The Electric Power
Industry in Japan2020

JEPICJapan Electric Power Information Center, Inc. (JEPIC) marked
the 60th anniversary of our founding in May 2018.
Established in 1958 as a non-profit association of Japan’s
electric utility industry, our primary purpose is to meet theincreasing need for systematic and sustained exchange of
information with electric utility industries around the world.
In response to government policy, JEPIC also initiatedtechnical cooperation programs for developing countries in
the field of electric power soon after our founding. These
programs remain one of our main activities today.

Research and Information Activities
JEPIC conducts research on the electric power industry inforeign countries in light of situations and issues faced by
the industry in Japan today. We provide information fromthose studies in various ways to contribute to the industry
worldwide. JEPIC also works to enhance cooperation withforeign electric utilities and other related organizations.

Exchange and Cooperation Activities
JEPIC is promoting information exchanges with the foreign
electric utilities and organizations in the electric utility
industry by holding regular meetings, and taking part ininternational conferences and symposia.

International Cooperation
With the support of the member companies, JEPIC
promotes integrated international cooperation programsfor developing countries, mainly in Asia, for the purpose of
improving power infrastructure and nuclear power safety inthose countries and sharing of general information. These
programs include human resource development efforts
such as seminars that JEPIC coordinates. JEPIC both receives
the participants of these seminars to Japan and dispatches
experts to their countries. Including these seminarprograms, JEPIC carries out the following tasks:• Cooperation with electric utilities in ASEAN countries• Technical cooperation under ODA programs• Technical cooperation for nuclear power safety

Contents
Executive Summary

3

I.

Structure of the Electric Power Industry

5

II.

Energy Policy

10III. Supply and Demand

24

IV. Supply Structure

31

V.

44

Retail Business and Trading Markets

Topics54

Statistical Data

59

Overseas Activities of Member Companies

63

The Electric Power Industry in Japan 2020

Utility category

Utility nameElectricity transmission utilities
J-POWER

Japan Atomic Power Co.
Electricity generation utilities
New entrants

Former general electricity utilities
Hokkaido Electric Power Co.
General electricity transmission
and distribution utilities

Tohoku Electric Power Co.
Tokyo Electric Power Company Holdings
Chubu Electric Power Co.
Hokuriku Electric Power Co.
Kansai Electric Power Co.
Chugoku Electric Power Co.
Shikoku Electric Power Co.

Electricity retailers

Kyushu Electric Power Co.
Okinawa Electric Power Co.

New entrants

2

Executive Summary

Executive Summary

I. Structure of the Electric Power Industry
Liberalization of entry to the power generation sector commenced in 1995 at a time when generation andtransmission were integrated along regional lines under 10 general electric utilities. Liberalization of the retailsupply of electricity to all except low-voltage customers was then implemented in stages between 2000 and2005.
Policy on reform of the electricity system was adopted in April 2013, and in the first phase of reform, theOrganization for Cross-regional Coordination of Transmission Operators (OCCTO) was established in April 2015.
In the second phase, the Electricity Market Surveillance Commission (now called the Electricity and Gas Market
Surveillance Commission) was established in September 2015 to strengthen oversight of the liberalized electric
power market. Liberalization of the electric power retailing and generation sectors was completed in April
2016. In the third phase, legal separation of transmission and distribution from vertically integrated businesses
is scheduled to be implemented in April 2020. Meanwhile, plans to abolish regulated electricity rates in April
2020 have been put on the back burner.

II. Energy Policy
Under the philosophy of 3E+S (energy security, economic efficiency, and environment plus safety), theelectricity sector aims to achieve a more balanced power generation mix by improving the efficiency ofthermal power plants, reducing dependence on nuclear power, and expanding use of renewables.
As of the end of August 2019, 15 nuclear reactors have been declared compliant with the new regulatory
standards and granted permission to have their installation licenses amended accordingly. Nine of these havealready reentered commercial service. The remaining six reactors that have been confirmed compliant anda further 21 reactors that are currently shut down or under construction are expected to eventually start or
restart operation. Japan’s remaining 24 reactors have been earmarked for decommissioning, including thereactors involved in the accident at Fukushima Daiichi Power Plant.
Installed capacity of renewables (especially solar) increased as the result of a feed-in tariff (FIT) scheme. The
government is considering completely overhauling the FIT scheme by the end of fiscal 2020. Meanwhile,
competition for customers is hotting up as electricity retailers respond to the progressive termination ofpurchase periods from November 2019 by offering a variety of purchase price plans.
In June 2019, the Japanese government submitted a long-term strategy for reducing emissions to the
UN Secretariat, setting a concrete target of achieving an 80% reduction in greenhouse gas emissions by
2050. It calls for innovation coupled with a virtuous circle of environmental and economic growth to solve
environmental issues.

3The Electric Power Industry in Japan 2020

III. Supply and Demand
In fiscal 2017, electricity demand in Japan was 977 TWh and peak national demand came to 156 GW.
In fiscal 2017, electric power generated in Japan came to 1,007 TWh, of which 16 TWh was generated by solar
power and 6 TWh by wind power.

IV. Supply Structure
Total generating capacity in Japan came to 306 GW at the end of fiscal 2018. This consisted of 161 GW ofthermal power, 49 GW of hydro power, 57 GW of renewables (excluding hydro), and 38 GW of nuclear power.
Development of 33 GW of generating capacity is planned from fiscal 2018 to fiscal 2028. This consists of 16 GWof thermal power, 7 GW of renewables (excluding hydro), and 10 GW of nuclear power.
As of the end of March 2018, the former general electricity utilities had provided 49% of low-voltage customers
with smart meters. All customers are expected to have smart meters by the end of March 2025.
Tohoku Electric Power Co. and Hokkaido Electric Power Co. are now connected via two interconnection routes
providing a total of 900 MW. The second route (300 MW) entered service in March 2019.
Traditionally, grid facilities have been boosted according to power source grid capacity. However, a new
approach is being taken now to make effective use of existing facilities by adopting the “connect and manage”
model already used in the United Kingdom and elsewhere.

V. Retail Business and Trading Markets
As of the end of February 2019, 9.44 million low-voltage customers (including households) have switchedsuppliers, accounting for 15% of the total number of low-voltage customers. With the market now fully
liberalized, electricity retailers are offering a variety of rate plans tailored to customers’ needs and lifestyles.
The volume of trades on the JEPX spot market has been on the rise, reaching 209 TWh in fiscal 2018. This is
more than a three-fold increase in year-on-year terms and means that about one quarter of all electricity soldin Japan is sold through JEPX. The average system price has hovered around the 8-9 yen/kWh mark and stoodat 9.76 yen/kWh in fiscal 2018
A baseload trading market was created, and the first baseload trades of fiscal 2020 took place in August 2019.
The system prices were 12.47 yen/kWh in the Hokkaido area, 9.77 yen/kWh in the Tohoku / Tokyo area, and 8.70
yen/kWh in the West Japan area. Trade volumes came to 13 MW in the Hokkaido area, 88 MW in the Tohoku /Tokyo area, 83 MW in the West Japan area, and 184 MW in the three areas combined.
The creation of a capacity market and a balancing market is now under consideration, with a view to launchingthese markets in or after fiscal 2020.

4

I. Structure of the Electric Power Industry

I. Structure of the Electric Power Industry

1. H
 istory of the Electric Power
Industry in Japan(1) Establishment of a System Comprising 10
Electric Utilities
Japan’s electric power industry came into being in 1886 withthe commencement of operations by the Tokyo ElectricLight Company, which was formed with private capital.
Numerous electric utilities were subsequently establishedaround Japan to serve growing demand for electricity driven
by increasing industrialization. By the early 1930s there
were more than 800 utilities. However, fierce competitionengendered by the prolonged depression led to a seriesof mergers and acquisitions, and Japan’s electric powerindustry ultimately coalesced around five utilities.
As Japan headed into World War II, the electric utilities
came under the control of the government. In 1939, thegovernment established the Japan Electric Generation
and Transmission Company and electricity generation andtransmission facilities came under centralized control. The
government also consolidated the electricity distribution
business into nine separate blocks. Following World War II,
the Japan Electric Generation and Transmission Company
was dissolved in May 1951 and the company’s facilities
and functions were transferred to nine privately-owned
electricity distribution utilities. As a result, a regime ofregional monopolies was established based on integrated
systems of electricity generation and transmission in nine
regions. The number of utilities then increased to 10 withthe establishment of Okinawa Electric Power Co. following
the reversion of Okinawa to Japanese control in 1972.
These electric utilities systematically invested in power
supply facilities to meet a growing demand for electricity
driven by Japan’s rapid economic growth. As private
enterprises, they simultaneously sought to deliver
affordable, stable supplies of electricity while continuing to
make management efforts to maximize shareholder equity.
As a result, they contributed significantly to Japan’s rapid

economic growth in the 1950s and 1960s by providing
high quality, affordable electricity with a minimum ofoutages. Although these utilities introduced electricity
rate hikes in the wake of the global oil crises of the 1970s,
they lowered rates several times between the 1980s and2000s, successfully providing the power that supported thedevelopment of Japan’s economy.

(2) Increasing Liberalization of the Electricity Market
Following the trend toward deregulation in the electric
power industry in Western countries, the liberalization ofentry into the electricity generation sector started in 1995 in
Japan, followed by retail supply liberalization for customers
receiving extra high-voltage (20 kV or above) in 2000. The
scope of deregulation was expanded further in stages
thereafter: to high-voltage (6 kV) customers with contracted
demand of 500 kW or above, in principle, in April 2004, andto all customers in the high-voltage category (those with acontracted demand of 50 kW or above) in April 2005.
However, power shortages and other issues caused by the2011 Great East Japan Earthquake prompted discussion of theideal configuration of the nation’s electric power system andits reform. Based on this discussion, reform of the electricity
supply system has been pursued in three stages since 2015.

(3) Electricity System Reform
The Policy on Electricity System Reform describing theoverall shape of reform was approved by the Cabinet in
April 2013. This policy divided the reform process into
three phases: 1) establishment by 2015 of an Organization
for Cross-regional Coordination of Transmission Operators(OCCTO) to act as a command center responsible formanaging supply and demand spanning different service
areas; 2) full liberalization of entry into the retail electricity
market by 2016; and 3) the legal separation of transmission
and distribution from vertically integrated businesses, andelimination of regulated retail rates by 2020.

5

The Electric Power Industry in Japan 2020

Roadmap to Electricity System Reform

Implementation: February 2013

[Phase I][Phase 2][Phase 3](Establishment of the OCCTO)(Deregulation of entry into
retail electricity market)(Ensuring neutrality in transmission anddistribution; Deregulation of electricity rates)

Implementation: April 2015

Implementation: April 2016

Scheduled: April 2020

Approval of establishment

Preparation for establishmentof the OCCTO

Determination of policy on electricity system reform

Figure 1 . 1

1) Formulation of plans for cross-regional supply and demand

Establishment of
the OCCTO

2) Formulation of plans for improvement of interconnected lines and cross-regional transmission lines
3) Cross-regional supply and demand/grid operation4) Supply and demand adjustment in times of supply shortages

Full deregulation ofretail sales
Preparation of environment for full deregulationof retail sales(liberalization of entry into
retail electricity market)

Customer freedom to select electric utilities and supplier freedom
to set electricity rates extended to small-customer sector(including households)
Period of transitional
measures foreliminating rate
regulations

Elimination of rate Establishment of
requisite systems forregulations
customer protection(end of transitional
measures)(last-resort service,universal service, etc.)

Review of competition conditions

Detailed system design

Transition to
new regulatory
systemVitalization of wholesale electric power market

Preparation for creation of new system forsecuring supply capacity

Preparation for hour-ahead market

1) Regulation of transmission and distribution (wheeling service fees, conduct of business, etc.)
2) Wholesale/retail market transaction monitoring, competition condition review, and rule development3) Operations related to stable electric power supply, including issuance of supply orders andimplementation of appropriate rolling blackouts in emergencies
Market monitoring

Elimination of regulations
on wholesale market

Creation of new system
for securing supply
capacity

Full-scale
1) Obligation to secure
implementation
supply capacity
2) Establishment of capacity market for future supply capacitytransactions
3) System for power source procurement bidding in anticipation of
future shortages

Creation of hour-aheadmarketMarket-based cross-regional supply and demand adjustment

Review, development and issuance of rules as preconditions for improving neutrality in transmission anddistribution operations Verification and implementation of means of securing power supply stability,
including disaster response measures, cooperation on transmission and distribution facility maintenanceand operation, and supply securement
Preparation for system transition

Creation ofbalancing market

Legal separationof transmission
and distribution
from the verticallyintegrated business

Regulation oftransmission anddistribution andmonitoring of neutrality
assurances

Realization ofcompetitive market
environment

Source: Adapted from the Report of the Expert Committee on Electricity Systems Reform (February 2013)

6

I. Structure of the Electric Power Industry

Based on this policy, a new entity called the Organization for2. Current Electricity Supply System

Cross-regional Coordination of Transmission Operators (OCCTO)
was established in April 2015 with the aim of enhancing the(1) Classification of Electricity Utilities

capacity to adjust supply and demand nationwide in both

Japan’s electricity utilities had been divided into thefollowing five categories: general electricity utilities,
wholesale electricity utilities, wholesale suppliers, specified
electricity utilities, and specified-scale electricity suppliers(new entrants). Subsequently, with the implementation offull liberalization of the retail market, these classifications
were reviewed and a new system of issuing licenses tobusiness operators was introduced in April 2016. At present,
the licenses define three main categories of electricity
generation, transmission and distribution, and retailing,
and the Agency for Natural Resources and Energy imposes
necessary regulations for each sector. The 10 generalelectricity utilities that have historically been engaged in
power supply since the end of World War II are now called“former general electricity utilities.”

normal and emergency situations. In preparation for the second
phase of liberalization of the retail market, another entity,
the Electricity Market Surveillance Commission (now called
the Electricity and Gas Market Surveillance Commission) wasestablished in September 2015 to strengthen oversight of theliberalized electric power market. A licensing system was thenlaunched in April 2016 and liberalization of the electric power
retailing and generation sectors was completed. Preparations
are now underway as shown in Figure 1.1 for the third phaseof liberalization planned for April 2020, namely legal separationof transmission and distribution from vertically integrated
businesses.

The necessary legal groundwork for the third phaseof electricity system reform was completed with theenactment of revisions to the Electricity Business Act
in November 2013, June 2014, and June 2015. Plans toeliminate regulated rates in 2020 have been put on the backburner (see “Electricity Rates” in Section 1, Chapter V).

(4) Updated System Design
The Ministry of Economy, Trade and Industry (METI)
emphasized the need to increase economic efficiency byfostering further competition in the electric power sector,
while addressing a number of issues that could not be
resolved solely by relying on the market alone. These issues
include ensuring safety, supply stability, and environmental
acceptability including the promotion of renewableenergies. METI also indicated that in order to solve theseissues, steps should be taken to make existing markets
more liquid and to actualize new forms of value by creatingcompletely new markets, such as a capacity market and a
non-fossil value trading market.
Based on these guidelines, a number of new types of market
are being considered, including (1) a baseload power
market, (2) a capacity market, (3) a balancing market, and(4) a non-fossil value trading market (see “Trading Markets” in
Section 3, Chapter V).

Data shows that 637 entities had obtained power
generation licenses in the electricity generation sector andpeak output was equivalent to 269 GW by May 2019. The
group of former general electricity utilities, J-POWER and
The Japan Atomic Power Co. accounted for 80% of thepeak output. The main entrants other than former generalelectricity utilities include firms from paper manufacturing,steel manufacturing, and the gas and petroleum industries.
Some local governments have also entered the power
generation business, albeit on a small scale.
In the transmission and distribution sector, utilities spun out
from the 9 former general electricity utilities will be required
to conduct business as general electricity transmission anddistribution utilities from April 2020.
In the retail sector, data released by METI’s Agency for
Natural Resources and Energy show that a total of 611
businesses (including the retail arms of former generalelectricity utilities) had obtained retail licenses (as of
September 9, 2019). In addition to the 10 former generalelectricity utilities, PPSs (new entrants to the electricity
retail sector) include telecommunications carriers,
trading companies, gas and petroleum companies, steel
manufacturers, and subsidiaries of former general electricity
utilities. Net system energy demand in fiscal 2018 came

7

The Electric Power Industry in Japan 2020

Electricity Supply System after Introduction of Licensing

Figure 1 . 2

A. Electricity generation business[notification only]
JFE Steel, TEPCO Fuel & Power,
local governments, etc. (637 entities)

B. Electricity transmission anddistribution business ( (1)-(3) )(1) General electricity transmission anddistribution business [license required]
TEPCO Power Grid,
Kansai Electric Power Co., etc. (10 companies)(3) Specified electricity transmission
and distribution business[notification only]

System of general electricity transmission
and distribution utilities

Sumitomo Electric Power,
JR East, etc. (31 companies)(2) Electricity transmission business[license required]
J-POWER, North Hokkaido Wind Energy Transmission,etc. (3 companies)

C. Retail electricity business[registration required]

ENNET, TEPCO Energy Partner,
KDDI, etc. (611 entities)
Homes, businesses, stores, etc.

Specified service points
distinguished from general demand.

Utilities maintaining and operating electricity transmission and distribution facilities
General electricity transmission
and distribution utilities

Electricity transmission utilities

Specified electricity transmission
and distribution utilities

Source: Compiled from Agency for Natural Resources and Energy, “(Reference) Electricity Power Supply Structure (from April 2016)”

8

I. Structure of the Electric Power Industry

to 853 TWh, of which former general electricity utilities
accounted for about 86%.

(2) Regulatory Organizations
a. Agency for Natural Resources and Energy

The Agency for Natural Resources and Energy is an externalorgan of METI. It is responsible for policies regarding
energy conservation, new energies, and securing a stable,
efficient supply of energy from oil, electricity, gas, andother sources. With regard to the electric power industry,
the agency is responsible for developing the electricity
market and electricity sources, adjusting electricity market
supply and demand, and planning, devising, and promoting
policies relating to nuclear power, renewables and smart
communities to ensure a stable and efficient supply ofelectricity. The agency is given the role of supervising
electric utilities.
b. Electricity and Gas Market Surveillance Commission

The Electricity and Gas Market Surveillance Commission wasestablished in September 2015—as a separate entity fromthe Agency for Natural Resources and Energy in METI—inadvance of the liberalization of electricity, gas, and heating
supply, with the aim of further strengthening monitoring of
the energy markets and related functions and encouraging
sound competition. The Commission’s powers include theability to conduct on-site inspections of utilities, recommend
business improvements, act as an arbitrator/mediator,
approve wheeling service charges, and carry out reviews ofretailer registrations. It also has the power to monitor thefairness of transactions and regulate business conduct tosafeguard the neutrality of the electricity and gas network
sectors.

(3) Organization for Cross-regional Coordinationof Transmission Operators (OCCTO)
OCCTO was established in April 2015 as a governmentauthorized organization that all electricity utilities are
required to join. Its objectives are to promote developmentof the transmission and distribution networks required
to make cross-regional use of generating sources, andto strengthen the industry’s capacity to adjust supply
and demand nationwide in both normal and emergency
situations. OCCTO is operated as a public organization
authorized under the Electricity Business Act.
OCCTO’s main functions include:• To coordinate supply-demand plans and grid plans, boost
the transmission infrastructure (including the capacity of
frequency converters and interregional interconnections), andfacilitate nationwide grid operation spanning different areas.
• To coordinate cross-regional supply-demand balancing
and frequency adjustment by the transmission operators ineach area under normal conditions.
• To adjust supply and demand by instructing that output
be increased and power shared in the case of power
shortages due to a disaster or other emergency.
• To perform, in an unbiased manner, functions relating to
the acceptance of connections from new power sourcesand disclosure of grid data.
• To provide guidance and recommendations to electric
power suppliers, handle complaints from electric power
suppliers, and resolve disputes.
• To study the introduction of a supply and demandbalancing market, and study and operate a capacity market
as part of moves to secure supply and balancing capacity.
• To study the efficient use of electricity transmission anddistribution facilities (“connect and manage”).

9The Electric Power Industry in Japan 2020

II. Energy Policy

1. Strategic Energy Plan
The government formulated its first Strategic Energy Plan in
October 2003, in accordance with the Basic Act on Energy
Policy’s requirement for a Basic Energy Plan to map out thebasic direction of energy policy. The plan subsequently
underwent several revisions, and the Fifth Strategic Energy
Plan was adopted by the cabinet in July 2018 to reflect theentry into effect of the Paris Agreement.
The basic concept of the fifth plan is to achieve what
are referred to as the “3E+S”—energy security, economic
efficiency, and environment plus safety—given Japan’s lackof domestic energy resources.
Guided by this 3E+S philosophy, the government formulated
the fifth plan based on the following two key premises:
firstly, that in the wake of the accident at the Fukushima
Daiichi Nuclear Power Plant (Fukushima Daiichi accident),
Japan should pursue the adoption of renewable energy
resources and minimize its dependence on nuclear, giving
top priority to its safety; and secondly, that in view of its
lack of fossil fuel resources, Japan should treat its energy
technologies as scarce resources and play a leading role inthe development of decarbonized energy.

renewables; (3) regarding the environment, the adoption ofgreenhouse gas reduction targets on a par with those in the
United States and Europe; and (4) regarding safety, action toincrease the safety of nuclear power.
In view of these policies, the plan calls for electric power
demand in fiscal 2030 to be kept to its fiscal 2013 level(around 980.8 TWh) by pursuing thoroughgoing energy(electric power) conservation efforts to counter the effecton demand of economic growth, which is expected tocontinue. Regarding the power generation mix, the aim is
to make more balanced use of resources to simultaneously
achieve the 3E+S while expanding use of renewables,
improving the efficiency of thermal power plants, andreducing dependence on nuclear power. Nuclear power’s
share of the mix in fiscal 2030 is to be reduced fromPower Generation Mix in Fiscal 2030

Total generation (approx.)
1,065 TWh

Biomass
3.7%–4.6%

Geothermal
1.0%–1.1%
Wind 1.7%

Renewableenergy22%–24%The plan lays down basic policies and measures towards
2030 and offers a scenario for energy transition anddecarbonization in the years leading up to 2050.

Solar
7.0%

Nuclear20%–22%Hydro
8.8%–9.2%(1) Basic Policies and Measures towards 2030

LNG
27%

The Fifth Strategic Energy Plan adopts broad goals for eachelement of the 3E+S philosophy that underpins it. These are:(1) regarding energy security, an improvement in energy
self-sufficiency to in excess of the level prior to the Great
East Japan Earthquake (approximately 25%); (2) regarding
economic efficiency, a lowering of electricity rates in theface of an anticipated increase in costs arising from reducing
dependence on nuclear power and widening adoption of

Figure 2 . 1

Coal
26%
Oil 3%

Source: METI, “Long-term Energy Supply and Demand Outlook 2015”

Source: METI, “Long-term Energy Supply and Demand Outlook 2015”10

II. Energy Policy

approximately 30% prior to the Great East Japan Earthquake
to around 20%–22%, while renewables’ share will be
increased from approximately 10% before the earthquake toabout 22%–24% (Figure 2.1).

(2) The Challenge of Energy Transition and
Decarbonization by 2050
The Fifth Strategic Energy Plan offers a scenario for
Sophisticated 3E+S. This involves, among other things,
turning renewables into core elements of the power
generation mix, developing storage batteries, hydrogensystems, and digital technologies, improving safety,
economic efficiency, and flexibility to reduce nuclear
dependence and retain nuclear as an option for
decarbonization, and reducing the carbon footprint ofthermal power plants, which will remain core elements ofthe mix during the transitional period.

2. Nuclear Power Generation(1) Government Policy
The Fukushima Daiichi accident caused huge damage
and led to the evacuation of residents over a wide area,
increasing public concerns about nuclear power. The
region’s recovery and the restoration of public confidence
are matters of the very highest priority to the government
and the utilities.
At the same time, however, Japan’s energy self-sufficiency
has been seriously hit by the delayed restart of nuclear
power plants, and IEA statistics show that the country’s
self-sufficiency rate stood at just 9.6% in 2017. The increasein imports of fossil fuel to power the thermal power plants
used to replace nuclear power since the Fukushima Daiichi
accident has imposed a greater financial burden on the
public. The need to reduce greenhouse gas emissions tocombat global warming has also risen in recent years.

(2) Action on Nuclear Safety
a. Reorganization of Nuclear Power Administration andEstablishment of the Nuclear Regulation Authority

The Fukushima Daiichi accident led to an overhaul of thesystem of administration of nuclear power in order toseparate safety regulation from use and to unify nuclear
safety regulation work. The Act for Establishment of the
Nuclear Regulation Authority was enacted in June 2012,
and the authority was established in September 2012 as anaffiliated agency of the Ministry of the Environment. The
Nuclear Regulatory Agency was further created to act as
the authority’s secretariat. Affairs concerning nuclear safety
regulation that had previously fallen under the jurisdictionof multiple agencies were simultaneously centralized under
the highly independent Nuclear Regulation Authority.
b. Adoption of New Regulatory Standards and Continuous
Improvement of Nuclear Safety Regulation

Following the Fukushima Daiichi accident, the Act on theRegulation of Nuclear Source Material, Nuclear Fuel Material
and Reactors (“Nuclear Reactor Regulation Act”) was revised
to incorporate a number of new provisions designed tostrengthen nuclear safety regulation. These included:• Reinforcement of strategies for severe accidents.
• Introduction of a “backfitting” program requiring existing
nuclear power facilities to comply with any new regulatory
standards incorporating the latest technological expertise.
• Modification of procedures for extending the period
of operation of nuclear reactors (setting the period of
operation at 40 years from the date of initial entry into
commercial operation, and allowing a one-time extension
to this term not to exceed 20 years where permitted by the
Nuclear Regulation Authority).
• Unification of regulation of nuclear power plants under the
Nuclear Reactor Regulation Act.
c. Initiatives by the Private Sector

Alongside the measures being taken by the regulatory
agencies described above, the Japan Nuclear Safety Institute(JANSI) was launched in November 2012 to allow privatesector entities to voluntarily perform their own peer reviewsin order to improve safety, and this has strengthened
action to improve safety at individual power plants. It has
been joined by the Atomic Energy Association (ATENA),
established in July 2018 as an organization that interacts
with regulatory authorities on behalf of industry. The aim of
this association is to strengthen arrangements to addresscommon safety issues by utilities and manufacturers
affecting the nuclear power industry as a whole. JANSI and

11

The Electric Power Industry in Japan 2020

Safety Measures Required by New Safety Regulatory Requirements
Establishment of emergency
response center

Securing of electricity
supply capabilities

Figure 2 . 2

Strengthening of offsite
power supply
Securing of water supply capabilities

Measures against
deliberate plane crashes

Measures against
natural disasters

Measures against flooding:door replacement for water-tightness
Measures against tsunami:
strengthening of seawalls

Securing of alternative
water injection capabilities

Installation offilter vents
Subsurface structure survey(over 1,000 m deep)
Measures against fire:
installation of earthquake-resistant firefighting equipment
Measures against tsunami: deeper pump inlets
Installation of bulkheads in reactor auxiliary seawater pump area
Source: Federation of Electric Power Companies of Japan (FEPC), “Energy and Environment” (2018)

ATENA will be working closely together to restore publicconfidence in nuclear power by continuing to promoteindependent action by the private sector to achieve highstandards of safety.

to decommission other reactors after considering the costof ensuring compliance with the new regulatory standards.
Altogether, 24 reactors nationwide have been earmarked
for decommissioning. The situation regarding restarts anddecommissioning is summarized in the table below.

(3) State of Nuclear Power Generation

As for the extension of the period of operation of nuclear
reactors, extensions had been approved, as of the end of
November 2018, for three PWR reactors operated by Kansai
Electric Power Co.—Units 1 and 2 at the Takahama Nuclear
Power Plant and Unit 3 at the Mihama Nuclear Power Plant—
and work is now underway to implement safety measures
to meet the conditions mandated for the extension ofoperation. In addition, an extension for The Japan Atomic
Power Company’s Tokai No. 2 Nuclear Power Plant wasapproved in November 2018, making it the first BWR tosecure approval, and implementation of safety measures
is under way with a target completion date of 2021. The
plants that are undertaking improvement work to comply
with the new safety standards will also need to obtain local
government approval before they can restart.

As of August 2019, 15 nuclear reactors had been declaredcompliant and granted permission for their installation
licenses to be amended in accordance with the new
regulatory standards. The nine pressurized water reactors(PWR) shown in Table 2.1 have reentered commercial service.
In addition to these PWRs, six boiling water reactors (BWR) of
the same type as those used at the Fukushima Daiichi Nuclear
Power Plant have also now been confirmed compliant and arebeing prepared to come back online pending local approval
and the completion of safety improvement work.
At Fukushima Daiichi and Daini Nuclear Power Plants,
following the request of Fukushima Prefecture, all 10 reactors
will be decommissioned. Decisions have also been made12

II. Energy Policy

Compliance with New Regulatory Standards

Restarted

Table 2.1

9 units

Restart approved(15 units)

Preparing for restart(Implementation of safety
work, etc.)

Company

Plant

Restart date

Kyushu Electric Power Co.

Sendai Unit 1

Aug. 11, 2015

Kyushu Electric Power Co.

Sendai Unit 2

Oct. 15, 2015

Kansai Electric Power Co.

Takahama Unit 3 Jan. 29, 2016

Kansai Electric Power Co.

Takahama Unit 4 Feb. 26, 2016

Shikoku Electric Power Co. Ikata Unit 3

Aug. 12, 2016

Kansai Electric Power Co.

Ohi Unit 3

Mar. 14, 2018

Kyushu Electric Power Co.

Genkai Unit 3

Mar. 23, 2018

Kansai Electric Power Co.

Ohi Unit 4

May 9, 2018

Kyushu Electric Power Co.

Genkai Unit 4

June 16, 2018

6 units

Under review (including 2 units under construction)

12 units

Applications not yet filed(including 1 unit under construction)

9 units

Total (including 3 units under construction)

36 units

To be decommissioned

24 units*1*1 Not including the three JPDR, Monju, and Fugen reactors.

Source: Compiled from Nuclear Regulation Authority website (accessed on August 31, 2019)

To comply with the new regulatory standards, work to
improve preparedness for natural disasters and severe
accidents had to be performed prior to startup. Antiterrorism measures, on the other hand, must be completed
within five years from approval. Due to delays, there are fears

that work may not be completed until between one andtwo and a half years after the completion deadline. If thishappens, it is expected that some plants will again have tosuspend operations until work is completed (from March
2020 for the earliest plant to have been approved).

Entrance door and equipment hatch of Tokai II Power Station (The Japan Atomic Power Co.) made watertight
Tokai II Power Station entered operation in November 28, 1978

13

The Electric Power Industry in Japan 2020

(4) Nuclear Fuel Cycle
a. Government Policy

As Japan is dependent on imports for the bulk of its energy
resources, a basic policy of the government has been to
establish a nuclear fuel cycle in order to reprocess the spent
fuel generated by nuclear power generation and reuse
the recovered plutonium and uranium as fuel. Steps are
therefore being taken to promote recycling and use of MOX
fuel in thermal reactors. Based on this policy, the Agreement
for Cooperation between the Government of Japan and theGovernment of the United States of America concerning
Peaceful Uses of Nuclear Energy that expired in July 2018,30 years after it entered effect, was automatically renewed.
In order to contribute to nuclear non-proliferation and to
gain the understanding of the international community,
Japan is working to reduce its plutonium stockpile under
the principle of not possessing any plutonium that does
not have a use. To this end, it is pursuing greater use of MOX
fuel in thermal reactors and managing and using plutonium
appropriately in accordance with the system introduced in
2016.
b. Uranium Enrichment

As the uranium-235 used by nuclear power plants
constitutes only about 0.7% of natural uranium, uranium
must be enriched to a uranium-235 concentration of 3%–5%before use. Japan Nuclear Fuel Ltd. (JNFL), a private-sector
company established to implement the nuclear fuel cycle on
a commercial basis, built a commercial uranium enrichment
plant in Rokkasho, Aomori Prefecture, that entered operationin March 1992. JNFL subsequently filed an application to
the Nuclear Regulation Authority for permission to switch
to using a new, cost-efficient type of centrifuge offering
improved performance and to introduce other changes
in compliance with the new regulatory standards. The
Nuclear Regulation Authority granted permission for these
operational changes in May 2017.
c. Spent Fuel Reprocessing

JNFL has been building a commercial reprocessing plant at
Rokkasho that is expected to be completed in the first halfof 2021. In light also of the changing business environment
faced by the nuclear power industry, including the
deregulation of the electricity market, the Spent Nuclear
Fuel Reprocessing Implementation Act was enacted in May

2016 to ensure the steady implementation of reprocessing
work. The Nuclear Reprocessing Organization of Japan
was also established in October of that year to serve as thecorporation authorized to manage the funds necessary forreprocessing and to reliably perform reprocessing work andrelated activities.
Meanwhile, the Recyclable-Fuel Storage Company, jointly
financed by Tokyo Electric Power Company Holdings andJapan Nuclear Fuel Limited, is currently building a recyclable
fuel storage center (the “Mutsu Interim Storage Facility”) in
Mutsu City, Aomori Prefecture, to provide a site for dry cask
based interim storage of spent fuel until it is transported toa reprocessing plant. This interim storage facility will enter
operation with an initial storage capacity of 3,000 tons,
which is scheduled to be increased to 5,000 tons.
d. Disposal of Radioactive Waste

Low-level radioactive waste generated by nuclear power
plants is buried by JNFL’s Low-level Radioactive Waste
Disposal Center in Rokkasho, Aomori Prefecture.
As for high-level radioactive waste generated from spent
fuel, METI published in July 2017 the Nationwide Map ofScientific Features for Geological Disposal showing potential
candidate sites as a preparatory step toward its final disposal.
The government plans to narrow down the number ofcandidate sites based on this map.
e. Development of Fast Reactors, etc.

In resource-poor Japan, construction of the Joyo
experimental fast breeder reactor was followed by the
Monju prototype fast breeder reactor in line with basic
government policy. However, it was officially decided in
December 2016 to decommission Monju. Research anddevelopment work on fast reactors conducted using the
Joyo experimental reactor will continue to be pursued inpartnership with other countries following the road map
developed in accordance with the new policy on fast reactor
development adopted by the Inter-Ministerial Council for
Nuclear Power in December 2016.

14

II. Energy Policy(5) Decommissioning Work at Fukushima Daiichi
Nuclear Power Plant
Recovery from the damage caused by the Fukushima Daiichi
accident and smoothly decommissioning the Fukushima
Daiichi Nuclear Power Plant and dealing with the problem ofcontaminated water are all top priorities for the government
and Tokyo Electric Power Company Holdings. Latest news
on progress toward these goals can be viewed on Tokyo
Electric Power Company Holdings’ website (http://www.
tepco.co.jp/en/decommision/index-e.html) (accessed on
September 9, 2019).
a. Basic Policy on Decommissioning of the Fukushima
Daiichi Nuclear Power Plant

In December 2011, nine months after the accident, thegovernment and Tokyo Electric Power Company Holdings
formulated a Mid-and-Long-Term Roadmap towards theDecommissioning of TEPCO’s Fukushima Daiichi Nuclear
Power Station Units 1–4, based on which decommissioning
work and related measures at the plant are to be
implemented.
This roadmap describes plans for decommissioning Units
1–4 and measures for dealing with radioactive contaminatedwater produced at the site. The decommissioning plansinclude plans for the moving of the spent fuel being stored
in spent fuel storage pools in each unit and the removal offuel debris melted in the reactors. A basic principle of theroadmap is that it is subject to continuous review in light of
the actual situation at the plant, progress on developmentof relevant technologies, and other factors, and revisions arebeing made to the roadmap as necessary.
b. Moving Fuel from Spent Fuel Pools

When the accident occurred, it was decided in the interestsof risk mitigation to remove the spent fuel then being stored
in spent fuel storage pools from the pools at Units 1–4 and to
store it appropriately in a shared pool at the site. The removalof spent fuel from the pool in Unit 4, where the most spent
fuel was stored, was completed in December 2014, and work
to remove spent fuel from Unit 3 started in April 2019. For
Units 1 and 2, rubble impeding the removal of fuel is being
removed, while steps are being taken to prevent the releaseof dust containing radioactive material and to monitor theconcentration of radioactive material in the atmosphere.

c. Removal of Fuel Debris

Extensive fuel debris, consisting of fuel and internal reactor
structures that melted during the accident and then cooled
and solidified, is believed to be present in Units 1, 2, and
3. Because of the extremely high levels of radiation in thereactor buildings, surveys of the interiors are presently being
conducted using remote-controlled equipment in advanceof the removal work to be started in 2021.
d. Control of Radioactive Contaminated Water

At the Fukushima Daiichi accident site, groundwater ispenetrating the reactor buildings, and more contaminatedwater is being generated as a result of such groundwater
mixing with accumulated core cooling water that contains
radioactive materials. In line with the three principles of (1)the removal of sources of contamination, (2) the isolation ofwater from contamination sources, and (3) the containmentof contaminated water, various countermeasures against
contaminated water are now being pursued to achieve
stable control of groundwater. Radioactive contaminatedwater is stored at the site after being treated to a level below
the discharge standards using an advanced liquid processing
system (ALPS), etc. The government is now considering
how to handle this treated water, taking a comprehensive
approach that examines social impact as well as scientificassessments of safety.

3. Renewable Energy(1) Current Status and Targets
The Fifth Strategic Energy Plan sets a target for renewableenergy adoption to be achieved by fiscal 2030 of 22%–24%of total power generation, based on a policy of adopting
renewable energies to the greatest extent possible to
make them core energy sources while balancing this withcontaining the burden imposed on customers. To assist the
adoption of renewables, a system for purchasing excess
electricity generated by solar power plants was launched in
November 2009, and a feed-in tariff (FIT) scheme covering
a wider range of power sources (see below for details) was
introduced in July 2012. This scheme accelerated capital
investment in renewables, with installed capacity growing
by 46 GW between the launch of the FIT scheme and the15

The Electric Power Industry in Japan 2020end of December 2018. Including pre-FIT capacity, total
installed renewables capacity reached approximately 67 GW.

(2) FIT Scheme and Issues
The government passed the Act on Special Measures
Concerning Procurement of Electricity from Renewable
Energy Sources by Electricity Utilities in August 2011, which
requires the electricity utilities to purchase all the electricity
generated from renewable energy sources (includinghydropower plants with a capacity of under 30 MW).1 Thisact led to implementation of the FIT scheme for renewableenergy on July 1, 2012.
The electricity supply sources, purchase prices and purchaseperiods covered by the FIT scheme for each fiscal year are to
be determined by METI. The purchase prices and periods forfiscal 2019 are as shown in Table 2.3. Under the FIT scheme,
the former general electricity utilities are permitted to passon their costs for the purchase of electricity generated byrenewable energy sources to their customers in the form ofa surcharge by including them in the electricity bill.
The surcharge for fiscal 2019 is 2.95 yen per kWh (2.4287

trillion yen for Japan as a whole), or 9,204 yen per year
for the standard model household. Under this system,
former general electricity utilities collect the surcharge
from customers and transfer the funds to a cost-bearing
adjustment organization called the Green Investment
Promotion Organization, which refunds their purchase costs
to them in due course (Figure 2.3).
The scheme also contains a provision that reduces thesurcharge for industrial customers who use extremely highvolumes of electricity and who satisfy certain conditions.
Notwithstanding the increase in investment in renewableenergies and growth in FIT-approved capacity since 2012,problems have emerged and the government revised
the FIT scheme in 2016. Many solar power generation
projects remain unfinished despite having already been
approved under the FIT scheme. Most of these wereapproved between 2012 and 2014 just after the launchof the FIT scheme when purchase prices were high, andso the government revised the startup deadlines andpurchase prices for these projects. Regarding wind power,
geothermal, small/medium hydropower, and biomass

Sakai Solar Power Station (Kansai Electric Power Co.)

16

II. Energy Policy

Installed Capacity of Renewable Energy (as of end December 2018)

Table 2.2

Unit: MW

Combined total by end June2012

Combined capacity installed
under FIT

Total

4,700

5,830

10,530900

37,22038,120Wind power

2,600

1,110

3,710

Small/medium hydropower

9,600

350

9,950

Biomass

2,300

1,520

3,820

500

20

520

20,60046,05066,650Type

Solar power (residential)
Solar power (non-residential)

Geothermal power
Total

Source: METI, Submission to the 13th meeting of the Coordination Subcommittee of the Advisory Committee for Natural Resources and Energy (2019)

Outline of the FIT Scheme

Figure 2.3

Those engaged in
the power generation
business using renewableenergy sources

Sale of electricity produced fromrenewable energy sources

Solar power

Purchase of electricity at a fixedprice for a governmentguaranteed period

Wind power

Electric powercompanies
Electricity supply

Collection of surcharge together
with electricity charge
Submission ofcollected surcharge

Payment forpurchase cost

Small- andmedium-scalehydro power

Electricity customers

Green Investment
Promotion Organization(organization to collect anddistribute the surcharge)

GeothermalPower

BiomassThose who generate power
at home

Decision on tariffs and durations,
respecting the opinion of the special
committee (each fiscal year)

Qualification of facilities(Government confirms whether
the facility can generate electricity
stably and efficiently. Qualification
is cancelled if the facility no longer
satisfies those requirements.)

Decision of surcharge
unit price per kWh(each fiscal year)

Minister of Economy,
Trade and Industry
Opinion on tariffs and duration
Special committee fordetermination of tariffs anddurations

Government

Source: METI website (accessed on September 9, 2019)

1 General electricity utilities cannot purchase electricity from renewable energy power generation facilities that they have installed themselves.

17

The Electric Power Industry in Japan 2020

Purchase Prices, Durations, and Installations under the FIT Scheme

Purchase category

Purchase price(yen/kWh)FY2018 FY2019

FY2017

FY2020

Output controller not required

28

26

24

–

Output controller requiredLess than 10 kW Output controller not required,dual generation
Output controller required, dual
generation*1

30

28

26

–

25

24

–

27

26

–

10 kW–500 kW

21

18

14

–

500 kW–2,000 kW

21

18

Bidding system

*1

Solar

Table 2.3

Bidding system

2,000 kW or above

20

19

18

55

20

19

18

18

17

16

16

Bottom-fixed offshore wind power

36

36

36

–

Floating offshore wind power

36

36

36

–

Less than 15,000 kW

40

40

40

40

15,000 kW or above

26

26

26

26

Less than 15,000 kW

30

30

30

30

15,000 kW or above

20

20

20

20

Geothermal (replacement ofLess than 15,000 kW
equipment excepting underground
15,000 kW or above
equipment)

19

19

19

19

12

12

12

12

Less than 200 kW

34

34

34

34

200 kW–1,000 kW

29

29

29

29

1,000 kW–5,000 kW

27

27

27

27

5,000 kW–30,000 kW

20

20

20

20

Less than 200 kW

25

25

25

25

200 kW–1,000 kW

21

21

21

21

1,000 kW–5,000 kW

15

15

15

15

5,000 kW–30,000 kW

12

12

12

12

Methane fermentation gasification (biomass-derived)

39

39

39

39

Woody biomass (thinnings, Less than 2,000 kWetc.) and agricultural crop
2,000 kW or above
residue

40

40

40

40

32

32

32

32

Construction material waste

All capacities

13

13

13

13

General waste and otherbiomass

All capacities

17

17

17

17

Onshore wind powerLess than 20 kW
All capacities

Offshore wind power
Geothermal
Geothermal (replacement of all
equipment)

Hydro

Hydro using existing conduits*2

Biomass

Newly installed
Replacement capacity

10

20
20
20

21

20 kW or above

Duration(years)

20

15

20

20

*1 Power generation facilities whose connection applications were received on or after April 1, 2015, and that are located in areas subject to supply and demand
control by Hokkaido, Tohoku, Hokuriku, Chugoku, Shikoku, Kyushu, or Okinawa Electric Power Companies are required to install output controllers.
*2 Upgrades to electrical facilities and penstocks utilizing existing conduits.
Source: Compiled from Agency for Natural Resources and Energy website (accessed on September 9, 2019)18

II. Energy Policy

Results of Tenders for Solar Power Generation

Table 2.4

Results of tenders

Successful bids

First tender(November 2017)

Eligible facilities: 2 MW or above
Requirement: 500 MW

Successful bids: 9
Total output: 141 MW
Successful bid price: 17.20-21.00 yen/kWh

Second tender(September 2018)

Eligible facilities: 2 MW or above
Requirement: 250 MW

Successful bids: 0(no bids came in below the ceiling price)
Total output:
Successful bid price:

Third tender(December 2018)

Eligible facilities: 2 MW or above
Requirement: 196.96 MW

Successful bids: 7
Total output: 197 MW
Successful bid price: 14.25-15.45 yen/kWh

Fourth tender(September 2019)

Eligible facilities: 0.5 MW or above
Requirement: 300 MW

Successful bids: 63
Total output: 196 MW
Successful bid prices: 10.50-13.99 yen/kWh

Source: Compiled from Green Investment Promotion Organization website (accessed on September 11, 2019)

power generation, the pricing system was changed toallow purchase prices to be set for multiple years. A tender
scheme for solar power generation of 500 kW or above has
also been introduced to bring down purchase prices. Resultsof tenders are shown in shown in Table 2.4.

(3) Complete Overhaul of the FIT Scheme
The rapid growth in the installation of renewables has
made it necessary to impose output controls. While thesolar power connection limit in Kyushu Electric Power Co.’selectricity service area is 8.2 GW, connected solar capacity
had already reached 8.1 GW by the end of August 2018.
Despite restricting output from thermal power plants, using
interconnections, and employing excess power to pumpup water for pumped storage, output controls have had tobe imposed on solar and wind power generation operatorssince October 2018. Looking ahead, it is likely that output
controls will be imposed more frequently in more areas,
particularly during public holidays in spring or autumn whenelectricity demand is low.
As adoption of renewables has spread, a number ofproblems with FIT have emerged, including rising surcharges
on renewables and difficulties with receiving power
generated by renewables on the grid side. The government
has decided to overhaul FIT by the end of fiscal 2020 in orderto make renewables an economically self-sustaining coreelement of the power generation mix. More specifically,large commercial solar power generation and wind power
generation are expected to become competitive sourcesof electric power, and action will be taken to make themeven more competitive and integrate them into the electric
power market. A study will also be made of mechanismsthat will allow renewable power generation operators
to sell electricity via the electric market while addressing
imbalances and providing a certain degree of predictability
regarding payback. The new system will be applied taking
into consideration the state of project development in eachcategory of power generation and is expected to initiallycover large commercial photovoltaic power generation.

(4) Termination of Purchase Period under the
Surplus Electric Power Purchasing System
Under the surplus electric power purchasing system
launched in November 2009 prior to the start of FIT scheme,
power was purchased for a period of 10 years at solar power
plants with a capacity of less than 500 kW. Beginning inNovember 2019 plants will come to the end of their tenyear periods, creating a problem that has been dubbed the“Year 2019 Problem.” The plants affected are estimated toreach a capacity of about 6.7 GW in total by 2023. Electricity
retailers that will be required to buy a certain proportion

19

The Electric Power Industry in Japan 2020

(44%) of their electricity from non-fossil fuel sources in
2030 under the Act on Sophisticated Methods of Energy
Supply Structures are showing interest in purchasing
power from solar power plants when the purchase period
terminates. The majority of electricity retailers set purchaseprices at 7–10 yen/kWh, and competition for customers is
intensifying as various purchasing options are offered. In
addition to straightforward purchases, for example, someelectricity retailers are now offering to purchase electricity
on condition that storage batteries are installed.

4. Global Warming Countermeasures(1) International Frameworks and Japanese
Government Initiatives
a. Greenhouse Gas Emission Reduction Targets

At the 21st Conference of the Parties to the United Nations
Framework Convention on Climate Change (COP21) heldin December 2015, 195 countries and regions adopted theParis Agreement, which addresses greenhouse gas (GHG)
emission reductions from 2020 onward. The Paris Agreement

sets forth long-term shared global targets including keeping
the average global temperature increase well below
2°C above pre-industrial revolution levels and balancing
anthropogenic GHG emission and absorption in the second
half of this century. Unlike the Kyoto Protocol, which required
only advanced nations to reduce their emissions, theParis Agreement requires all signatory countries to set out
emissions reduction targets as well as the domestic policies
to be employed to achieve those targets. The extent towhich those targets have been attained is to be evaluatedevery five years.
The Plan for Global Warming Countermeasures wasapproved at a cabinet meeting in May 2016, setting out
how the GHG emission reduction target for 2030 (26.0%
reduction compared to fiscal 2013) outlined in the INDC
submitted by Japan in 2015 will be achieved. This plan
notes that it is important to steadily implement thecountermeasures outlined in the INDC on the way toachieving the mid-term targets, and the government islooking to utilize a diverse range of policy tools including
voluntary measures, regulatory measures and economic
measures, exploiting their respective characteristics in an

Folding wind turbines being promoted by Okinawa EPco delivered to Tonga (Okinawa Electric Power Co.)

20

II. Energy Policy

Government Action on GHG Reduction Targets

Table 2.5

Date

Trend

December 1997

Kyoto Protocol adopted at COP3. Japan’s GHG reduction target set at 6% below 1990 levels.

October 1998

Act on Promotion of Global Warming Countermeasures instituted in response to adoption of the
Kyoto Protocol.

April 2005

Kyoto Protocol Target Achievement Plan outlining the measures necessary to attain Japan’s 6%
GHG reduction target approved at a meeting of the cabinet.

January 2010

The Japanese government responds to the Copenhagen Accord (COP15) by submitting a GHG
reduction target for 2020 of 25% below Japan’s 1990 levels to the Secretariat of the United Nations
Framework Convention on Climate Change, premised on establishment of a fair and effective
international framework and agreement to ambitious targets by all major countries.

November 2011

At COP17, Japan declares that it will not participate in the second commitment period under the
Kyoto Protocol.

November 2013

At COP19, Japan announces a target of achieving a 3.8% reduction relative to fiscal 2005 by 2020.

July 2015

Following the decision of COP19, the Japanese government submits to the UNFCCC Secretariat atarget of reducing emissions by 26% below fiscal 2013 levels (a 25.4% reduction relative to fiscal
2005 levels) by fiscal 2030.

May 2016

The Plan for Global Warming Countermeasures approved at a cabinet meeting in response to theconclusion of the Paris Agreement.

June 2019

The Long-term Strategy under the Paris Agreement approved by the cabinet.

Source: Agency for Natural Resources and Energy website (accessed on September 9, 2019)

effective manner. The policy for the electricity sector is tomaximize the deployment of renewable energies, improve
thermal power plant efficiency, and utilize nuclear power
plants that have been confirmed to be safe.
In June 2019, the cabinet adopted a long-term strategy
for reducing emissions up to 2050 as required by the Paris
Agreement, and this was presented to the UN Secretariat.
This strategy sets a long-term target of achieving an 80%
reduction in GHG by 2050. Noting the difficulty of achieving
this target simply by continuing to pursue conventional
means of reducing emissions, it calls for innovation coupledwith a virtuous circle of environmental and economic
growth to solve environmental issues.
Table 2.5 shows the government’s initiatives relating to GHG
reduction targets since adoption of the Kyoto Protocol in
1997.

b. Joint Crediting Mechanism

The Japanese government employs the Joint Crediting
Mechanism (JCM) to effectively address climate change,
based on the belief that achieving “low-carbon growth”
globally depends on both developed and developing
countries alike making adequate use of technologies,
markets, and funds.
The JCM allows contributions to GHG emission reductions
and carbon capture achieved in partner countries throughtransferals of Japanese low-carbon technologies andoutcomes to be counted as part of Japan’s contribution.
The Japanese government has consulted with developing
countries concerning the JCM since 2011. It has signed
bilateral documents with 17 countries, the latest being with
the Philippines in January 2017.
International discussions are underway concerning thevalidity of the JCM under the Paris Agreement.

21

The Electric Power Industry in Japan 2020(2) GHG Emissions and Voluntary Efforts by thePrivate Sectorb. Voluntary Efforts by the Private Sector

In order to better contribute to global GHG emission
reductions over the long-term, the Japan Business
Federation (Keidanren) issued the Commitment to a
Low Carbon Society (Phase I) in 2013, followed in 2015
by the Commitment to a Low Carbon Society (Phase II)
laying down commitments up to 2030 in order to further
contribute to action on climate change. Commitment to a
Low Carbon Society calls for participants to set targets andreview progress themselves to ensure the effectiveness of
their actions, and further commits the Japanese business
community with its technological strengths to play a keyrole in the drive to halve global GHG emissions by 2050.

a. GHG Emissions in Japan

In fiscal 2017, Japan’s GHG emissions measured 1,292 million
tons (CO2 equivalent), and emissions of CO2 accounted for
92.1% (1,190 million tons) of this total. CO2 emissions showed
9.6% decrease from fiscal 2013 and a 8.0% decrease fromfiscal 2005.
CO2 emissions in individual sectors have been decreasing
since 2013 (Figure 2.4), and declining by 11.2%, 12.2%, and10.7% respectively in the industrial sector, the commercial
sector, and the residential sector between fiscal 2013
and fiscal 2017. This was due largely to lower energy
consumption resulting from energy conservation in all
sectors and to improvements in the CO2 emission intensity
for electricity.

As of March 2019, 62 industries had adopted targets foremissions resulting from business activities in Japan in 2030,
and action is underway to reduce emissions throughout
entire value chains and to accelerate the development ofinnovative technologies and contribute more internationally.

Changes in CO2 Emissions by Sector

Figure 2.4

500 ( Million tons-CO2 )

503

465

467

<relative to fiscal 2013>(relative to fiscal 2005)

Industrial (plants, etc.)<-11.2%>413 (-11.7%)

400

300

Transportation (vehicles, etc.)
244

200

Operations and others(commercial operations,services and offices, etc.)

207

236

220

<-4.9%>

213 (-12.7%)
207 <-12.2%>

224(-5.9%)

208

100

Residential

130
131

Energy conversion (excluding statistical errors
in the distribution of electricity and heat)

96

0

170

’90

’91

’92

’93

105

102

<-8.4%>

96 (-6.1%)
57

Industrial processes and use of products
49
29

Other emissions (agriculture, indirect CO 2 emissions, etc.) 4.6

3.5

Waste (incineration, etc.)24
6.7(+8.9%)

32

66

’94

’95

’96

’97

’98

’99

’00

’01

’02

’03

’04

186 <-10.7%>

’05

’06

’07

’08

’09

’10

’11

’12

’13

<-4.0%>

47 (-16.8%)<-1.8%>

29 (-8.9%)
’14

’15

’16

’17
( FY )

3.2 <-7.9%>(-28.8%)Note1:1:Emissions
Emissionsby sector
are calculatedby distributing
the emissions
that accompany
power generation
thermalgeneration
amongfinal
the consumption
respective final
consumption sectors.
Noteby sector
are calculatedby distributing
the emissions
that accompany
power generationand thermal andgeneration
among
the respective
sectors.
Note
Percentages
in anglebrackets indicate
changein emissions
in eachinsector
to fiscal
fiscal 2013,
percentages
parentheses indicate change relative to fiscal 2005.
Note2:2:
Percentages
in parentheses
indicatechangein emissions
each relative
sector in2013 andrelative
to fiscalin2005.
Source: Ministry of the Environment, “Japan’s National Greenhouse Gas Emissions in Fiscal Year 2017 (Final Figures)” (2019)22

II. Energy Policy

CO2 Emissions in the Electric Power Industry

Figure 2.5(CO2 emission factor (kg-CO2 /kWh)) 0.75

600 (CO2 emissions (million tons CO2 equivalent))

0.70
500

484

400

409

CO 2 emissions

415

441

0.65

430

411
0.60

0.570

373

300

469

372

0.552
0.531

317

332
301

0.55

0.516
0.496

0.50

0.463

0.45

275
0.476

200

0.423

0.417
100

0.487

0.40

CO 2 emission factor
0.373

0.35

0.351

0.350
0.30

0

’90 ’91 ’92 ’93 ’94 ’95 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15’16 ’17’18

Note: Reflected adjustments made for Kyoto Mechanism credits
Source: Compiled from FEPC, “Energy and Environment” (2018)c. CO2 Emission and Global Warming Countermeasures
Implemented by the Electric Power Industry

The Federation of Electric Power Companies of Japan(FEPC) (consisting of former general electricity utilities) is
participating in the Japan Business Federation’s Commitment
to a Low Carbon Society and are promoting measures onboth the supply and demand sides of the electricity. In July
2015, 12 members of FEPC and 23 PPSs announced theirown Commitment to a Low-Carbon Society in the Electricity
Industry, which commits them to achieving a CO2 emission
factor in the electricity in fiscal 2030 of approximately
0.37 kg-CO2 /kWh (equivalent to a reduction of 35% fromthe fiscal 2013 level). The Electric Power Council for a Low
Carbon Society (ELCS) was established in February 2016 withthe aim of moving forward with the attainment of thesetargets for all electricity utilities as a whole.
According to data released by ELCS, CO2 emissions in fiscal
2018 (final figures) came to 372 million tons-CO2 and the CO2
emission factor was 0.463 kg-CO2/kWh.

On the supply side, electricity utilities are working on a
range of initiatives, including restarting nuclear power plants
which are confirmed to be safe and feeding electricity
derived from renewable energy sources into the grid basedon the FIT scheme for renewable energy.
On the demand side, they are actively promoting energy
conservation, providing information to realize more efficientelectricity use, and pursuing the widespread installation ofsmart meters.
The utilities are also actively pursuing research anddevelopment, working to develop a range of promisingtechnologies, including clean coal technologies, CO2
capture and storage technologies, next-generation powertransmission and distribution technologies, and ultra-highefficiency heat pumps.
Figure 2.5 shows CO2 emission trends in the electric powerindustry.

23

The Electric Power Industry in Japan 2020

III. Supply and Demand

1. Electricity Demand and Peak Load
Japan’s electricity demand has increased practically intandem with post-war economic growth. Japan’s gradualeconomic recovery continued in fiscal 2017 as real GDP grewby 1.9% from fiscal 2016 when real GDP rose 1.2% from a year
earlier. The unemployment rate also improved in fiscal 2017,
falling 0.3 percentage points to 2.8% from fiscal 2016 when it
stood at 3.1%.
Electricity demand in Japan has either declined or remained
unchanged since reaching 1,077.5 TWh in 2007, and in fiscal
2017 came to 977.4 TWh. This trend is attributable to several
factors, including 1) the slowing of economic growth, 2)
improved energy conservation, and 3) demographic decline.

More recently, however, growing solar power generation in
the residential sector, which these statistics do not capture,also appears to have played a part. Peak national demand
has also remained largely unchanged since 2011 and came to155.8 GW in fiscal 2017.
Power consumption breaks down by use as follows: 28%
residential demand, 34% commercial demand, and 36%
industrial demand. Industry remains the largest consumerof electricity. Since the 1990s, however, industrial demandhas entered a downward trend due to changes in industrial
structure and growing energy conservation. Over the
longer term, the growth in power consumption has thus
been driven by consumption in non-industrial sectors,
namely the residential and commercial sectors. Growth inChanges in Electricity Demand, 1975-2017

Figure 3.1

1200 [ TWh ]1,044 1,048
1000

982

1,077

1,036

1,056
1,003

1,002

992

993

969

955

961

977

882
800

766

599

600

520
400

428

200

0

1975 1980 1985 1990 1995 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

[ FY ]

Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)24

III. Supply and Demand

consumption in the commercial sector has been propelled
by growth in offices and commercial facilities triggered bydevelopment of a service economy and the accompanying
use of air conditioners and other appliances. In theresidential sector, the rapid spread of heating and coolingappliances, such as air conditioners and electric carpets
and other household appliances, driven by rising living
standards, ensured that power consumption continued to
grow until fiscal 2005. Growth then leveled off as applianceownership reached a saturation point and energy-saving
devices began to capture a growing share of the market. In
fiscal 2011, increased awareness of the importance of saving
electricity in the aftermath of the Fukushima Daiichi accident
caused consumption to go into decline. In fiscal 2017, nonindustrial consumption accounted for 62% of final power
consumption.
The proportional rise in non-industrial demand has resulted
in higher demand in recent summers and winters due todemand for heating and air-conditioning. There have thus

emerged greater divergences in demand between thewinters and summers and other seasons (Figure 3.3), and also
between daytime and nighttime hours (Figure 3.4). Since
the 2011 Great East Japan Earthquake, however, power
conservation and other measures have curbed daytime
power consumption during the summer, and the disparities
between the summer and other seasons, and between
daytime and nighttime hours during the summer, haveshrunk.
Efficiency in the use of generation facilities declines withgrowing variation in demand, pushing up power supply
costs. Nevertheless, while the annual load factor (i.e.,
the ratio of annual average load to annual peak load, an
indicator of the efficiency of use of generation facilities)
followed a downward trend in the late 1990s, it actually
improved to 60%-70% from the mid-2000s. This is thanks inlarge part to the introduction of electricity rates designed tolevel loads, nighttime electricity use, and the wider adoptionof solar power generation.

Breakdown of Power Consumption by Sector, 1975-2017

Figure 3.2
Transportation

Industrial

Residential

Commercial

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

1975

1985

1995

2000

2005

2010

2011

2012

2013

2014

2015

2016

2017

Note: The method of calculation was changed from fiscal 1990.
Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)25

The Electric Power Industry in Japan 2020

Electric Power Consumption over the Course of a Year

Figure 3.3

90 [ TWh ]80

FY2016
FY2005FY2015
FY1995

70
60
50
40

FY198530

FY197520

FY1965

10
0

Apr.

May

June

July

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Note 1: Figures for fiscal 1975 and 1985 exclude Okinawa Electric Power Co.
Note 2: Figures are totals for 10 electric power companies through fiscal 2015, and for 10 areas in fiscal 2016.
Source: Compiled from Agency for Natural Resources and Energy, “Energy White Paper 2018”

Power Consumption over the Course of Days on Which Peak Loads Occurred
[GW]
200

Figure 3.4(Total for 10 electric power companies)

183

178

180

171
156

160

154

Power consumption

140

July 24, 2001

144

Aug. 23, 2010
Aug. 5, 2005

120

Aug. 25, 1995

100
89

80

Aug. 7, 1990

91

88
76

Aug. 29, 1985

73

65

60

Aug. 7, 2015
Aug. 9, 2016

110

92

July 31, 1975

50

40

32
20
0
1

2

3

4

5

6

7

8

9

10

11

12

Note: Figures for fiscal 1975 exclude Okinawa Electric Power Co.

13

14

15

16

17

18

19

20

21

22 23 24
[Time of day]

Source: Agency for Natural Resources and Energy, “Energy White Paper 2018”26

III. Supply and Demand

Annual Load Factor, 1975-2017

Figure 3.5

70%
68%
66%
64%
62%
60%
58%
56%
Annual average load / peak load 3-day average

54%

Annual average load / peak load
52%
50%
1975

1980

1985

1990

1995

2000

2005

2010

2015 2017(FY)

Source: Compiled from Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018) for annual average load / peak load 3-day average (up to
fiscal 2015); and OCCTO, “Outlook of Electricity Supply-Demand and Cross-regional Interconnection Lines” for annual average load / peak load (from fiscal 2015)

2. Electric Power Generated
Electric power generated came to 1,007.4 TWh in fiscal 2017.
The progressive shutdown of nuclear power plants following
the March 2011 earthquake increased dependence on
thermal power plants and caused thermal’s share of power
generated to rise from 66.7% in fiscal 2010 to 83.3% in fiscal
2017. While nuclear power’s share stood at 24.9% in fiscal
2010, the shutdown of all nuclear power plants in September
2013 caused this figure to drop to 0% in fiscal 2014 whilethermal’s share rose to 90.7%. Since the restart of Kyushu
Electric Power Co.’s Sendai Nuclear Power Plant in August
2015, several other plants have gradually come back online.
However, nuclear’s share of power generated in fiscal 2017
was still only 3.0%.

On the other hand, the construction of renewable energy
installations such as wind and solar power plants has
increased. In fiscal 2017, 6.1 TWh of electric power was
generated by wind power, and 15.9 TWh by solar power.
Although wind power was first introduced in the 1990s,
growth has been sluggish in recent years, increasing by onlyaround 18% over the past five years. Solar power, on theother hand, has grown rapidly despite not entering the mix
until around 2005. Following the launch of the FIT scheme
in July 2012, solar power installations have surged, with solar
output surpassing wind power in fiscal 2015. In fiscal 2017,about 2.6 times as much power was generated by solar
power than by wind power.

27

The Electric Power Industry in Japan 2020

Power Generation Mix, 1975-2017

Figure 3.6

Renewables (excluding hydro)
100%

5%

Hydro

ThermalNuclear

1%

1%

0%

1%

2%

3%

90%

91%

91%

89%

85%

83%

8%

8%

8%

9%

9%

90%

24%

29%

80%

25%

26%

30%

70%
60%

77%
82%

50%
63%
40%

61%

61%

9%

9%

66%

67%

7%

8%

30%
20%
10%

18%

13%
0%

0%

1975

0%

1985

1995

0%

2000

0%

2005

8%

0%

1%

2010

1%

2011

1%

2012

1%

2013

1%

2014

8%
1%

2015

9%

4%

5%

2016

2017

(FY)

Note: Figures on electric power generated for electric utilities are generation-end figures through fiscal 2015, and transmission-end figures from fiscal 2016.
Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)

Wind and Solar Power Generation

Figure 3.7(TWh) 18
15.940

16
Wind

14

Solar

12
10
8
6.140
6
4
2
0

2000

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Note: Figures on electric power generated for electric utilities are generation-end figures through fiscal 2015, and transmission-end figures from fiscal 2016.

(FY)

Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)28

III. Supply and Demand

3. E lectricity Supply and Demand
Balancedemand and supply capacity over the 10-year period fromfiscal 2018 to fiscal 2027 will be almost 0%, and electricity
demand and supply capacity are expected to remain atcurrent levels.

(1) Present and Projected State of Supply and
Demand Balancea. Recent Developments

Eight years since the Great East Japan Earthquake, Japan’s
electricity supply and demand situation is improving. Due tothe prolonged shutdown of nuclear power plants, however,the country still remains dependent on thermal power toensure a stable supply of electricity.
b. Supply and Demand Projections

As for the electricity supply and demand situation, it hasremained possible in recent years to maintain the minimum
3% reserve margin needed to ensure supply continuity in allareas of Japan. The average rate of change in both electricity(2) Securing Balancing Capacity
Electricity retailers have to be able to always match supply
and demand, and they secure the necessary supply capacity
to do so. It falls upon general electricity transmission anddistribution utilities to secure the supply capacity required
to be able to deliver adequate electricity to retailers tomeet supply and demand fluctuations. Since fiscal 2017,
the capacity required to balance supply and demand has
been procured by tenders conducted by these transmission
and distribution utilities in order to ensure that balancing
capacity is procured in a fair and transparent manner.

Projected Electricity Demand and Supply Capacity

Figure 3.8

(GW)
200

Electricity demand

Supply capacity

180
160
140
120
100
80
60
40
20
0

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

(FY)

Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)

29

The Electric Power Industry in Japan 2020

The balancing capacity procured is of two main types:
power source I and power source II. Power source I consistsof power provided by dedicated sources of balancing
capacity that are always available to transmission anddistribution utilities; and power source II consists of surplus
power from sources that can be used following gate closure
for retail power sources. Power source I’ provides balancing
capacity when weather conditions are severe, and isprocured utilizing generated output and demand response
programs.

Power source I’ was used a total of seven times in the Tokyoand Kansai areas in fiscal 2018. In the Tokyo area, it was usedfour times in August 2018 because of the tight supply anddemand situation due to a heat wave. In the Kansai area, it
was used twice in July 2018 because of the tight supply anddemand situation due to a heat wave, and once in January
2019 because of a similarly tight situation in the winter. As
of September 2019, power source I’ had been used once infiscal 2019 due to unseasonably cool weather in April.

In fiscal 2019, 11,440 MW of power source I and 140,680 MWof power source II were procured. In addition, 1,940 MW ofpower source I’ was procured, of which 890 MW of demand
was met by demand response.

Nishi-Sendai Substation Storage Battery System (Tohoku Electric Power Co.)30

IV. Supply Structure

IV. Supply Structure

1. Power Generation Facilities

generation efficiency of all thermal plants in Japan wasmaintained at a world-class level of 44.1%1 in fiscal 2016.

Total generating capacity was 305.5 GW at the end of fiscal
2018. This consisted of 53% thermal power (14% coal, 27%
LNG, and 12% oil), 12% nuclear power, 16% hydro, and 19%
renewables (excluding hydro). Figure 4.1 shows thebreakdown of power generation facilities in Japan by powersource at the end of fiscal 2018. The data on power
generation facilities in this chapter are for facilities owned byelectric utilities and facilities generating electricity procured
by electric utilities from entities other than electric utilities.

(1) Power Generation Facilities for Electric Utilities
a. Thermal PowerThe total installed capacity of thermal power plants was
160.6 GW as of the end of fiscal 2018, and the average power

Coal-fired generating capacity came to 43.1 GW. Coalgenerates higher CO2 emissions than other fuels. However,recent years have seen emissions reduced by the
introduction of ultra-supercritical (USC) coal power plants.
The power generation efficiency of coal-fired power plants
in Japan was maintained at a world-class level of 41.6% in
fiscal 2016.
LNG-fired generating capacity came to 82.0 GW. LNG-fired
power plants produce lower SOx, NOx, and CO2 emissions
than oil- and coal-fired plants. Construction of large LNGfired power plants employing high-efficiency combinedcycle technologies is underway to further reduce emissionsof these substances. A new plant2 added to the grid in 2018

Breakdown of Commercial Power Generation Facilities by Power Source (FY2018)

Figure 4.1

Wind 1% Others 2%

Coal 14 %Solar 16%

Hydro 16%

Nuclear 12%

LNG 27%

Oil andothers 12%

Total generating capacity 305.5 GW
Source: OCCTO, “Aggregation of Electricity Supply Plans, FY2019”

1 Power generation efficiency is calculated on a low heating value (LHV) basis.
2 Chubu Electric Power Co.’s Nishi-Nagoya Thermal Plant Unit 7-2 (operation started in March 2018).

31

The Electric Power Industry in Japan 2020（g/ kWh）

Comparison of SOx and NOx Emissions per Unit of Power Generated at
Thermal Power Plants of Major Countries (2016)

Figure 4.2

3

2.0

2

1

0

SOx emissions
NOx emissions

1.3
0.5

0.5

US

0.8
0.2

Canada

UK

0.8
0.2

0.6

1.0
0.1

FranceGermany

0.4

Italy

0.1

0.2

Japan

Source: FEPC, “Energy and Environment” (2018)

exhibits significant improvements in performance, with gas
turbine inlet temperatures of 1,600°C and power generation
efficiency of approximately 63.08%.

accounted for just 3.8% of power generated at the end of
fiscal 2018. Oil-fired power plants are declining due to thepromotion of highly economical coal power plants andlow-carbon LNG power plants.

Oil-fired generating capacity came to 35.5 GW. However, oil

Unit 2 of Sakaide Power Station (Shikoku Electric Power Co.)
Reentered service after conversion from oil to LNG-CC in August 2016.

32

IV. Supply Structure

Jimah East Coal-fired Power Plant in Negeri Sembilan, Malaysia (Chugoku Electric Power Co., TNB, and Mitsui & Co.)
Jimah East is a USC plant with an output of 2,000 MW (1,000 MW × 2 units). Commercial operation started in 2019.

b. Hydro Power

Hydro power plants have been promoted in Japan to takeadvantage of the country’s high levels of rainfall. Hydro
generating capacity at the end of fiscal 2018 came to 49.1
GW, of which conventional hydro accounted for 21.6GW andpumped storage for 27.5 GW. Variable speed pumped
storage systems have also been adopted. These systems
provide a means of addressing fluctuations in output fromrenewables as they allow power output to be flexibly
adjusted.
c. Renewable Energy• SolarInstalled solar power generating capacity at the end of fiscal
2018 was 49.6 GW. Solar power makes up approximately 90%
of total FIT-certified renewable power generating capacity.
In Japan, solar power has led growth in renewables.
• WindAs of the end of fiscal 2018, a total of 3.8 GW of wind power
generating capacity had been installed in Japan. However,wind power has lagged behind solar because it takes longer

to assess the environmental impacts (including the impact
on the landscape) and there are constraints on grid capacity.
For this reason, the introduction of wind power generation
facilities is delayed compared to solar power generation. The
majority of installed wind power generation facilities areonshore, and only around 20 MW of capacity is offshore.
One obstacle to development of offshore wind farms was
the lack of clarity surrounding the rules on occupancy ofmarine areas. The situation was clarified, however, with theentry into force in April 2019 of the Act on Promoting
Utilization of Sea Areas for Development of Power
Generation Facilities Using Maritime Renewable Energy
Resources, and the introduction of offshore wind farms is
expected to increase in the future.
d. Nuclear Power Generation

Total nuclear power generating capacity (by 17 PWRs and 22
BWRs) at the end of fiscal 2018 came to 38.6 GW. As of theend of August 2019, nine nuclear reactors (all PWRs) were incommercial operation (see “Nuclear Power Generation” inSection 2, Chapter II).

33

The Electric Power Industry in Japan 2020

Sakuma Dam (J-POWER)Entered operation in 1956 with an output of 350 MW.

Trends in Renewable Energy Generating Capacity

Figure 4.3

(GW)

60

50
Solar
Wind

26% annual average growth

Small/medium hydro40

Geothermal
Biomass

30
9% annual average growth20

5% annual average growth

10

0

2003

2004

2005

2006

2007

2008

2009

*Excluding large hydro

2010

2011

Surplus powerpurchasing system

2012

2013

2014

2015

2016 (FY)FIT scheme

RPS (Renewable Portfolio Standard) scheme
Source: Agency for Natural Resources and Energy, “Energy White Paper 2018”34

IV. Supply Structure

Hatchobaru Geothermal Power Station (Kyushu Electric Power Co.)
Hatchobaru Geothermal Power Station has a total capacity of 110 MW, which is the largest capacity of the geothermal power station in Japan.

(2) Future Plans
a. Transition of Power Generating Capacity and Power
Development Plans

In March 2019, OCCTO published the “Aggregation ofElectricity Supply Plans” for FY2019.3 Figure 4.4 shows
generating capacity by power source, and Table 4.1 shows
the breakdown of power development plans up to fiscal
2028 (new installation, uprating/derating, and retirement
plans).4
Looking forward, coal- and gas-fired generating capacity willtrend upward overall as construction of new capacity willoutweigh ongoing decommissioning. As the global trend to
reduce GHG emissions continues, however, the withdrawalof plans for new coal-fired power plants and the shift togas-fired power plants are observed in Japan.
Decommissioning of oil-fired power plants will continue andgenerating capacity will shrink. While renewable generating

capacity will increase driven by construction of new solar
power plants and wind farms, hydro will increase only
marginally.
b. Moves to Expand Capacity by Power Source• Thermal PowerIn June 2016, the government published its “Technology
Roadmap for Next-Generation Thermal Power Generation.”
Among other things, this aims to reduce CO2 emissions fromthermal power plants by improving the efficiency of gasand coal-fired power generation.
More specifically, the aim regarding gas-fired plants is todevelop ultra-high temperature (1,700oC class) gas turbines5
and fuel cell combined cycle (GTFC)6 systems that generate
electricity in three steps (by means of a fuel cell, gas turbine,and steam turbine). Regarding coal-fired plants, the aim is todevelop integrated coal gasification combined cycle

3 In this report, the installed power generation capacity is the aggregation of the capacity of electric power plants owned by electricity utilities and those owned bycompanies other than electricity utilities that are registered as procured supply capacity of electricity retailers and general electricity transmission and distribution utilities.
4 Aggregated including facilities for which the date of commercial operation is “uncertain.”
5 Development will be completed by around 2020 (approx. 57% power-generation efficiency and CO2 emission intensity of 310 kg/MWh).
6 Development will be completed by around 2025 (approx. 63% power-generation efficiency and CO2 emission intensity of 280 kg/MWh).

35

The Electric Power Industry in Japan 2020

Trends in Generating Capacity by Power Source, 2016-2028 (*1)

Figure 4.4

Generating capacity (GW)(*2)

Conventional hydro400

Pumped storage

Coal

LNG

Oil and others

Nuclear

Wind

Solar

350

1.5%

1.5%

300
250
200

1.8%
13.5%
1.2%
13.0%

1.8%
15.2%
1.2%

13.1%

19.7%

21.0%

12.1%

1.4%
16.2%
1.2%
12.5%

2.4%
11.4%

11.1%

12.4%

11.6%

9.3%

9.0%

27.3%

27.1%

26.8%

25.0%

24.8%

14.4%

14.4%

14.1%

15.8%

15.2%

9.1%

9.1%

9.0%

7.2%

7.1%

8.3%
6.5%

8.0%

7.2%

150

Others

3.0%

100
50
0

2016

2017

2018

6.4%

2023

2028

*1 Generating capacity is the sum of the values submitted by electricity utilities.
*2 “Oil and others” includes the total installed capacities from oil, LPG, and other gas and bituminous mixture fired capacities.
Source: OCCTO, “Aggregation of Electricity Supply Plans, FY2019”

Power Development Plans up to FY 2028 by Stages

Table 4.1

		Power source

Hydro

Thermal

New installation plan

Updating/derating plan

Retirement plan

Total

OutputSites

OutputSites

OutputSites

Output

326

41

52

47

-200

26

178

Conventional

326

41

52

47

-200

26

178

Pumped storage

–

–

–

–

–

–

–

16,118

41

-240

1

-10,096

45

5,782

Coal

8,241

13

–

–

-756

3

7,485

LNG

7,817

16

–

–

-5,287

10

2,530

Oil

60

12

-240

1

-4,05332-4,223

10,180

7

152

1

-559

1

9,773

6,658

379

6

2

-324

45

6,340

Wind

1,859

62

–

–

-170

33

1,689

Solar

3,780

285

–

–

-2

1

3,778

Geothermal

46

1

Biomass

909

26

Waste

64
33,282

NuclearRenewables(Output: MW)

Total

6

2

–

–

52

–

–

-69

5

840

5

–

–

-83

6

-19

468

-29

51

-11,179

117

22,074

Source: OCCTO, “Aggregation of Electricity Supply Plans, FY2019”36

IV. Supply Structure(IGCC)7 and integrated coal gasification fuel combined cycle(IGFC)8 systems.

installation of NAS batteries with an output of 50 MW andcapacity of 300 MWh in fiscal 2016, and it has demonstrated
the possibility of avoiding having to control up to 300 MWhof solar power output per day.

• Renewable Energy
METI aims to expand adoption of renewables by solving the
problem of fluctuations in output by making use of storage
batteries, hydrogen, and other technologies.

Regarding hydrogen, METI formulated a “Strategic Roadmap
for Hydrogen and Fuel Cells” in March 2019. In addition tosetting targets for reductions in hydrogen prices, this setstargets for power generated by hydrogen-combustion gas
turbines.9 Regarding carbon recycling, METI formulated a“Roadmap for Carbon Recycling Technologies” in June 2019.
This states that CO2 emissions can be reduced by recycling
CO2 by separating and recovering it from the exhaust gas
generated by power plants and other emission sources andcombining it with “clean” hydrogen produced by fossil fuelreform and surplus power from renewables to synthesize
fuel (such as methane). Using fuel produced from cleanhydrogen at thermal power plants is also expected toreduce CO2 emissions from thermal power plants.

Shipped capacity (MWh)Trend in Shipped Capacity of Stationary Lithium-Ion Storage Battery Systems

Figure 4.5

500

2,000
Shipped capacity

450

1,800

1,754.116

Total capacity

400

1,600

350

1,400
1,256.803

300
250

Total capacity (MWh)Use of storage batteries is rising. Over 240,000 stationary
lithium-ion storage battery systems with a capacity in excess
of 1.7 GWh were in use in fiscal 2018 (Figure 4.5). METI is
conducting experimental projects using storage batteries.
Themes selected for these projects include the adoption oflarge grid stabilization systems for storing power generated
from renewables and the development of virtual power
plants using customer-side energy resources (such as
storage batteries and demand response). An example of thekinds of projects underway is that being conducted at the
Buzen storage battery substation by Kyushu Electric Power
Co. using NAS batteries. This commenced with the

1,200
1,000

932.194200

800
694.279

150

600

100
50

199.182
11.8300400

379.365

FY2011200

82.213

FY2012FY2013

FY2014FY2015FY2016FY2017FY20180

Source: The Japan Electrical Manufacturers’ Association, “Shipments of Stationary Lithium-Ion Storage Battery Systems” (2019)

7 Development will be completed by around 2020 (approx. 46%-50% power-generation efficiency and CO2 emission intensity of 650 kg/MWh).
8 Development will be completed by around 2025 (approx. 55% power-generation efficiency and CO2 emission intensity of 650 kg/MWh).
9 The aim is to achieve 27% power-generation efficiency by around 2020 (power output of 1 MW).

37

The Electric Power Industry in Japan 2020

2. T ransmission and Distribution
Facilities

transmission cables (500 kV, 275 kV, 220 kV and 187 kV) arealso being installed to enhance the reliability of the power
supply to the central districts of large cities.

(1) Transmission Facilities
Japan’s bulk transmission systems comprise 500 kV, 275 kV,
220 kV, 187 kV, 154 kV, and 132 kV transmission lines. The
maximum transmission voltage is 500 kV for the 10 generalelectricity transmission and distribution utilities except
Hokkaido Electric Power Co. (275 kV) and Okinawa ElectricPower Co. (132 kV). As of the end of March 2018, thesetransmission lines had a total circuit length of approximately
179,000 km (Table 4.2).

DC transmission lines are used in limited areas such as forthe interconnections between Hokkaido and Honshu (tworoutes), and between Kansai and Shikoku.

(2) Substation Facilities
As of the end of March 2018, Japanese 10 general electricity
transmission and distribution utilities have 6,774 substations
with a total installed capacity of 843,886 MVA (Table 4.2).
Almost all substations are now, with just some exceptions,remotely controlled and unmanned, and this has reduced
the number of operators required at substations.

Japan’s three major metropolitan areas, Tokyo, Osaka andNagoya, are served by bulk transmission systems comprising
500 kV multiple outer ring transmission lines surrounding
demand areas with additional transmission lines for demandareas connected to the rings in a radial pattern. In the Tokyo
Metropolitan Region, Tokyo Electric Power Company
Holdings has constructed transmission lines designed tohandle up to 1,000 kV as a third outer ring, which is currently
operating at 500 kV. Extra-high voltage undergroundDue to the difficulty of finding sites for substations in urban
areas, general electricity transmission and distribution
facilities have reduced their footprints by adopting
technologies such as gas insulated switchgear (GIS).

Total Circuit Length of Transmission and Distribution Lines and Transformation Facility Capacities
1975

Table 4.2

1985

1995

2005

2010

2015

2016

2017

Circuit length of transmission lines (km)220kV or above

14,16723,48629,10735,20935,791

36,94936,84536,865110kV Under 220kV

28,91335,10636,95235,96235,69635,58835,70935,459Under 110kV

69,361

78,66088,64895,176

104,618

106,167

106,238

106,341

Total

112,441

137,252

154,707

166,347

176,105

178,704

178,792

178,665

Substation output capacity (MVA)

234,748447,866

657,536

778,740

810,924

833,112842,084

843,886

Total Number of substations

3,466

5,152

5,814

6,570

6,686

6,718

6,766

6,774

Transformation facility capacities

Circuit length of distribution lines (km)Overhead
UndergroundTotal

2,623,787 3,179,970 3,661,963 3,918,743 3,966,677 4,005,974 4,015,703 4,023,882
14,35825,34850,371

65,287

66,89670,73371,36072,0962,638,145 3,205,318 3,712,334 3,984,030 4,033,573 4,076,707 4,087,063 4,095,978

Source: Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018)38

IV. Supply Structure

Assist Arms (Hokuriku Electric Power Co.)
Hokuriku Electric Power Co. has been working with universities and manufacturers todevelop “Assist Arm” robots for use by power distribution workers. In the near future,these will reduce labor requirements and improve efficiency by automating some work.

Removing snow from power lines (Hokkaido Electric Power Co.)

154kV Inawashiro Kyu-kansen transmission line (TEPCO Power Grid)
Constructed in 1914 with the third longest (225 km) transmission line in the world at that time. Still in commercial use more than a century later.
The transmission towers were manufactured by American Bridge.

39

The Electric Power Industry in Japan 2020

(3) Distribution Facilities
Distribution lines are classified into special high-voltage lines(33/22 kV), high-voltage lines (6kV), and low-voltage lines(200/100 V), and the standard for high-voltage distribution
systems is the 6 kV multi-divided, multi-connected system.
In densely populated areas, electricity is supplied via special
high-voltage lines to prevent equipment congestion andimprove supply reliability, and spot network systems areused to meet the needs of customers who requireparticularly reliable supplies. Normally, electricity is supplied
to low-voltage customers through 200/100 V single-phase
three-wire or 200 V three-phase three-wire systems. Low
voltage distribution lines are thus generally installed inthree-phase four-wire open-delta connection distribution
systems used to supply both single-phase and three-phasepower. As of the end of March 2018, the total length of
distribution lines in Japan was approximately 4,096,000 km.
Of this, 72,000 km (approximately 1.8%) consisted ofunderground lines (Table 4.2).
Efforts to improve supply reliability and operating efficiency
in the distribution sector include the widespread use of
distribution automation systems for remote supervision andautomatic control of distribution equipment. In response to
the recent growth of distributed energy sources, switcheswith sensors and static automatic voltage regulators (such as
STATCOMs) are increasingly being installed in distribution
networks in order to maintain supply reliability and power
quality.

SAIFI and SAIDI (Total for 10 electric power companies)

Figure 4.6

7 (events)

700 (min.)

701 min.
[Affected by Great East Japan Earthquake]
6600

514 min.

Duration (right scale)4.85 events

5500

Frequency (left scale)

4

400

3

300

[Affected by typhoon No. 19][Affected by typhoons, etc.]

187 min.

200

21.36 events

0.94 events

169 min.

128 min.
0.90 events
0.51 events

1

33 min.
0.35 events

88 min.

100

14 min.
14 min.
10 min.
0.33 events
0.20 events 0.18 events
0.13 events

0
1966

1975

1985

1990

79 min.
0.22 events

1995

2000

2005

2010

16 min.
0.14 events02017 (FY)

Note: 9 electric power companies up to FY1988
Source: FEPC, “FEPC INFOBASE” (2018)40

IV. Supply Structure

Smart meters for low-voltage customers have also been
installed in order to (1) facilitate meter reading, (2) track
individual customers’ electricity usage so as to facilitate
power-saving measures, and (3) provide a means of limiting
power consumption when the supply and demand balanceis tight. All special high-voltage and high-voltage customers
and 49% of low-voltage customers (including households)
had been provided with smart meters as of March 2018. All
customers should have smart meters by the end of March
2025.

(4) Supply Reliability (SAIDI, SAIFI)Supply reliability is being kept high compared tointernational standards by conducting patrols to prevent
outages in advance as well as by developing high-voltage
distribution network facilities as outlined above. Since the1990s, a high level of supply reliability has been maintained
except for major disasters such as the Great East Japan
Earthquake. In fiscal 2017, the System Average Interruption
Frequency Index (SAIFI) was just 0.14 interruptions and the
System Average Interruption Duration Index (SAIDI) was only
16 minutes (Figure 4.6).
Very recently, maintaining supply reliability for more severe
weather conditions (including typhoons and torrential rain)
and meeting customers’ electricity needs have emerged as
challenges. METI has therefore set up a committee toinvestigate the development of electricity infrastructure thatis highly disaster resilient.

3. C ross-Regional Operation andInterregional Interconnections(1) Cross-Regional Operation
The Japanese power grid is divided into two frequency
systems: a 50 Hz system in eastern Japan and a 60 Hz systemin western Japan10. The neighboring grids of nine of thegeneral electricity transmission and distribution utilities’service areas are connected to one another (Okinawa
Electric Power Co. is the exception). Japan has nointernational interconnections.

The individual electric power companies are responsible, in
principle, for operating their own systems independently
and mainly compensate for load fluctuations on their own
grids using their own generating sources. However, they
have also worked with each other interregionally in order toimprove economic efficiency and ensure a stable power
supply by developing optimal power sources, conducting
capital investment, and exchanging power so as to benefit
from differences in their regional characteristics anddemand structures. Today, use of the interconnections thatspan the service areas of different general electricity
transmission and distribution utilities is administered by
OCCTO. Traditionally, electricity generation utilities havebeen allowed to use these interconnections on a first-come,first-served basis.
However, in October 2018 this first-come, first-served model
was abandoned, and an implicit-auction approach wasintroduced under which, in principle, use of theinterconnections will be assigned based on contracts
concluded in the spot market for next-day delivery. The
introduction of these new rules should expand the use of
the interconnections by new market participants and put inplace a fair and competitive environment. At the same time,by implementing cross-regional merit orders, it is hoped that
increases in electricity rates can be held to a minimum andadditional business opportunities created for operators.

(2) Interregional Interconnections
As of 2019, the interregional interconnections in operation are
mainly AC transmission lines. In the 50 Hz eastern region,
Tokyo Electric Power Company Holdings and Tohoku ElectricPower Co. are linked by 500 kV AC transmission lines, while
Tohoku Electric Power Co. and Hokkaido Electric Power Co.
are linked by DC submarine cables that span theapproximately 20 km strait between Honshu and Hokkaido.
Until recently the only connection between Tohoku ElectricPower Co. and Hokkaido Electric Power Co. was a single ±250kV (600 MW) connection. In March 2019, however, a secondroute (±250 kV, 300 MW) started commercial operation.
In the 60 Hz western region, Chubu Electric Power Co.,
Hokuriku Electric Power Co., Kansai Electric Power Co.,
Chugoku Electric Power Co., Shikoku Electric Power Co. and10 The frequency difference is said to date back to 1896, when 50 Hz German-made power generation equipment was introduced in eastern Japan and 60 Hz U.S.-madeequipment in western Japan.

41

The Electric Power Industry in Japan 2020

National Grid Connections (As of August 2019)

Figure 4.7*1
indicates DC facilities.
*2 [] indicates daytime operating capacity of interregional interconnections
on weekdays during August 2019. Varies according to time.

Hokkaido area
Connection between
Hokkaido and Honshu[900 MW]

Chugoku-Kyushu
interconnection[2,470 MW]

Kansai-Chugoku
interconnection[4,140 MW]

Hokuriku-Kansai
interconnection[1,900 MW]

Connection between
Chubu and Hokuriku[300 MW]

Chugoku area
Kyushu area

Tohoku-Tokyo interconnection[5,150 MW]

Kansai area

Chugoku-Shikoku
interconnection[1,200 MW]

Shin Shinano F.C.

Tokyo area

Chubu area

Shikoku area
Okinawaarea

Tohoku area

Hokuriku area

Connection between
Kansai and Shikoku[1,400 MW]

Sakuma F.C.

Chubu-Kansai
interconnection[2,500 MW]

Connection between
Hokkaido and Honshu(600 MW → 900 MW)(entered operation in
March 2019)

Tohoku-Tokyo interconnection• OCCTO plans to increase
operating capacity
by 4,550 MW(to be completed in FY2027).

Higashi
Shimizu F.C.

Connection between Tokyo and Chubu[1,200 MW]

Connection between Tokyo and Chubu (1) (1,200 MW → 2,100 MW)• TEPCO Power Grid is working to add 900 MW (to be completed in FY2020).
Connection between Tokyo and Chubu (2) (2,100 MW → 3,000 MW)• OCCTO plans to add another 900 MW and TEPCO Power Grid, Chubu Electric Power Co.,and J-POWER are preparing to commence construction (to be completed in FY2027).

Source: Agency for Natural Resources and Energy (2019)

Kyushu Electric Power Co. are linked by 500 kV ACtransmission lines. DC lines are used by Chubu ElectricPower Co. and Hokuriku Electric Power Co., which areconnected by back-to-back DC linkage facilities (300 MW),and by Kansai Electric Power Co. and Shikoku Electric Power
Co., which are linked by ±500 kV DC submarine cables(initially operated at ±250 kV) that span the Kii Channel. The
50 Hz and 60 Hz systems are linked by the interconnections
between the Tokyo Electric Power Company Holdings andChubu Electric Power Co. networks (Sakuma Frequency
Converter (300 MW), Shin-Shinano Frequency Converter (600MW), and Higashi-Shimizu Frequency Converter (300 MW):total 1,200 MW) (Figure 4.7).
The large-scale adoption of distributed energy sources has
made it difficult in recent years to maintain the optimum

configuration of facilities. OCCTO is therefore consideringplans to enhance these interconnections, taking into
account the individual utilities’ views. It has already been
decided that the Shin-Shinano Frequency Converter at theTokyo-Chubu interconnection will be upgraded by 900 MW
by fiscal 2020, and plans are being made to expand the
Sakuma and Higashi-Shimizu frequency converters’ capacity
by a total of 900 MW by the late 2020s (from 1.2 GW to 2.1
GW and then 3.0 GW in total). Responding to calls from IPPs
and others, OCCTO plans to increase the capacity of theTokyo-Tohoku interconnection by 4.6 GW by fiscal 2027.
OCCTO is required to develop a long-term policy that sets a
course for developing and updating Japan’s cross-regional
interconnection systems on a nationwide scale. In thisprocess it has identified the following three key issues for42IV. Supply Structure

facility formation over the mid- and long-term.
• Growth in electricity demand is slowing.
• If new interconnection needs are to be addressed throughthe conventional approach to facility formation and griduse, it will require a huge increase in transmission anddistribution facilities.
• This will result in a decreased capacity factor fortransmission and distribution facilities, with inevitable
upward pressure on wheeling charges.
Pivoting sharply from conventional thinking, which has
revolved around boosting the grid to meet power source
grid capacity, OCCTO has decided on a policy of making thebest possible use of existing facilities. Premised on this, it hasdeveloped an approach to transmission and distribution

facility development that tailors the “connect and manage”
model already used in the United Kingdom and elsewhere
to Japanese conditions. It employs three mechanisms. Firstly,
available capacity is calculated based on estimates thatclosely resemble actual use, rather than on full-capacity
operation of all power sources. This method has been in fulluse since fiscal 2018. Secondly, there is the “N-1 inter-trip
scheme,” which is a method of instantly limiting power
output to secure stable transmission capacity in the event of
N-1 failure.11 This has been employed since October 2018.
Thirdly, there is “non-firm access,” which is a method ofallowing fresh access on condition that output is limited
while other power sources are in operation. As of fiscal 2019,
action is underway to translate this into practice.

Construction of the Hida converter station (Chubu Electric Power Co.)

11 A single fault affecting one transmission or distribution line, one transformer, one generator, or one other item of electrical equipment.

43

The Electric Power Industry in Japan 2020

V. Retail Business and Trading Markets

1. Electricity Rates

low-voltage customers (78% of the total) paid regulated
rates.

(1) Regulated Electricity Rates
Up until full liberalization of the retail electricity market in
April 2016, general electricity utilities supplied electricity
with the approval of the Minister of Economy, Tradeand Industry at rates based on standard electricity use
and at rates assuming use of electricity in a manner that
contributed to load leveling, etc. The standard rates forhouseholds have remained regulated since full liberalizationin order to protect customers. As of April 2019, 60.36 million

Regulated rates were originally to be discontinued at theend of March 2020. However, as competition had not
developed sufficiently, METI decided in July 2019 to maintainregulated rates from April 2020 onwards. Discontinuation ofregulated rates will continue to be considered, while paying
close attention to developments at Tokyo Electric Power
Company Holdings and Kansai Electric Power Co., whichhave comparatively more residential switchers.

Arrangements to Bridge the Transition to Competitive Rates

Customers with demand of
50 kW or greater

From April 2005
Customers supplied at
deregulated rates set by
PPSs and utilities otherthan general electricity
utilities
Customers supplied at
deregulated rates set bygeneral electricity utilities

Customers
supplied underprovisions forlast-resort
service bygeneralelectricity
utilities

Customers with demand under 50 kW

Customers supplied atcompetitive rates set by
PPSs and former generalelectricity utilities

Customers supplied atcompetitive rates set byformer general electricity
utilities

Measures aspart of generalelectricity
utilities’ supply
obligations

Customers supplied atcompetitive rates set byformer general electricity
utilities
Customers supplied under
the provisions oftransitional measures(regulated rates) by former
general electricity utilities

Last-resort service

Post completion of transitional measures(full deregulation of retail rates)

Customers
supplied underprovisions forlast-resort
service under
the new system

Customers supplied atcompetitive rates set by
PPSs and former generalelectricity utilities

Customers supplied underoptional supply provisions bygeneral electricity utilities

Customers supplied under
supply provisions bygeneral electricity utilities

From April 2016

Figure 5.1

Customers supplied at
deregulated rates
Measures as partof the supply
obligations
imposed onformer generalelectricity utilities
as a transitional
measureLast-resort service

Customers
supplied underprovisions forlast-resort
service under
new system

Last-resort service

Source: Agency for Natural Resources and Energy website (accessed on September 5, 2019)44

V. Retail Business and Trading Markets

Two-Component Rates Structure

Table 5.1

Electricity rate = basic rate + unit electricity rate × electricity consumption ± fuel cost adjustment
× electricity consumption + surcharges to encourage renewable energy generation
× electricity consumption
Source: FEPC website (accessed on September 10, 2019)a. Rate Structureb. Fuel-Cost Adjustment Scheme

The electricity rates charged when former general electricity
utilities supply electricity consist of two components: a basic
rate that is determined according to the type of service
agreement, and a consumption-based rate that is calculated
based on the amount of electricity used (Table 5.1). The
consumption-based component of the regulated rates paidby households is further divided into three tiers in order
to, among other things, encourage energy conservation,
which has been promoted since the first OPEC oil embargo.
A relatively lower unit rate is charged for the first tier, which
covers consumption up to the 120 kWh that is considerednecessary for daily life. The unit rate for the second tierreflects the average supply cost, and a slightly higher unit
rate is charged for the third tier. There is also a regulated ratethat applies mainly to small factories.

A fuel-cost adjustment scheme was introduced in January
1996 in order to externalize the effects of fuel prices andexchange rates, which are beyond the control of generalelectricity utilities in their efforts to enhance efficiency, andthus reflect the changes in rates as expediently as possible
and to stabilize the general electricity utilities’ management
environment.
At present, the period (time gap) before fuel pricefluctuations are reflected in electricity prices is set to twomonths in order to level rate fluctuations, and fuel pricethree-month averages are reflected in the electricity rates
charged each month (Figure 5.2).

Fuel-Cost Adjustment Timing (Example: June, July, August)

Jan.

Feb.

Mar.

Apr.

May

2 months later

Period for calculation of
average fuel cost

Period for calculation of
average fuel cost

Period for calculation of
average fuel cost

Figure 5.2

June

July

Aug.

Sep.

Application of fuel costadjustment unit price

2 months later

Application of fuel costadjustment unit price

2 months later

Application of fuel costadjustment unit priceSource: Compiled from FEPC materials

45

The Electric Power Industry in Japan 2020c. Feed-in Tariff Scheme for Renewable Energy

A system of purchasing surplus electric power generated
by solar power systems was introduced in 2009. In 2012,
the scope of sources covered was expanded and former
general electricity utilities were required to purchaseelectricity generated using renewable resources (solar, wind,hydroelectric, geothermal, and biomass) at a fixed price for acertain period. The cost of purchase was to be recovered via
a surcharge calculated in proportion to the volume of use
by customers that constitutes one component of electricity
rates (see “Renewable Energy” in Section 3, Chapter II).

retail market commenced in April 2016. Large customers’
contracts are determined through negotiation withelectricity retailers based mainly on their planned andactual electricity usage. In addition to being able to simply
carry on paying regulated rates for service provided byformer general electricity utilities, households and otherlow-voltage customers can also choose from among theunregulated rate plans offered by former general electricity
utilities and PPSs. Former general electricity utilities and PPSs
provide a range of new rate options tailored to customer
lifestyles based on their own sales strategies (see “Efforts to
Acquire Customers” in Section 2, Chapter V).

(2) Unregulated Rates(3) Trends in Unit Electricity Rates

Liberalization of retail supply to special high-voltage
customers commenced in April 2000. Coverage wasprogressively expanded, and full liberalization of theElectricity rates in Japan have declined since rising sharply
from the 1970s to the early 1980s due to the oil crises. Since(yen/kWh)

Trends in Electricity Rates

Figure 5.3

3530
Residential

25

20

Average for residential
and commercial/industrial

15

Commercial/industrial

10

5

0
1970

1975

1980

1985

1990

1995

2000

2005

2010

2016 2017(FY)

Note: Figures are totals for general electricity utilities through fiscal 2015, and for electricity utilities from fiscal 2016.
Source: Agency for Natural Resources and Energy, “FY2018 Annual Report on Energy” (2019)46

V. Retail Business and Trading Markets

Average Unit Wheeling Charges of General Electricity Transmission and Distribution Utilities(As of July 2017)

Table 5.2

Average unit wheeling charges of general electricity transmission and distribution utilities(yen/kWh) (excluding tax)

Low voltage

High voltage

Special high voltage

Hokkaido

8.76

4.17

1.85

Tohoku

9.71

4.50

1.98

Tokyo

8.57

3.77

1.98

Chubu

9.01

3.53

1.85

Hokuriku

7.81

3.77

1.83

Kansai

7.81

4.01

2.02

Chugoku

8.29

3.99

1.62

Shikoku

8.61

4.04

1.79

Kyushu

8.30

3.84

2.09

Okinawa

9.93

5.20

3.01

Source: Agency for Natural Resources and Energy, “Process of Rates Reform Allowing for Changes in the Business Environment” (2017)

the Great East Japan Earthquake in 2011, however, rates haveagain risen due to the increased cost of generating powerat thermal power plants resulting from the shutdown ofnuclear power plants and escalating fuel prices. Electricity
rates fell from 2015 due to lower fuel costs, but again rose in
fiscal 2017 (Figure 5.3).

(4) Wheeling Charges
Even in a deregulated environment, it is general electricity
transmission and distribution utilities that build, operate, andmaintain transmission and distribution networks to ensurestable supply. When PPSs retail electricity and former generalelectricity utilities supply electricity on a retail basis outsideof their own service areas, they must use the network of
the general electricity transmission and distribution utilities
that own the supply facilities in the service area concerned.
Wheeling charges are the fees imposed by transmission anddistribution utilities on the users of their network (Table 5.2).
The wheeling charges are deliberated by a review meetingof specialists on electricity pricing under the auspices of theElectricity and Gas Market Surveillance Commission, taking

into account both the appropriate recovery of requisite costs
and fairness for network users. They are then opened to
public comment prior to final adoption.
Since April 2016, general electricity transmission anddistribution utilities have been required to provide electricity
via a universal service for customers on isolated islands,
applying the same rate levels as on the mainland in order toprotect customers. The electric power supplied to islands
is mainly generated by thermal power plants, and the costof provision of universal service to islands (including the
portion of the price that varies according to thermal fuelcosts) is passed on to all customers in the individual service
areas of general electricity transmission and distribution
utilities in question via wheeling charges under what is
known as the “universal island service price adjustment
system.”47

The Electric Power Industry in Japan 2020

2. Efforts to Acquire Customers(1) State of Switching
As of the end of February 2019, there had been a cumulative
total of approximately 9.435 million cases of switching since
March 2016 (Figure 5.4), when applications for switching werefirst accepted. Among general households, some 15% of theregular contracts in effect immediately prior to liberalization(approximately 62.53 million) had been switched.

(2) Activities of Electricity Retailers
Electricity retailers supply extra high-voltage and highvoltage customers in accordance with contracts and unit
prices negotiated on the basis of projected electricity
usage and actual circumstances. Former general electricity
utilities are working to strengthen their business capacity
by establishing specialized marketing operations, increasing

personnel to take charge of business for corporate
customers, and implementing business training. For
example, they have assigned a dedicated business manager
for each customer and increased the frequency of customer
contact so that the customer’s needs can be suitably met. In
addition, they are diagnosing and analyzing the customer’s
energy usage, and making proactive proposals to theircustomers regarding the efficient use of energy.
On the other hand, electricity retailers provide low-voltage
customers with customer services and so on through rateplans tailored to customers’ needs and lifestyles, pointbased loyalty programs, and membership websites. Services
that utilize information on electricity usage obtained fromsmart meters are also emerging. Former general electricity
utilities are installing smart meters that can measure
usage at 30-minute intervals, and all customers will havesmart meters by the end of fiscal 2024 (see “Uses of Digital

Trends in Number of Low-Voltage Switchers by Service Area (As of end of February 2019)[10,000 switchers]

Figure 5.4

End of February 2019
Approx. 943.5

1,000

Hokkaido
Tohoku900
800

End of April 2018
Approx. 652.3

700
600

End of April 2017
Approx. 326.7

500

Tokyo

400
300

Chubu
Hokuriku

End of April 2016
Approx. 53.7

200

Kansai

100
0

April
2016

April
2017

April
2018

Chugoku
Shikoku
KyushuOkinawa
February
2019

Note: S witching refers only to changing from a former general electricity utility to a PPS contract.
It does not include changing to an unregulated-rate contract that is offered by a former general electricity utility.
Source: Agency for Natural Resources and Energy, “Progress on Full Liberalization of the Electricity and Gas Retail Markets” (2019)48

V. Retail Business and Trading Markets

Technologies by Former General Electricity Utilities” in Section 2 of

(3) Rate Comparison Sites“Topics”).

As seen above, electricity retailers are offering a variety ofrate plans, and about 1,000 types of plans were available asof the end of August 2019. Rate comparison websites havetherefore been launched to help customers choose theplans that best meet their needs. Competition is intensifying
in the major conurbations of Tokyo, Osaka, and Nagoya, andthere are also signs of growing competition in provincial
urban areas in regions such as Hokkaido and Kyushu.
Although the number of electricity retailers has declined
since fiscal 2018, there has been little change in the numberof plans. Some electricity retailers may have pulled out due
to the competition, while others are expanding the range ofplans that they offer.

a. Rate Plans Tailored to Lifestyles

Electricity retailers are offering time-of-use rate plans forcustomers who tend to be out during the day and consume
most of their electricity at night, as well as for customers
who use storage heaters and/or water heaters overnightand during off-peak hours. Such plans offer lower unit
rates for nighttime electricity use. Other options are alsoavailable. These include plans that provide discounts off thecontracted unit price as usage increases for customers who
use large amounts of electricity due to family size or pets,
and plans that offer lower rates for devising ways of using
electricity more wisely.
There are also plans that offer summer-only discounts forhouseholds with elderly members in order to encourage theuse of air conditioning to prevent heat stroke.
b. Additional Services and Discounts for Bundled Goods

There are also rate plans that offer non-electricity-related
goods and services to households. These include inspectionand emergency repair of faulty electrical equipment,such as wiring faults that keep the power from turning
on. Other everyday support services include services to
identify and report water leaks, find lost keys, and check onelderly customers at home. Other plans provide discounts
for supply contracts that are bundled with cellular phone,internet, gas, automobile gasoline, and other services.
Bundling lifestyle-related commodities and services with
rate discounts in this way is expected to improve customer
satisfaction and help electricity retailers to attract and retain
customers.
c. Renewable Energy Rate Plans

Among the green options being offered are rate plans thatdeliver electricity generated using renewable resources.
Although there are limits to how much electricity canbe generated and procured from renewables, a growing
number of electricity retailers are offering plans of this kind,and they are also increasing their disclosure of informationon their power generation mix and CO2 emissions.

(4) Regulations and Guidelines
The Electricity and Gas Market Surveillance Commission
established the Guidelines Concerning the Management of
the Electricity Retail Business in January 2016. The purposeof these guidelines is to enhance protection for electricity
customers, allowing them to receive electricity withconfidence while also contributing to the healthy growthof the electricity business itself. These guidelines provide
instructions to the utilities in question, such as electricity
retailers, on how to observe relevant laws and regulations, aswell as instructions encouraging their autonomous efforts.
Specifically, the guidelines indicate desirable conduct
by operators in order to protect customers and bringabout the healthy growth of Japan’s electricity business.
These include: (1) provision of appropriate information tocustomers, (2) suitable forms of business and contracts,(3) optimized contract contents, (4) appropriate handlingof customer complaints and inquiries, and (5) optimized
contract cancellation procedures. The guidelines also
identify behavior which would constitute a problem under
the Electricity Business Act (i.e., actions that could lead tothe issuance of a business improvement order or a business
improvement recommendation).
These guidelines are to be revised as and when necessitatedby future changes in the electricity retail environment. Fourrevisions have been made so far, with the latest revision
being made in December 2018.

49

The Electric Power Industry in Japan 2020

3. Trading Markets(1) Wholesale Electricity Market
The Japan Electric Power Exchange (JEPX) was establishedin November 2003 and commenced trading in April 2005.
The purpose of JEPX is to stimulate electricity transactions
on the exchange. Specifically, transactions will be stimulated
by offering enhanced instruments for selling and sourcing
electricity and encouraging the formation of index prices
to assist assessments of investment risk, etc. Initially, JEPX
was treated as a privately operated, voluntary wholesale
exchange. Later, it was designated a wholesale electricity
market under the provisions of the Electricity Business Act inApril 2016.
The principal market participants are the electricity
generation utilities and electricity retailers involved inwholesale power transactions. However, other players, suchas general electricity transmission and distribution utilities
that accept electricity generated by feed-in tariff plans,
are also involved as “special trading members” in orderto facilitate the sale and purchase of “non-fossil value,” asdescribed in a later section. Businesses such as demand
response aggregators that enter into negawatt trading
contracts with transmission and distribution utilities havealso been permitted to participate in the market since March2017. As of July 2019, 167 companies are trading members.
JEPX currently provides a marketplace for the following
electricity transactions:• Spot market: Trading in 30-minute increments of electricity
for next-day delivery.
• Forward market: Trading in electricity for delivery over thecourse of a specified future period. Products are createdby packaging together specific periods and times, such asmonthly 24-hour products or weekly daytime products.

Average System Prices and Trade Volumes on the Spot Market

Avg. system price (yen/kWh)
250.0

Figure 5.5

Total trade volume (TWh)(yen/kWh)

(TWh)

18.00

16.51
14.43

200.0

208.6

14.67

13.72

16.00
14.00
12.00

11.32

150.0

9.78

9.76

9.72

9.76

10.00

8.46

8.38

8.00
100.0

6.52

6.00
58.6

4.00

50.0

0.0

2.3

3.5

3.5

2007

2008

2009

5.5

4.7

2010

2011

7.4

10.3

12.6

15.4

23.0

2.00
0.00

2012

2013

2014

2015

2016

2017

2018

Source: Compiled from Agency for Natural Resources and Energy, “Handbook of Electric Power Industry” (2018), and JEPX website (accessed on August 1, 2019)50

V. Retail Business and Trading Markets• Intra-day market: A market for correcting unexpected
misalignments between supply and demand occurring
between a spot market transaction and delivery (aminimum of one hour later).
• Bulletin board trading market: JEPX mediates the trading ofelectricity for prospective buyers and sellers.
The spot market is the largest of the above four markets
in trading volume and is a particularly important market.
Trading is done through a blind single-price auction system.
It is blind because participants cannot see other participants’
bids when they make their bids. A single-price system is one
that defines the intersections between the sell and buy bid
curves as the system price and trade volume. As a rule, highbuy bids and low sell bids are executed at the system price.
Market fragmentation can occur due to the existence ofconstraints concerning, for example, the available capacityof connections between services areas. When market
fragmentation occurs, system prices and trade volumes arecalculated at the level of each of the fragmented markets.
The volume of trades on the spot market has been on therise since 2016, and reached approximately 208.6 TWh in
fiscal 2018. This is more than a three-fold increase in yearon-year terms and means that about one quarter of allelectricity sold in Japan is sold through JEPX. The averagesystem price has hovered around the 8-9 yen/kWh marksince fiscal 2015, and stood at 9.76 yen/kWh in fiscal 2018
(Figure 5.5).

(2) New Markets
For the purpose of encouraging further competition inelectricity markets, securing stable power supply, andactualizing environmental value, the Japanese government
is considering the establishment of several new markets.
The intention is that the creation of these unconventional
new markets will serve to actualize and render tradable
new forms of value to accompany the lowered entry/exit
barriers in existing markets. The main mechanisms underconsideration are (a) a baseload power market, (b) a capacity
market, (c) a balancing market, and (d) a non-fossil value
trading market.
a. Baseload Power Market

New market entrants find it difficult to own or enter
contracts to buy electricity from affordable baseload powersources such as coal, large hydropower, and nuclear power
plants. To surmount this difficulty, a market dedicated to the
trading of electricity produced by baseload power plants
was created, in which former general electricity utilities
and new entrants are given equal access to electricity frombaseload power plants. It is expected that the resulting
increase in transactions in the wholesale market will lead toincreased competition in the retail market.
The first baseload trades of fiscal 2020 took place on August
9, 2019. The clearing prices were 12.47 yen/kWh in the
Hokkaido area, 9.77 yen/kWh in the Tohoku/Tokyo area,and 8.70 yen/kWh in the West Japan area (Table 5.3). Tradevolumes came to 12.7 MW in the Hokkaido area, 88.2MW in

Results of First Baseload Market Trades in fiscal 2020
Trade

Area
Hokkaido

Tohoku and Tokyo

Western Japan

Table 5.3

First of FY2020 (Trade date: Aug. 9)

Clearing price (yen/kWh)12.47

Trade volume (MW)

12.7

Clearing price (yen/kWh)9.77

Trade volume (MW)

88.2

Clearing price (yen/kWh)8.70

Trade volume (MW)

83.4

Source: JEPX, “Notification of Results of Fiscal 2020 Trades on the Baseload Trade Market”

51

The Electric Power Industry in Japan 2020

the Tohoku/Tokyo area, 83.4 MW in the West Japan area, and184.3 MW in the three areas combined.

The intent is to open the capacity market to transactions infiscal 2020, and to have capacity contracts become effectivefrom fiscal 2021.

b. Capacity Market

The predictability of the payback on investment in power
generation business is likely to decline, depending on theincreasing competition and changes in environmental
trends. If the adoption of renewables expands
simultaneously, it is expected that the power generation
operating rate will decline, the selling price of electricity will
fall, and revenues from selling electricity from all sources will
come down. Conversely, however, regulatory organizations
consider that if investments in power generation capacity
are not made at the appropriate time, there could be
more situations in which the supply and demand balance
becomes too tight, and electricity balancing capacity
cannot be secured. Therefore, the creation of a capacity
market is now under consideration for the purpose of 1)
ensuring a greater degree of investment predictability, 2) the
replacement of old power plants with new ones and 3) the
securing of actual (installed) supply capacity through market
mechanisms.

c. Balancing Market

The tasks of controlling frequency and balancing supply anddemand are performed by general electricity transmission
and distribution utilities in each area. With regard tobalancing, it is important that operators secure the capacity
required for practical purposes while avoiding giving
preferential treatment to particular sources of electricity
or creating too great a cost burden. Japan’s first auction
for balancing supply and demand was held by generalelectricity transmission and distribution utilities at the end of
fiscal 2016 for balancing supply and demand for fiscal 2017(see “Securing Balancing Capacity” in Section 3 (2), Chapter III).
A balancing market for procuring and operating balancing
supply and demand more efficiently on a cross-regional
basis is now under consideration, with a view to launching
the market in or after 2020.

Results for Non-fossil Value Trading Market

Figure 5.6

Weighted average trade volume price (yen/kWh)(GWh)
120.00Trade volume (GWh)(yen/kWh)

1.30

1.30

1.30

1.30

1.30

1.30
106.38100.00

1.40
1.20
1.00

80.00

0.80
60.00
0.60
40.00

0.40

21.02
20.00

5.16
0.00

For Jan.-Dec.
2017

0.20

8.56
3.50

2.24

For Jan.-Mar.
2018

For Apr.-June
2018

For July-Sept.
2018

For Oct.-Dec.
2018

0.00

For Jan.-Mar.
2019

Source: Compiled from JEPX, “Notification of Results of Trades on the Non-Fossil Fuel Trading Market”

52

V. Retail Business and Trading Markets

d. Non-Fossil Value Trading Market

The wholesale electricity market described above makes
no distinction between fossil fuel and non-fossil fuel power
generation, and there were concerns that this omission
could obscure the actual value of non-fossil power
generation capacity. It was also pointed out that it would
be difficult for new entrants to buy electricity from nonfossil fuel sources, as they do not have enough sufficient
trading experience compared with former general electricity
utilities. Furthermore, it was proposed that the cost of theenvironmental value of electricity derived from renewables
purchased through the FIT scheme should not have to
be borne by all customers, but instead should be borne
primarily by those customers who desire that value. As
one step to help address these concerns, a non-fossil value
trading market was established in the wholesale electricity

market described above to isolate non-fossil value of theelectricity only and to certify it for trading. It is hoped thatthe establishment of this market will help Japan reachits global warming targets by fostering use of a power
generation mix consistent with its most suitable energy mix.
Six auctions of non-fossil certificates for FIT electricity had
been held as of August 9, 2019. The weighted average tradevolume price on each occasion was 1.30 yen/kWh. The tradevolumes of the first through fifth auctions ranged between
2-21 GWh. The sixth auction covering January to March
2019, however, saw the trade volume surge to in excess of
100 GWh for the first time (Figure 5.6). Trading of electricity
generated by non-fossil fuel sources not covered by FIT
scheme is scheduled to commence in fiscal 2020.

53

The Electric Power Industry in Japan 2020

Topics

1. D
 igital Transformation of Japan’s
Electric Power Industry
For many years now, Japan’s former general electricity
utilities have automated their facility monitoring and control
systems and other hardware in the electricity generation
sector and the transmission and distribution sector in orderto make operation and maintenance less labor intensive.
Recently, they have also been forging ahead with digitaltechnologies such as Big Data and the Internet of Things(IoT), and this digital transformation is expected to raise
profitability and generate new business (Figure 1). Further

labor savings are being pursued by greater automation ofoperation and maintenance, mainly in the generation andthe transmission and distribution sectors, with the aimof improving profitability. In the retail sector in particular,
efforts to generate new business include proactively rollingout energy management services and other new services,
including services in non-energy fields.

Directions in Digitization of the Electric Power Industry

Objectives and value offered
Automation and control
optimization(optimum control, etc.)

Improvementof profitability

Generation of
new business

Manpower reduction andsafety improvement (remotecontrol and automation)

Figure 1

Typical initiatives• Superefficient operation of power plants using IoT, AI
technologies, etc. [generation] … Fig. 2• Optimized procurement planning and revenue analysis byelectricity retailers [transmission and distribution, retailing]• Improvement of safety technologies using IoT, AI, etc.
[generation, transmission and distribution] … Fig. 3 (e.g., visualinspection of transmission lines and use of drones to diagnose deteriorationof pylons)

Data mining/knowledge
management (for forecasting,sharing, and making tacitknowledge explicit)• Optimized procurement planning and revenue analysis byelectricity retailers [retailing]• Forecasting of energy conservation outputs [transmission anddistribution] … Fig. 4

Development of energy
management services, etc.

• Peer-to-peer blockchain power trading [transmission anddistribution, retailing]• Development of distributed systems of supply and demand[transmission and distribution, retailing] … Fig. 5

Development of new nonenergy services, etc.

• Utilization of data on electricity usage (smart meters)[transmission and distribution, retailing] … Fig. 6

Source: METI, “Digital Transformation of the Electric Power Industry” (2018)54

Topics

2. U
 ses of Digital Technologies by
Former General Electricity Utilities

determination of abnormalities by means of AI-based image
analysis.

(1) Electricity Generation Sector

As intermittency of renewable sources has a major impact
on the stability of supply and demand, technologies arealso being developed to forecast solar power output moreaccurately. For example, former general electricity utilities
estimate solar radiation intensity at ground level by using
cloud images taken by weather satellites to analyze cloud
characteristics. Advection of clouds captured in weather
satellite images is also forecast in order to forecast theamount of solar radiation at 3-minute intervals in a 1 km
grid up to 3 hours and 30 minutes ahead. This has madeit possible to predict fluctuations in solar power output inadvance and allow stable control of supply and demand.

Key challenges for the generation sector in recent years havebeen operating cost reduction, environmental impact, andlabor shortages for maintenance. Former general electricity
utilities aim to make more sophisticated use of data on
power generation by pursuing technological innovations indata compilation, analysis, and forecasting.
The former general electricity utilities, for example, havestrengthened their cooperative ties with IT firms and plant
manufacturers, and demonstration projects for combustion
control modeling using AI have been conducted at coalfired power plants. The projects demonstrated lower NOx
emissions than achieved through operation by engineers.

(3) Retail Sector(2) Electricity Transmission and Distribution Sector
In the transmission and distribution sector, maintenanceand inspection work needs to be streamlined to cope withaging facilities and fewer maintenance personnel. To makethis work less labor intensive, therefore, the former generalelectricity utilities are trialing remote capture of images
using drones during transmission line inspections andInstallation of renewables such as solar has surged in recent
years. Output from such sources is heavily dependent
on weather conditions, however, leading to concerns for
power supply reliability. There is thus a growing needfor the balance of supply and demand to be made more
flexible. Virtual power plants (VPPs) are attracting interest
as a solution. VPPs use IoT technologies to remotely control
energy sources such as distributed energy systems, storage

Use of AI at Coal-fired Thermal Power Plants

Steps in demonstration (Development of forecasting model)

Extraction ofnecessary data
Data cleansing
Analysis

Operator

Combustion
regulation
test data

NOx emissions minimized by
optimizing combustion parameters

Physical model
Statistical model
Developmentof forecasting
model
Expertise

Report ofresults of analysis

Modeling andoptimization

ion

at

er

Optimum configuration including
parameters for unburned
combustibles, temperature balance,
etc. as well as NOx minimization

Former General
Electricity Utilities

Data
provision

Manufacturer

op

Multi-purpose
optimization

Determination of objective andexplanatory variables by correlation
analysis, development of forecastingmodel combining optimum
algorithms.

Identification of dataand issues

Co

Modeling
Confirmationof accuracy

Organization of trial

M
e
un mo
de ra
r n
(M stan dum
oU di o) ng f

Identificationof issues

Figure 2

IT firm
Statistical machine learning

Source: METI, “Digital Transformation of the Electric Power Industry” (2018)

55

The Electric Power Industry in Japan 2020

Use of Drones for Transmission Facility Maintenance

Figure 3

How drones are used
NetworkAI

Image recognition by AI

Automatic detectionof abnormal parts

Learned data

NormalAbnormalImaging

OfficeSource: METI, “Digital Transformation of the Electric Power Industry” (2018)

Short-term Forecasting of Solar Radiation by Means of Image Analysis
Estimation of solar radiation

Figure 4

Cloud advection forecasting
Cloud advection is forecast by
estimating cloud movement vectors
from changes over time in weather
satellite images.
High

High

Solar radiation estimatedfrom multiple weather satellite images

Stratus cloud
Cloudless
Cumulus cloud

Ground level

Estimation of solar radiation distribution every 2.5 minutes

Solar radiation estimated taking into accountcharacteristics of individual clouds using visible
and infrared images

Ground level

Forecasting every 3 minutes of solar radiation up to
3 hours and 30 minutes ahead

Forecasting of solar radiation distribution based on
results of cloud advection forecasts

Source: METI, “Digital Transformation of the Electric Power Industry” (2018)

batteries, and demand response in order to deliver electric
power like a large power station.
With the business opportunities created by the future
establishment of a balancing market, major former generalelectricity utilities are pushing ahead with a business called“resource aggregation,” which enables integrated control ofcustomer-side energy resources in order to provide balancing
capacity. These utilities are pursuing demonstration projects
to aggregate resources by, for example, remotely adjustingcustomer side facilities (water heaters, storage batteries, andEVs) to balance electricity supply and demand.

56

Topics

Business Scheme Using Storage Batteries and Other Energy Resources

Virtual power plant

Water heater

Discharge

Discharge

ChargeChargeFigure 5

Integrated control of numerous
distributed energy resources

Customer-side energy resources (downstream)

Se

rvic

Former General
Electricity Utilities

ep

rov

isio

n

Aggregator

Centralized power supply controlled
to balance supply and demand

Centralized power source (upstream)

Source: METI, “Progress Report on Subsidies for Projects to Develop and Trial Virtual Power Plants Utilizing Customer-Side Energy Resources” (2017)

Overview of Smart Home Services

Consumer

Sensor,smart meter,
etc.

Figure6

Former General Electricity Utilities

Monitoring
data

User

Provision of
information forhome services,
etc.

Source: Compiled from Ministry of Internal Affairs and Communications, “A Structural Analysis of the ICT Industry in the IoT Age and a Study to Verify the Multifaceted
Contributions of ICT to Economic Growth” (2016)

Moreover, with the progress of smart meter introduction,
a number of initiatives are underway to generate new
business using the data obtained from customers’ smart
meters, all premised on proper protection of privacy. Data
from smart meters (customer electricity use every 30
minutes, etc.) is first collected by a data management system
operated by a former general electricity utility, and thenprovided to electricity retailers that have contracts withcustomers. Former general electricity utilities provide non-energy services using the data obtained from smart meters.
For example, leading former general electricity utilities aredeveloping services that contribute to everyday comfort andsecurity (such as systems to monitor the wellbeing of older
people) by developing data platforms that use and analyze
the data on daily life obtained from home appliances,sensors, smart meters, and other devices.

57

Statis tical Data

The Electric Power Industry in Japan 2020

Electric Power Generation*
(TWh)

FY

HydroelectricElectric Utilities
Industry-owned
Thermal**Electric Utilities
Industry-owned
NuclearElectric Utilities
Industry-owned
Wind PowerElectric Utilities
Industry-owned
SolarElectric Utilities
Industry-owned
Geothermal
Electric Utilities
Industry-owned
OthersElectric Utilities
Industry-owned
Total
Electric Utilities
Industry-owned

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

83.5
75.9
7.6
798.9
621.3
177.6
258.1
258.1
–
2.9
0.0
2.9
0.0
0.0
0.0
2.8
2.6
0.2
–
–
–
1,146.3
957.9
188.4

83.8
74.5
9.3
742.5
568.4
174.1
279.8
279.8
–
3.6
0.0
3.6
0.0
0.0
0.0
2.9
2.7
0.2
–
–
–
1,112.6
925.4
187.2

90.7
74.2
16.5
771.3
553.3
218.0
288.2
288.2
–
4.0
0.1
3.9
0.0
0.0
0.0
2.6
2.5
0.2
–
–
–
1,156.9
918.2
238.6

91.7
74.4
17.3
906.9
678.5
228.4
101.8
101.8
–
4.7
0.2
4.5
0.1
0.0
0.0
2.7
2.5
0.2
–
–
–
1,107.8
857.4
250.4

83.6
67.4
16.3
986.8
735.9
250.8
15.9
15.9
–
4.8
0.2
4.7
0.2
0.1
0.1
2.6
2.5
0.1
–
–
–
1,094.0
822.0
272.0

84.9
68.6
16.3
987.3
743.1
244.2
9.3
9.3
–
5.2
0.2
5.0
1.2
0.1
1.1
2.6
2.4
0.2
–
–
–
1,090.5
823.7
266.8

86.9
70.3
16.7
955.3
717.8
237.6
–
–
–
5.0
0.0
5.0
3.8
0.1
3.7
2.6
2.4
0.2
–
–
–
1,053.7
790.6
263.2

91.4
74.9
16.5
908.8
675.7
233.1
9.4
9.4
–
5.2
0.1
5.1
6.8
0.1
6.7
2.6
2.4
0.2
–
–
–
1,024.2
762.6
261.6

84.6
81.9
2.7
877.0
794.4
82.6
17.3
17.3
–
5.5
5.0
0.5
11.1
6.5
4.6
2.2
2.2
0.1
0.3
0.3
–
997.9
907.6
90.4

90.1
87.9
2.3
861.5
777.6
83.9
31.3
31.3
–
6.1
5.5
0.7
15.9
8.7
7.2
2.1
2.1
0.1
0.2
0.2
–
1,007.4
913.3
94.1*Figures for industry-owned generation represent the total amount generated by power plants with a generating capacity of 1,000kW or above.
**Including biomass and waste-to-energy.
Source: FEPC (2008-2009), METI (2010-2017)

Electric Power Consumption

(TWh)

FY

2008

2009

2010

2011

2012

2013

2014

2015

Specified-Scale DemandSpecified Supply
Self-Consumption
Supplied by Electric Utilities
Power Generated and Consumed by Privately-owend Power Facilities
Total Consumption

285.3
46.8
571.7
12.1
9.6
925.5
110.0
1,035.5

285.0
45.2
544.0
9.9
12.6
896.7
106.2
1,002.8

304.2
47.5
574.9
0.0
4.4
931.1
125.4
1,056.4

289.0
44.9
545.6
0.0
4.3
883.8
118.7
1,002.4

286.2
43.7
541.0
0.0
4.4
875.3
116.3
991.6

284.3
42.8
544.4
0.0
4.5
876.0
116.6
992.6

273.1
40.5
537.8
0.0
3.9
855.4
114.1
969.4

266.9
39.2
531.5
0.0
4.0
841.5
113.8
955.3

Low Voltage

Residential
Commercial and Industrial

FY

2016

2017

Specified Supply
Others (Last Resort Supply and Isolated Area Supply)
Self-Consumption
Supplied by Electric Utilities
Power Generated and Consumed by Privately-owend Power Facilities
Total Consumption

271.8
37.6
307.4
231.4
3.4
2.3
45.8
899.8
71.3
971.1

280.4
38.4
310.6
233.8
3.4
–
47.8
914.4
63.0
977.4

Low Voltage
Specified-Scale Demand

Residential
Commercial and Industrial
High Voltage
Extra-High Voltage

Source: METI

60

Statistical Data

Installed Generating Capacity*
(MW)

FY

HydroelectricElectric Utilities
Industry-owned
Thermal**Electric Utilities
Industry-owned
NuclearElectric Utilities
Industry-owned
Wind PowerElectric Utilities
Industry-owned
SolarElectric Utilities
Industry-owned
Geothermal
Electric Utilities
Industry-owned
OthersElectric Utilities
Industry-owned
Total
Electric Utilities
Industry-owned

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

47,94946,252
1,697
179,324140,023
39,30247,93547,935
–
1,756
4
1,752
13
0
13
532
497
35
1
–
1
277,511234,71142,80047,96645,221
2,745
181,736
142,574
39,162
48,847
48,847
–
1,997
12
1,985
16
0
16
535
500
35
1
–
1
281,099
237,153
43,946

48,111
43,8494,262
182,381
135,070
47,312
48,96048,960
–
2,294
85
2,209
32
13
19
537
502
35
–
–
–
282,315
228,479
53,836

48,41944,1684,250
185,309
136,132
49,177
48,96048,960
–
2,419
85
2,334
85
61
24
537
502
35
–
–
–
285,729
229,908
55,821

48,93444,651
4,282
188,903
139,794
49,10946,14846,148
–
2,562
83
2,479
267
65
202
512
477
35
–
–
–
287,327
231,219
56,10748,932
44,676
4,256
191,258
141,901
49,35744,26444,264
–
2,646
82
2,563
1,559
67
1,492
512
477
35
–
–
–
289,171
231,468
57,70349,59745,403
4,194
193,356
143,777
49,57944,26444,264
–
2,750
30
2,720
4,085
81
4,005
508
473
35
–
–
–
294,560
234,028
60,53250,03545,786
4,248
190,805
143,040
47,76542,04842,048
–
2,808
50
2,758
5,624
87
5,536
517
473
43
–
–
–
291,836
231,484
60,35250,05849,521
536
193,910
174,392
19,51741,482
41,482
–
3,203
2,893
310
9,110
5,655
3,455
526
511
15
64
64
0
298,352
274,519
23,83450,01449,562452
193,462
173,261
20,201
39,132
39,132
–
3,483
3,091
391
12,592
7,318
5,274
471
466
5
54
54
0
299,209272,885
26,324*Figures represent the total amount generated by power plants with a generating capacity of 1,000kW or above.
**Including biomass and waste-to-energy.
Source: FEPC (2008-2015), METI (2016-2017)

Transmission, Substations and Distribution Facilities of Former General Electricity Utilities (As of March 31, 2018)
Transmission Lines (km)Substations

Route length

Circuit length

NumberOutput Capacity( MVA)

Voltage (kV)Overhead

Underground

Overhead

Underground

500

7,853

89

15,320177

84

223,550

275

7,429

606

14,692

1,514

159

174,225

220

2,617

61

5,028

134

62

39,260

187

2,735

15

5,229

35

39

16,760

110–154

15,537

1,011

28,247

1,948

681

155,801

66–77

38,196

7,335

68,346

13,2484,468

224,351≦55

13,4086,133

14,651

10,096

1,281

9,754

Transformers

Distribution Lines (km)Route length

Circuit length

Output Capacity [MVA]

Overhead

Underground

Overhead

Underground

Overhead

Underground

948,120

42,945

4,023,882

72,096334,833

34,433

Source: METI

61

The Electric Power Industry in Japan 2020

Peak Load, Supply Capability, Annual Electricity Demand, Reserve Margin and Load Factor
2010

2011

2012

2013

2014

2015

2016

2017

2018

Peak Load (GW)

178.9

156.4

157.2

161.6

154.3

161.2

156.2

157.1

159.7

Supply Capability (GW)

199.0

175.9

176.9

179.5

179.8

184.2

180.4

185.2

178.9

Annual Electricity Demand (TWh)

974.3

926.8

914.7

917.5

898.9

888.2

887.1

892.6

886.9

Reserve (GW)*

20.1

19.5

19.7

17.9

25.6

23.0

24.2

28.1

19.2

Reserve Margin (%)*

11.2

12.5

12.6

11.1

16.6

14.3

15.5

17.9

12.0

Load Factor (%)**

62.2

67.4

66.4

64.8

66.5

62.9

64.8

64.9

63.4

FY

* Reserve= Supply Capability-Peak Load		
Reserve Margin= Reserve/Peak Load×100		
**Load Factor= Annual Electricity Demand / (Peak Load ×365(366)×24hours) ×100		
Source: Japan Electric Power Survey Committee (2010-2014), OCCTO (2015-2018)		

Summarized Comparative Table Classified by Country for 2017
UK

FranceGermany

Russia

China

Japan

1,193,885

81,170130,761

219,299

272,400

1,777,080

299,209

Hydroelectric

100,899

4,365

25,517

10,27153,200343,590

50,014

Thermal837,986

50,901

18,947

83,643

190,600

1,104,950

193,462

Nuclear108,179

9,361

63,13011,357

27,90035,82039,132

Renewables and others

146,820

16,542

23,168114,028–

292,720

16,601

Total Energy Production (GWh)

4,041,335

338,172

529,235

653,655

1,094,290

6,417,100

1,007,423

Hydroelectric

300,281

8,774

53,541

26,155

187,130

1,193,100

90,128

Thermal2,525,135

166,172

53,855334,249

700,200

4,555,800

861,518

Nuclear804,948

70,336

379,091

76,324203,140

248,100

31,278Renewables and others

410,971

92,89142,749216,9273,810

420,100

24,470

–

39.4

46.1

34.0

–

43.3

–

12,429

5,139

8,184

7,909

7,452

4,616

7,946

Domestic Energy Supplies (GWh)

4,088,278

333,601

482,015

397,710

1,089,100

5,435,700–

Energy Sales (GWh)

3,723,356

277,907–444,591–

5,083,500

863,137

Number of Customers (At year-end; thousand)

151,780

30,589––––66,027

Peak Load (MW)776,155

52,27994,23678,710151,200–

155,770

59.4

66.5

58.3

57.7

78.5

–

66.0

–

34.9

–

45.8

39.3

39.8

–

5.5

7.9

7.7

6.8

–

6.5

–

–

4,554

6,881

6,288

6,700

4,557

7,710

FY

Total Installed Capacity (MW)Capacity Factor (%)
Total Energy Production per Capita (kWh)Annual Load Factor (%)
Power Generation Efficiency (%)
Loss Factor (Transmission and Distribution) (%)
Total Consumption per capita (kWh)USA

Source: JEPIC, METI

62

Over sea s Activities o f Mem b er Co m pan ies

This section presents information on member companies’ overseas activities, provided by a number of member
companies. Although JEPIC has compiled this information with care, no guarantee can be made as to its accuracy.

The Electric Power Industry in Japan 2020

Data on Member Companies (as of March 31, 2019) *FY 2018

Approved maximum output of power facilities [MW]**Electricity
Capital (¥m) Sales (¥m)
sold
NonConsolidated
retail[GWh]consolidated

Hydro

ThermalNuclearRenewable(excl. hydro)

Total

Hokkaido Electric Power Co.

114,291752,238

22,774

1,650

4,469

2,070

–

8,190

Tohoku Electric Power Co.

251,4412,244,314

68,8762,556

12,0492,750

243

17,598

Tokyo Electric Power Company
1,400,975 6,338,490
Holdings

230,306

9,873

41,161

12,612

51

63,697

Chubu Electric Power Co.

430,777 3,035,082

123,6025,459

24,3763,617

39

33,491

Hokuriku Electric Power Co.

117,641

622,930

26,060

1,958

4,825

1,746

–

8,528

Kansai Electric Power Co.

489,320

3,307,661

117,826

8,228

19,4416,578

11

34,259Chugoku Electric Power Co.

185,527

1,376,979

52,944

2,909

7,802

820

6

11,538

Shikoku Electric Power Co.

145,551

737,274

23,296

1,151

3,395

890

2

5,438

Kyushu Electric Power Co.

237,304

2,017,181

72,2193,580

10,3554,699

211

18,845

Okinawa Electric Power Co.

7,586

205,481

7,453

–

2,145

–

2

2,147

J-POWER

180,502897,366

–

8,575

8,523

–

444

17,542

Japan Atomic Power Co.

120,000

113,337

–

–

–

2,260

–

2,260

*Some consolidated data contains non-consolidated data.
**Calculated based on figures contained in the “key facilities” sections of financial statements.
Source: Compiled based on companies’ financial statements

64

Overseas Activities of Member Companies

Hokkaido Electric Power Co.

Training of hydroelectric engineers for EGAT, the Electricity
Generating Authority of Thailand (2018)
Technical cooperation on maintenance and improvement of equipment in the hydroelectric
power industry (2005~)
 Objectives
・ Improvement of technical skills and development of human resources in thehydroelectric power industry
 Trainees
・ EGAT hydroelectric engineers (3 people)
 Period
・ From July 23 to August 3, 2018
 Content
・ Training visits to plants including a pumped storage plant in Hokkaido
・ Lectures on hydroelectric power plant maintenance support systems, operation andmaintenance of pumped storage plants, etc.
 Background to project・ Training provided under the Memorandum on Technical Cooperation Regarding
Hydroelectric Power Generation signed in May 2015.
・ Technical assistance has continued to be provided since the first cohort ofhydroelectric engineers of EGAT was trained followed a request made through
JEPIC in 2005.

65

The Electric Power Industry in Japan 2020

Tohoku Electric Power Co.

Overview of Projects■ We are actively participating in overseas power generation projects.
■ We are leveraging our years of expertise in geothermal and high-efficiency thermal
power generation in Japan to expand our overseas operations targeting mainly North
America and Southeast Asia.

VietnamNghi Son 2 (Coal 1,200 MW)- planned

MexicoFalcon (Gas 2,233 MW)- invested in 2011

Indonesia

Rantau Dedap (Geothermal 98.4 MW)- invested in 2018
As of July 2019

Geothermal Power Project in Indonesia■ We are one of Japan’s largest geothermal power
producers and make up 40% of the country’s total
capacity.
■ We contribute to management and technicalsupport based on our 40-year experience inoperating domestic power stations.

Location

South Sumatera, Indonesia

Investors

Engie (42%), Marubeni (32%)
Supreme Energy (16%)
Tohoku Electric Power Co. (10%)

COD

Second half of 2020

As of July 201966

Overseas Activities of Member Companies

Tokyo Electric Power Company Holdings

Developing Global Enterprises

Source: TEPCO Integrated Report 2018

The TEPCO Group continues to work as one to expand its reach in the global market. In particular, it has leveraged its technologicalexpertise in supplying stable power to densely populated regions to provide consulting services to overseas utilities. To date it has
provided such services more than 600 times inapproximately 70 countries.
U.K.
Italy
Spain
NorwayFinlandNetherlands
SerbiaGermany
Switzerland
RussiaCanadaU.S.

JapanSouth Korea
Qatar
UAE
Oman

India
Sri Lanka
Maldives
Bangladesh

Iran

Egypt

Power generation projects

Total of 5.1 GW in 23 countries(as of the end of FY 2017)
Australia, Canada, Chile, Finland, India, Indonesia,
Italy, Japan, Mexico, Netherlands, Norway, Oman,
Philippines, Qatar, Singapore, South Korea, Spain,
Thailand, UAE, UK, Uruguay, USA, Vietnam

MexicoChina
VietnamPhilippines
Indonesia

Thailand
Laos
MyanmarSingapore
BhutanAustralia

Uruguay
Chile

Energy‐related projects other than power generation

14 projects in 7 countries(as of the end of FY 2017)
Australia, Canada, Germany, Singapore, Switzerland,
UK, USA(includes venture companies, venture capital funds,
venture accelerators, and local holding companies)

In the power generation, transmission/distribution, and power retail fields, TEPCO has been
preparing for further growth by, among other things, establishing holding companies andinvestment companies overseas as it continues to search for new business opportunities. As
well as joining and investing in projects after careful consideration of the risks, capitalprocurement, and profitability, TEPCO has also been engaging in personnel exchanges andcultivating human resources capable of sharing their technical skills. TEPCO will continue toproactively engage in renewable energy projects overseas in particular.

Details and Benefits ofOverseas Ventures
Consulting fees

Power generation projects(as of the end of FY 2017)
Bangladesh, Bhutan, China, Egypt, India, Iran,
Laos, Myanmar, Philippines, Russia, Serbia,
Singapore, Sri Lanka, Thailand, Vietnam

Consulting services• Power infrastructure exportingand energy conservation‐related
consulting• Establishment of joint ventureswith leading domestic
manufacturers in order toincrease orders from overseas

Energy conservation‐related consulting
at a hospital in India (TEPCO HD)

New technology, information,and human networks that breakfrom conventional wisdom

Benefits• Project investment• Dispatch of employees overseas

ReturnReturn Technology
Information Human(human resources
and networks)

ReturnConsulting services¥900 million in sales in 15 countries

Becoming a lean andinnovative company

Energy‐related projects
other than power
generation• Strategic investment in companies andprojects*• Project development through provisionof technical support• Dispatch of employees overseas

Coc San Hydropower Project in Vietnam (TEPCO HD)*Includes participation in venture capital funds and venture accelerators in order to form
relationships with venture companies that are predicted to grow in the future

Source: TEPCO Integrated Report 2018 (partially modified)

Installation of storage batteries in Hawaii (Oahu)(TEPCO Ventures)

67

The Electric Power Industry in Japan 2020

JERA * a joint venture of Tokyo Electric Power Company Holdings and Chubu Electric Power Co.

Who arewe?

ü JERA ﬁnished integrating the entire thermal power value chain of Tokyo Electric Power Company
and Chubu Electric Power Company on April 1, 2019.
ü JERA is the largest power generation company in Japan. It procures 35MT of LNG and
has a worldwide power generating capacity of 75 GW.

What weaim forü JERA aims to become a global leader in LNG and renewables, leading the transition to a clean
energy economy by 2025.

Overseasbusinessesü We engage in ﬁve upstream projects, 9 GW power generation projects, intercontinental
optimization and trading, and O&M services all over the world.

68

Overseas Activities of Member Companies

Kansai Electric Power Co.
Overseas Power Business and International Contribution
We are involved in power projects around the world, including in Asia, Europe and the U.S.
In developing countries, we contribute by providing consulting services and organizing workshops on how to
improve power infrastructure.
Ireland : Evalair

0

U.S. : West Deptford

UK : Moray East
UK : Triton Knoll
UK-Germany : NeuConnect

U.S. : St. Joseph Phase 2
Laos: Nam Ngiep1

UK : Electricity North West

Taiwan : Kuo Kuang

Thailand : Rojana

U.S. : Hickory Run

Taiwan : Ming-Jian
Philippines : San RoqueSingapore : Senoko
Indonesia : RajamandalaIndonesia :Tanjung Jati B

Australia : Bluewaters●：Thermal●：Hydro●：Renewable：Others

Philippines : New Clark City

As of December 2019

Overseas Projects

1

Type

Status

Kepco'sParticipation

EquityPortion

Net Capacity(MW)

Philippines

Hydro

Operational

since 1998

50.0%

218.0

Thailand

CCGT Co-generation

Operational

since 2003

39.0%

197.0

Ming-Jian

TaiwanHydro

Operational

since 2005

24.0%

4.1

Kuo Kuang

TaiwanCCGT

Operational

since 2006

20.0%

96.0
421.1

Project

Location

San Roque
RojanaSenokoSingapore

CCGT, Conventional

Operational

since 2008

15.0%

RajamandalaIndonesia

Hydro

Operational

since 2012

49.0%

23.0

Nam Ngiep 1

Laos

Hydro

Operational

since 2013

45.0%

130.5
229.6

Bluewaters

Australia

Coal-fired

Operational

since 2013

50.0%

Tanjung Jati B

Indonesia

Coal-fired

Under Construction

since 2015

25.0%

535.0

West Deptford

U.S.

CCGT

Operational

since 2016

17.5%

134.4

Evalair

Ireland

Onshore Wind

Operational

since 2017

24.0%

53.5

Hickory Run

U.S.

CCGT

Under Construction

since 2017

30.0%

300.0

Triton Knoll

UK

Offshore Wind

Under Construction

since 2018

16.0%

137.1

Moray East

UK

Offshore Wind

Under Construction

since 2018

10.0%

95.4

St. Joseph Phase 2

U.S.

CCGT

In Development

-

20.0%

-

Electricity North West

UK

Distribution

Operational

since 2019

22.0%

-

New Clark City

Philippines

Distribution and Retail

Operational

since 2019

9.0%

-

NeuConnect

UK-Germany

Interconnector

In Development

-

18.3%

-

As of December 201918 Projects in 11 Countries, Net Capacity : 2.57GW (Operational : 1.51GW)The Kansai Electric Power Co., Inc.

69

The Electric Power Industry in Japan 2020

Chugoku Electric Power Co.

Overseas Business⑦Gemeng（China）

We are developing our international business by drawing on
the technological expertise which we have acquired in Japanand abroad.

⑤Kleen（USA）③Yunlin（Taiwan）

Chugoku ElectricPower America, LLC①South Field Energy（USA）
Chugoku Electric Power
Singapore Pte. Ltd.
②Ahlone（Myanmar）⑥Jimah East
（Malaysia）

IPP Business
Consulting Business
Overseas Office④Pakkat（Indonesia）

As of January 2020

Outline of IPP Projects

As of January 2020

No

Project

Location

Type

Gross
Capacity(MW)①

South Field
EnergyColumbiana, Ohio, USA

CCGT1 (Gas)

1,182

10.0

20212

②

AhloneYangon district,
Myanmar

CCGT1 (Gas)

121

28.5

April 2013③

YunlinYunlin County, Taiwan

Offshore wind

640④

PakkatHumbang Hasundutan
Regency, North Sumatra
Province, Indonesia

Hydro(Run‐of–river
type)

18

25.0

April 2016

⑤

Kleen

CCGT1 (Gas)

620

16.2

July 2011⑥

Jimah East

USC4 (Coal)

2,000

15.0

December 2019⑦

GemengConglomerate

6,400

3.0

April 2007
(date ofestablishment)

Middletown,
Connecticut, USA
Mukim Jimah, Negeri
Sembilan, Malaysia
Shanxi Province,
Taiyuan City, China

Chugoku Electric Date of entry
Power’s share intro commercial(%)
operation

6.75(C&C Investment December 20212
Corporation)3

1 Combined Cycle Gas Turbine
2 Scheduled
3 Joint venture established by Chugoku Electric Power (50%) and Chudenko (50%)

4 Ultra Super Critical

70

Overseas Activities of Member Companies

Shikoku Electric Power Co.

Shikoku Electric Power Company

Target Areas and Overseas Assets

①

⑥

◎
②

③

⑤
⑧
⑨
⑦

④

: Developing area

: Current/Developing project

Middle East②③
Barka 3
Sohar 2Oman①◎: Branch officeAmericas⑥④Hamriyah

Huatacondo

UAE

Chile

⑤
South Field
EnergyUSA

Project

Ras Laffan C

Country

Qatar

Output2,730
MW(GTCC)Water:
290,000ton/day

744 MW each
(GTCC)

1,800 MW
(GTCC)

98 MW (PV)

1,182 MW
(GTCC)

Equity5%

7.15%
for each project

15%

30%

8.9%

COD

2011
(25 year PWPA)

2013(15 year PPA)

2023
(23.5 year PPA)

2019
(Merchant)

2021(Merchant)⑦
Project Batang Toru 3Country
Indonesia

Asia / Pacific⑧
YunlinTaiwan⑨
AhloneMyanmar

Output

10 MW(Mini Hydro)

640 MW(OffshoreWind)

121 MW(GTCC)

Equity

15%

4.4%

28.5%

COD

2020
2021
2013
(20 year PPA) (20 year PPA) (30 year PPA)

71

The Electric Power Industry in Japan 2020

Kyushu Electric Power Co.

Overseas Business Strategy
Target capacity (net) in 2030: 5,000 MW(current capacity: +2,810 MW)• We contribute to international society by delivering stable, low-cost power supply solutions, as well
as by developing human resources through our overseas IPP and consulting businesses.
• We became involved in managing the Electricity Generating Public Company Limited (EGCO), one of
the largest independent power producers in Thailand, in May 2019.
Overseas energy business12 countries/areas (2,190 MW)
Overseas consulting services*78 projects in 22 countries*

are recent projects
Inner Mongolia IPP (wind)
Capacity: 50 MW
Equity ownership: 15 MW
China

EGCO*
Capacity: 5,968 MW
Stake: 350MW
Thailand and 5 other countries*Including projects underconstruction

Kleen Energy IPP (gas)Capacity: 620 MW▼ Our first power generation project
Supplying ISO New England in the U.S. Stake: 126 MW
USA (CT)(Kleen Energy IPP)
South Field Energy IPP(gas)*
Capacity: 1,182 MW
Stake: 214 MW
USA (OH)*Under construction
Birdsboro IPP (gas)Capacity: 488 MW
Stake: 54 MW
USA (PA)Hsin Tao Power IPP (gas)Capacity: 600 MW
Stake: 199 MW
TaiwanIlijan IPP (gas)Capacity: 1,200 MW
Stake: 96 MW
Philippines

Sarulla IPP (geothermal)
Approx. capacity: 330 MW
Approx. stake: 83 MW
Indonesia

Phu My III IPP (gas)Capacity: 744 MW
Stake: 199 MW
Vietnam
Senoko Energy Pte. Ltd.
Capacity: 2,380 MW
Stake: 357 MW
Singapore▲ One of the largest geothermal IPPs in theworld(Sarulla IPP in Indonesia)

Tuxpan II & V IPP (gas)Capacity: 495 MW x 2
Stake: 248 MW x 2
Mexico▲ Inspection support(Tuxpan II IPP in Mexico)
As of July 201972

Overseas Activities of Member Companies

J-POWER

Overseas Power Generation Business Power plants in operation: 37 projects in 6 countries/regions (owned capacity of 6.91GW)
Projects in operation: 37
Projects under construction/planned: 2

Triton Knoll
Offshore Wind Farm
Hezhou Coal Power Plant in China (2012)(2,090 MW capacity, 17% stake)

Westmoreland Gas Power Plant in U.S. (2018)(926 MW capacity, 25% stake)Central Java Coal
Power Plant

Nong Saeng Gas Power Plant in Thailand (2014)(1,600 MW capacity, 60% stake)Green Country Gas Power Plant in U.S. (2002)(795 MW capacity, 50% stake)As of December 31, 2018

Expansion of Overseas Business We are expanding in Thailand, the U.S., and China, where we already have a strong presence. We aim to acquire
projects in Indonesia and Taiwan (where we also have operations) and in new markets with robust energy demand.
 Leveraging the technological capabilities we have built up in our domestic business, we are taking steps to expand
our presence in wind, hydro, and other renewables overseas.

We s t m o r e l a n d

C e n t ra l J a va

Tr i t o n Kn o l l O f f s h o r e W i n d

Location

Pennsylvania, USA

Location

Java, Indonesia

Location

North Sea, UK

Start ofoperation

Dec.2018

Start ofoperation

No. 1 June 2020
No. 2 Dec. 2020

Start ofoperation

2021

Capacity

926 MW (231.5 MW owned)

Capacity

2,000 MW (680 MW owned)

Capacity

860 MW (215 MW owned)

Type

Combined cycle gas turbine

Type

Coal (ultra-supercritical)

Type

Offshore wind power

Stake

25%

Stake

34%

Stake

25%

●

73

The Electric Power Industry in Japan 2020

Japan Atomic Power Co.

Major Projects
Turkey‐ Feasibility study of Sinop NPP (geological survey)‐ Technical support‐ Development of human resources

Kazakhstan‐ Technical support‐ Development of human resources

U.S.A.
‐ Formation of joint venture(JExel Nuclear Company)
with Exelon
U.K.
‐ Support for Wylfa Newydd project

Results and on‐goingThailand‐ Technical support‐ Development of human resources

Vietnam‐ Feasibility study of Ninh Thuan 2 NPP‐ Technical support‐ Development of human resources

Development of human resources
JAPC offers a comprehensive range of education and training support tailored to individual countries’
needs.
So far, we have provided training for approximately 560 people in 23 countries.
We also use our experience to provide support for feasibility studies of nuclear power plants.
Tokai Training Center

Nuclear power plant simulator

Preparation of master plan for introduction of
nuclear power

Pump disassembly andinspection

Radiation measurement

74CONTRIBUTORS:

Kojiro Henmi
Manabu Hirano
Sho Hironaka
Osamu Kato
Joji Kawano
Masaya Kuboki
Kaoru Morita
Masashi Okada
Takakazu Okubo
Shota Sakamoto
Yasushi Takizawa
Kohei Tsuruya
Takanori Yamamoto

DISCLAIMER

This publication was prepared by the Japan Electric Power
Information Center (JEPIC), based on publically available
information. While we presume this information to beaccurate and reliable, we provide no guarantee as to theaccuracy of the data or information contained herein. JEPIC
shall therefore assume no legal responsibility for any trouble,
loss, or damages resulting from any actions taken based on
the content of this publication.
All rights reserved.
©2020 Japan Electric Power Information Center, Inc.

Distribution Areas and Frequency ofElectric Power Companies(As of March 2020)

Hokkaido
Electric Power Co.

TohokuElectric Power Co.

Hokuriku
Electric Power Co.
ChugokuElectric Power Co.

KansaiElectric
Power Co.

Chubu
Electric
Power Co.

TEPCOPower Grid

ShikokuElectric Power Co.
KyushuElectric Power Co.
60 Hz

50 Hz

JEPIC’s member companies
include the 10 electric powercompanies indicated on the map
and two wholesale electric utilities,
J-POWER and The Japan Atomic
Power Company.

Okinawa
Electric Power Co.

Member Companies (As of March 2020)
Hokkaido Electric Power Co., Inc.
2, Higashi 1-chome, Odori, Chuo-ku, Sapporo, Hokkaido 060-8677, Japan
http://www.hepco.co.jp/english/index.html

The Chugoku Electric Power Co., Inc.
4-33, Komachi, Naka-ku, Hiroshima-shi, Hiroshima 730-8701, Japan
http://www.energia.co.jp/e/index.html

Tohoku Electric Power Co., Inc.
1-7-1 Honcho, Aoba-ku, Sendai, Miyagi 980-8550, Japan
http://www.tohoku-epco.co.jp/english/index.html

Shikoku Electric Power Co., Inc.
2-5, Marunouchi, Takamatsu, Kagawa 760-8573, Japan
https://www.yonden.co.jp/english/index.html

Tokyo Electric Power Company Holdings, Inc.
1-1-3, Uchisaiwai-cho, Chiyoda-ku, Tokyo 100-8560, Japan
http://www.tepco.co.jp/en/index-e.html

Kyushu Electric Power Co., Inc.
1-82, Watanabe-dori 2-chome, Chuo-ku, Fukuoka 810-8720, Japan
http://www.kyuden.co.jp/en_index.html

Chubu Electric Power Co., Inc.
1, Higashi-shincho, Higashi-ku, Nagoya, Aichi 461-8680, Japan
http://www.chuden.co.jp/english/index.html

The Okinawa Electric Power Co., Inc.
2-1, Makiminato 5-chome, Urasoe, Okinawa 901-2602, Japan
http://www.okiden.co.jp/en/

Hokuriku Electric Power Co.
15-1, Ushijima-cho, Toyama-shi, Toyama 930-8686, Japan
http://www.rikuden.co.jp/english/index.html

Electric Power Development Co., Ltd. (J-POWER)
6-15-1, Ginza, Chuo-ku, Tokyo 104-8165, Japan
http://www.jpower.co.jp/english/index.html

The Kansai Electric Power Co., Inc.
3-6-16, Nakanoshima, Kita-ku, Osaka 530-8270, Japan
http://www.kepco.co.jp/english/

The Japan Atomic Power Co.
5-2-1, Ueno, Taito-ku, Tokyo 110-0005, Japan
http://www.japc.co.jp/english/index.html

The Electric Power
Industry in Japan

2020

15-33, Shibaura 4-chome Minato-ku,
Tokyo 108-0023, Japan
http://www.jepic.or.jp/

JEPIC OFFICE
Washington Office1120 Connecticut Avenue, N.W., Suite 1070
Washington, D.C. 20036, U.S.A
Tel: +1 (202) 955-5610 Fax: +1 (202) 955-5612
European Office
10, rue de la Paix, 75002
Paris, France
Tel: +33 (1) 42.86.90.11 Fax: +33 (1) 42.86.50.80
Beijing Office
Chang Fu Gong Office Building 401, Jia-26
Jianguomenwai Dajie, Chaoyang-qu, Beijing 100022
The People’s Republic of China
Tel: +86 (10) 6513-9885, 9886 Fax: +86 (10) 6513-9887

Published in March 2020

Printed in Japan with vegetable-based ink on recycled paper