So what's changed since 3/11?

May 3, 2015

The same old energy mix

http://www.japantimes.co.jp/opinion/2015/05/03/editorials/the-same-old-energy-mix/#.VUccpZPwmic

The government’s draft for Japan’s energy mix in 2030, which was endorsed by a panel of experts at the Economy, Trade and Industry Ministry last week, makes it clearer that the Abe administration is pursuing a return to the nation’s energy landscape that existed before the 2011 Fukushima nuclear disaster and contradicts Prime Minister Shinzo Abe’s repeated words that the government is seeking to reduce the nation’s dependency on nuclear power as much as possible by maximizing introduction of renewable energy and greater energy efficiency.

According to the medium-term targets set in the draft, nuclear power will account for 20-22 percent of the nation’s electricity supply as of 2030, while the share of renewable energy such as solar and wind power will rise to 22-24 percent.

True, the target for renewable sources was set just slightly higher than the share of nuclear energy, which is forecast to fall from the levels before the 2011 triple meltdowns at Tokyo Electric Power Co’s Fukushima No.1 plant. It is questionable, however, whether all possible measures were explored to increase the future share of renewable energy before such targets were set.

The feasibility of the target for nuclear power is also in doubt. In 2010, nuclear power made up of 28.6 percent of Japan’s electricity generation. As power companies shut down their nuclear reactors in the wake of the Tepco plant disaster, the share of nuclear power plunged to 1 percent in fiscal 2013. All of the nation’s 48 reactors — including four aging ones that were officially decommissioned last week — are currently offline.

While the Abe administration is seeking to reactivate the idled reactors once they clear the Nuclear Regulation Authority’s screening under what the government touts as the world’s toughest safety standard, the 20-22 percent share for nuclear energy in 2030 still appears to be a tall order.

Following the Fukushima disaster, the government decided that reactors should be decommissioned after they have been in operation for 40 years in principle — except for a one-time extension of their life to up to 60 years on the condition that they undergo costly safety renovations. If no new nuclear power reactors are built in the coming years— which seems difficult given the continuing popular safety concerns about nuclear power — the power companies would need to extend the operation of about 15 aging reactors by 2030 to secure a 20 percent share for nuclear energy, assuming that all of the reactors approved by the NRA have been put back online.

Meanwhile, the government continued to balk at setting ambitious targets for increasing the share of renewable energy. The trade and industry ministry, which led the discussions at its panel, remained negative toward substantially boosting the share of renewable energy, which in 2013 stood at 10.7 percent, including hydro power. When the Environment Ministry in early April released a simulation commissioned to a private think tank that stated renewable energy can account for up to 35 percent of Japan’s power supply in 2030, trade and industry minister Yoichi Miyazawa was quick to dismiss the calculation as impractical, noting that it fails to properly assess the feasibility of the various steps that need to be taken to promote the renewables.

Opponents to boosting the share of renewable energy often cite the high cost of power generation through such sources. Keidanren (the Japan Business Federation) argued against setting the target for renewables higher by citing the damage higher electricity charges would cause to businesses and consumers.

But what’s missing from the argument is the issue of how the cost of renewable energy — which indeed remains high in Japan despite the trend of falling costs in other countries — can be lowered. The government should identify the hurdles that make renewable energy expensive in this country, and take steps to remedy the problems, including reform of the power transmission networks.

In setting the draft for the energy mix, the trade and industry ministry also released its estimate of the per-unit cost of each source of electricity in 2030. According to the estimates, the cost of nuclear energy per 1 kilowatt hour will be ¥10.1 — cheaper than ¥12.9 for coal-fired thermal power, ¥13.4 for liquefied petroleum gas-fired thermal power, ¥13.9-¥33.1 for wind power and ¥12.5-¥16.4 for solar power.

The cost of nuclear energy was raised from ¥8.9 in the earlier estimate released in 2011 to reflect the increased cost of measures to bump up plant safety in accordance with the updated NRA regulations and possible expenses of compensation in case of severe accidents, although the calculated frequency of such accidents was lowered in view of the tighter safety standards. The cost of thermal power that depends on imported fuel was raised from earlier estimates in view of the yen’s fall against the dollar. While it was estimated that the equipment costs for renewable power would decline, the profits that generators of such power get through the feed-in-tariff system — which would be added on to the utility charges — were newly added to the calculations.

The validity of the formula of these estimates — based on which the government touts the cost advantage of nuclear energy over other sources — should be thoroughly examined.

As nuclear power plants were put offline, the utility firms fired up more thermal power plants, whose share in Japan’s electricity generation rose from 61.7 percent in 2010 to 88.3 percent in 2013. Thermal power generation would need to be maintained for the foreseeable future. But unlike many other industrialized economies that promote the use of natural gas-fired thermal plants, which emit relatively small amounts of carbon dioxide, Japan seems to be pushing for coal-fired plants — because coal is less expensive. The draft sets the target share of natural gas-fired thermal power plants at 27 percent and that of coal-fired plants at 26 percent. The government should reconsider whether this is the right direction in view of the fight against climate change.