Feed-in tariff system to boost renewables?

July 2, 2012

Feed-in tariff era gets under way

Kyodo

http://www.japantimes.co.jp/text/nn20120702a2.html#.T_GpKJFIwpU

The feed-in tariff system for renewable energies entered into force Sunday to help promote their use and cut Japan's dependency on nuclear power.

The system requires utilities to purchase all electricity generated through solar, wind, water and geothermal power, among other eco-friendly sources, at fixed rates for up to 20 years. The costs will be passed onto consumers.

The government's generous tariff rates have created considerable interest in the sector, with companies rushing to build massive solar and other power plants based on renewable energies.

Two large solar installations went online in Kyoto, Gunma, Niigata and Fukuoka prefectures the same day. Meanwhile, Kyocera Corp. plans to construct a 70-megawatt solar facility in Kagoshima Prefecture and is scheduled to establish a special company to oversee the project later this month. Mitsui Chemicals Inc. and other firms also intend to start work on a solar and wind power station later this year.

The government had approved 44 solar or wind power facilities with a combined output of 41,605 kw to join the system as of Thursday, according to an official at the Agency for Natural Resources and Energy, part of the industry ministry.

Household electricity bills are expected to rise by ¥87 per month on average under the new system, the agency said earlier. This estimate is based on the assumption that general households consume ¥7,000 worth of electricity each month.

As renewable energies are generally more expensive than thermal power generation, the feed-in tariff system was designed to ensure the profitability of such operations and spur more companies to enter the sector.

For example, the utilities will have to pay ¥42 per kilowatt-hour for solar-generated electricity to operators that produce 10 kw or more, over the next 20 years. The same rate applies to facilities with a lower capacity but for a shorter time period — 10 years.

July 1, 2012

Utilities required to buy renewable energy

http://www3.nhk.or.jp/daily/english/20120701_03.html

Power companies in Japan will have to purchase electricity generated by renewable energy sources.

Starting on Sunday, utilities will be required by law to buy solar, wind and geothermal energy at fixed prices.

The system is part of efforts to promote the use of recyclable energy and reduce dependence on nuclear power.

The prices are set higher than costs for generating such energy. Solar power is about 50 cents per kilowatt hour.

A number of firms have started renewable energy businesses in anticipation of the new system. Some companies launched their concerns on Sunday.

Major regional power companies plan to increase their prices to cover the costs. An average Japanese household is expected to pay an additional 1 to 1 dollar and 40 cents per month.