The case for investment in energy efficiency was hammered home to Japanese businesses yesterday with the release of a government-backed report suggesting corporate energy bills could rise by $1.1bn a year by 2020 as a result of the country's new solar energy feed-in tariff scheme.
The proposed incentive mechanism is to be introduced in April 2010 and will allow utilities to pass on the extra cost of acquiring surplus solar power at above market rates to their customers.
According to the new report from the Ministry of Economy, Trade and Industry Japan's business sector will see power costs increase by about $32m per month – or $384m annually – for the first few years of the scheme. It adds that the figure may then triple in the following five to 10 years to $95m per month, or $1.1bn annually.
Households will pay an average of $0.30 a month more, potentially rising to $0.90 – or $11 per year – by 2020, according to ministry estimates. The higher sum is equal to a collective $528m more in annual electricity bills charged to Japan's 48m households.
Under the feed-in tariff, utilities will be required to purchase surplus power generated from factories and households starting from November. Japan's 10 electricity companies will be obliged to pay $0.50 per kWh for any power from homes, while businesses that feed energy from solar panels into the grid will receive $0.25 per kWh.
The tariff structure is aimed at encouraging homeowners to install solar panels and sell excess electricity back to the grid.
Japan has a target of delivering a 10-fold increase on its 2005 solar generation capacity of 1.4GW by 2020, rising to a 40-fold increase by 2030.
The new report is the latest in a series of cost estimates related to Japan's carbon reduction efforts that are currently being calculated and publicised by the government. A panel report released earlier this month estimated that Japan's policies to reduce CO2 output will cost $515bn (£256bn) over the next decade.
Guaranteed feed-in tariffs will offer up to 36.5p per kilowatt hour generated 15 Jul 2009
Around 32,000 public schools to power lights using solar energy and sell excess electricity to utilities 14 Jul 2009
Move follows passage of feed-in tariff policy for solar energy 13 Jul 2009
Campaign for increased UK feed-in tariffs enters final straight 27 Jan 2010
Overseas investors being tapped for $10bn Gujarat project 09 Sep 2009
Co-op vows to stop using oxo-degradable plastics as controversial research claims they have no environmental advantage over conventional plastics 11 Mar 2010
Developer of ultra-high temperature sensors secures £3m in latest funding round 11 Mar 2010
Negotiators stress support for Copenhagen Accord will not impact primacy of formal UN negotiating process 11 Mar 2010
More news
Christian Kjaer, chief executive of the European Wind Energy Association, argues that a supergrid is essential to EU efforts to cut carbon emissions 11 Mar 2010
With the World Cup expected to provide a sales boost for television manufacturers, Hannah Hislop of the Green Alliance warns poor energy labelling will make it difficult for football fans to pick the greenest models 10 Mar 2010
Trewin Restorick wonders if the new Sustainable Restaurant Association can help green our cuisine 09 Mar 2010 More in-depth
Post your comment
Send an email to the Business Green editor at feedback@businessgreen.com
