LP Gas as Energy to Support
Sustainable Society and Living

Tsuyoshi Ogasawara
Chairman/Japan LP Gas Association
The International LP Gas Seminar 2022
March 1, 2022

About Japan LP Gas Association
ChairmanTsuyoshi Ogasawara (President, Astomos Energy Corporation)

Establishment
1963

MissionSecuring stable supply and safety measures, demand development, environmental
protection, public communications, statistics, policy proposals and other LP gas
related activities

Members(10 Japanese primary distributors, producing / importing LP gas in Japan)
Astomos Energy Corporation
ENEOS GLOBE Corporation
GYXIS Corporation
ITOCHU Corporation
Iwatani Corporation
Japan Gas Energy Corporation
Kygnus LP-Gas Co., Ltd.
National Federation of Agricultural Cooperative Associations
Taiyo Oil Co., Ltd.
Tokyo Gas Co., Ltd.

1

Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary
2

Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary3

LP Gas Demand Trend in Japan LP gas demand in Japan has reached maturity, tend to dwindle slightly.
(KT)

Total

Electric power
ChemicalCity gas

14,22914,151

168

294

2,698

2,572

Residential andcommercial

182
2,762
1,110

964

995

1,054

985

3,048

3,030

3,309

6,297

6,275

FY2015FY2016

AutogasIndustrial

14,687

14,114

13,931

145

81

2,715

2,840

1,127

12,787

2,136

869

1,100
773

1,097
529

3,157

3,140

3,098

6,384

6,101

5,997

5,927

FY2017FY2018FY2019FY2020940

Source: Ministry of Economy, Trade and Industry (METI), Japan LP Gas Association(Note)
FY: Fiscal year (April-March)
CY: Calendar year (January-December)

4

Sales Volume by Segment (yearly comparison from CY2019 to 2021)
 Sales volumes in 2020 dropped due to COVID-19. The volumes in 2021 isalmost same as 2020’s.

(KT)

14,166
13,053 13,013

8,000

Variation (CY2020 → CY2021)

7,355

7,122 7,226

6,000■ Total (all segments)▲0.3 %■ Residential and commercial+1.5 %■ Industry▲3.4 %■ Autogas▲12.7 %■ City gas+11.7 %■ Chemical▲8.0 %

4,000

2,727 2,604

2,516

2,178

2,000

1,319 1,172 1,309
587

0

Total (all segments)
Source: Japan LP Gas Association

1,733 1,594

2019 2020 2021
Residential andcommercial

20192020 2021
Industry

2019

422

369

2020 2021
Autogas20192020 2021
City gas20192020 2021
Chemical5

LP Gas Import Sources by Country: Trend in Japan (Propane and Butane in total)
 In addition to a stable supply from the USA and the Middle East,
Canada’s and Australia’s shares have increased.
Total

10,521

10,535

10,787

10,6999,830

10,238(KT)others

5.9%
3.8%

2.7%
2.1%

1.9%
3.3%

2.3%
6.6%
3.2%

2.0%
9.1%

1.8%
7.2%

8.5%

12.6%

Australia
Canada

31.8%
56.3%

64.1%
73.3%

USA

68.6%

69.5%

58.6%
38.9%

CY2016
Source: Japan LP Gas Association

CY201730.6%

CY2018

14.6%

11.7%

8.9%

CY2019CY2020CY2021

Middle East

6

LP Gas Import Sources by Country: Trend in Japan (Propane and Butane for each) Secure steady and stable supply for both propane and butane,
while their origins differ.
(KT)

Total (Propane)
8,779

8,195

(KT)

Total (Butane)
8,737

1,920

1,635

1,501

others

1.4%
3.9%
3.9%

1.2%
6.4%

1.0%
4.8%

10.3%

14.8%

othersAustralia

6.4%

5.9%

6.9%

Canada

19.0%

22.5%

21.0%
Australia

31.2%
82.5%

37.3%
74.9%

47.2%

73.3%

USA

USA

43.4%

8.2%

7.2%

6.1%

CY2019CY2020CY2021

Source: Japan LP Gas Association

34.2%

24.8%
Middle East

Middle East

CY2019CY2020CY20217

Secure a Stable Supply Japan's share of maritime trade continues to decline, but assurance ofits’ stable imports should be kept.
Efforts towards stable supply:■The expansion of imports from Canada and Australia has further diversified procurement sources.
■Maintain and strengthen relations with gas-producing countries such as the Middle Eastern countries.

Import trend in Asian LPG consumer countries
30,000(KT)[Japan's import share]
CY2010CY202015.2％
20,000

7.4％

CanadaChina's imports

U.S.A.

Middle East

Japan's imports

10,000Main procurement sources and sea routes

India's imports

Australia0

Map Data︓Craft MAP

2010

2012

2014

2016

2018

2020

8

Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary9

Maintain Stockpile System and Supply Chains Establish and maintain supply chains in preparation for disasters.
Specified quantities of LP gas are always
stockpiled in government and private facilities.

St o ck pi l e syst e mClassification

Stockpiled quantity

Remarks

National stockpile

1,394 KT

Equivalent to

Mandatory private stockpile

1,066 KT

Equivalent toRelevant law:
“Oil Stockpiling Act”

50 days imports.
40 days imports.

Fukushima National Stockpile Base andAdjacent Private Base.

(as of the end of December 2021)

Mobile Power Generator Cars are deployed at certain bases for power
recovery when electricity supply is lost.

Mobile Power Generator Cars

Placement

Power connection training

Mobile power Generator Cars
Power receiving equipment

Aomori
Niigata

Nanao
Chiba

Fukushima

A mobile power generator car connected to
power receiving equipment at the base.

Collaboration against an Emergency

KawasakiPower supply from the on-board generator.

Yokkaichi

Build a collaboration system to maintain supply in domestic logistics.

Regional collaboration

Formulation of Companies to cooperate within the specific regions and supply LP gas to theEmergency supply collaboration plan: disaster area in case of emergency.

Securing traffic routes

Nominated as LPG trucks are registered as “Emergency Vehicles” those can run major
Designated Public Institution: highways even road transportations are restricted in an emergency.

Primary distributors mutually support

Conclusion of Mutual support among LP gas companies of the Japan LP Gas Association inmutual assistance agreement: the event of supply insecurity in an emergency.

10

Bolster LP Gas Disaster Resilience Function (1) Promote self-defensive fuel stockpiling at evacuation centers, etc. byintroducing LP Gas Bulk Supply System.

Image of LP Gas Bulk Supply System

Electricity

Installation location
Power generator
Hospitals

Hot water/baths

Municipal offices
andCommunity centers

Nursery facilities
Commercial facilities

LP Gas Bulk Supply System

Water heater
Meals

Schools

AC installation rate of all public elementaryand junior high schools in Japan

Soup kitchen

Aim to improve the installation rate to gyms, where the installation rate is particularly low.
Classification
Ordinary classroom
Gym

Number of rooms

Number of installations

426,414396,567

36,004

3,237

Air conditioning (AC)Installation rate(※)

93.0 %(※)

9.0 %※ AC systems other than LPG fuel GHP are included

Source: Ministry of Education, Culture, Sports, Science and Technology

GHP
・ GHP : Gas Heat Pump
・ AC system that uses gas for heating and cooling11

Bolster LP Gas Disaster Resilience Function (2) LP Gas can contribute to a sustainable society as a distributed energy source.

Benefits of using LP Gas
Distributed energy

×〇
Available even when electricity
and city gas are cut off.

Self-defensive stockpiling

LP Gas with superior
resilience capability <FYR>

No quality deterioration

Necessary days for recovery during
the Great East Japan Earthquake:

LP gas inside the container
Energy can be stored for long periods.
inventories become the stockpile.

LP Gas41 days

City Gas

53 daysElectricity

109 days

Subsidy by Ministry of Economy, Trade and Industry (METI)
Subsidy
Project subsidy for the promotion of self-defensive fuel stockpiling for socially essential infrastructures in case of a disaster.

Budget
FY2017
6.0

billion yen

LP Gas Bulk Supply System Installations(including supplementary budget)

FY2018
6.0

billion yen

FY201931.5

billion yen

FY202041.1

billion yen

FY2021

33.6

billion yen

FY2022

40.4

billion yen

Result(FY2012 and later)

Target(by FY2025)

1,112
units

4,300
units

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Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary
13

LP Gas, efforts to achieve SDGs
 Identify LP Gas industry roles and determine future directions in line with SDGs’ goals.
GOAL 7

Establish a stable supply system and reliable supply chains.

Stable supply
Diversification of procurement sources

GOAL 9Maintain stockpile systems

Create high-value added services utilizing advanced technologies.

Innovation
Technological development of Green LP Gas

GOAL 11

Collaborate with distributed microgrid systems

Bolster disaster-resistance as a distributed energy source.

Resilience
Introduce LP Gas Bulk Supply System

GOAL 13

Introduce GHP (LPG fuel)Develop new measures to achieve a low/de-carbonizing society.

Environmental
measures
Promote switching fuel to LPG

Introduction of LPG fuel ships

14

Introduction of LPG Fuel Ships
 LPG Fuel Ships are useful alternative solutions for IMO’ shipping fuel SOx regulations.
 The need for LPG Fuel Ships is growing to meet IMO's GHG reduction strategy.

Alternative methods to comply with IMO regulation:
Low-sulfur fuel oil

Scrubber

LNG Fuel Ship

LPG Fuel Ship

Number of LPG Fuel Ships ordered

Source: Kawasaki Heavy Industries, LTD.
Environmental characteristics:Almost equivalent to LNG
Infrastructure cost: Superior to LNG

As of December 28, 2021
(total number worldwide)

LPG Fuel Ships
Adopting LPG Fuel in worldwide

Source: BW LPG
・Some existing VLGC’s engines were modified into LPG fuel types.
・New orders are LPG Fuel types.

Japan's first LPG Fuel Ship has begun operation

Source: Astomos Energy
・The world's first newly built with LPG fuel.
・Dual fuel engine (LPG and heavy oil).

LPG Fuel Ship with LPG and ammonia containments

Source: NYK Line・LPG fuel VLGC for LPG and ammonia transportation.
・Scheduled to be completed in 2024.

15

Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary
16

Government’s Position/Policy for Decarbonization and Green LP Gas
 Government’s decision to promote decarbonization. Contribution of LP Gas is needed.

Japan’s GHG emission reduction targets:
Target year

Greenhouse gas reduction target

Remarks

2030

46% reduction compared to FY2013

Apr. 2021 Leaders Summit on Climate

2050

Zero emissions

Oct. 2020 Diet Extraordinary Session

Description and position for LP Gas
Green Growth Strategy for Carbon Neutral in 2050

"Carbon Neutral Declaration"
by Prime Minister Suga (at that time).

(Cabinet approval in June 2021)

In 2050, demand for LP Gas is expected to remain at about 60% of today.
Synthetic production of LP Gas is to be established and commercialization will be realized by 2030.
Aim to switch all LP Gas demand into Green LP Gas by 2050.
The 6th Basic Energy Plan

(Cabinet approval in October 2021)

LP Gas, regarded as the last resolution in case of emergency, is an essential source for energy supply,
not only in normal times but also in emergency situations.
Important to secure a reliable and solid supply system workable even in an emergency.
For the goal of decarbonization, the government will support research and development efforts and thesocial implementation of Bio/Synthetic LP Gas.

17

Establish working force organizations for research and study for Green LP Gas
 Promote research and study toward social implementation of Green LP Gas.
Research workshop for developing Green LP Gas production technologies
PeriodNovember 2020-March 2021 (five times held)

Chair

Professor Sekine, Waseda University

Participants Experts from industry / government / academia
Conclusion by the workshop

Develop technology of carbon-free LP Gas synthesis (Propanation, Butanation).
Need to achieve early social implementation of Green LP Gas.

Institute of Japan Green LP Gas Promotion
Founded

October 18, 2021

Activities

Develop manufacturing technology for social implementation of Green LP Gas

Members
Japan LP Gas Association
5 Executive director companies

Astomos Energy Corporation

ENEOS GLOBE Corporation

GYXIS Corporation

Iwatani Corporation

Japan Gas Energy Corporation
Associate member

Japan LP Gas Association (secretariat)

18

Japan’s LP Gas industry aims to establish Green LP Gas supply structure Product Green LP Gas via synthesizing from CO2 and H2. Establish supply
structure by utilizing existing LP Gas infrastructure.

Synthesis and supply of Green LP Gas:
■Supply Infrastructure utilizing on-site synthesis
Recovering emitted CO2
Renewable energy

Industrial on-site

CO2-free

LP Gas synthesis

Large industrial customers[on-site]Home on-site

Filling station

Bio resources

Residential consumers, etc.
Research for social implementation
Reformation

Thinned wood, combustible waste,etc.

Combustion

CO2

LP Gas synthesis facility LP Gas synthesis reaction (simplified)
・ Propanation
・ Butanation
CO2/CO+H2 → C3H8+H2O■Supply utilizing existing infrastructure

Chemical raw materials

CO2/CO+H2 → C4H10+H2O
Garbage, waste oil, sewage sludge,
livestock excrement, etc.

Islands/depopulated areas(including newly supplied on-site area)

Combustion or
fermentation

Thermal power plant, etc.

■Propane and butane are produced through a catalytic reaction

Electric power

Recovery

CO2

PlantsLP Gas synthesis[large manufacturing facility]■New demand
LPG Fuel Ship

City gas19

Roadmap for Social Implementation of Green LP Gas
 Promote research and demonstration in stages to realize social implementation.
National project

Basic/leading research stage
・Develop elemental technology individually・Demonstration at a bench scale plantSocial implementation

Practical application research・Develop systems those integrate elemental technologies. ・Verification for social implementation for the market
・Scale-up verification of catalysts, etc.
(practical use / economic efficiency).

・Lower cost process by large-scale production→ Realization of Green LP Gas society through large-scale production.

Commercialization plant(10t-100t/day)
Demonstration plant(100kg/day)Business development utilizing existing infrastructure[Target]・Thermal power plants, etc.
・Steelworks
・Waste incinerator plant・Sewage treatment plant・Others

Demonstration test equipment(10kg/day)Construction of pilot plants
Bench scale plant[Target]・CO2 from thermal power plants, etc.
・CO2 from sewage sludge, etc.
・H2 from renewable energy.

・Introduction of high-efficiency LP Gas equipment.
・Level up supply chain efficiency.
・Conversion to LPG Fuel Ship.

2021

2022

2023

LP Gas supply[Industry’s efforts for lower carbonization] 【LP Gas supply and alternation by Green LP Gas】
13 million tons
(other than Green LP Gas)

【Future direction of LP Gas industry】
・Turning over of business entity from primary distributer into manufacture.
・Apply technologies to manufactures outside Japan・Alternating all LP Gas supply with carbon recycled LP Gas (Green LP Gas).

8 million tons

【CO2 reduction】

CO2 reduction

2030-2050 cumulative total : 240 million tons
2050 alone : 24 million tons

Green LP Gas

2030

2040

2050

20

Challenges for Social Implementation of Green LP Gas
 Clarify the role of segments in LP Gas industry to realize Green LP Gas social implementation.

Role of wholesale and retail companies

Role of primary distributors

2020

2030

2040

2050

Development of Green LP Gas synthesis technology
Social implementation of Green LP Gas facilities in Japan

What the LP Gas industry should do during the transition period before social implementation:

Promote the introduction of high-efficiency LP Gas combustion equipment
Promote low carbonization throughout the industry, achieved by the introduction of high-efficiency equipment such as ENE-FARM.

Reduce CO2 emissions by streamlining LP Gas supply chain
For contribution to low carbonization, use LPWA and AI to streamline complicated cylinder deliveries, and to reduce supply costs.

Campaign of LP Gas industry’s efforts for low carbonization to the public
To maintain being “LP Gas chosen by our customers”, quantify low carbonization activities and positively do campaigning to the public.

21

Contents
1. LP Gas Demand and Supply Trends
2. Resilience of the LP Gas Industry
3. Contribution of LP Gas towards SDGs
4. Way to the Green LP Gas Industry
5. Summary22

【Summary】 Future Direction of the LP Gas Industry

Ensure stable supply:
Continue stable imports.
Promote diversification of procurement sources.
Maintain and strengthen good relations with gas-producing countries.

Strengthen resilience measures:
Securing stockpiling systems in case of emergencies.

Demand and expansion of green LP Gas

Securing supply systems for the entire supply chain.
Strengthen disaster prevention capabilities at emergency / evacuation centers.

Actions for Green LP Gas:
Promoting decarbonization as clean energy.
Develop Green LP Gas technology and realize its social implementation.
Efforts throughout whole LP Gas industry segments.

We will persist ”Energy used by people continually ” into the future.
23