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June 2012 Content Background Wind Energy in Japan Japanese Wind Energy Industry Government Supports Useful Links Major Japanese Companies Profiles of Major Japanese Companies Major Wind Energy Projects in Japan
Background
The result of the Fukushima accident and subsequent shut-downs of reactors elsewhere in Japan signaled that the nuclear power production wont be back to the pre-Fukushima level. To offset the shortfall, oil and gas now generate nearly 90 percent of the nations electricity, with hydropower accounting for about 8 percent and other renewables, solar, wind, geothermal and biogas, making up the balance. All of 54 nuclear reactors in Japan have been out of operation since May 2012. Japans future energy mix stands at the crossroads. Nuclear power generation will be resumed; however, debate nowadays is the level of reliance on nuclear. The scenario with ratio of 15% nuclear power in total electricity supply is looming large.
To cope with a shortage of electricity, the government has requested both industries and households to take energy saving measures. It is also easing regulations and restrictions on renewable energy projects. Furthermore, utilities will be required to buy electricity from renewable energy providers
through the feed-in tariff (FIT) system from July 2012. Quick diffusion of technology for peak suppression and backup power is called for. Diversification of energy sources is an urgent issue. So far, Japans renewables supplied merely 3% of the total power generation which is only 1% increase since 1990. With or without nuclear, renewables will expand. Estimate of Renewable Energy in Japan 2010
Cumulative installation volume (kW) 3,884,000 2,440,000 540,000 3,239,000 3,256,000 13,358,000 Estimate generation volume ( billion kWh) 4.083 4.275 2.652 17.305 11.978 40.293 Share of total domestic generation (%) 0.35 0.37 0.23 1.49 9,600 142,000 3.0 11.9 29.7 100 1.03 3.47
Type
Source: Renewables Japan Status Report 2012, Institute for Sustainable Energy Policies
Source: Japan Wind Power Association Japans wind power generation started in 1980, but began in full-force with the introduction of 1,000 kW generating systems in 1999. Many wind turbines have been installed in Hokkaido, Tohoku and Kyushu where the wind conditions are desirable. Recently, new installation is subdued because grid connection capacity has not been improving. Furthermore, various restrictions on location, the amendment to the building code in 2008, and global demand on wind power plants have added burden on the wind power industry. As a result, the market for wind power in Japan stagnated. Despite the introduction of the feed-in tariff (FIT) and a shortage of electricity, it is not yet clear how the current situation will affect wind energy market in Japan. Wind energy industry is similar to assembly industry such as automobiles, where Japan possesses competitive edge. Components industry (machinery, electronics, materials, etc.) maintenance (twice a year), installation, construction, consultancy services are all related to the wind business. According to the Institute for Sustainable Energy Policies, the market size for the Japanese wind energy is
envisaged at 500 billion JPY (5 billion ) per year, equivalent of 20,000 jobs. Taking foreign markets into calculation, the wind energy market can attain the size of 2 trillion JPY (20 billion ) per year, creating 50,000 jobs.
The top three developers/integrators are: Developers/Integrators Eurus Energy Holdings Corporation Electric Power Development Co., Ltd. (J-POWER) Japan Wind Development Co., Ltd. Remark TEPCO 60% share; Toyota Tsusho 40%
Remark: Vestas (Denmark) was represented by Vestech until January 2011 Lagerwey merged with the Windmaster, NKK, nowadays JFE Engineering Corporation (merged with Kawasaki Steel in 2003), have introduced Lagerweys 750kW turbines since 1996. Today, JFE Engineering also handles Gamesa from Spain, focusing more on large scale turbines Siemens withdrew from the Japanese wind market in 2004 but decided to restart the business in 2011
Japanese manufacturers lagged behind of European firms in the wind market. Reasons vary. Domestic market has been small, many projects have not been commercially viable and other technologies such as nuclear and solar were priorities among renewables. About 80% of Japanese wind energy plants, which are commercially based, are developed by private
companies, Eurus Energy, J-POWER and Japan Wind Development Co., Ltd. through establishing locally based companies involving communities. Wind farm developers often represent foreign manufacturers and earn commissions by selling turbines. Together with subsidies, which accounted one thirds of initial investment, developers were able to finance wind farm projects. General contractors made profit out of constructing new wind farms by installing wind turbines without considering management, maintenance and generating stable electricity. Consequently, many wind farms in Japan operate at a loss.
Type Research and Demonstration Commercial Number of Plants 91 326 Public operated (Municipalities, NEDO, METI related) plants: 68 Private operated plants: 258 Remark:
The current electricity shortage gives a new incentive to re-evaluate, re-organize and re-boost Japanese wind industry. The introduction of the feed-in tariff (FIT) system sheds new light on possibilities of wind energy production. Furthermore, the project of offshore floating wind farm off the coast of Fukushima will test what Japanese technology and industry could do as a whole. Japanese wind energy industry is to develop a new business model which includes, manufacturing, construction, management/maintenance of wind farm and to export it to markets abroad, especially China. How Japan could compete price-wise, is yet to be answered.
Government Supports
The government has been supporting wind energy development since early 1990s. Research projects and field-tests had been financed by the government and conducted mostly byNew Energy and Industrial Technology Development Organization (NEDO). Subsidies for constructions were handedout until 2010. Laws and regulations have been reviewed. Those supply-side support schemes were to be terminated before the Fukushima accident of 2011. Now that the shortage of electricity is a reality, more progressive measures are called for. From July 2012, the feed-in tariff (FIT) system will be introduced. Utilities will be required to buy electricity from renewable energy providers at a rate of 42 JPY per kwh for solar energy, 23 per kwh for wind power and 30-35 JPY per kwh for small-scale hydropower. These preferential rates will apply for 10 to 20 years depending on the energy source. Consumers are going to bear these higher rates. Ministry of Economy, Trade and Industry (METI) is currently supporting the offshore demonstration project in Fukushima which will cost 12.5 billion JPY, built by a consortium including Japanese trading house Marubeni, Mitsubishi Heavy Industry (MHI), Mitsubishi Corp., IHI Marine United, Mitsui Engineering & Shipbuilding, Nippon Steel, Hitach, Furukawa Electric and Shimizu. The University of Tokyo and Mizuho Information & Research Institute are also involved. Japan has already announced another pilot wind farm off Goto Island. The government will also support Japanese companies to get involved in offshore wind projects abroad. New Energy and Industrial Technology Development Organization (NEDO), which is Japans biggest public R&D management organization supported by METI, is fostering innovation for the nextgeneration in the wind technologies. NEDO Projects: Energy and Environmental Technologies
Useful Links
Government of Japan Ministry of Economy, Trade and Industry (METI) http://www.meti.go.jp/ Wind Power Generation Natural Resources and Energy Agency of METI http://www.enecho.meti.go.jp/ Ministry of the Environment http://www.env.go.jp/en/ Regional Electric Power Companies (10 EPC) Hokkaido EPC http://www.hepco.co.jp/
Tohoku EPC http://www.tohoku-epco.co.jp/ Tokyo EPC http://www.tepco.co.jp/ Hokuriku EPC http://www.rikuden.co.jp/ Chubu EPC http://www.chuden.co.jp/ Kansai EPC http://www.kepco.co.jp/ Chugoku EPC http://www.energia.co.jp/ Shikoku EPC http://www.yonden.co.jp/ Kyushu EPC http://www.kyuden.co.jp/ Okinawa EPC http://www.okiden.co.jp/
Related Industry Associations Japan Wind Power Association http://www.jwpa.jp New Energy Foundation http://www.nef.or.jp/english/index.html New Energy and Industrial Technology Development Organization (NEDO) http://www.nedo.go.jp Federation of Electric Power Companies http://www.fepc.or.jp/english/ Major Wholesalers Electric Power Development Co http://www.jpower.co.jp/english/index.html Federation of Electric Power Companies, Japan http://www.fepc.or.jp/english/ Electricity Review Japan http://www.fepc.or.jp/erj/index-e.html Energy and the Environment http://www.fepc.or.jp/english/info/ energyandenv/front.html
U-PICA Company Ltd. DIC Corportion NIPPON REINETSU Co., Ltd. Asahi Glass Co., Ltd. Nippon Electric Glass Co., Ltd. Toray Industries, Inc. fiber Toray Industries, Inc. Mitsubishi Rayon Co., Ltd. Toho Tenax Co., Ltd.
Electrical equipment Hitachi Ltd. Fuji Electric Co., Ltd. TMEIC (Mitsubishi Electric/Toshiba) Yaskawa Electric Corporation Meidensha Corporation Fujikura Ltd. Generator Hitachi Ltd. Meidensha Corporation Yaskawa Electric Corporation TMEIC (Mitsubishi Electric/Toshiba) Transformer Fuji Electric Co., Ltd. Risho Kogyo Co., Ltd. Gear box ISHIBASHI Manufacturing Co., Ltd. Seisa Gear, Ltd. (Sumitomo Heavy Industries, Ltd.) Komatsu Ltd. ONEX CORPORATION Netsuren Co., Ltd. Bearing JTEKT Corporation (Koyo/Toyota) NSK Ltd. NTN Corporation Komatsu Ltd. Nippon Roballo Co., Ltd. Hydraulic equipment Kawasaki Precision Machinery Company (Kawasaki Heavy Industries, Ltd.) Moog Inc. Machinery equipment Nabtesco Corporation Sumiotomo Heavy Industries, Ltd. Toyooki Kogyo Co., Ltd. Akebono Brake Industry Co., Ltd. Steel/Casting The Japan Steel Works, Ltd.
AKASAKA Park Building 5-2-20 AKASAKA, MINATOK-KU, Tokyo 107-6111 TEL 03-3588-5165 FAX 03-3589-3372 GE is the worlds leading wind turbine suppliers and GE Japan is 100% owned subsidiary company which performs full fledged operation for planning, sales, installation and services., GE Energys current product portfolio includes wind turbines with rated capacities ranging from 1.5 MW4.1 MW and support services extending from development assistance to operation and maintenance. GE has capacity of 436 MW in Japan and enjoys second place next to Vestas of Denmark.
Operator: Japan Wind Power Development Corporation Location: ZENIHAKO Wind Power (HOKKAIDO OTARU-SHI ) Total Output: 40 MW (2 MW X 20 units) Planned to operate: TBD Operator: Japan Wind Power Development Corporation Location: MATSUMAE Wind Power (HOKKAIDOMATSUMAE-CHO) Total Output: 40 MW (2 MW X 20 units) Planned to operate: TBD Operator: Japan Wind Power Development Corporation Location: FUKIKOSHI DAICHI Wind Power (AOMORI Prefecture, ROKKASHO MURA) Total Output: 20 MW (2 MW X 10 units) Planned to operate: January 2012 Operator: EURUS Energy Holdings Location: Eurus Energy DATE (HOKKAIDO DATE-SHI) Total Output: 10MW (2MW X 5 units) Planned to operate: November 2011
This information is compiled by the Embassy of the Kingdom of the Netherlands in Tokyo. For more information or comments regarding this documents, please contact the Netherlands Embassy in Japan.
Embassy of the Kingdom of the Netherlands Ms. Kazuyo Komatsubara 3-6-3 Shibakoen, Minato-ku Tokyo 105-0011 Japan E-mail: tok-ea@minbuza.nl Tel: +81 (0)3-5776-5430