⚡ Japan Breaks 60% Fossil Fuel Barrier While Offshore Wind Dreams Sink Under Rising Costs
👀Japan achieved a historic energy milestone as fossil fuel share of electricity generation dropped below 60% for the first time, driven by solar power surging 25-fold since 2010.
*Editor’s note: This article was originally published on 8/27/2025 on Linkedin.
🎧🗣️Audio Versions of this newsletter are available thanks to NotebookLM
In English🇺🇲: Japan Climate Curation vol. 167 [15:17 min.]
In Japanese🇯🇵: Japan Climate Curation vol. 167 [22:08 min.]
🚀Now, the English audio digest of a sister publication, Climate Curation, which covers mainly non-Japanese global climate news topics, is available in English.
🇺🇲Climate Curation vol. 172 audio summary in English [18:29 min.]
🇯🇵Climate Curation vol. 172 音声概要 [25:25 min.]
Welcome! I'm Hiroyasu Ichikawa, ichi, and this is issue 167 of the "Japan Climate Curation" newsletter📬, which has been curating hand-picked Japan-related climate news content every week since spring 2022, with over 470 subscribers [ more than 2,950 on Linedin]. You can subscribe by clicking on the Linkedin page or the form below.
I hope you find the articles below beneficial for reading (or skimming)!
Found this week's news insights valuable? Please give it a quick "like" or "share" on LinkedIn – you never know who else in your network might benefit from staying in the loop on Japan's climate scene🙂🙇
*note : "Climate Curation" a different climate newsletter in Japanese (every Saturday) is available on Linkedin / note / theLetter. It curates Japan and global climate-tech trends. I hope you like it.
【Digest of this week's topics】
Japan achieved a historic energy milestone as fossil fuel share of electricity generation dropped below 60% for the first time, driven by solar power surging 25-fold since 2010. However, the renewable sector faces severe headwinds as Mitsubishi Corp withdrew from offshore wind projects after recording ¥52.4 billion losses, while major steel and chemical producers scaled back carbon-cutting efforts under Trump's climate-skeptical influence. ESG bond issuances fell 8% as companies shift toward conventional bonds. Japan responded by proposing to extend offshore wind farm leases from 30 to 40 years to improve project economics. Positive developments emerged through Bill Gates' nonprofit partnering with Japan on biomass and hydrogen research, while Suzuki announced $8 billion EV investment in India. Innovation continued with Toshiba developing waste heat power generation technology, though Fukushima decommissioning costs ballooned beyond government estimates.
*Disclaimer: Generative AI tools such as Claude Sonet 4 and NotebookLM have been used for summary and translation assistance. 🙂
[🇯🇵📰👀Japan Climate News Headlines]
【1】⚡ Japan's utilities cut fossil fuel electricity share to new lows [8/26 Reuters]
Japan's fossil fuel share of electricity generation hit a record low below 60% in H1 2025 for the first time, a significant milestone for one of the world's top-10 fossil fuel consumers and the fourth-largest economy. Clean energy surged dramatically with solar power up 25-fold since 2010, wind and bioenergy more than doubling, plus gradual nuclear recovery from post-Fukushima lows. Clean electricity supplies reached 188 terawatt hours, up 47% since 2019. Coal generation fell 9% and gas 25% versus H1 2019, driven by high gas prices and expanding renewables. At current trends of 6% annual clean growth and 3% fossil decline, clean energy may overtake fossil fuels by 2033, threatening long-term prospects for fossil fuel exporters who have relied heavily on Japanese demand.
【2】🌊 Mitsubishi Corp., partner to pull out of offshore wind projects in Japan [8/26 Nikkei Asia]
Mitsubishi Corp. and its partner Chubu Electric Power have decided to withdraw from offshore wind power projects in Japan due to unprofitable conditions caused by low bid prices and rising global material and labor costs. The companies won three projects (one in Chiba Prefecture, two in Akita Prefecture) in the government's first public auction for offshore wind projects in 2021, targeting completion from 2028. However, Mitsubishi recorded a substantial loss of ¥52.4 billion in its offshore wind business for fiscal 2024. This withdrawal represents a significant setback for Japan's renewable energy initiatives and highlights fundamental challenges in the country's energy policy framework.
【3】🏭 Japanese steel and chemical producers pull back from carbon-cutting [8/26 Nikkei Asia]
Japanese steel and chemical industries are scaling back greenhouse gas emission reduction efforts as investor pressure weakens under the Trump administration's climate-skeptical policies. Kobe Steel has halved its investment plans, Mitsubishi Gas Chemical suspended green methanol production, and Eneos scrapped hydrogen targets. These industries account for about one-fifth of Japan's emissions, raising concerns about achieving the 2050 net-zero goal. The slowdown in technological innovation also poses risks to Japan's materials sector competitiveness.
【4】📋 Japan proposes 10-year extension for offshore wind farm leases to ease cost pressures [8/27 Reuters]
Japan's industry and land ministries have proposed extending offshore wind farm lease periods from 30 years to 40 years to help developers manage soaring construction costs. Under current guidelines, construction, operation, and decommissioning must be completed within 30 years, limiting actual operations to about 20 years. The extension aims to boost electricity sales, improve cash flow, and attract more investors. Japan targets 45 gigawatts of offshore wind capacity by 2040, up from 0.3 GW in 2024, but progress has stalled due to rising costs. Major trading house Mitsubishi Corp is reportedly preparing to withdraw from multiple projects due to profitability concerns.
【5】💰 Japan ESG bond issuance falls 8% in Trump's shadow [8/21 Nikkei Asia]
Japanese companies' ESG bond issuances declined 8% year-on-year to 1.92 trillion yen ($13 billion) in January-July, marking a second consecutive decline. Rising interest rate expectations are driving companies toward conventional bonds due to their simpler approval processes. President Trump's opposition to ESG bonds has also influenced the slowdown, with ESG bonds' share dropping to 19.5% of total issuances. Sustainability-linked bonds plunged 42%, while green bonds rose 23%. Although experts maintain long-term ESG demand remains strong, the Trump administration's anti-ESG stance is casting shadows over Japanese companies' attitudes toward sustainable financing.
【6】🔬 Bill Gates nonprofit to support Japan's biomass and hydrogen research [8/25 Nikkei Asia]
A nonprofit organization founded by Microsoft co-founder Bill Gates will partner with the Japanese government starting in fiscal 2026 to support decarbonization research and development. The organization will provide subsidies and support for biomass and hydrogen research, Japan's areas of expertise, to promote commercialization in clean energy fields. This marks the second expansion outside the U.S., following Singapore in 2024. Beyond funding research, the nonprofit will focus on commercialization through university-based ventures, prioritizing advice on business model development. In the U.S., the organization has supported 120 projects since 2021, with 58 achieving commercialization, raising expectations for enhancing Japan's R&D competitiveness.
【7】🚗 Suzuki Motor will invest $8bn in India to begin EV production [8/26 Nikkei Asia]
Suzuki Motor announced an $80 billion investment in India for electric vehicle production over the next 5-6 years. India will serve as Suzuki's global EV manufacturing hub, launching commercial production of the mid-sized "e Vitara" SUV at its Gujarat facility. The company plans to export to 100 countries, including Japan and European markets. The Gujarat plant targets 1 million unit annual production capacity. Prime Minister Modi praised the initiative as a significant leap toward "Make in India" objectives.
【8】🔧 Toshiba unlocks green power generation from factory waste heat [8/21 Nikkei Asia]
Toshiba has developed an innovative power generation system that converts factory waste heat into electricity. Unlike conventional technologies that use environmentally harmful hydrofluorocarbons, Toshiba employs an aqueous amine solution as the heat transfer medium. The system can utilize waste heat at temperatures of 80-150°C, with commercialization targeted for fiscal 2028. As other companies withdraw due to stricter HFC regulations, Toshiba anticipates growing demand for renewable energy that leverages unused heat sources in support of decarbonization efforts.
【9】☢️ Fukushima nuclear plant decommissioning seen overrunning estimate [8/23 Nikkei Asia]
Fukushima Daiichi nuclear plant decommissioning costs have reached 5.2 trillion yen, likely exceeding the government's 8 trillion yen estimate. TEPCO spent 2.1 trillion yen through fiscal 2024, with 2.45 trillion yen budgeted for full-scale debris removal preparations starting in fiscal 2037. With unpredictable retrieval costs and TEPCO's weak finances facing an eighth consecutive year of negative cash flow, staying within the 8 trillion yen budget appears impossible.
【10】🏔️ Are 'coolcations' the answer for Japan's heat-weary tourists? [8/24 The Japan Times]
As Japan faces record-breaking heat waves, 'coolcations' - vacations to escape the heat - are gaining attention. JR East and Hoshino Resorts actively promote travel to high-altitude destinations, while ski resorts like Hakuba expand summer operations. A survey shows 38% plan to stay home this summer, avoiding outdoor activities. Ski resorts, facing shorter snow seasons due to climate change, diversify with summer activities like SUP and mountain biking. However, even supposedly cool destinations cannot entirely escape the heat, with temperatures reaching the mid-30s.
📬That's all for this week! Thank you for reading(or skimming) 🙇. I hope you will have a wonderful week ahead!
Did you found this week's news insights valuable? Please give it a quick "like" or "share" on LinkedIn – you never know who else in your network might benefit from staying in the loop on Japan's climate scene🙂🙇
The "Climate Curation" newsletter in 🇯🇵Japanese (every Saturday) is available on Linkedin and theLetter.
Please feel free to contact me via email: hiroyasu.ichikawa [@]socialcompany.org, if you have any research/consulting needs for your business or just for a coffee chat☕.
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