Gas Processing & LNG is Produced by Gulf Publishing Holdings LLC

Japan's turn? Power prices hit 9-month highs amid global energy crunch

Electricity prices in Japan have risen to nine-month highs this week as gains in global prices of oil, LNG and coal are starting to feed through to the country's $150 B power market.

Energy prices across the world are hitting records or multi-year highs as economies from Europe to Asia recover from the pandemic but are facing lingering supply chain and other disruptions.

For Japan, which imports all but a tiny amount of its energy needs, higher oil, gas and coal prices are bringing back inflation, with wholesale prices at 13-year highs.

Elevated electricity prices are also reviving memories of last winter when prices hit record highs and Japan's grid nearly failed in the worst energy crisis for the country since the Fukushima disaster.

On Tuesday, spot prices for peak hour delivery of electricity reached 50 yen ($0.44) per kilowatt hour (kWh), just shy of 50.01 yen/kWh, hit the day before, which was the highest since January.

"We are seeing thermal generation being offered to the market at increasingly higher prices to either preserve fuel for winter or get paid for it on an opportunity-cost basis," said one trader.

Like last winter, rising costs for LNG and coal are driving the gains in prices and, with colder temperatures just weeks away, Japan's big utilities have been taking steps to avert a similar crisis.

Inventories of LNG have been topped up and are now above 2.4 million tonnes, around 600,000 tonnes higher than the four-year average for this time of the year, Japan's industry ministry said.

That represents about 12 days supply based on last year's imports of 74.4 million tonnes of LNG.

"Japan learnt its lesson from the blackouts last year and started stockpiling quite early for this winter," said an LNG trader. 

Copyright © 2019. All market data is provided by Barchart Solutions. Futures: at least a 10 minute delay. Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.

                                  CMEGroup                                     Icelogo


Editorial Comment
-Adrienne Blume
The editors of <i>Hydrocarbon Processing</i>, sister publication to Gas Processing & LNG, will release their “HPI Market Data 2022” annual forecast report in October.
Industry Focus: Sensor advances allow pipeline leak detection to take to the skies
-Doug Baer
Sustainability and green initiatives have always been laudable objectives, with mission statements around the world confirming commitments to lower emissions and energy consumption, and increase recyclability, to name a few.
Maintenance and Reliability: Prevent unplanned shutdowns for LNG liquefaction facilities
-Peter Zhang
Although an unplanned shutdown is an integrated part of the operational and safety management system of an operating plant, unplanned shutdowns for a modern LNG liquefaction operating facility often become some of the costliest events for the facility owner.
Regional Focus: Balancing Africa’s world-class LNG projects and the environment
-Shem Oirere
The construction of world-scale natural gas processing plants by three of Africa’s top natural gas producers has attracted scrutiny, despite efforts to commercialize the continent’s hydrocarbon resources and expand energy supply on the continent.

Throughput optimization for pipelines and gas plants

Register Now

Many processes within oil and gas pipelines and processing plants depend on maintaining specific temperatures and pressures at which the process fluids are liquids or gases. In addition, anytime water is a component in the process fluid hydrates can form and plug piping and vessels. Learn how Sensia’s Throughput optimization solution allows operators, and control systems to “see inside” the process in real time to understand where the facility is operating with respect to critical physical constants, including the phase envelope and hydrate temperature. This insight allows for more stable operation, reduced energy expenditure and associated emissions, and greater facility throughput. Case studies will include controlling methanol injection, managing heaters, virtual sensors for sulfur recovery units and more.

April 1, 2021 10:00 AM CDT

Register Now


Please read our Term and Conditions, Cookies Policy, and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2021 Gulf Publishing Holdings LLC.