Building toward large-scale use of renewableenergy in Japan
2019/08/15

Sumiko Takeuchi
Senior fellow and member of the board of directors at the IEEI※

Reprinted by courtesy of The Japan Times（JUL 8, 2019）

The Paris agreement has accelerated worldwide momentum for strengthening global
warming countermeasures.
As most greenhouse gas emissions come from energy consumption, key measures tocheck global warming are saving energy through efficient use and transitioning to low
carbon energy. For example, better fuel efficiency would reduce the amount of carbon
dioxide issuing from cars that run on fossil fuels. But to bring about a drastic reduction,
it is essential to shift from gasoline to electric vehicles and from fossil fuel power
generation to renewable energy and nuclear power that do not emit carbon dioxide.
Carbon dioxide emissions can be significantly reduced by electrifying equipment andreducing the carbon content of power sources.
Enhancing zero-carbon energy is an urgent task as the Japanese government aims toderive 44 percent of power from renewable and nuclear power by 2030. The use ofsolar has been growing rapidly in Japan, but still, when we look at the power mix ratio
in 2016, renewables other than hydroelectric, such as solar and wind, accounted for
only 7 percent, compared with 8 percent for hydro. Increasing renewable energy will
have to be a pillar of Japan’s energy policy for the foreseeable future.
There is a wide variety of renewable energy in Japan. This nation has the world’s
third-biggest potential for geothermal power, but many of the sites are in mountainous
areas where the power transmission network is fragile, or in national parks subject tonature conservation regulations, making development extremely costly andtime-consuming. Japan is reportedly rich in biomass reserves, but domestic reserves
alone are insufficient to provide enough feedstock to operate large numbers of powerstations. The best large-scale hydroelectric power sites in Japan have already been
identified and exploited, so there is little potential remaining for new development. ForCopyright © 2019 International Environment and Economy Institute. All rights reserved.

the foreseeable future, the key will be to boost solar and offshore wind power, as
onshore wind projects face land use restrictions.
Solar and wind power are domestic energy sources that produce no carbon dioxide
emissions during power generation, and they have the advantage of near zeromarginal costs since their fuel does not have to be bought. On the other hand, their
output depends a great deal on weather. In electrical power systems that require abalanced supply and demand, as generation via renewables increases, various costs
will be incurred for such needs as building more transmission lines, securing power
storage and providing maintenance for backup thermal power generation.
It’s no exaggeration to say that the biggest theme in our nation’s energy policy is
curbing the overall cost to the public while reaping the benefits of renewable energy tothe fullest.
To make large-scale use of renewable energy possible, the price tag needs to be as low
as possible. But, unfortunately, under the feed-in tariff (FIT) system that Japan
introduced in 2012, the burden on the public will total ¥2.4 trillion ($22 billion) in fiscal
2019 alone, with the cumulative total of about ¥10 trillion since its introduction in July2012. That is because the Fukushima No. 1 nuclear disaster that started in 2011
generated blind faith in renewable energy, resulting in a system that provides
excessive support for renewables.
To be sure, Japan will have to overcome unfavorable conditions for renewable energythat other countries don’t have to face, such as a narrow and predominantly
mountainous land with varied weather conditions, including a rainy season and regularsnowfall. But considering that the price paid for solar power in Japan is roughly doublethat in Germany, despite it being situated at a higher latitude, it has been alreadyrecognized that the FIT system needs to be improved immediately. Discussions for aradical revision of the FIT regime has are already underway and an auction system isbeing introduced for nonresidential solar power. That is because cost reduction is themost important factor in determining whether renewables will become a main power
supply source.
In addition, to utilize renewables on a cost-efficient basis, effective use of the existing
power grid will be essential. Beefing up transmission lines in conjunction with an
expansion of renewable energy would require vast investments and time. Unlesscareful consideration is made on the cost effectiveness of investments in theCopyright © 2019 International Environment and Economy Institute. All rights reserved.

transmission network, the future could be left with a huge financial burden.
But rules for managing transmission networks have already been improved. Japan’stransmission network had previously been run on the assumption that all power plants
would run at full capacity, thus choking room for renewable expansion, but thetransition to more flexible operations of transmission networks is underway.
Japan is an island with a power grid isolated from other countries. In addition, the gridis divided into two frequency areas, 50 Hz in the east and 60 Hz in the west. Even
within the same frequency, the areas are divided into several smaller grids, served byformer monopolies, with weak interconnections like between Hokkaido and Tohoku,
and between Chugoku, Kyushu and Shikoku. The supply-demand balance has to be
maintained at each of these small grids, making it more difficult for Japan than in othercountries to raise the ratio of renewable power. To accomplish that, all means have tobe exhausted, including using pump-storage hydropower and spreading the use ofstorage batteries, in addition to making the most out of the existing transmission
network.
The road to make renewables Japan’s main power source will not be smooth, buttherein lies many business opportunities. It is reasonable to hope there will be atransformative social change made possible by new services that take advantage ofstorage batteries, hydrogen and other technologies.

Copyright © 2019 International Environment and Economy Institute. All rights reserved.