Japanese city gas distributor Tokyo Gas announced on November 26 that it will spend JPY2tr (USD17.5bn) on clean fuels, such as hydrogen and other renewable energy sources, as reported by Reuters on the same day. With the huge funding, the Japanese company has raised its goal of renewable energy capacity for 2030 to six gigawatts (GW) from 5GW, compared to its current installed capacity of 1.4GW. Citing Tokyo Gas President Takashi, the firm would start benefiting from the planned investment in the later 2020s and expect a JPY200bn net profit in 2030, doubling from the estimated profit of JPY104bn for the fiscal year 2021.

Tokyo Gas will spend about one-fourth of the JPY2tr budget on renewable energy and JPY100bn on hydrogen production and other clean fuels. It will also use around JPY500bn to branch out overseas, including expanding the upstream development by its shale gas unit in the US and liquefied natural gas (LNG) infrastructure operations in Asia. Tokyo gas and other utility companies launched overseas expansions due to the weakening power consumption in Japan with its aging population, while the demand for clean fuels is growing globally amid the decarbonization appeal. Precisely, the country’s total energy consumption has been descending since 2010 by 2% on average from 2010 to 2019 and by 7% in 2020, according to Enerdata. On November 25, Japan’s Sumitomo Corporation and Tokyo Gas formed a partnership with Malaysia’s state-owned oil company, Petronas. The three entities will jointly study to establish a supply chain importing carbon-neutral methane from Malaysia to Japan.

Sources:

https://www.reuters.com/markets/commodities/tokyo-gas-spend-y2-trln-clean-energy-double-profit-by-2030-2021-11-26/

https://www.enerdata.net/estore/energy-market/japan/

https://www.upstreamonline.com/energy-transition/petronas-and-japanese-partners-to-team-up-on-carbon-neutral-methane/2-1-1105781