Two months after Russia's military invasion of Ukraine, natural gas prices are skyrocketing worldwide.

On the 22nd, the Ministry of Economy, Trade and Industry held a meeting of experts to discuss energy procurement strategies.

Concerns about supply shortages are widespread due to the military invasion by Russia, one of the world's leading producers of natural gas.



The spot price of LNG = liquefied natural gas procured by Japan in Asia rose to about 14 times the same period last year on the 7th of last month, a record high.



This week as well, it has been around three times the level of the same period last year.

Under these circumstances, the Ministry of Economy, Trade and Industry held a meeting of experts on the 22nd to discuss energy procurement strategies.



Much of LNG is used as fuel for power plants, and national officials explained that if prices continue to rise and procurement becomes difficult, the supply and demand of electricity next winter will be serious.



Furthermore, he pointed out that if European countries that receive natural gas supply from Russia by pipeline increase the procurement of LNG from the United States instead, competition will intensify and it may become more difficult for Japan to secure LNG. Did.



Experts say, "Even in decarbonization, it is important to promote resource development with the support of the government." "LNG thermal power alone is not enough, and we should increase supply capacity including expansion of renewable energy and operation of nuclear power generation. There were a lot of opinions such as "."

Inundation of new applications for new electric power

The price of natural gas has soared due to Russia's military invasion of Ukraine, and electricity prices have remained high. Now, the business of "new electricity" is also affected.



Of these, the new electric power "Remixpoint", which sells electricity to more than 20,000 households nationwide except Okinawa, has been flooded with new applications since last month.



This is because other new electric power companies have withdrawn from the retail business and there is a growing movement to switch contracts.



However, the company stopped accepting new applications from the 7th of this month because it is uncertain that it will be able to secure profits while the cost of procuring electricity is soaring due to the military invasion of Ukraine by Russia.



This company procures electricity by individually contracting with a power generation company.



The amount is limited and it is necessary to procure and supply electricity from the wholesale market of electricity to new users, but it is said that if electricity is supplied to new customers due to soaring prices, it will be in the red. increase.

Yuji Nakagome, General Manager of the Remixpoint Energy Division, said, "Our mission is to deliver electricity to customers who want it in a stable manner, and I'm really disappointed at the current situation where we can't do that. Will not accept new applications. "



According to Teikoku Databank, a private credit bureau, there are 706 "new power companies" registered in the country as of April last year.

Of these, 14 companies went bankrupt last year in 2021, the highest number since the full liberalization of electricity retailing in 2016.



Soaring electricity prices are behind the increasing number of bankruptcies and withdrawals from businesses due to new electricity.



Many new electricity sources that do not have a power plant source electricity mainly from the wholesale electricity market, but the price of LNG = liquefied natural gas, which is the main fuel for thermal power generation, soars due to the impact of Russia's military invasion of Ukraine. However, the electricity supplied to the wholesale market is also high.



Prices traded last month on the wholesale electricity market averaged around 26 yen per kilowatt hour, more than four times the same month last year.

Domestic energy companies strengthen the sense of crisis

Due to Russia's military invasion of Ukraine, the demand for LNG = liquefied natural gas is increasing, and domestic energy companies are becoming more vulnerable.



INPEX, a major resource development company, handles about 10% of Japan's LNG imports and procures LNG from gas fields in Australia and Indonesia, which have interests.



And, if necessary, we buy what is not enough for the demand from the market called "spot" where we buy each time.



However, after Russia's military invasion of Ukraine, many of the LNG produced in the United States are heading to Europe, which is trying to de-Russia, and the amount of LNG in Asia is decreasing.



Under these circumstances, the company holds a weekly meeting on spot market trends, and representatives from Singapore and Australia, where transactions are based, are discussing countermeasures.



What the company is also concerned about is the trend in China, where LNG imports are high in the world.



Currently, demand is declining due to the influence of the new coronavirus, but the company will strive to collect information so that it can stably secure LNG for Japan even if China significantly increases LNG procurement in the future. I am doing it.

Motota Okamoto, General Manager of the Global Energy Sales Headquarters, said, "LNG production cannot be increased immediately, and for the time being it is inevitable that we will compete for a limited number of pies. In addition to development, we will strengthen procurement to meet demand. I want to do it. "

Expert "Needs a comprehensive inspection of energy policy"

Energy expert Noriaki Oba of the Post Oil Strategy Institute said, "It's comparable to the oil crisis. Countries that originally bought natural gas from Russia, such as Europe, are trying to stop buying it." It's an unprecedented crisis in the past. "



"It is always important to diversify the risks of energy sources, but in Japan, in order to diversify energy sources that were too biased toward the Middle East, we were increasing procurement from Russia. Russia is in this situation. Next, it's a very annoying question of where to go. "



On top of that, "I think that energy security collateral itself will be the subject of a review. It is necessary to carry out a comprehensive inspection of energy policy, including cooperation in energy-saving technologies to reduce gas demand in Europe and the positioning of nuclear power. I was talking.