Future of Japan's Electrical Capacity Remains Uncertain

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Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--The Japan Energy and Environmental Council has released information regarding rates of production for several types of renewable energy technologies, including wind and solar power, as well as geothermal energy. Japan has been faced with a precarious electrical capacity since March of this year, when the Great East Japan Earthquake Disaster sparked the country's ongoing nuclear crisis. By the end of the year, only six of Japan's 54 nuclear reactors, representing 12% of the country's nuclear capacity, will be running. By next March, Japan's entire nuclear fleet will be offline.

The Energy and Environmental Council has estimated that if Japan utilizes optimal locations for solar power, onshore windfarms and geothermal power stations, these types of renewable energy could produce nearly 40% of the country's total power generation. Japan passed its first feed-in tariff (FIT) scheme in late August, which will allow a greater influx of renewable energy projects.

However, the FIT law, which comes into affect next summer, is unclear in regards to rate of pay per watt and other important points pertinent to project development. Companies wishing to develop windfarms or solar power stations may also come up against existing laws that could diminish a project's ability to fully utilize land.

Several of Japan's regional power generation companies, including Kansai Electric Power Company Incorporated (TYO:9503 ) (Kanden) (Osaka, Japan), are planning to restart mothballed thermal power stations to help overcome the loss of the country's nuclear capacity. Kanden will bring down two of its three remaining reactors next month, bringing its nuclear capacity to 870 megawatts (MW). To cope with expected electricity shortages next summer, Kanden plans to bring a unit at its Kainan power station online. The unit was shuttered 10 years ago, and could signal the restart of other mothballed units. Japan's thermal energy generation has increased drastically since March, with liquefied natural gas (LNG) imports expected to reach 80 million tons by the end of the year.

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