JERA: the biggest carbon polluter you’ve never heard of

JERA, a 50-50 joint venture of TEPCO and Chubu Electric Power, is pushing polluting fossil fuels in Japan and around the world while trying to brand itself a global clean energy leader.

A webinar with experts related to shareholder proposals to TEPCO and Chubu can be found here.

JERA’s dirty investments need to stop so the company can actually help the clean energy transition!

Fast Facts about JERA’s support for fossil fuels

  1. JERA is the largest thermal power generator by maximum outputs in Japan (including coal-fired power plants under construction in Yokosuka and Taketoyo) and is planning to combust ammonia/hydrogen (including ammonia or hydrogen from fossil fuels) under the “JERA Zero Emission 2050” roadmap.
  2. JERA is actively pursuing significant expansion in the LNG sector, including LNG fields such as Barossa LNG in Australia, approximately five LNG import terminals [1] and LNG to power projects with nameplate capacity of 11.6GW [2] in Bangladesh and Vietnam
  3. JERA’s operations produce approximately 169 MtCO2-e annually, or 15% of Japan’s annual emissions (2020).
  4. Although renewable energy accounts for only 1% of JERA’s business, it claims to be a clean energy company.

JERA’s fossil fuel buildout is incompatible with the global climate goals of the Paris Agreement and commitments for Net Zero CO2 emissions by 2050

TEPCO and Chubu Electric Power, and their joint venture JERA, have committed to net zero CO2 emissions by 2050, but their actions are inconsistent with these commitments:

  • The IEA’s net zero by 2050 scenario (NZE2050) specifies there can be no new exploration or expansion of oil and gas fields beyond projects already approved for development. If JERA is committed to net zero by 2050, it should demonstrate this by immediately ruling out new exploration or expansion of oil and gas fields, and not invest in projects such as Barossa LNG in Australia.
  • JERA also should not be investing in further coal or LNG terminals, as NZE2050 calls for the “Phase-out of all unabated coal power plants by 2040” and states that “Also not needed are many of the liquefied natural gas (LNG) liquefaction facilities currently under construction or at the planning stage.”
  • Climate risk-concerned investors should be wary of any company making claims about the future use of ammonia co-firing, including blue ammonia, as it presents as an expensive, energy-intensive method for generating electricity with emissions reductions that are dubious.

Although JERA claims that LNG is essential in the transition away from fossil fuels, by sponsoring massive LNG projects JERA is increasing its carbon footprint, locking Asian countries such as Vietnam and Bangladesh into fossil fuels rather than having them develop renewable energy.

Analysis from Oil Change International shows switching from coal to gas for power generation will not cut carbon emissions enough to meet the Paris climate goals. Imported LNG can be as polluting as coal when aggregating emissions from extracting, processing, storing, and transporting the gas, as well as burning it.

Pushing Australia’s carbon bomb: Barossa LNG

The project contains one of the largest CO2 reservoirs in the world, which includes a 260 km gas pipeline, and, if built, is projected to release millions of tons of greenhouse gases during its lifespan.

The project may impact the critical habitats of marine life in the area, including the threatened Flatback and Olive Ridley turtles.

The project could cause two of Australia’s most important tropical fisheries to lose access to important fishing grounds, and it is alleged that seismic testing could harm fish stocks.

Involvement in financially risky LNG

LNG storage

As JERA is investing in projects that are banking on the failure of the Paris agreement and out of line with the IEA Net Zero 2050 scenario, JERA is placing itself at risk of its proposed assets being stranded. JERA’s owners, TEPCO and Chubu, and their investors, will be exposed to these risks through JERA.

While JERA has committed to net zero by 2050, it has no coherent plans (including short and medium term targets) to achieve this goal, despite significant exposure to climate risk resulting from its fossil fuel dependence.

The Taskforce for Climate-related Financial Disclosures firmly established climate risk is financial risk, and recommends that companies establish short and medium term targets to allow investors assess whether companies are managing climate-related risks.

By only investing 1% of its business in renewable energy, JERA is missing out on opportunities to expand into a growth market.

Japan’s new coal power project: Yokosuka

JERA is constructing a new coal-fired power plant (2 x 650 MW) on a site which originally had oil-fired power plants in Yokosuka, Japan. These new units are estimated to emit 7.46 million tonne-CO2/year, more than oil units emitted in the past. Residents continue to oppose the project by filing lawsuits to prevent the start of operations in 2023 and 2024.

JERA is constructing another plant in Taketoyo, Japan (1,070 MW) and plans to start operation in August 2022.

To achieve its target “to stop all inefficient coal-fired power plants by 2030”, JERA should not be constructing or starting to operate new coal-fired power plants.

Yokosuka protest. Photo credit: Kiko Network

Photo credit: Kiko Network

JERA’s dirty investments need to stop so the company can actually help the clean energy transition!

[1] Bidder for Matarbari LNG Terminal, Shareholder of Summit International which is a sponsor of Matarbari Summit LNG Terminals, the Can Na LNG Terminal and Tien Lang 1 Industrial Park Hai Phong Terminal.

[2] Shareholder of Summit International which is a sponsor of Matarbari Summit LNG Power Plant (2,400MW), Bidder on Bac Lieu (3,200MW) and Ca Na 1 (1,500MW), Sponsor of Hai Phong Phase 1 and 2 (4,500MW)