Utilities shift to cheaper coal amid high LNG prices, reducing gas-fired generation by 16% year-on-year.
Japan’s gas-fired power generation fell to 17.3 terawatt-hours in June, a 16% decline from the same month last year. The drop reflects a broader shift toward coal as utilities seek lower-cost alternatives amid elevated liquefied natural gas prices.
Coal-fired generation increased by 4.6% during the same period, according to data from the country’s nine largest power utilities. The trend has accelerated since geopolitical tensions in the Middle East disrupted energy markets, pushing LNG costs higher.
No immediate market reaction was reported, but the shift may weigh on LNG demand in Asia’s largest importer.