Strong growth in Japan’s nuclear sector seen in short term: report

Nuclear power generation could rise 10.4% in 2022.

Japan’s nuclear sector could see strong growth in the short term as the country reduces its reliance on gas power amidst disruptions in supply and increasing gas prices, Fitch Solutions projected. 

At the end of 2021, gas power accounted for 40.2% of Japan’s generation mix. But, the Japanese government is now looking at speeding up the process of restarting nuclear power plants due to the impact of the Russia-Ukraine crisis on the sector.

Just this month, Prime Minister Fumio Kishida announced the need to diversify its power sector. 

“Within the next two years, we expect the nuclear power sector to increase in its contribution to the generation mix,” the report read in part. 

“We forecast nuclear power generation to have strong growth in the short term, with 10.4% and 5.4% growth in 2022 and 2023 respectively.”

This will largely be driven by the restart of Mihama 3, Onagawa 2, and Takahama 1 and 2 nuclear reactors, which have passed the stringent safety checks. The plants will also be retrofitted with anti-terrorism mechanisms and received the appropriate regulatory approvals. 

“Aside from these plants, we expect limited growth in Japan’s nuclear power sector for the longer term, although we now see upside risks to this forecast if Japan successfully diversifies its generation mix.”