Company Information
Name: The Electric Power Development Co Ltd (J-POWER)
Market: Japan
Installed capacity (as of 2023):¹ 16.1 GW (Thermal), 9.9 GW (Non-thermal)
Climate-related targets committed:
Long-term: Net zero emissions by 2050
Medium-term:
– 46% CO₂ emission (-22.5 million tons) reduction from FY2013 levels by 2030
– Increase 4 billion kWh per year of renewable power generation in Japan by 2030 (compared to FY2022)
– 9.2 million tons or more CO₂ reduction from FY2013 levels by 2025
Engagement Updates
The J-POWER engagement group continues to discuss its decarbonization strategy with the company, particularly on the phaseout of its domestic coal fired power plants and the feasibility of decarbonization technologies. In addition, they discussed the need to consider just transition aspects in the coal phaseout plan, the physical resilience of coal assets and the company’s policy engagement with the Japanese Government.
It is positive to see that the company has incorporated investor expectations from past engagements. In an update of its medium-term management plan² published in May 2024, J-POWER announced it will close up to five low-efficient coal fired power plants units by 2030³ as part of its target to reduce 46% of CO₂ emissions from the 2013 level. Several media outlets, including Reuters,⁴ covered the news. This helped start momentum of coal phaseout discussions in the Japanese market. The company’s medium-term plan also provided enhanced disclosure on their strategic investment allocation plan over the 2024–2026 period and contained a new renewables target that extends until 2030.
In terms of the company’s climate governance, J-POWER introduced five non-financial evaluation indicators for performance-linked executive remuneration in 2023—these cover material issues such as responses to climate change and engagement with local communities. The percentage of performance-linked remuneration was raised from 10% to 20%, and a variable compensation component (performance-linked and stock-based compensation) was applied.
J-POWER’s roadmap to achieving net zero emission by 2050—Blue Mission 2050—comprises three pillars: (1) expanding CO₂ -free power sources through renewable energy and nuclear power, (2) achieving zero emission from power sources by converting coal-fired thermal power to coal gasification technology with carbon capture, utilization and storage (CCUS) or carbon recycling and producing CO₂ -free hydrogen, and (3) power network enhancement. In line with the Blue Mission 2050 roadmap, J-POWER is working toward constructing and opening the Ohma Nuclear Power Plant, increasing its hydroelectric power capacity, completing the New Sakuma Frequency Converter Station, and investing more in battery storage.
Next year, the engagement group will continue working with the company on coal phaseout discussions. This will include overseas operations, adopting SBTi-aligned emission reduction targets, and discussing just transition considerations in its overall decarbonization strategy.