Tokyo pushes alternative energy for Japan

www.energycurrent.com
7/20/2009

TOKYO: Government efforts to encourage the use of new energy sources, including solar and wind energy, have been gathering momentum mainly due to new incentives and subsidies. These alternative energy sources produce little carbon dioxide, while helping create new businesses at low cost and without importing natural resources.

The central government has accelerated the development of all-domestic new energy sources by introducing new goals and subsidy systems in rapid succession. The government aims to double the nation's electricity-generating capacity by 2020, using new energy sources including biomass, small-scale hydroelectric power generation and geothermal power, and to increase capacity three times or more by 2030.

The government's major focus is on solar energy. Advocating the "world's best sunlight plan," with the aim of increasing solar panel-derived electricity generation by 20 times by 2020 compared to 2005 levels, the government has introduced a variety of support measures.

About 45,000 households have applied for installation subsidies to install solar panels since the government introduced them in January. The government's installation subsidy per household ranges from 210,000 yen to 250,000 yen. Each local government also offers its own subsidies that can be used in combination with the national subsidies.

The government likely will introduce a plan to double the purchase price electric power companies must pay for surplus electricity generated by household solar panels from the present 24 yen per kW-hour to 48 yen during the first 10 years of installation. The new system will likely start this fiscal year. As solar energy generation involves a range of industries, including makers of housing, batteries and related materials, as well as small private housing contractors, these moves also are expected to be effective in stimulating the economy.

Meanwhile, the Economy, Trade and Industry Ministry has introduced a target of tripling or quadrupling the nation's geothermal power generation capacity from the current 530,000 kWs by 2030. Geothermal power is generated by turbines using steam extracted from underground. One of its benefits is stability, as it is unaffected by weather compared with other new energy sources.

Japan is blessed with the world's third-largest geothermal resource reserves, following Indonesia and the United States. Japan's geothermal energy reserves total an estimated 200 million kWs, the equivalent of 15 to 20 large nuclear energy plants. However, no new geothermal power station has been built in the nation, largely due to high construction costs and restrictions on the selection of locations usable for such facilities.

The ministry plans to raise its subsidy rate for constructing geothermal power stations from the present 20% to 33% as early as fiscal 2010. The ministry likely will consider expanding the scope for geothermal generation under the Renewable Portfolio Standard Law,which obligates power companies to use new energy sources. However, when pumping hot water from the ground, it is necessary to prioritize environmental protection as about 80% of geothermal resources are located within national parks.

The push for alternative energy sources is not limited to the public sector. Private power and trading companies are planning to establish mega-solar energy systems. There are also moves aimed at developing "smart grid" digital technology, which is necessary for a steady supply of solar energy.

Last month, the government announced its midterm greenhouse gas emission target of reducing emissions by 15% from 2005 levels by 2020. At the Group of Eight leaders' meeting last week in L'Aquila, Italy, they agreed to long-term goals of reducing global greenhouse gas emissions by at least 50% by 2050, with industrialized nations cutting theirs by 80% or more. To achieve these goals, it will be necessary to expand the adoption of new energy sources and not just raise the operational rates of nuclear energy plants in the electricity-generating sector, in which greenhouse gas emissions are relatively high.