Japan embraces lab-made fuels despite costs and climate concerns

Japan Times

21-04-2025

For Japan's largest utilities, lab-made fuels are a meaningful step toward greener energy that also extends the life of billions of dollars' worth of existing fossil-fuel infrastructure.
For their critics, products like "e-methane' and "syngas' are not an attractive compromise but an expensive distraction, at a time when the country — already a climate laggard in global terms — should instead be accelerating its shift to renewable power.
Eager to win over naysayers, companies like Electric Power Development and Osaka Gas have seized on this year's World Expo in Osaka, packing last week's launch event with mascots, virtual reality and their plans to incorporate alternative fuels into existing systems. A transformation, they argue, can be achieved without compromising on energy security or the stability provided by their pipelines and fleet of power plants.
"The beauty of e-methane is that we can continue using our existing natural gas infrastructure,' said Yosuke Kuwahara, director of the carbon neutrality promotion office at Osaka Gas. The company showcased a small-scale facility producing what it called the "gas of the future' at the sustainability-themed expo, traditionally an opportunity for countries to showcase technological prowess.
The gas is one of several synthetic fuels created through chemical processes and designed to replicate the properties of conventional fuels, with the added aim of making them easier to replenish and less polluting.
Japan remains the most fossil-fuel reliant among the Group of Seven advanced economies, with low-carbon sources making up roughly a third of its energy mix. Its utilities have long justified their continued use of dirty fuels by saying large-scale solar and wind deployment is limited by the island nation's geography, or that nuclear energy will take time to ramp up after a yearslong hiatus due to safety concerns.
Slowly introducing alternative fuels into the mix is "a way to decarbonize,' said Sumiko Takeuchi, senior fellow with the International Environment and Economy Institute, who has advised the government on its energy strategy. By using plants already in service, that can be done with limited risk to the nation's power supply, she added.
'Gas of the future'?
Japanese utilities say e-methane is chemically almost identical to natural gas but is effectively carbon-neutral because of the environment-friendly way in which it's produced.
At the expo, Osaka Gas demonstrates how carbon dioxide captured from the venue's food waste can be blended with green hydrogen, made using renewable energy, to generate e-methane. On a larger scale, CO2 can be captured from landfills and factories to produce it for millions of customers, said Kuwahara.
Osaka Gas is building an e-methane plant in Niigata Prefecture and plans to substitute the fuel for 1% of the gas it delivers to households by 2030. Tokyo Gas has a similar goal. Japan has said it may boost that to as much as 90% e-methane by mid-century, according to a 2023 presentation made by the Ministry of Economy, Trade and Industry.
Burning e-methane, however, still releases the greenhouse gases it is composed of — meaning those planet-warming emissions must then be captured and stored.
Without that last step, "you just delay the emissions,' said Hiromitsu Miyajiri, a program coordinator with Kiko Network, a Japanese environmental group. "It's not going to result in a reduction in emissions.'
Costs are an even more pressing hurdle.
When Jera, Japan's biggest power producer, co-fired ammonia at its Hekinan coal plant in Aichi Prefecture last year, it reduced emissions by 20%. The ammonia was made with natural gas, but the company's goal is to eventually use renewables to create a green version of the fuel. Jera has since announced plans to use it commercially in 2030 and to switch over completely by 2050.
But even a 50-50 blend of coal and ammonia made from natural gas would cost about double a power plant's revenue, according to an Asia Research & Engagement report released this month.
Jera declined to discuss the costs of its project.
Transition delay
At the heart of most objections, however, is the criticism that such experimentation will ultimately delay Japan's already tardy transition to low- or zero-carbon energy. Using gases like ammonia and hydrogen alongside fossil fuels in power plants may also increase different kinds of air pollution.
Utilities should focus on shifting to renewables instead of pursuing strategies that prioritize existing infrastructure, said Michiyo Miyamoto, an energy finance specialist with the Institute for Energy Economics and Financial Analysis, which aims to accelerate the green transition.
"As a long-term strategy, it's really risky,' she said.
Japan's utilities are pressing ahead, though.
Electric Power Development, also known as J-Power, plans to install gasification systems at its Matsushima coal plant in Nagasaki Prefecture by 2028. The technology mixes pulverized coal with oxygen to create syngas, from which hydrogen is extracted to generate power. Here too, the challenge will be to capture and store the carbon dioxide created in the process.
The company is looking at underground storage sites in Japan and Malaysia, but that raises issues of leaks as well as local opposition, according to Mira Cordier, an analyst with Asia Research & Engagement.
"There are major uncertainties about technological and economic feasibility,' she wrote in an email.
While J-Power won't disclose the project's costs, syngas is a key part of its plan to reach net zero by 2050, said Takashi Oikawa, deputy general manager for press relations.
"Thermal power plants will have to be decarbonized and that's what we are working toward,' Oikawa said, adding that does not mean shuttering the facilities. "We will try to utilize them as long as possible by introducing new technology.'