It is important to diversify the type of power sources available without remaining excessively dependent on any one source. While giving full consideration to maintaining a stable and economically viable supply of energy, our aim is to achieve an optimal combination among hydroelectric, thermal, nuclear, and renewable energy. Currently, nuclear power supplies approximately one third of electricity for Japan, with the remainder being derived from a variety of sources. Future goals also include increased use of renewable energy.

The graphic below demonstrates the current (2001) composition ratios for Japan's electric utilities' generating plant capacity (left) and generated electricity (right):

Hydroelectric power is one of the few types of energy in which Japan, a country with scarce resources, can be said to be self-sufficient. Hydroelectric power is advantageous for its highly stable supply and stable generation costs over the long term. The development of hydroelectric power as an energy source once again gained momentum after the oil crises of the 1970s. Although steady development of hydroelectric power plants is desired, Japan has nearly exhausted the sites available for construction of large-scale hydroelectric facilities. Recent development has been on a smaller scale.

While the ratio of thermal and nuclear power generation facilities continues to increase, steady development of large-scale pumped-storage power generation stations for peak demand continues. These pumped-storage generation facilities continue to make up a larger percentage of hydroelectric power generation facilities.

Initially Japan used coal for thermal power generation, followed later by a reliance on oil. Today, a diverse range of fuels including coal, oil and liquefied natural gas (LNG) are used and still fulfill an important role in generating facilities. In particular, recently, in response to global environmental concerns to lower the amount of CO2 emissions, the use of LNG is being encouraged.

In efforts to enhance thermal efficiency further, combined-cycle generating systems using a gas turbine and a steam turbine are being introduced. As a result, gains in thermal efficiency have reached 49%. In the future, thermal efficiency gains will exceed 50% by means of an ultra-efficient gas turbine, while other promising new technologies such as coal gasification in combined power generating systems will continue to be developed.

It is also important to harness the forces of nature in creating new sources of energy. In recent years, solar energy and wind power have attracted a lot attention as clean and natural energy alternatives. And though these types of technologies have yet to realize their full potential, maximum effort should be applied to develop those that are promising as future energy sources.

Electricity companies should also be fully engaged in raising generating efficiency, lowering costs, surmounting the technological hurdles to integration between power generating systems and developing natural energy sources. There are still a host of technical matters to overcome before a richly diverse and stable supply of energy can be achieved; however, while making use of regional characteristics it is important to strive toward this end. To encourage the development and use of alternative energy sources, a "Green Energy System" (see graphic below) was launched from October 2000. This system promotes alternative energy use by offering financial incentives and support to customers who install alternative energy systems.