The Japanese crisis and natural gas


Mari Iwata’s article in the February 13, 2012 edition of the Wall Street Journal offers an interesting account of the energy situation in Japan.

Japan’s energy situation has gone through a complete metamorphosis since the tragic events associated with the 2011 earthquake. These events have caused significant collateral damage to the nuclear industry in the country: only 3 of 54 Japanese nuclear power plants are now in operation. The scenario of a Summer 2012 without nuclear power is now a real possibility. The nuclear sector provides 30% of the country’s electricity annually.

The nuclear crisis leaves Japan in a difficult situation. To meet these challenges, Japan is turning increasingly towards natural gas, a resource Japan itself produces only in small amounts – less than 4% of the gas used in the country is from Japanese sources.

The Wall Street Journal points out that Japanese demand for natural gas is reviving the natural gas market. This is visible on several fronts, including the announcement of huge gas development projects and by Japanese economic indicators. In 2011 alone, gas imports increased by billions of dollars.

The Japanese have chosen to turn to natural gas for many reasons, but mainly because, according to the article, “Japanese users see natural gas as cleaner than coal, less expensive than oil and more readily available than sun or wind power.”