thoughts?

Yes, well, I have been saying that nuclear power is necessary to prepare for a sustainable future. So, this Basic Plan certainly put nuclear as 20% of power generation in 2040. But thanks to the AI and data centres, the total demand of electricity will also increase, unlike in the sixth Basic Plan, where it decreased. Therefore, by increasing the total demand for electricity 20%, which is the same number as the old one for the nuclear, means you need more power generation by the nuclear in 2040.

That means not only restarting old nuclear power plants, but maybe we also need to build new reactors to replace the old ones. So, in this seventh Basic Plan, we have more use for nuclear, not less. This is one of the big differences of the seventh plan, and I'm very happy about it.

However, can we deliver small modular reactors as an alternative to the current big light water reactors? We are still up in the air about it. The private sector should play a role in this, because sometimes the project length gets very extended in building big reactors. And such delays lead to cost escalation. So, this is an opportunity for the private sector to deliver nuclear projects on time and on budget – this is the actual challenge. But government also should help to make it happen. I think it reflects very well in the seventh Basic Plan. We are seeing lots of hopeful future for nuclear power everywhere, not only in Japan but other countries too.

How does Japan’s new Basic Plan strike a balance between sustainability, efficiency and energy security?

This plan foresees the future where the 40-50% of the supply will be renewables and thermal power would be about 30-40% while nuclear is 20%. So it is in a way that by 2040 we need everything. Of course, renewables are very important - 50% or more should be renewables, but to achieve this, as a backup to the volatile renewables, we may need thermal power.

Thermal is not just burning oil and gas or coal, but we need very clean fuel. So, hydrogen, ammonia, co-firing with coal, that kind of more clean thermal power will be I demand. Nuclear is also going to play a role, but nuclear plants cannot be built so quickly to replace thermal power. So, decarbonising thermal power is one of the elements which Japanese government is trying to put as a priority, creating new opportunities for hydrogen, clean ammonia, and carbon capture and storage.

The Japanese government is thinking about AZEC, the Asian zero carbon community. But using the hydrogen and ammonia supply chain is a very important part of this, and CCS supply chain is another very important element to make this seventh plan feasible.

How do you see all this coming together at the Japan Energy Summit and Exhibition, of which you're the Chair of the Executive Committee?

Japan, as one of the world’s most advanced economies and largest energy importers, is taking a leadership role in redefining the future of energy. I am honoured to help this year’s Japan Energy Summit and Exhibition as a Chair, and we are trying to cover almost all the important issues. This year’s Japan Energy Summit and Exhibition focuses on natural gas, among other areas. And we are also moving to hydrogen, ammonia, these clean fields, as well as use of more renewables, CCS, power market, and also nuclear. When we think about the future of decarbonisation as well as energy security, global collaboration is necessary.

Japan Energy Summit & Exhibition, taking place from 18-20 June in Tokyo, provides a vital international platform for such collaboration, aligning policy and industry. Co-hosted by Tokyo Gas and JERA, the event brings together senior government officials, energy executives, investors, and technology leaders from across the global value chain. This will be a global platform to share and exchange knowledge from different countries and different sectors. And I'm very happy and very much honoured to chair this exercise.