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How Japans FIT opened up renewable energy markets after Fukushimas nuclear crisis? This report provides the details of the FIT policy that was implemented in July 2012, early results, and insights for future opportunities.
December 2012
Disclaimer
Japan-North America Cleantech Advisory Group (the Company) produces and publishes contents on the report based on information and data the Company believes reliable and accurate at the time of writing, but the Company does not take any responsibility with regard to accuracy, reasonability, and completeness. Any party that views or collects information from the report does so at his or her own risk and must judge whether the information is applicable to his or her own circumstances. Nothing in this report is intended to be investment advise. The Company will not be liable for any direct, indirect, special, incidental, consequential, or exemplary losses or damages resulting from the use of the report and of information on the report.
Table of Contents
1. The FIT Policy
The details of the Policy contract prices and period for each type of renewable energy and other requirements
2. The Result
How the FIT opened up new opportunities of renewable energy? Here are the early results.
Section 1
Background
In 2003, the renewable portfolio standard (RPS) that requires electric utilities to purchase fixed amount of electricity generated from renewable energy sources was implemented. In FY2003, 4,000 gigawatt hours of electricity was generated from renewable energy sources. It grew to over 10,000 gigawatt hours in FY2010. In 2009, the feed-in-tariff for residential solar PV was implemented. The capacity of solar PV generation increased from 2.14 gigawatts (approx. 500,000 houses) in 2008 to 4.91 gigawatts (one million houses) in 2011. Yet electricity from renewable power sources only accounted for approximately 1.2% as of 2010 (not including large hydro). The new feed-in-tariff was implemented in July 2012 to further boost renewable energy. The new FIT includes five types of renewables solar PV (residential and nonresidential), wind, hydro, geothermal, and biomass
Information is based on Agency for Natural Resources and Energy, Ministry of Economy, Trade and Industry website: http://www.enecho.meti.go.jp/saiene/kaitori/dl/120522setsumei.pdf (in Japanese)
Common rules
All the contract prices and periods will be reviewed annually by the government committee. Once a contract is closed, the price and period are locked for the period of the contract. Contract price is in effect at a point of time whichever comes later:
A complete application that includes specification and information on installation location and interconnection is received by an electric utility company, or The facility is approved by the Minister of Economy, Trade, and Industry
Contract period starts when electric power delivery is initiated. Commissioning period is not included. Prices include tax. The prices and period do not apply to existing facilities at the time of the policy implementation (July 1, 2012). These will be determined on a case-by-case basis. Fiscal year (FY) in Japan starts in April. FY2012 for the FIT policy is July 2012 to March 2013. 1=80 (US or CAD) in this document
Common requirements
A power generation facility/equipment must be approved by the Government, and an application must be submitted to the electric utility company of the applicable jurisdiction. A maintenance system that maintains expected performance must be secured for the contract period. A measurement system of electricity generated in accordance with applicable regulations must be equipped. Documentation required. Equipment of facility must be clearly identified by documentation. (e.g. manufacturers, product number etc.) Cost information (e.g. facility, land, interconnection, operation, and maintenance) must be submitted annually. For existing facilities, if electricity supply generated by renewable energy source is increased, the incremental electricity must be measured.
<10kW
42 (52.5) 10 years
Enefarm micro-CHP
Hot water Fuel cell generation unit tank unit
For <10kW system, JIS standards (JISC8990, JISC8991, JISC8992-1, JISC8992-2) or JET certification must be complied. Circuits must be designed so generated power is consumed first and surplus is supplied to an electric utility company. For double generation, the generator must have a mechanism to prevent the power from flowing to the grid.
<20kW
57.75 (72.1) 20 years
Requirements (part)
For <20kW systems, JIS certification (JISC 1400-2), equivalent certification by JSWTA or a foreign certification body must be complied.
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200-1,000kW
30.45 (38.1) 20 years
<200kW
30.45 (38.1) 20 years
Requirements (part)
The output of generators must be less than 30 megawatts. No pumped storage hydro is allowed.
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<20kW
42 (52.5) 15 years
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General wood
25.2 (31.5) 20 years
Non-wood waste
20 years
Recycled wood
20 years
Requirements (part)
Systems to measure the ratio of biomass must be in place and monthly measurement must be conducted. Biomass fuel must not have significant influence to existing industries. Documents that prove the origin of biomass fuel are required. (Not applicable to biogas/gasification and recycled wood) For wooden biomass generation, a proof of complying the guideline is required. Refer to Forestry Agency website.
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Section 2
The Result
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Geothermal
15
0.2%
38%
15% 63% 5%
Hydro 1,000kW Hydro <1,000kW
4% 0%
Biomass Geothermal
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Trends Solar PV
Mega solar
A total of 340 mega solar systems (capacity equal or greater than 1,000 kW per system) have been installed as of October 31.
Source: http://www.enecho.meti.go.jp/saiene/kaitori/dl/setsubi/201210setsubi.pdf (in Japanese) http://business.nikkeibp.co.jp/article/report/20111226/225632/?P=2 (in Japanese) http://www.kankyo-business.jp (in Japanese)
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Source: http://www.kankyobusiness.jp/news/003566.php?utm_source=mail&utm_medium=mail121024_d&utm_camp aign=mail (in Japanese), http://business.nikkeibp.co.jp/article/report/20121109/239261/?P=1 (in Japanese), http://www.meti.go.jp/english/policy/energy_environment/renewable/pdf/summary201207. pdf
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Section 3
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