Nagoya, Japan – If Japan’s energy giant JERA Co. Inc. wants to make one truth unmistakably clear, it’s that the energy transition isn’t some one-size-fits-all crusade. Other than the spotlight-grabbing renewables, the hard reality is that repurposing existing coal fleets through ammonia substitution can be an equally powerful path to net zero.

The company is racing toward a 2050 future with net zero CO₂ emissions across its domestic turf and global footprint—an ambition it expects its partners worldwide to match stride-for-stride as they push together for a genuinely sustainable energy future.

While accelerating its renewable energy investments across global markets, the Japanese firm is simultaneously doubling down on innovation to cut carbon from the sprawling coal fleets that still dominate Japan and key markets like the Philippines. Its flagship partnership with Aboitiz Power could soon prove that deep emissions cuts don’t always require a total revolution in the power mix.

During a site visit by Philippine journalists, JERA showcased its mastery in executing a 20 percent ammonia substitution on the 1.0-gigawatt Unit 4 pilot at the 4,100-megawatt Hekinan plant. Sited within Aichi prefecture, which is Japan’s largest coal-fired power station, the project illustrates that even the most colossal thermal facilities can be steered toward a cleaner future.

At a media briefing, facility executives revealed that the 20 percent ammonia substitution tests had already been wrapped up, and construction works are underway; the facility will soon be advancing to the commercial operation phase.

“The fuel ammonia substitution test of Unit 4 was successfully completed at the end of June; and the expansion of storage facilities for commercial operation started in July,” the company stated.

At Hekinan, ammonia co-firing is targeted to be gradually scaled up—from 10,000 tons a year for denitration or removal of nitrogen compounds to 30,000 tons annually in the 20 percent substitution trial at Unit 4. Ultimately ramping up to 500,000 tons per year once it reaches commercial stream.

“We conducted the world’s first test of 20 percent ammonia substitution at a large-scale commercial coal-fired power plant. Results were positive, with the level of nitrogen oxide (NOx) no higher than before ammonia substitution,” JERA emphasized.

In fact, the company has already exceeded its initial target, reaching a 28 percent ammonia substitution rate (0.6 GW), effectively exhibiting that operations can safely surpass 20 percent. That could pave the way for a longer-term investment blueprint toward 50 percent co-firing and even potentially 100 percent ammonia substitution as commercial conditions would warrant.

And judging by the pace of installation of burners, tanks, and piping at the demonstration plant, along with the steady march of progress, large-scale ammonia substitution at Hekinan Unit 4 is now clearly running nearly a year ahead of schedule.

“Given the success of the demonstration testing, we are accelerating construction and supply chain development aimed at commercial operation,” JERA noted.

The real advantage of this fleet repurposing strategy lies in building fuel ammonia facilities without halting operations. Therefore, the asset still delivers uninterrupted power supply while the shift to a cleaner future is being pursued.

The company’s demonstration test similarly confirmed that “no revision to the existing coal procurement portfolio is necessary,” based on the evaluation of operational performance and environmental impact.

JERA Asia CEO Izumi Kai acknowledged that the Hekinan ammonia substitution experiment would have been unthinkable without strong Japanese government support—fundamentally, the New Energy and Industrial Technology Development Organization (NEDO) financial backing during the project’s R&D phase.

Although the company hasn’t disclosed development costs or the effect on Japanese consumers, Mr. Kai stressed that a targeted subsidy or regulatory framework could cushion tariff hikes, making ammonia fuel substitution in coal plants commercially feasible.

The JERA CEO admitted the ammonia substitution venture at this point is ‘very costly,’ but qualified that repurposing existing facilities could turn economically viable with government backing—whether through subsidies or a rate-regulation framework.

He highlighted that government support for Hekinan’s capital expenditure (capex) shields ratepayers from tariff impacts, although he qualified that developers must strategically secure funding and manage fuel expenses, especially if full pass-through to ratepayers becomes inevitable.

Mr. Kai thus asserted that replicating this fuel substitution in thermal-heavy markets like the Philippines will require a robust government–private sector dialogue in designing the right regulatory framework, incentives, or subsidies—an effort he classified as ‘absolutely critical.’

Beyond these hurdles, JERA is also strategically managing ammonia procurement from various sources globally to insulate itself from critical risks, including US tariffs and the relentless shocks of geopolitical upheavals.

Further, the Japanese company is joining forces with top global players to scale up clean hydrogen and ammonia production, targeting not only domestic projects but also to fuel prospective ventures across its global partnerships.

On the transportation front, JERA is likewise reinforcing collaborations with NYK and MOL (Mitsui O.S.K. Lines) shipping firms to develop high-capacity ammonia carriers as well as forge solid logistics solutions for safe and efficient fuel delivery.

Looking ahead, Mr. Kai is envisioning a possible fusion of decarbonization technologies—from hydrogen to hybrid approaches combining ammonia substitution with carbon capture and storage (CCS) or carbon capture utilization and storage (CCUS)—while leaving open the possibility that, with future breakthroughs, full-scale 100% ammonia substitution could emerge as a standalone solution.

“To me that could be and/or; and I also believe that will be ‘and’ because ammonia substitution is basically using existing facilities; and it may take few decades to increase ammonia combustion to 50% or 100%. But we may see technological advancement with 100% ammonia combustion boiler, etc. If we imagine after 20 years, if there would be better technologies available, we may consider to replace with 100% ammonia combustion machines, then of course, no more CCS,” he expounded.

Building on its breakthroughs at the Hekinan power facility, JERA and its Philippine partner, Aboitiz Power, are similarly pushing the envelope by exploring prospective ammonia fuel substitution at the 430 MW Pagbilao-3 coal plant in Quezon province.

Somehow, the company affirmed that ammonia substitution is feasible at the Pagbilao facility. But mirroring JERA’s experience in Japan, success hinges on strong and viable government policies.

“We have conducted feasibility study for this potential substitution ammonia for coal at Pagbilao-3; and we have conducted other feasibility studies in other Southeast Asian countries as well – and of course, it’s not so easy from the economic perspective, therefore, some subsidy arrangement is needed,” Mr. Kai said.

He added that once the opportunities and risks of a properly scaled ammonia rollout at Pagbilao-3 are fully mapped, the project and its shareholders will be poised to advance initiatives, as underpinned by a bankable investment regime.

“Once we have deep understanding of the opportunities and risks, then at the appropriate timing, Pagbilao-3 shareholders can be ready for such option,” he conveyed.

Clearly, the pivotal decision for scaling this alternative across the Philippine power industry now rests with policymakers and regulators—either through a definitive policy move by the Department of Energy (DOE) or via tariff-setting by the Energy Regulatory Commission (ERC) to make this emissions-reduction track commercially sustainable.

“That all depends on discussion – of course, government will discuss internally. However, our approach is also to try to communicate as early as possible the realities …for the government to consider such in the framework,” he pointed out.

Somehow, Philippine energy officials have long argued that full coal phaseout may be unrealistic, stressing that reliable baseload power is still essential to underpin the country’s projected economic growth in the years ahead.

Yet, policymakers are acutely aware also of the nation’s duty to abate climate change risks for future generations, which is why alternative decarbonization roadmaps—including repurposing the country’s coal-heavy power fleets—had always been high on the agenda.

At this stage though, energy policy framers are on a tightrope walk on greening existing thermal assets while keeping the lights on and the economy humming. They are also fully attuned to the reality that a climate-friendly power mix is worthless if consumers would be left wrestling with rolling blackouts.