From theory to reality: Japan's nuclear revival strengthens the case for circular pink hydrogen

This is article 2 of 3 in the "From Theory to Reality" series. Here is article 1.

Japan's nuclear restart gathers pace

Since the completion of the author's thesis submitted to Johns Hopkins University in December 2024, in conformity with the requirements for the degree of Master of Science (Energy Policy and Climate), several significant developments confirm that pink hydrogen based on a partial circular economy approach may have a viable and sustainable future in Japan. First, the current resurgence in Japan's nuclear power sector shows the country's acknowledgement that nuclear power is vital to achieving immediate energy security and carbon neutrality by 2050. Namely, in December 2025, TEPCO (Tokyo Electric Power Company) announced plans to develop data centres and pink hydrogen-producing plants near the world's largest nuclear plant as this Japanese power company diversifies into infrastructure and alternative energy vital for the booming AI sector (Nikkei 2025). The plant's operations have been suspended since the 2011 Fukushima disaster. This strategic shift leads to diversification of TEPCO's business and capitalisation on the surging power demand from the AI sector. This initiative is also expected to invigorate the Niigata region by transforming the site into a hub for next-generation industrial infrastructure and emissions-free energy. TEPCO plans to produce pink hydrogen in areas near the Kashiwazaki-Kariwa nuclear plant, with output expected to begin around 2030. TEPCO restarted the Kashiwazaki-Kariwa nuclear plant (Unit 6) on 21 January 2026 (Dalton 2026). This development is significant since TEPCO's restart 1) signals Japan's acknowledgement that nuclear energy is essential for achieving carbon neutrality by 2050, 2) may potentially accelerate restarts across the rest of the industry, and 3) can stabilise energy costs for Japanese manufacturers and consumers, boosting Japan's Green Transformation (GX) efforts (Nikkei 2025). It is estimated that restarting this reactor might lessen LNG imports via the Strait of Hormuz by nearly 30% (Japan News, 2026). The restart of Hokkaido's Tomari NPP Unit 3 and KEPCO's potential buildout of a new reactor at its existing Mihama site might also lead to more gigawatt output (Japan NRG, 2025).

Furthermore, the recent Middle East conflict resulted in a multi-layered shock to Japan, threatening Prime Minister Sanae Takaichi's real wage gains and fiscal gains. Such a crisis helps accelerate nuclear restart momentum, with 15 reactors online and 3 ready to restart (Govella & Nakano, 2026). In June 2026, Japan's Ministry of Economy, Trade and Industry (METI) also proposed a plan to replace 2 to 5 ageing nuclear reactors by the 2040s and a total of 11 to 14 reactors by the 2050s. This marks the first time numerical replacement targets have been set since the 2011 Fukushima disaster (Satoshi, 2026). Later, Japan's Federation of Electric Power Companies celebrated METI's nuclear replacement roadmap, describing it as vital for supply chain and workforce certainty. In so doing, the country's power industry's public endorsement converted METI's policy proposal into a coordinated government-industry signal, the clearest indication yet that Japan's nuclear replacement programme possesses genuine commercial momentum. Chairman Mori (Kansai Electric President)'s call for new reactor construction beyond replacement is the most important statement to watch (Reuters, 2026).

Based on these accelerating developments, Humber (2026) affirms Japan's economic inevitability of its big nuclear restart by saying, "Still, the question is not whether Japan will restart its reactors, but how much it will pay for pretending it has a choice." Currently, Russia and China (Tabeta et al. 2026) lead the global nuclear power market, accounting for 90% of plants undertaken in 2025. Furthermore, Nobuo Tanaka (2026), the former Executive Director of the International Energy Agency (IEA), reiterates the importance of nuclear power in Japan by contrasting petro-states (those that derive power from the production of exports of fossil fuels) and electro-states (those that seek influence and security through electrification), and advises Japan to take the middle path. He proposes that, in the medium to long term, Japan become an electro-state, while preserving strong ties with the major petro-state, the US, as its military guarantor. Tanaka suggests the development of peaceful and sustainable nuclear power in Japan, especially through the Integral Fast Reactor (IFR) technology, as a central anchor to this strategy. In sum, the big restart and further development of Japan's nuclear sector may spur the construction of adjacent pink hydrogen production plants.

Government funding and policy tailwinds

Second, the increase in Japan's government funding and support for nuclear power and H2, along with related recent scientific innovations, may simultaneously accelerate both the nuclear power sector and pink hydrogen production. For instance, regarding government funding, in January 2026, Japan's cabinet approved a record $780 billion (122.31 trillion yen) budget for FY2026, with large allocations for next-generation energy, green transformation, next-generation energy sources, and supply chain resilience. Under a novel "GX Strategic Regions" programme, the Japanese government allocated $13.4 billion (2.1 trillion yen) over five years to subsidise corporate investment in data centres and factories powered entirely by nuclear or renewable energy. Government funding for next-generation nuclear energy will also increase, with $778 million (122 billion yen) allocated to develop demonstration nuclear reactor projects, such as IFRs. Grants to municipalities hosting such sites will rise by $10.8 million (1.7 billion yen) from the previous year, to $506 million (79.4 billion yen). METI earmarked $231 million (36.3 billion yen) to bridge price gaps for clean H2 and other high-cost clean fuels to promote wider adoption (Kang, 2026).

Other significant developments include the reveal of the results of the Long-Term Decarbonised Power Sources Auction on 13 May 2026. The results showed that, for three years in a row, nuclear power remains the largest winner by capacity, in terms of kW awarded (FY2023: 1,315,707; FY2024: 3,153,107; FY2025: 1,939,123), whereas battery storage projects supply the flexibility (Japan NRG, 2026). Lastly, in June 2026, 62 companies and organisations joined a voluntary "H2 1% Procurement Declaration," an initiative intended to encourage practical application and demand creation. The Japan H2 Association further announced that it would work with METI, ANRE, private-sector partners, and local governments to advance the proposed "Hydrogen Backbone Initiative," which is intended to expand clean hydrogen use in Japan. This initiative specifically follows a policy proposal submitted to Prime Minister Takaichi on 28 May, which called for greater support for H2 deployment and industrial development (March, 2026). Such a significant development in Japan's clean hydrogen sector indicates Japan's attempt to stimulate early-stage consumption through voluntary commitments, enabling it to build the customer base required to support future hydrogen infrastructure developments.

Breakthroughs in storage and electrolysis

Regarding Japan's scientific innovations, in March 2025, Japan's Atomic Energy Agency (JAEA) announced the successful development of a uranium-based storage battery, with potential commercialisation in 2032. This dual-purpose battery is expected not only to stabilise intermittent renewable power but, more importantly, to recycle depleted uranium, a by-product of nuclear fuel production, potentially solving the problem of nuclear waste management through a partial circular economy approach (JAEA 2025). Furthermore, in December 2025, Screen Holdings and Tokyo Gas announced their readiness to commence mass production of "PEXEM," a cost-efficient catalyst-coated membrane that serves as a main component of PEM water electrolysers (Screen 2025). PEXEM is ready to reduce costs by minimising the use of rare metals. In the same month, researchers, including RIKEN, announced a novel "self-repairing" manganese catalyst that replaces iridium, addressing a 55,000-fold difference in material price. The research group discovered a mechanism in which dissolved ions regenerate on the catalyst surface, enabling more than 2000 hours of stable operation even under heavy loads. Commercialisation is targeted for 2030–2040, paving the way for mass adoption of PEM electrolysers (Nikkei 2026). In essence, significant government support for the nuclear and hydrogen sectors and related scientific discoveries may jump-start pink hydrogen production in Japan, especially if it is based on a partial circular economy approach.

Wastewater as the circular-economy link

Lastly, the recent expansion and innovation in Japan's wastewater management sector offer hope for applying the author's concept of nexus-integrated policies for Japan (Anderson 2023), through the co-location of Japan's pink hydrogen hubs with unused tertiary effluents from future modern wastewater treatment plants as a partial circular economy approach. Namely, Japan's water and wastewater treatment market is expected to grow from nearly $9.8 billion (2024) to $15.75 billion (2033), with a compound annual growth rate (CAGR) of ~5.3%, due to increasing investment in infrastructure, the adoption of advanced water treatment technologies, and strict environmental regulations (At Press 2025a). Ancillary markets for wastewater systems (such as diffuser membranes) also show significant growth through 2035 (FMI 2025).

Moreover, innovation in wastewater utilisation continues through new technologies and industry advances. For example, the Japan Sewage Works Agency (JS) continues to innovate and promote advanced wastewater technologies through its New Tech Implementation Program (started in 2011) and the B-DASH (Breakthrough by Dynamic Approach in Sewage High Technology) Project (JSWA 2024). The Sewage Works Exhibition '25 in Osaka showcased the latest lifecycle solution and new treatment approaches in Japan's sewage tech (JSWA 2025). Further, at the company level, WEF Technology Development Company reported that its "W-Gaia" system was successful during 2023–2025 in generating active oxygen from air to break down difficult-to-decompose contaminants (resistant bacteria, organics, oils). The successful pilot project by Tenchijin and AISIN in Iwata City, Shizuoka Prefecture, that integrates satellite monitoring and AI with water infrastructure to prevent and predict leaks (At Press 2025b) demonstrates the trend towards more sophisticated, data-driven, AI-assisted wastewater management. In sum, Japan's strong expansion of the wastewater market and investment growth, along with government-backed sewage tech adoption programmes and innovation in advanced treatment, provide confidence in the potential development of new modern wastewater treatment plants near Japan's pink hydrogen hubs.

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