Why Japan Deserves Some Praise on Climate

Japan Chair Platform

Japan has been on the receiving end of some sharp criticism in the wake of the recent G7 meeting for its stance on climate change. Japanese prime minister Shinzo Abe announced a target of cutting greenhouse gas emissions of 26 percent below 2013 emission levels by 2030, which is equivalent to 18 percent less than 1990 emissions. This falls short of what is needed to keep the risk of catastrophic climate change to reasonable levels.

Despite this, the criticism of Japan is largely unfair. Japan’s energy supply remains in turmoil following the Fukushima disaster of March 11, 2011. And regardless of international pledges, all governments face the reality that transforming energy systems takes time and requires overcoming domestic obstacles to change. The truth is that Japan cannot be a pathbreaker on climate change. But by keeping its target within the range of those announced by others, it has ensured that other countries cannot use Japan as an excuse for shirking.

Japan’s Post-2020 Climate Policy

The protocol establishing binding targets for developed countries famously bears the name of Japan’s former capital of Kyoto. Climate change was touted as a symbolic goal by Japanese policymakers, and former prime minister Yukio Hatoyama was lauded for committing Japan to cutting greenhouse gas (GHG) emissions by 25 percent from 1990 levels by 2020.

Since then, however, things have changed. At the 19th session of the Conference of the Parties (COP 19), under the UN Framework Convention on Climate Change (UNFCCC) in Warsaw, Japan, along with Australia, was criticized as a climate laggard for offering a 3.8 percent GHG emissions reduction from 2005 levels by 2020. In the lead-up to the all-important COP 21 being held in Paris in December 2015, Japan’s climate efforts are again being criticized as not going far enough.

The problem with this view is that it fails to recognize that Japan is still reeling from the Fukushima nuclear disaster. A little under a third of Japan’s electricity was delivered from its fleet of 54 nuclear units prior to this catastrophic event. In the wake of the accident, remaining units were idled, and emissions from fuel combustion jumped. Energy-related CO2 emissions grew from 1,139 to 1,235 million tonnes of CO2 equivalent from 2010 to 2013, an increase of 8 percent, representing a shift in power generation back to fossil fuels. Japan’s nuclear plants are now subject to enhanced safety checks, and the power utilities are required to renegotiate with local governments. Some are understandably nervous about the safety of the nuclear facilities.

Targets Matter, and They Don’t

Many countries failed to meet their commitments made under the Kyoto Protocol. But this does not mean the international pledges governments are making in the lead-up to Paris are unimportant. International commitments—even in the absence of compliance mechanisms—can shape domestic policy choices by narrowing the range of what is acceptable.

Japan should thus be congratulated for trying to keep its emissions projections at a level sufficient not to undermine international negotiations. Indeed, a core goal of the long-term energy planning process from the outset was establishing a target for 2030 that approximates that of Europe and the United States, despite the implications the idling of Japan’s nuclear units has for Japan’s current and future emissions profile.

In the long run, Japan’s contribution to solving the problem of climate change will be determined by the innovation of its companies and by how it manages energy supply and demand domestically. On the latter, the government recognizes nuclear power will play a diminished role in Japan’s energy system. Indeed, some analysts think nuclear power will contribute far less to Japan’s electricity generation than the announced target of 20 to 22 percent. The key question is how policy choices will affect future investment choices. Here there is room for criticism.

Japan’s emissions target emerged in part from a bottom-up assessment of energy supply and demand to 2030 on a fuel-by-fuel basis, which takes into account the government’s assessment of the cost competitiveness and technological constraints of different fuels. This approach to energy planning tends to underestimate the possibilities of technological and policy innovation. A case in point is Japan’s version of the feed-in tariff (FIT). Japan was the global leader in solar photovoltaics in the 1990s, with the majority of this installed on the roofs of households. The FIT, through which investors received a guaranteed return on investment for power generated through renewable energy sources, increased the installed base well beyond government expectations, and shifted its distribution toward utility-scale grid connected projects.

Total electricity generated by solar photovoltaics today remains tiny compared to nuclear power delivered prior to 2011. But the success of the FIT demonstrates that policy change can contribute more than expected to emissions cuts in the power sector. The intermittency of renewables is offered as one reason for increasing the role of coal as “baseload” power for the grid, for example, but falling costs in battery storage could change this calculus.

Market reform will also shape the cost competitiveness of different fuels. Japan is currently overhauling the rules governing competition in the power sector, including opening the residential sector to competition and pushing forward with unbundling the vertically integrated regional power utilities.

One possibility is that this will have little effect: previous rounds of market reform failed to weaken the enormous market power wielded by the utilities. But with Tokyo Electric Power Company (TEPCO) announcing plans to shift to a holding company structure, and beginning to allocate investments outside its home market, it is possible that new market entrants will spur greater penetration of natural gas and renewables, shifting demand away from more carbon-intensive fuels.

Regardless, though Japan can certainly do more, in the wake of the Fukushima disaster, it will not—and indeed cannot—be a trailblazer in climate change. But the government deserves a modicum of praise for ensuring it does not undermine the global project of producing a binding agreement that incorporates all the major emitters.

Llewelyn Hughes is senior lecturer at the Crawford School of Public Policy, Australian National University, and director of research at GR Japan, a public affairs consultancy.

Japan Chair Platform is published by the Office of the Japan Chair at the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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Llewelyn Hughes