Australia’s gas industry hangs by a Japanese thread

Without funding from Japan, many of Australia’s gas projects wouldn’t have gone ahead. Massive public loans from Japanese taxpayers are propping up Australia’s now-enormous fossil gas industry. Japan is also becoming a major gas trader and today exports more gas to other countries than it imports from Australia.

Even as the world rapidly shifts to a clean energy future, Japan is emerging as a fossil fuel holdout. The world’s fourth-biggest economy, Japan has long been dependent on foreign sources of fossil fuels. Even as China has filled its deserts with solar farms, Japan has focused on gas.

These projects make it harder for Australia to achieve its climate goals and undermine the shift to clean energy industries. New gas projects threaten to divert workforce and investment away from these export industries.

But this can change. As Australia spends big on green power, green manufacturing and green exports – as part of the government’s Future Made in Australia policies – the enduring partnership between the two nations could go green.

Developing new clean energy partnerships with energy-hungry Asian nations such as Japan, China and South Korea could boost climate cooperation, grow new clean energy exports and promote investment.

Japanese funding, Australian gas

Worried about energy security, Japan is subsidizing new offshore gas projects in Australia which probably wouldn’t go ahead otherwise.

Japan is the world’s largest provider of international public finance for gas production. While other nations – including Australia – have pledged to end international finance for fossil fuels, Japan has kept the money flowing.

For example, last month, the Japan Bank for International Cooperation provided Australia’s biggest gas