Japan is on track to achieve its target for renewable power capacity installed by 2030, paving the way for its 2050 carbon neutral goal. But cost pressure could grow further as the country's consumer surcharge to fund renewable electricity is set to rise higher than previously predicted.
Japan's renewable power sources will account for 22pc of its power mix in 2030, or the minimum target of 22-24pc for the year, only if half the already-approved capacities including solar, wind and biomass projects under the country's feed-in-tariff (FiT) scheme come on line, according to the trade and industry ministry (Meti). The potential share was based on the country's total power demand of 1,065TWh in 2030.
The share of renewable energy will increase to 24pc in the 75pc start-up case and climb to 25pc when all the approved projects begin operations by 2030, the Meti said. The full operation scenario consists of the share of solar for 9.3pc, wind for 2.2pc, geothermal for 0.3pc, hydropower for 7.8pc and biomass for 5.8pc.
Japan in 2015 set a 2030 target to generate 22-24pc of its power from renewable sources, as well as 20-22pc from nuclear and 56pc from thermal fuels. The policy review in 2018 added a 2050 goal to make renewables the main power source, while maintaining the 2030 power mix target.
But the purchase costs of the FiT-supported renewable electricity are expected to rise to ¥4.9 trillion ($45.8bn) in 2030, which assumes all the approved projects start operations by then. This exceeds the earlier forecast of ¥3.7 trillion-4 trillion for the same year. The further increase would burden power consumers that are obligated to bear a part of the FiT costs. The surcharge fees accounted for 11-15pc of electricity bills, including industry, commercial and residential sectors in the April 2019-March 2020 fiscal year, compared with just 1pc in 2012-13, according to Meti.
The steady increase of renewable capacity contrasts with slower-than-expected restart of the country's nuclear power reactors amid growing concerns over safety features. Japan has 33 reactors, of which only nine units with a combined capacity of 9,130MW are operational. Limited nuclear availability has increased the share of thermal power outputs. Thermal fuels accounted for 76pc of the country's power generation in 2019-20, followed by renewables at 18pc and nuclear at 6pc.
But Meti continues to promote the restart of nuclear reactors while prioritising safety, to realise a carbon neutral society in 2050. The ministry is working to review Japan's energy policies to align with the 2050 target, with the new basic energy policy due for review every 3-4 years, likely to usher in an increased focus on electricity more from renewables and a clearer nuclear policy direction.
