Hostname: page-component-7b9c58cd5d-dlb68 Total loading time: 0 Render date: 2025-03-18T00:51:28.133Z Has data issue: false hasContentIssue false

A New Japanese Miracle? Its Hamstrung Feed-in Tariff Actually Works

Published online by Cambridge University Press:  14 March 2025

Rights & Permissions [Opens in a new window]

Extract

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the ‘Save PDF’ action button.

Reeling from history's biggest double-blow of natural and nuclear disasters, post 3-11 Japan seemed poised to lead the world's accelerating turn to radical efficiency and renewable energy (the latter accounted for 56% of net additions to global power capacity in 2013). After 3-11, then-Prime Minister Kan Naoto quickly initiated regulatory shackles on the country's nuclear capacity and implemented a feed-in tariff (FIT). These deft moves became core elements in a battering-ram of policy changes and political opposition that forced open a door to profound change in Japan's power mix and its political economy. The country has seen minimal nuclear power generation in the wake of 3-11, and not one kilowatt between September 15 of 2013 and the present. Japan now appears on track towards the restart of at least some of its remaining nuclear capacity. Not without reason, the “smart money” believes Japan's power choices are dominated by fossil fuels and the resumption of considerable nuclear capacity. So it is important to ask whether aggressive efficiency and FIT-incentivized renewable power got through while the door was open or face a suffocating squeeze if significant nuclear generation returns on-line.

Type
Research Article
Copyright
Copyright © The Authors 2014

References

Notes

1 For the details, see “With Developing Worlds Policy Support, Global Renewable Energy Generation Capacity Jumps to Record Level,” UNEP News Centre, June 3, 2014.

2 On September 10, Japan's Nuclear Regulation Authority gave its approval for restart of the 2 nuclear reactors at the Sendai plant in Kyushu. Since the assent of local governments is required before actual restart of the plant, they may not come on-line until early 2015. See Kentaro Hamada, “Japan approves nuclear restart amid push to close old reactors,” Reuters, September 10, 2014.

3 For example, note the comments of analysts cited by Jacob Adelman and Chisaki Watanabe in “Japan Rejoining Nuclear Club Leaves Fossil Fuel Appetite,” Bloomberg News, July 29, 2014.

4 On this, see the interview with Wall Street Journal Japanese energy-policy reporter, Mari Iwata, in Clint Richards, “Interview: Japan's Post-Nuclear Future,” The Diplomat, September 18, 2014.

5 Thomas Gerke, “The debate over restarting nuclear reactors in Japan,” Renewables International, April 9, 2014.

6 See Yuriy Humber, “Nuclear Power-less Japan Must Pay for Fuel Imports in Weak Yen,” Bloomberg Businessweek, September 18, 2014.

7 See (in Japanese) “Mid-Term Report on Conditions and Outlook for SSL, LED and Organic EL Lighting, 2014” EM Data, August 2014.

8 See p. 2 of Christine Holland, “Are LEDs the Next CFL: A Diffusion of Innovation Analysis,” 2014 ACEEE Summer Study on Energy Efficiency in Buildings paper 9-426.

9 “Vending in Japan,” Euromonitor Report, March 2014.

10 These figures are based on the Agency for Natural Resources and Energy “Electricity Survey Statistics,” and compiled by Greenpeace Japan in a September 15, 2014 article celebrating a year without nuclear power. Their summary of the data suggests that compared to 2010, the power savings in 2013 saved YEN 1.7 trillion in fossil fuel costs. See (in Japanese) “Celebrate! One Year of Zero Nuclear Generation,” Greenpeace, September 15, 2014.

11 See “Energy efficiency: a key tool for boosting economic and social development,” IEA Press Release, September 9, 2014.

12 See (in Japanese) Fujinami Takumi, “Making Conservation the Spring for This Country's Growth: Key Items are Consumers’ Conservation Investment and the Shifting Industrial Structure,” Japan Research Institute New Energy Basic Plan Deliberation Series No. 4, Paper 2014-027, August 21, 2014.

13 For example, as the “Global Cleantech Innovation Index 2014” report comparing 40 countries (including all of the G20 members) notes on its page 8, “Cleantech venture capital is still primarily made up of energy-related technologies (51 percent in 2013), though much less so compared to 77 percent in 2010, and much more of the energy element is around efficiencies, as opposed to renewables generation.” The report is available here.

14 Tawada Yoshihisa, the head of the Japanese Solar Energy Association, stresses this fact in noting that Japanese solar initiatives date back to the mid-1950s. See (in Japanese) “Cutting through the trilemma of the 3 Es and producing a virtuous cycle,” President, September 20, 2014.

15 Masanori Tobita, “Geothermal energy is Japan's buried treasure,” Nikkei Asian Review, October 30, 2013.

16 The New Energy and Industrial Technology Development Organization (NEDO) is Japan's top quango for energy R&D. Its September 18, Sunshine Plan 40-Year Anniversary Special Symposium announcement and details (in Japanese) are here.

17 See “Japan's new minister says energy policy without nuclear difficult,” Reuters, September 21, 2014. Obuchi's remark came during the regular Sunday debate show on NHK, and the clip is available in the original Japanese here.

18 Lovins’ profile is available at the Foundation's web site.

19 Lovins’ comparative figures are nicely visualized (in Japanese) in the first 2 minutes of this November 2, 2012 NHK broadcast “Taking on an Energy Shift”.

20 See Amory Lovins, “How Opposite Energy Policies Turned The Fukushima Disaster Into A Loss For Japan And A Win For Germany,” Japan Renewable Energy Foundation, September 4, 2014.

21 Quirin Schiermier, “Renewable power: Germany's energy gamble,” Nature, April 10, 2013.

22 See “RECAI Renewable Energy Country Attractiveness Index,” Issue 42, September 2014, p 20.

23 See “Conergy files for insolvency as solar crisis deepens,” Reuters, July 5, 2013.

24 One of the German sites of innovation is Karlsruhe Institute of Technology, or KIT, where storage solutions are a focus of research. See “Largest German Solar Power Storage Park,” KIT Press Release 106/2014.

25 Craig Morris, “German exports of renewable technology,” Energy Transition, August 27, 2014.

26 See Mika Ohbayashi, “Great Achievements of Feed-in Tariff and Challenges for Japan's Renewable Energy Policy,” Japan Renewable Energy Foundation Renewables Update, September 5, 2014.

27 For the data on Japan's power, see (in Japanese) “Current conditions and issues concerning renewable energy,” METI Agency for Natural Resources and Energy, June 17, 2014: Agency for Natural Resources and Energy

28 In technical terms, as opposed to regulatory barriers. Fast deployment of onshore wind would require shortening environmental assessments.

29 See Amory Lovins, “How Opposite Energy Policies Turned The Fukushima Disaster Into A Loss For Japan And A Win For Germany,” Japan Renewable Energy Foundation, September 4, 2014.

30 See (in Japanese) Kaneko Kenji, “The JPEA reports that the domestic soalr system market totals YEN 2.5 trillion and 210,000 jobs,” in Nikkei Tekunologii, August 22, 2014.

31 See (in Japanese) “2013 new business starts at about 110,000 firms, 4th year of increases,” Tokyo Shoko Research, August 8, 2014.

32 Its corporate history (in Japanese) is here.

33 See (in Japanese) “2013 new power business starts of 1,799 firms was 2.2 times the previous year,” Tokyo Shoko Research, August 13, 2014.

34 On this, see (in Japanese) “What is a PPS?” Epower-management, August 25, 2013.

35 The number of PPS firms, their power output, and other information is available (in Japanese) here.

36 See (in Japanese) “Orix plans to invest YEN 300 billion in renewable power over the next five years,” Nikkei Shimbun, August 14, 2014.

37 The Orix Group's very detailed English-language website is here.

38 See (in Japanese) Kaneko Kenji, “Osaka Prefecture Izumisano City is to set up a PPS within the year, using power supplied by megasolar projects at Kansai International Airport,” Nikkei Technology, August 28, 2014.

39 The city describes the details of the contracts and their background, in Japanese, here.

40 On the plan, see (in Japanese) Ishida Masaya, “Energy production and local consumption in Kanagawa Prefecture, cutting power costs by YEN 1.5 million with megasolar,” Smart Japan, August 28, 2014.

41 See (in Japanese) Fujii Kohei and Yamashita Hidetoshi, “The Actual Conditions And Issues of Renewable Energy Use in the Municipalities,” Presentation Overview for Society for Environmental Economics and Policy Studies, SEEPS, September 13-14, 2014.

42 See (in Japanese) “21 prefectures shift power supply for head offices to PPS,” Sankei Shimbun, July 13, 2014.

43 Unfortunately, the article is not accessible online. It is (in Japanese) “Large firms power cancellations total 11 nuclear reactors worth,” Nikkei Shimbun, August 6, 2014, page 11.

44 See (in Japanese) “Large printing firms in support of PPS,” Nihon Keizai Shimbun, August 15, 2014.

45 See “Green Growth in Kitakyushu, Japan,” OECD, May 23, 2013.

46 See (in Japanese) Tojo Yohei, “Partial supply gives strong following wind to PPS,” Construction News, August 5, 2014.

47 Ari Phillips, “Onshore Wind Power Is Now Cheapest Form Of New Electricity In Denmark,” Climate Progress, July 22, 2014.

48 Ed Crooks, “US solar and wind start to outshine gas,” Financial Times, September 18, 2014.

49 The Agency is investigating whether special purpose companies might be a suitable mechanism for securing grid access fees, construction costs, and other funds from wind producers. On this, see (in Japanese) “The Energy Agency is subsidizing an initiative in 3 areas of Tohoku aimed at expanding grid capacity for wind power,” July 15, 2014.

50 On this, see (in Japanese) “METI Agency for Natural Resources and Energy selects 10 firms for test to cut environmental assessments for wind and geothermal,” Denki Shimbun, August 19, 2014.

51 See “Japan Infrastructure Report: Energy and Utilities, Q4, 2014, Industry Forecast,” BMI Infrastructure Report, October 1, 2014.”

52 On the background, see Andrew DeWit and Iida Tetsunari, “The ‘Power Elite’ and Environmental-Energy Policy in Japan,” The Asia-Pacific Journal Vol 9, Issue 4 No 4, January 24, 2011.

53 See Koben Calhoun and Jesse Morris, “Getting To The Bottom Of US–Germany Solar Soft Cost Differences, & How To Make Solar Cheaper In US Than In Germany,” CleanTechnica, December 6, 2013.

54 See Mika Ohbayashi, “Great Achievements of Feed-in Tariff and Challenges for Japan's Renewable Energy Policy,” Japan Renewable Energy Foundation Renewables Update, September 5, 2014.

55 The IEA report is available here.

56 See Terje Osmundsen, “Only solar PV is exceeding expectations for clean energy,” REneweconomy, September 11, 2014.

57 See Terje Osmundsen, IEA and Solar PV: Two World's Apart, Norwegian Climate Foundation Report no. 1/2014.

58 On the anthropological and other problems in energy forecasting in general, including in the IEA, see Steve Yetiv and Lowell Field, “Why Energy Forecasting Goes Wildly Wrong,” Journal of Energy Security, October 23, 2014.

59 On the economic and political challenges for Abenomics, see Linda Sieg and Tetsuji Kajimoto, “Japan's Abenomics feared in trouble as challenges build,” Reuters, September 2, 2014.

60 See (in Japanese) “Expectations for ‘local revival’ are split 50-50,” Nihonkai Shimbun, September 14, 2014.

61 The July 28, 2014 Citigroup analysis is “Global Energy 2020: The Revolution Will Not Be Televised as Disruptors Multiply,” and it is available here. Note that on pp 46-49 they project an restart of much of the downed nuclear capacity, but do not project nuclear to achieve its 2009 peak of 48.9 Gigawatts of power. Their scenarios for solar, by contrast, see it supplying at least 45.2 Gigawatts of power by 2013 and perhaps as much as 109.7 Gigawatts. They also make note of “wild cards” at the intersection of energy and technology (p. 31), but neglect the items taken up later in this paper.

62 The nuclear village are clearly paying attention to falling renewable prices. On August 21, 2014, the METI formally proposed a UK-style price guarantee for nuclear power, should its cost become uncompetitive. See (in Japanese) “METI is keen to introduce a ‘price guarantee’ for nuclear, but passing costs onto users is meeting stiff criticism,” Reuters, August 21, 2014.

63 For example, on September 19, Kyushu Electric announced that it was considering a halt to purchases of renewable power in its service area, citing concern over capacity of the grid. See (in Japanese) “Kyushu Electric announces that it is considering halting renewable purchases,” Mainichi Shimbun, September 20, 2014.