As the hulking corpse of Fukushima’s Daiichi nuclear power plant smouldered in 2011, experts began predicting an energy revolution. Japan would turn its back on nuclear power and embrace renewables, they said. There were strong precedents: Germany, the world’s fourth-largest industrial nation, committed in June 2011 to replacing nuclear power with renewables by 2022. Italy voted overwhelmingly by referendum the same month to abandon plans to restart its nuclear program.
Nearly four years later, the aftermath of Fukushima’s triple meltdown is messier than those European examples. Japan’s government has committed to restarting idling reactors (such as in Kyushu’s Kagoshima Prefecture), making it almost certain that some will come back online, perhaps this year. But the nation has also become one of the planet’s most dynamic markets for green energy. A feed-in-tariff, introduced in 2012 and guaranteeing ¥42 a kilowatt-hour (kWh) to producers — roughly double the UK rate — has triggered more than 1.2 million applications, mostly for solar-power installations.
If all these projects went ahead, Japan could leave most of its nuclear stations switched off, says Mika Ohbayashi of the Japan Renewable Energy Foundation, a Tokyo-based think-tank. But there’s a problem: Japan’s power utilities say they are overwhelmed and have revolted. Many are blocking access to the grid. Kyushu Electric Power, which supplies electricity to nine million households in Japan’s sunny south, was the first to balk, in September of last year, after 72,000 solar-power producers rushed to beat the deadline for a cut in the guaranteed tariff to ¥32 a kWh. It is accepting no new applications to the grid until it has settled concerns about the reliability of supply from the new producers.
The Ministry of Economy, Trade and Industry (METI) is backing the utilities. A government panel is probing the solar shambles ahead of a March decision on purchase prices for renewable energy. Analysts expect METI to cut the prices that utilities must pay energy producers. Thousands of small producers such as Yauemon Sato, are furious. Sato has rented land in his native Fukushima, hired a workforce and lined up ¥80 million in capital from local investors and banks. His company says it can produce electricity for 750 households. “Now all our plans have been put on hold,” he laments.
Experts say Japan’s government should have anticipated the problems it is having with its drive for renewables. Germany triggered a similar stampede of small producers during the period of 2009–12, by offering them guaranteed prices for 20 years and priority access to the grid. That has helped push clean energy’s share to nearly a remarkable quarter of Germany’s power consumption; but it also has driven up electricity bills: subsidies cost consumers 16 billion euros in 2013, according to The Economist. And some power utilities are suing the government, saying their business has been damaged by the subsidies.
METI could have learned from Germany’s mistakes by being less generous with its guaranteed tariffs for the renewables producers and by ensuring that the transmission grid was modernised to prepare for their arrival, says Tom O’Sullivan, an independent energy consultant and founder of Tokyo-based Mathyos Japan. “Ideally, the ministry should have created a separate grid operator, independent of the big power utilities,” he continues. At present, the utilities own everything and have little incentive to let independents onto the system.
The utilities’ objections have added to doubts about Japan’s plan to increase renewables’ share of electricity output to 20% by 2030, almost double its pre-Fukushima share, when nuclear energy provided about 30% of the nation’s electricity. So far, just 12% of the solar power that METI has approved has been installed, and much of the rest may prove uneconomic, says Ohbayashi, given that in less-sunny parts, solar panels’ output will be more sporadic.
So how have the problems in the market affected foreign players? Etrion, a Canadian solar power company that, until 2012, did most of its business in Europe, says it has been forced to do some belt-tightening in Japan. The company develops solar projects here with Hitachi and has 34 Megawatts (MW) of solar power under construction and more than 138MW under development. “Everybody is working to reduce costs,” says Marco A Northland, Etrion’s chief executive officer.
He points out, however, that the feed–in tariff is only one factor in doing business — the cost of financing, technology, construction and location all play a part, too. “We continue to be bullish about Japan,” he says. The company is committed to reaching 300MW of solar power by 2017.
First Solar, the largest maker of solar panels in America, says a shakeout in Japan is inevitable. Far from being deterred, the company supports stricter METI screening to flush out the system, says Jack Curtis, its vice-president of business development for the Asia-Pacific. “The market is actually due for some level of rationalisation; the ¥42 was at a level that was going to encourage a massive take-up of the program.” He says the company can make money with a tariff of ¥30 — First Solar has already installed a 1.3MW station in Kyushu and intends to invest $100 million in the country. “That remains unchanged.”
Marco agrees on the need for rationalisation: METI is working in the right direction, to filter out unfeasible companies and work on a more orderly process with the utilities, he says. “There was a little bit of confusion and frustration; but METI is trying to regulate better, so these issues with utilities for grid connection of solar projects should be resolved.”
Not everyone is as kind. Critics say the utilities should invest more in storage and backup technologies, so they can cope at times when solar plants are not producing enough power to meet demand. They are sceptical of claims by Kyushu Electric Power and other firms that they are motivated only by the need to avoid blackouts. Japan’s problems with its grid are real, says Mycle Schneider, a Paris-based energy consultant, but this is not enough to justify blocking all new renewable plants. The utilities are “scared to death” — “and rightly so” — that the rise of so many independent producers will wreck their business models, he says.
Japan’s shift to more sustainable energy will not come cheap. The government may have to spend $60 billion over the next two decades subsidising the preferential tariffs for renewables producers, predicts Yasuyo Yamazaki, a former investment banker who heads the country’s largest solar-energy project. But he believes this would be money well spent. Since Japan switched off its nuclear plants, the cost of importing fossil fuels has soared, to $250 billion a year. Instead of tapping taxpayers for yet more money to upgrade the grid, Yamazaki believes the government could mobilise Japan’s vast pool of private savings, now tied up in pension funds and low-yielding accounts, by putting the right incentives in place. But whatever happens, he says, there is no going back — Japan’s energy market has turned a corner.© Japan Today
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http://www.wholesalesolar.com/solar-panels.html <$1 a watt in bulk. Probably less than that for blems (grade b)
http://www.wholesalesolar.com/federal-tax-credit.html (30% rebate coupon)
These panels have jumped from ~200W to ~300W now.
We have this:
So the New Green Revolution will wreck established power producers.
But only if established power producers invest in their own demise!
Japan has come to the realization that it must bring back the nuclear power plants. Making those plants safe will cost billions but far fewer billions than solar power subsidies require.
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we all know that future is solar, no body can deny that, what has happened in janpan everybody knows, to bring temprature down and to be natural in human kind, it is important to use solar energy and hence, the solar panel price has to be brought down by governments.