Japanese electricity prices have soared to all-time highs as a cold snap coincides with tight supplies of liquefied natural gas to raise fears of blackouts in parts of the country.

Power companies begged their customers to leave the heating on but turn off other appliances as the electricity system hit 99 per cent of its maximum capacity in western parts of the country on Tuesday.

The spike in energy prices comes just two months before the tenth anniversary of the Fukushima disaster — the aftermath of which pushed Japan into a radical rethink of its energy mix away from nuclear power — and two months after it announced an ambitious plan to become carbon neutral by 2050.

Intraday prices on the Japan Electric Power Exchange hit a record high of ¥246.8 per kilowatt-hour during the afternoon on Tuesday in the spot market compared with an average of ¥7.6kW/h last January and ¥15.1kW/h in December 2020. Prices for power supplies on Wednesday also reached records, as trading volumes surged to historic levels.

Warnings of potential blackouts come with just three of Japan’s 33 nuclear reactors in operation, leading experts to predict that the current crisis could add an urgency and strength to government efforts to accelerate the restart programme.

A week of unusually severe weather has dumped more than a metre of snow on parts of the country and prompted many households, which are working from home because of Covid-19, to turn up the heating.

“With the continued extreme cold the electricity supply is tight, so while carrying on as normal with the heating on, for example, you could turn off the light in the other room,” said energy minister Hiroshi Kajiyama at a press conference.

With only limited domestic energy supplies, Japan has long been one of the top importers of LNG, relying on cargoes of the super-chilled fuel to meet demand for heating, manufacturing and electricity generation.

But it is facing increased competition as more countries use LNG to cut reliance on heavily polluting coal, while supplies have been tighter than expected this winter. Though most of Japan’s LNG shipments are secured under long-term contracts, the spot market for cargoes — where traders and utilities can source additional shipments — has soared to an all-time high in recent days.

Commodity trader Trafigura bought a cargo of LNG in Asia on Tuesday at a record $39.30 per million British thermal units (mmbtu) for delivery in February, according to price assessment agency S&P Global Platts. Prices of LNG had been as low as $2 per mmbtu last April.

Tightness in LNG markets is also having an effect in Europe, where UK gas prices hit a two-year high on Tuesday of 75 pence per therm, up more than 10 per cent on the day.

“This is evidence of the increased seasonality and volatility resulting from LNG increasingly being used alongside the growth in renewables for power burn to flatten the curve of greenhouse gas emissions,” said Richard Holtum, global head of LNG and gas for Trafigura.

Extreme cold across East Asia plus China’s unofficial ban on imports of Australian coal have brought China into LNG markets as an unusually strong buyer.

Traders said there was also a shortage of tankers available owing to delays at the Panama Canal, the main route from the shale fields near the US Gulf Coast, while other large LNG suppliers such as Qatar and Australia had experienced outages over the winter.

Shigeki Matsumoto, an energy company analyst at Nomura Securities said that while fuel inventories at the various Japanese electric power companies were unknown, it could be assumed that fuel was running short.

“Electric power companies may also have reduced LNG procurement volume to reduce the risks of having excess LNG on hand on the assumption that the pandemic would reduce electric power demand,” said Mr Matsumoto.

Even using its dirtiest plants, the industry warned it may struggle to keep the lights on. “There is a risk of outages at elderly thermal plants, and with the increased demand, there is also a risk of running out of fuel for these plants,” said the Federation of Electric Power Companies, the main industry body.

The industry pointedly noted that generation from solar panels has been very low and is not expected to recover in the coming days.

Tom O’Sullivan, a Tokyo-based consultant and analyst with the publication Japan NRG said: “The government and utilities have not done a good job of reactivating nuclear reactors . . . [they] may now be making the case to the Japanese public of turning these back on.”