The Emerging U.S.-Japan Energy Alliance and Its Implications for China

Abstract

Since the Tohoku earthquake and Fukushima nuclear accident in March 2011, Japan’s energy policy has undergone great changes, resulting in closer energy cooperation with the United States. To serve its own national interests, the United States also began to emphasize the significance of energy cooperation under the U.S.-Japan alliance. Consequently, both countries have made strategic breakthroughs in terms of energy politics, energy economics and energy security, and a U.S.-Japan energy alliance is now taking shape. The progress of U.S.-Japan energy cooperation, on one hand, will help reduce the cost of China’s natural gas import and create favorable conditions for China to promote domestic reforms in the energy sector. On the other hand, it will also present new challenges to China’s geopolitical environment and its global role. While the United States continues to increase its export of liquefied natural gas (LNG) to Asian markets, China should make full use of the opportunity to speed up the development of its own shale gas resources, optimize its energy consumption structure, promote domestic energy reforms, and diversify its energy import sources. In the meantime, it should try to work with the United States and Japan to foster an all-inclusive, long-term mechanism for energy cooperation among all countries in the Asia-Pacific.