First Proposal on Energy Policy (Outline)

July 14, 2011
Keidanren

1. Fundamental Concepts(1) Ongoing commitment toward early restoration from the accident at the Fukushima Daiichi Nuclear Power Station is of utmost importance.
(2) As factors including high corporate tax rates and inappropriate measures to fight climate change dull Japan’s competitive advantage as abusiness location, in order to avert further hollowing-out of the economy the government should promptly set a course ensuring stableelectricity supply for the next five years or so.
(3) Looking to the medium- to long-term (2020–2030), the government should review priorities among the 3Es (energy security, economic growth,and environmental protection) and create a new “best mix” for energy. Japan requires policies that place more emphasis on energy security(stable energy supply) and the economic aspect of energy, with safety as a major prerequisite. Japan should continue to combat climatechange on a worldwide scale through the development and diffusion of world-leading technologies.
(4) We should avoid rash debate over the electricity business and focus on realistic discussion that includes the issue of the government’sinvolvement in nuclear energy.
(5) In reviewing energy policy, the government should release objective data and ensure transparent and open public discussion.

2. Urgent Measures Required to Ensure Stable Electricity Supply in the Short Term
(1) Swiftly formulate and publicize an action
plan for ensuring stable electricity supply
over the next five years or so(2) Promptly re-start nuclear power stations still (3) Ensure smooth procurement and transport
shut down following regularly scheduledof fossil fuels through public-private
inspectionscooperation(4) Support introduction of private power
generation equipment
gq pand storage
gbatteries(5) Support introduction of energy-saving
devices, etc., support energy-saving
improvements of buildings, and promotenational energy conservation campaigns(6) Continue deregulation initiatives introduced
this summer to balance supply
pp y and demand

3. Review Energy Policy from a Medium- to Long-Term Perspective
Need for New “Best Mix” for Energy
Open public discussion should be conducted after objectively analyzing
aspects including the advantages and disadvantages of each energy form.
(1) Nuclear
N lenergy development
dlt should
h ld continue
titot beb promotedt d steadily,t dilwhile assuring safety as a major prerequisite
・ Improve safety, including rigorous measures to prevent the recurrenceof accidents and a radical review of safety standards
・ Re-examine information disclosure protocols(2) For fossil fuels, stable procurement/supply and highly efficient use are
crucial・ Government and private sector must cooperate to ensure acquisition of
upstream rights and interests as well as diversification of fuel sources
and suppliers・ Strengthen R&D in fields such as highly efficient thermal power
generation and commercialization of carbon dioxide capture and storage(3) Renewable energy is important from such perspectives as improving
energy self-sufficiency
・ Based on the potential of introducing renewable energy forms, formulate

Energy Supply System(1) Create stronger links between centralized anddistributed power sources
power
・Realize the best mix of centralized and distributed psources to achieve stable supply, high efficiency, andemergency responsiveness by reinforcing both types ofenergy supply and enhancing complementarity
・Examine emergency back-up power sources, how costs
for these will be borne, and who will take responsibility
for supply(2) Develop disaster-resistant infrastructure
・Examine enhancement of frequency converter stations
and installation of interconnection transmission lines
g, including
g government
gsupportpp
between regions,・Maintain and strengthen oil supply chain, including
utilization of national stockpiles
・Examine how future gas pipeline projects should bepursued(3) Build smart grids
・Accelerate efforts to commercialize smart grids throughtrial projects in model cities, etc.

realistic plans suited to Japan’s natural environment
・ Increase efficiency and reduce costs by supporting R&D and capital
investment and encouraging competition among operators
・ Ease regulations on location and other aspects of geothermal power
stations, wind farms, etc.
(4) Proactive support for energy conservation is crucial
・ Provide policy support for introduction of energy-saving devices andinvestment in plant and equipment, prioritize R&D, review lifestyles andwork styles through national campaignsNeed for Review of Future Measures toFi ht ClimateFightCli t Change
Ch(1) Maintain/enhance world-leading levels of energy
efficiency in manufacturing processes and products
through industry-led initiatives(2) Accelerate efforts to realize bilateral offset mechanisms(3) Review Japan’s currently proposed medium-termtargets for greenhouse gas reduction and individual
measures to fight climate change from a zero base