Japan: electricity prices rise 3% in the face of record demand

Electricity prices in Japan jumped 3% on July 30, following a 24% rise, in response to increased energy demand caused by an extreme heat wave.
Hausse prix électricité Japon

Partagez:

Electricity prices in Japan have risen significantly due to high demand caused by record-breaking temperatures.
The Japan Electric Power Exchange recorded a 2.8% rise in the 24-hour forward price, reaching 17.24 yen/kWh on July 30, following a 23.8% increase the previous day. This situation is the result of an intense heat wave that has hit the country, leading to massive use of air conditioning and increased energy consumption.
Tokyo Power Grid, one of the main electricity suppliers, reported that integrated reserve capacity in the Tokyo area dropped to 5.97% on July 29, with peak demand forecast between 1pm and 2pm, reaching 94% plant utilization.
This critical situation prompted emergency measures to meet growing demand.

Emergency measures and increased supply

In response to this unprecedented energy demand, JERA has stepped up its electricity supply by 298.9 MW as of 1:30 pm on July 29.
This increase concerns several generating units, including coal- and gas-fired power plants.
In addition, the Organization for Cross-Regional Coordination of Transmission Operators (OCCTO) has asked member utilities to step up their power supply until 9.30pm to maintain grid stability.
Weather forecasts predict high temperatures across Japan, with peaks of 38°C in Tokyo, 37°C in Osaka and Kagoshima, 36°C in Fukuoka and 33°C in Sendai.
These extreme conditions are expected to keep Tokyo’s reserve capacity at critical levels until early August.

Technical incidents and service interruptions

Several technical incidents disrupted electricity supplies.
Tohoku Electric had to shut down its 295 MW gas-fired unit at Higashi Niigata due to a breakdown, and Hirono IGCC Power reduced its coal production by 270 MW because of a cooling problem.
In addition, JERA announced the closure of its 450 MW gas-fired unit at Minami Yokohama for technical reasons. Kansai Electric managed to restart its 486.5 MW gas-fired unit at Himeji Daini after an unscheduled outage on July 15.
Meanwhile, stocks of liquefied natural gas (LNG) held by Japan’s major electric utilities rose by 6.8% to 2.35 million tonnes as of July 21.

Outlook and management of energy crises

The increased demand for electricity due to extreme heat has highlighted the fragility of the Japanese power grid in the face of climatic variations.
Emergency measures and production increases are temporary responses to a structural problem of managing peak demand.
This energy challenge underlines the need for ongoing investment in infrastructure and diversification of energy sources to ensure long-term stability.
Meanwhile, the sector remains under pressure to maintain a reliable supply despite extreme weather conditions.
The current situation could also prompt regulatory reforms and initiatives to strengthen the resilience of the power grid.
OCCTO continues to monitor the situation closely and issue guidelines to ensure a stable electricity supply.
Companies in the sector are called upon to cooperate and optimize their operations to respond effectively to this energy crisis.

The UK's Climate Change Committee is urging the government to quickly reduce electricity costs to facilitate the adoption of heat pumps and electric vehicles, judged too slow to achieve the set climate targets.
The European Commission will extend until the end of 2030 an expanded state-aid framework, allowing capitals to fund low-carbon technologies and nuclear power to preserve competitiveness against China and the United States.
Energy-intensive European industries will be eligible for temporary state aid to mitigate high electricity prices, according to a new regulatory framework proposed by the European Commission under the "Clean Industrial Deal."
Mauritius seeks international investors to swiftly build a floating power plant of around 100 MW, aiming to secure the national energy supply by January 2026 and address current production shortfalls.
Madrid announces immediate energy storage measures while Lisbon secures its electrical grid, responding to the historic outage that affected the entire Iberian Peninsula in late April.
Indonesia has unveiled its new national energy plan, projecting an increase of 69.5 GW in electricity capacity over ten years, largely funded by independent producers, to address rapidly rising domestic demand.
French Minister Agnès Pannier-Runacher condemns the parliamentary moratorium on new renewable energy installations, warning of the potential loss of 150,000 industrial jobs and increased energy dependence on foreign countries.
The European battery regulation, fully effective from August 18, significantly alters industrial requirements related to electric cars and bicycles, imposing strict rules on recycling, supply chains, and transparency for companies.
The European Parliament calls on the Commission to strengthen energy infrastructure and accelerate the implementation of the Clean Industrial Deal to enhance the continent's energy flexibility and security amid increased market volatility.
The European Commission unveils an ambitious plan to modernize electricity grids and introduces the Clean Industrial Deal, mobilizing hundreds of billions of euros to strengthen the continent's industrial and energy autonomy.
In the United States, regulated electric grid operators hold a decisive advantage in connecting new data centres to the grid, now representing 134 GW of projects, according to a Wood Mackenzie report published on June 19.
The French National Assembly approves a specific target of 200 TWh renewable electricity production by 2030 within a legislative text extensively debated about the future national energy mix.
In 2024, US CO₂ emissions remain stable at 5.1bn tonnes, as the Trump administration prepares hydrocarbon-friendly energy policies, raising questions about the future evolution of the American market.
The early publication of France's energy decree triggers strong parliamentary reactions, as the government aims to rapidly secure investments in nuclear and other energy sectors.
Seven weeks after the major Iberian power outage, Spain identifies technical network failures, while the European Investment Bank approves major funding to strengthen the interconnection with France.
The European Union has announced a detailed schedule aiming to definitively halt Russian gas imports by the end of 2027, anticipating internal legal and commercial challenges to overcome.
Madagascar plans the imminent opening of a 105 MW thermal power plant to swiftly stabilise its electricity grid, severely affected in major urban areas, while simultaneously developing renewable energy projects.
India's Central Electricity Regulatory Commission proposes a new financial instrument enabling industrial companies to meet renewable energy targets through virtual contracts, without physical electricity delivery, thus facilitating compliance management.
Minister Marc Ferracci confirms the imminent publication of the energy programming decree, without waiting for the conclusion of parliamentary debates, including a substantial increase in Energy Efficiency Certificates.
At a conference held on June 11, Brussels reaffirmed its goal to reduce energy costs for households and businesses by relying on targeted investments and greater consumer involvement.