With Nuclear Reactors on Ice, Japan Fires up Coal and Gas

An estimated $7 billion spending spree will bring 14 new coal- and gas-fired plants online by next year

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Tomohiro Ohsumi / Bloomberg / Getty Images

Coal is stockpiled inside a storage yard at the Joban Joint Power Co. coal-fired power station in Iwaki City, Fukushima Prefecture, Japan, on Wednesday, Aug. 1, 2012.

Pinched between a moribund nuclear sector and an overpriced oil sector, Japan’s power companies are plowing an estimated $7 billion into coal and gas. Reuters reports that Japan’s energy companies will have 12 new gas plants and two coal plants online by next year, adding a combined 6.8 gigawatts of capacity to the energy-starved nation.

The Fukushima meltdown in 2011 prompted a nation-wide shutdown of nuclear reactors, forcing Japan to make a sudden switch to costly oil imports. Analysts predict a shift to coal and gas will alleviate industries suffering from soaring energy bills, which have dented their international sales. Japan’s trade deficit hit a record high of 4.8 trillion yen in the first half of 2013.