Climate change, energy, and Japan’s GX & fusion startups, part 1: History

Climate change leads to rising sea-levels, changing weather patterns, and the advance of desertification.

The Intergovernmental Panel on Climate Change (IPCC) stated in its Sixth Assessment Report (2021) that the fact climate change is caused by human activity is “unequivocal.”

In Japan, average temperatures have been rising faster than the global average. This trend is especially pronounced in major metropolitan areas, where the heat island effect accelerates warming.

So, what initiatives is Japan pursuing toward decarbonization? This article introduces Japan’s modern energy history while also highlighting the latest GX startups and nuclear fusion startups.

Humanity and Energy

In the mid-18th century, James Watt’s improvements to the steam engine made coal a driving force, sparking the Industrial Revolution in Britain. By the late 19th century, oil had become widespread. Natural gas was embraced as a cleaner fossil fuel in the mid-20th century.

Around this time, nuclear power became practical, and large-scale electricity generation from uranium fission was established around the world. The oil shocks of the 1970s prompted energy conservation and diversification. From the 1990s onward, renewable sources such as wind and solar grew rapidly. Of course, humanity has a much longer history with natural energy—windmills, waterwheels, and sailing ships long predated industrial use.

Today, as the fight against global warming intensifies, decarbonization has become a shared international priority, and nuclear fusion is attracting attention as a potential next-generation stable power source.

The beginning of Japan's modern energy history

To trace Japan’s modern energy history, we want to return to the Meiji era (1868–1912). With the end of centuries of isolation ( Sakoku 鎖国 ) and the influx of Western technologies, Japan’s modern energy industry began to take shape.

Coal was the earliest major energy source used in Japan. Initially, it was consumed domestically as a substitute for firewood. The turning point came in the late Edo era, when foreign steamships began calling at Japanese ports and coal demand surged. Over time, coal became vital for powering ships and trains.

By the Taishō era (1912–1926), with the opening of Tokyo Station and the launch of taxi services, urban transportation networks expanded rapidly. Before World War II, coal was positioned as a critical resource for industrial growth and warfare, but overexploitation during the war halved production capacity by its end.

Meanwhile, oil, electricity, and gas were used in Japan primarily as lighting sources. Tokyo’s Ginza district and Yokohama’s Bashamichi were the sites of Japan’s first gas lamps and electric streetlights.

By the early 1900s, gas use shifted toward heating, and appliances like gas stoves became common in urban areas. Gas also began to be used as an industrial energy source.

Electricity and the War Economy

From the Sino-Japanese and Russo-Japanese Wars to the two World Wars, conflict defined the era, and wartime demand accelerated industrialization. Electricity demand grew sharply, leading to shortages. Tokyo Electric Light Company (now TEPCO) responded by building large-scale hydropower plants to meet Tokyo’s rising energy needs. Hydropower intensified competition in an industry previously dominated by thermal generation. As wartime controls tightened, the Electricity Control Law of 1938 placed the sector under state management.

Oil, initially imported from the West, became widespread in the form of kerosene lamps. Demand surged, and given Japan’s heavy reliance on U.S. imports, the government promoted domestic oil field development.

By the Taishō era, oil had shifted from a lighting fuel to a driving force in industry. On the eve of the Pacific War, Japan relied on imports for over 90% of its oil.

In 1941, after the U.S., U.K., and Netherlands imposed a full oil embargo, Japan faced a critical resource crisis. Failed negotiations with the U.S. later that year pushed Japanese leaders to launch war in the Pacific.

In the next article in this series, we will trace Japan’s energy history from the postwar period to the present day, and look how past experiences inform the nation’s efforts to achieve carbon neutrality in the 21st century.

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