Japan’s JERA commits $32.4b to green energy, fuels

Japan’s leading power utility, JERA, will invest 5 trillion yen ($32.4 billion) over the next decade in renewable energy, new fuels such as hydrogen and ammonia, and liquefied natural gas (LNG). This announcement made by global CEO Yukio Kani, cited by Reuters on Thursday.

By fiscal year 2035, JERA aims to achieve annual LNG transaction volumes of over 35 million metric tons, 20 gigawatts of renewable energy capacity, and handle 7 million tons of hydrogen and ammonia.

Each sector will receive between 1 trillion and 2 trillion yen in investment. The company, Japan’s top LNG buyer, projects a consolidated net profit of 350 billion yen and EBITDA of 700 billion yen by fiscal 2035.

Emissions are expected to fall by at least 60 per cent from 2013 levels, with a goal of reaching zero emissions by 2050.

For the current fiscal year ending next March, JERA forecasts a net profit of 200 billion yen and EBITDA of 500 billion yen, excluding fuel cost adjustments.

President Hisahide Okuda mentioned that the company is considering options for a capital increase, including current shareholders, third-party allotment, or an initial public offering.

JERA plans to phase out inefficient coal-fired power by fiscal year 2030 and convert all other coal-fired generation to ammonia by the 2040s to eliminate coal entirely.

The company’s strategy statement emphasised that expanding LNG use in Asia is crucial for promoting a low-carbon society.