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Japan plans FIT revamp to protect other renewables, such as geothermal

Shibuya, Tokyo, Japan (source: flickr/ Guwashi999, creative commons)
Alexander Richter 7 Oct 2018

The Japanese government is looking at revamping its renewable energy feed-in-tariff system in order to protect development of other renewable energy sources, such as geothermal, against an over-supply of solar power too burdensome for electric companies forced to buy power under the system.

The Japanese Ministry for the Economy is looking at revamping the feed-in-tariff system set up to push and promote renewable energy development. This step is described as necessary due to fears of the rising electricity costs for consumers and companies, as reported by the Asahi Shimbun.

The system was introduced in the summer of 2012 and has seen several alterations and decrese in prices most for solar power installations.

It will also consider lowering the prices at which the electric power companies purchase electricity produced by solar power. With the initially highly priced prices for solar, the price of those have dropped significantly until 2018.

A lot of solar power generation facilities with certifications in place are holding back on starting operations waiting for lower prices of solar panels to maximize their profits.  When all those plants start operations, the electric power companies will face additional costs of JPY 1.2 trillion per year for the purchase of solar power. This would then be likely be passed through to households and companies.

Based on that and budgets available, electric power companies will not be able to buy electricity of other renewable energy sources than solar and effectively block development for those, including geothermal.

This results in the review by the ministry in meetings this week with its special council of experts.

Source: Asahi