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Japan Mulls Asking Public to Help Curb Energy Use Amid War in Iran

Yomiuri Shimbun file photo
Economy, Trade and Industry Minister Ryosei Akazawa

The government is weighing various options to curb energy use due to the war in Iran, including asking the public to cut back on their use of petroleum products.

The Economy, Trade and Industry Minister Ryosei Akazawa said that all possible measures, such as demand-side initiatives, are on the table while avoiding seriously impacting the economy.

At a press conference after a Cabinet meeting on Friday, Akazawa said that while Japan has secured enough oil to meet overall needs through the release of reserves, some regions are facing supply imbalances and logistical bottlenecks.

Based on international price trends and supply conditions, the minister said the government is prepared to explore various measures, such as formal requests to reduce energy use.

To refer to IEA measures

Japan has enough oil reserves to last about eight months of essential domestic consumption. However, the reserves will continue to decline if the crisis in Iran remains unresolved for an extended period.

Speaking at a plenary session of the House of Representatives on Thursday, Prime Minister Sanae Takaichi acknowledged that energy-saving measures may be needed. She said the government intends to respond flexibly to the situation, without ruling out any options.

The government plans to look at the energy-saving recommendations that were issued by the International Energy Agency in March, with a senior official at the economy ministry saying the government will “refer to the IEA’s restraint measures” in their deliberations.

Potential measures are expected to center on reducing fuel consumption for transportation and shipping. Such measures could include encouraging people to work from home or take public transportation. Reducing business trips to cut back on the amount of fuel used by the aviation industry is another option.

While Japan has significantly improved its energy efficiency since the first oil crisis in 1973, many experts believe households will be able to reduce their level of consumption further.

In a comparison between fiscal 1973 and fiscal 2023, energy consumption has remained nearly unchanged even though the size of the economy has more than doubled.

Over this period, energy use in the industrial sector — which makes up nearly half the total — fell by about 30%, whereas consumption rose by 70% for households and 50% in the transportation sector.

In 1974, the government issued an order in 1974 to restrict power use, requiring large factories and other major users to cut their consumption by 15%, to conserve fuel for oil-fired power plants, which supplied nearly 70% of the nation’s electricity at the time,.

Nomura Research Institute Ltd.’s Takahide Kiuchi estimates that a 15% reduction in power consumption sustained over three and a half months — as was the case in 1974 — would shave 0.94% off the nation’s real annual gross domestic product.

“A sudden imposition of tough restrictions would lead to significant economic fallout,” Kiuchi said. “It is necessary to handle the transition gradually.”