Wednesday, June 29, 2011

No. 70: Prospect of natural energy in Japan – Photovoltaic generation (June 30, 2011)

The revival of the nation’s subsidy system in 2009 stimulated the market of photovoltaic generation that had been stagnant after 2006. Domestic shipments in terms of generating capacity increased 70% over the previous year to about 1.1 million kW in 2010, exceeded 1 million kW for the first time. The government is discussing the system of purchasing all renewable energy, and this policy is expected to activate the business further should it be enacted.

The subsidy system plays the major role to spread photovoltaic generation because its generation cost is 37-46 yen per kW, higher than the generation cost of wind generation. However, the generation cost of photovoltaic generation has been decreasing worldwide because the bubble burst of the photovoltaic cell business in Spain and because increasing presence of new photovoltaic cell makers from the U.S. and China that are increasing sales by virtue of mass production and competitive prices. The grid parity – the point at which alternative means of generating electricity is at least as cheap as grid power – becomes more likely thanks to the decreasing generation cost. According to European Photovoltaic Industry Association (EPIA), South Europe blessed with sunshine is nearing the grid parity.

Home electric utility rate is 23 yen per kW in Japan, and this is the target of photovoltaic generation for the time being. Japanese makers of photovoltaic cells are competing with foreign makers by increasing the conversion efficiency with such technology as monocrystalline silicon, multicrystalline silicon, thin silicon, and copper indium gallium DiSelenide (CIGS). In fact, Japanese makers are the front runners in the performance competition. In the immediate future, they have to achieve an electric utility rate less than the industrial rate of 14 yen per kW. New Energy and Industrial Technology Development Organization (NEDO) plans to achieve the 14 yen per kW in 2020 and 7 yen per KW in 2030.

In June this year, NEDO set up a joint project with EPIA to develop the concentrator photovoltaic system (CPV) with a conversion efficiency of more than 45%. The leading Japanese researcher of this project insists that the progress of CPV makes it possible to reduce the generating cost to less than 8 yen per kW before 2030. The current administration plans to reduce the generation cost of photovoltaic generation to one third in 2020 and one sixth in 2030.

Thursday, June 23, 2011

No. 69: Prospect of natural energy in Japan – Offshore wind generation (June 24, 2011)

Offshore of Ibaraki Prefecture, Japan’s first full-scale offshore wind generation plant started operation in June 2010. It has a generation capacity of 14,000 kW. Managed by Window Power Ibaraki, it currently supplies electricity to 7,000 households. The company plans to build another 8 offshore windmills in 2012, and is having negotiations with the government to build about 100 offshore windmills in the sea between 500 m to 4 km offshore. The ambitious plan will realize a large-scale ocean wind generation plant with a generation capacity of 500,000-1,000,000 kW.

This plan attracts wind attention because the future of Japan’s wind generation depends on it. Onshore wind generation does not have a bright future as it did in the past because the discontinuance of subsidy system and the difficulty to find suitable locations. In contrast, offshore wind generation has a rather bright future. New Energy and Industrial Technology Development Organization (NEDO) estimates that the resource amount for offshore wind generation in the sea deeper than 200 m within 30 km from the revetment is about 1.2 billion kW. If a wind generation plant is running at 30% of the capacity and a nuclear power plant is running at 80% of the capacity, the 1,200 million kW is equivalent to the power generated by 450 nuclear power plants with a generation capacity of 1 million kW.

European countries like Great Britain and Denmark place importance on offshore wind generation, and about 10% of 9 million kW generated by wind generation comes from offshore wind generation. In Japan, various measures in designing are inevitable because Japan has severe natural conditions including earthquakes and tsunami. Japan Society of Civil Engineers set up an organization to study design guidelines for offshore wind generation and will publish the research report in two years.

The generation cost of onshore wind generation is about 10 yen per kW. It is higher than the generation cost of nuclear generation (5-7 yen), but it considerable lower than that of photovoltaic generation (40-50 yen). It costs more to build an offshore wind generation plant and onshore wind generation plant, but the former is far more stable and higher in performance than the latter because wind is strong and wind direction is stable. The big problems are with the acquisition of locations and indemnification for fishers. A Tokyo University professor suggests political leadership to spread offshore wind generation.

Friday, June 17, 2011

No. 68: Is wind power generation promising in Japan? Not really (June 17, 2011)

The pacing of constructing wind power plants is decelerating in Japan. According to the Japan Wind Generation Association, the wind power plants that started to operate in 2010 have a combined generation capacity of 260,000 kW, less than the capacity of the previous year for the first time in the past three years. The accident in the Fukushima Nuclear Power Plant is expected to stimulate the move for more wind power plants, but the reality is different. The new generation capacity of 2010 decreased 13% from the previous year and 35% from 2006 when the construction of wind power plants peaked. There are several reasons for the decelerated pace. The government traditionally subsidized one third of the construction cost of a wind power plant, but it discontinued the subsidy starting 2010. In addition, the bill that obliges electric power companies to purchase renewable energy was submitted to the Diet, but prospects do not look brighter.

Wind generation power companies are mostly not good in financial condition. Japan Wind Development sold its Wakayama Plant to a subsidiary of Osaka Gas. Japan New Energy Explore (JANEX) operating wind power plants in Kyushu decided to put off the plan to construct new wind power plants. Japan has a total wind generation capacity of 2,440,000 kW. The Japan Wind Generation Association projects to increase Japan’s capacity to 1,100,000 kW by 2020. Today, however, winder generation capacity is currently equivalent only to two nuclear power plants.