Will there be an energy crisis in Japan during winter time this year? The Ministry of Economy, Trade and Industry estimates the power supply for winter this year to be the harshest in 10 years as 7 regions are expected to have a reserve capacity of merely 3%.
NHK reports that the Ministry of Economy, Trade and Industry announced the projections of power supply during wintertime at the expert meeting last Tuesday. The reserve capacity of the Tokyo Electric Power Company will only be 3.1% during the peak power consumption period in February 2022 if the weather is particularly cold during this year’s winter, whereas the reserve capacity in six regions, including Chubu, Kansai, and Kyushu, is estimated to be merely 3.9%. As for other regions, the reserve capacity for Tohoku can arrive at 4.4%, while Hokkaido and Okinawa will come to 7% and 33.8% respectively.
A mere 3% reserve capacity in power supply for 7 regions denotes the most severe power provision in 10 years. The ministry will be urging households and businesses to preserve energy, and further pointed out that the operation risks of power plants, as well as shortages of liquefied natural gas and other fuels, may constrain the supply of power by an additional extent.
According to the previous forecast of the Japan Meteorological Agency, the possibility of La Nina is 60% during autumn and winter this year, where the temperature in Japan may be lower than the average level next month. The country is currently preparing for the arrival of the wintertime, and has now attained a new high in the inventory of LNG in 5 years at approximately 2.3 million tons under reduced output of thermal power plants and low solar power generation during winter, which is a YoY increase of 700K tons. The ministry pointed out on the 21st that the supply will be sufficient this year.
Public utilities, amidst surging power consumption during winter last year, had purchased a significant amount of expensive natural gas spots due to insufficient fuels, which resulted in a sizable elevation in wholesale electricity prices. The Japanese government has now joined hands with major power, natural gas, and petroleum companies to tackle the imminent wintertime.
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