Japan and Korea are two of the most advanced economies in Asia, both having a strong focus on trade with a dependence on energy imports to meet demand. Energy security concerns are spurred by their low energy self-sufficiency rates, Japan at 13% and Korea at 19%. To reduce their reliance on imports and to promote the energy transition, both countries have made significant investment in clean energy, with 92% of total energy investment going to clean energy compared to a global average of 66%. Investment in low-emissions electricity has grown in the last ten years by around 10% from USD 38 billion to USD 42 billion.

2025 is a critical year for energy policy, with the release of new plans to achieve the twin goals of securing stable energy supplies and accelerating the energy transition. Japan’s Seventh Strategic Energy Plan emphasised the expectation of increased electricity demand and the importance of maintaining energy security. Korea’s 11th Basic Plan for Electricity Supply and Demand highlighted the importance of energy security to meet the country’s rapid increase in electricity demand spurred by advanced industries such as artificial intelligence (AI) data centres, semiconductors, and chip and battery manufacturing. Policy initiatives such as Japan’s capacity market operations and Korea’s 20% reserve margin targets, along with public–private co‑operation, will play a critical role in meeting the growth in electricity demand.

In the next decade, promoting renewable power will be crucial for securing energy supplies and increasing domestic energy supply to alleviate pressure on the trade balance. In recent years sustainable bonds for nuclear-related investment have emerged, and government involvement will be essential for large-scale investments.

Furthermore, Japan and Korea will continue prioritising long-term liquified natural gas (LNG) contracts to mitigate short-term price volatility, while accelerating emissions reductions through proper planning and investing in clean energy. Given the similarities in their energy mix, co-operation between the two countries will be beneficial over the coming decade. Joint LNG procurement, combined with the emissions reduction initiatives already underway, are a positive step in this direction.