In the past 12 years, Japan’s renewable energy sector has grown rapidly, driven by policy changes after the Fukushima incident and strong incentives. Renewables now account for about 25% of Japan’s energy mix, with over 75 GW of installed capacity.
December saw the outline for the 7th Strategic Energy Plan, which outlines an increase in renewable capacity to 40-50% of the energy mix by 2040. Nuclear power is also slated to increase, certainly through reactor restarts, though also encouraging replacement reactors on existing sites and potential new buildout.
As opposed to the previous plan released in 2021, which was prior to key global events such as Russia’s invasion of Ukraine and the Israel-Hamas conflicts, as well as the rapid rise of energy hungry AI and data centers, the current plan predicts an increase in overall energy consumption. This has led to a sudden embrace of nuclear power.
Last October, Shigeru Ishiba became Japan’s new Prime Minister. A longtime advocate for renewable energy and decarbonization, in his first speech he mentioned that energy demand will rise due to AI and digitalization, even before the new Strategic Energy Plan is released.
Despite Donald Trump’s re-election to office in the U.S., and close U.S.-Japan ties, the key factors of increasing energy demand and importance on energy security for Japan point in the direction of a growing, further diversified and distributed energy market for Japan. Let’s look at our outlook for the job market in key sectors for 2025.