Australia–Japan energy partnerships for regional security and decarbonisation

Abstract

Australia and Japan stand at a pivotal juncture in their energy futures, with shared imperatives of ensuring energy security, affordability, and sustainability. As key players in the global energy landscape, their collaboration holds the potential to shape the trajectory of the Indo-Pacific’s energy transition, as outlined in Japan’s ‘New Plan for a Free and Open Indo-Pacific’ (FOIP). A central aspect of this collaboration involves securing liquefied natural gas (LNG) supplies from Australia to Japan and the region while simultaneously decarbonising the supply chain through carbon capture and storage (CCS) and advancing hydrogen technologies. Both nations recognise the significance of natural gas in ensuring regional energy security and affordability. Japan, heavily reliant on energy imports, particularly LNG, is motivated by past crises and geopolitical tensions to diversify its energy sources. The partnership between Australia and Japan not only addresses Japan’s energy needs but also influences the power dynamics within the Indo-Pacific. Challenges such as regulatory uncertainties and policy shifts dampen confidence for Japanese investors in Australia’s energy sector. Despite this, CCS technology offers a promising pathway to reduce emissions from natural gas production, with infrastructure facilitating low-emission hydrogen production. Policy coherence and streamlined regulations are essential to fostering innovation and scaling up these technologies. Collaboration on CCS and hydrogen commercialisation presents opportunities for both nations to lead the energy transition. Japan’s ambitious plans to increase its domestic hydrogen supply highlight the potential for joint efforts.