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Current status of energy transition and low carbon developments in Japan Nov. 7, 2017 @COP23 Yuko Nishida Manager, Climate Change Group Renewable Energy Institute

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Page 1: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Current status of energy transition

and low carbon developments

in Japan

Nov. 7, 2017 @COP23

Yuko Nishida

Manager, Climate Change Group

Renewable Energy Institute

Page 2: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Based on its scientific research, we work;For realization of non-carbon business model,

Supporting policy makers and media for further understandings of

climate change and energy policies,

Collaborating with local governments’ and consumers’ networks ,

Organizing a business coalition for RES100% procurement,

Dissemination of international knowledge through network,

Being the credible voice as an independent thinktank.

Who we are: Renewable Energy Institute

Page 3: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Who we are: Renewable Energy Institute

Page 4: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Feed-in Tariffs in Japan:

Five Years of

Achievements and Future

Challenges

The Ways Forward for

Japan EPCOs in the New

Energy Paradigm

Business Risks of New Coal-fired Power Plant

Projects in Japan

—The Decline in Capacity Factor and Its Effect

on the Business Feasibility

For Greater Deployment of Wind

Power

—Examining Land Use

Regulations and Environmental

Impact Assessment

Proposal for Local

Energy Policy

Cost Study of Wind Power

Generation in Japan

REPORT: 10 Q&A on the German

Energiewende

― A contribution to the Japanese

energy debate

TRANSLATION

Reinventing Fire: China

A Roadmap for China’s Revolution in

Energy Consumption and Production

to 2050, Executive Summary

Asia International Grid

Connection Study

Group Interim Report

Latest Publications: Renewable Energy Institute

Page 5: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Outline

1. Current status on energy transition in Japan

1-1 Decreasing energy demand

1-2 Increasing renewable energy introduction

1-3 Status on nuclear

1-4 Coal and other thermal power generation

1-5 GHG emission transition

2. Policy status and its challenges in Japan

2-1 Japan’s policy targets and current status

2-2 Policy for Renewable --Ambitious enough?

2-3 Coal Issue

3. Low carbon development in building sector

Outline

Page 6: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

After 2011 energy demand has decreased

Decoupled with GDP

Electricity demand has also dropped

10% down since 2010

1-1 Decreasing Energy and Power Demand

0

100

200

300

400

500

600

0

3

6

9

12

15

18

19731975 1980 1985 1990 1995 2000 2005 2010 2015

1018J

(FY)

Industrial

Residential

Transport

10 billion USD, as of GDP

Commercial

Annual Energy Consumption (Final) & GDP GrowthSource: Energy white Paper, METI

Annual Electricity SalesSource: Electric Power Investigation Statistics METI

Page 7: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Growing Renewable Energy

Rapid growth driven by FIT pushed up renewable energy ratio to 15% in 2016 (vs 8.9% in 2010)

PV capacity now excess nuclear

1-2 Growing Renewable Energy

Cumulative installed capacity for renewables

Source: Chart3, Business Risks of New Coal-fired Power Plant Project in Japan (REI 2017)

Japan Electrical Capacity 2010-2016

Source: Chart 3, The Ways Forward for Japan EPCOs in the New Energy Paradigm (REI 2017)

Page 8: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

1-3 Nuclear

Japan Gross Electricity Generation FY2010-FY2016

Source: Chart 3, The Ways Forward for Japan EPCOs in the New Energy Paradigm (REI 2017)

Drastic decrease of nuclear power supply: 2% in 2016

Decommissioned: 12, Application yet to be filed: 18, Under examination: 14,

Permission granted:7, In operation: 5.

Total Electricity Generated and Purchased (FY2016;Share)Source: Feed-in Tariffs in Japan: Five Years of Achievements and Future Challenges

(REI 2017)

Page 9: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

1-4 Coal & other thermal

Still major power sources, but changing status

Problematic coal dependence

Japan Gross Electricity Generation FY2010-FY2016

Source: Chart 3, The Ways Forward for Japan EPCOs in the New Energy Paradigm (REI 2017)

How Japan Replaced Nuclear Power

Notes: Assuming constant electricity intensity. "Other" is included in fossil fuels and is negligible

Source: Chart 49, The Ways Forward for Japan EPCOs in the New Energy Paradigm (REI 2017)

Page 10: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

GHG emissions peaked out?

But not so drastic improvement

1-5 GHG Emission Transition

800

900

1,000

1,100

1,200

1,300

1,400

1,500

199

01

99

11

99

21

99

31

99

41

99

51

99

61

99

71

99

81

99

92

00

02

00

12

00

22

00

32

00

42

00

52

00

62

00

72

00

82

00

92

01

02

01

12

01

22

01

32

01

42

01

5

GHG emissions in Japan(1990-2015年度)

NF₃ SF₆ PFCs HFCs N₂O CH₄ CO₂

00

200

400

600

800

1000

1200

1400

CO2 emissions by fuel type

Coal Coal products Oil Oil products Natural Gas City Gas

GHG Emissions in Japan (FY1990-2015)

Source: National Greenhouse Gas Inventory Report of JAPAN (2017)

CO2 Emissions by Fuel Type

Source: National Greenhouse Gas Inventory Report of JAPAN (2017)

Page 11: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

2. Policy status and its challenges in Japan

Page 12: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Japan’s TargetGHG reductions26~28% reductions by 2030 -5.3% (2015)

(2005 base)80% by 2050

Zero emission power sources Renewables 22~24% 15%(2016)Nuclear 22~20% 2%

Energy Efficiency 330 mil.kl 350 mil.kl35% improve (with 1.7% economic growth)

2-1 Japan’s policy targets and current status

Current

Page 13: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

●Renewables approx. 22~24%

●Nuclear approx. 20~22%

●LNG thermal approx. 27%

●Coal thermal approx. 26% Still pursue the

●Oil thermal approx.3% “Base load” concept

Need ambitious targets for renewables

Unrealistic target for nuclear

Coal dependency

Japan’s energy mix for electricity in 2030

Page 14: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Feed in Tariff (2012-)

⇒ increasing deployment, cost down,

industrial growth

Challenges

• PV> Biomass > Wind

• Still relatively high cost

• Misleading operation rules

--unlimited curtailment, registration

⇒Improving FIT system

Electricity system reform and other policy reforms

2-2 Policy for renewables: For further expansion

Page 15: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

8

4

42 projects, 18.6GW as of SEP 2017

STATUS

3 in operation (about 390MW)

14 under construction (5,310MW)

2 finished EIA process (225MW)

23 under EIA (12,700MW)

3 cancellation (2,300MW)

2-3 Coal Issue: New coal power plant development

Page 16: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Business Risks of New Coal-fired Power Plant Project in Japan (2017)

–The decline in capacity factor and its effect on the business feasibility

Status change after 2011 Electricity demand decrease

Rapid expansion of renewables

Drastic decrease of nuclear power supply

Future Capacity factor for coal plantsREI’s estimation: 56% in 2026

Projection by JGV/OCCT: 69% in 2026

Business risk on coal investmentLow capacity factor

Corporate trends & Global policy trends

REI publication on highlighting coal business risk

Page 17: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Estimated capacity factor of thermal powerEstimated by Renewable Energy Institute

Coal

LNG

Oil

With all 42 new coal plants…

Capacity factor drop to 56%

Conditions• Current electricity demand level remain

• Nuclear; 10% (1/2 of Gov’t Plan)

• Increase of PV based on current pace growth (RTS)

If power demand declines by 5%...

Capacity factor drop to 49%

Capacity Factor of Thermal Power: REI’s estimation

Business risk on coal investment

Page 18: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

3. Low Carbon Development:

in Building Sector

Page 19: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Enhance the Energy Code Mandate

Energy performance mandate (2017~)

2016 new code

Expand Top Runner Regulations

Building equipment, Home appliances

⇒Building materials, housing units

Policy development in building sector

Page 20: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Zero Emission House (ZEH) Targets: By 2020 1/2 of new detached housesBy 2030 Average new houses

ZEH Roadmap ZEH Builder Program

ZEH builder registration: about 6000 companies (as of 7.2017)

Prerequisite for subsidy program Require builders to set own target ⇒aggregate to the national targetCapacity building and information/technology dissemination

Subsidy program

Large scale subsidy program⇒to more than 12,000 houses in FY2016

Policy development in building sector

Energy consumption

Energy Efficiency

Standard primary energy consumption

Energy generationd. renewables

Energy self-sufficiency

-20%

75%

100%

Energy Efficiencya. Insulation, shadingsb. passive energy usec. high efficient equipment

Energ

y

genera

tion

ZEH Definition

Page 21: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Zero Emission Building Targets:

By 2020 new public buildings = ZEB

By 2030 Average new buildings =ZEB

ZEB Roadmap

ZEB definition

(allow without on-site renewables)

ZEB design guideline

Subsidy program

Large scale subsidy program

Zero Emission Buildings 100%

Energ

y

genera

tion

Energy consumption

50% or more reduction

Standard primary energy consumption

100% Energy Conservationa. Insulation, shadingsb. passive energy usec. high efficient equipment75%

50%

Energy generationd. renewables

Energy self-sufficiency

ZEB Definition

Page 22: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Green building rating for new buildings

27 local governments (2002~)

CO2 emission reporting program for existing buildings

31 prefectural level governments and 12 cities

Cap and Trade Program Covers Building Sector

Tokyo Metropolitan and Saitama prefecture

Policy development in local governments

Colored 31 prefectures are implementing

CO2 emission reduction reporting program

covering existing buildings/facilities

Page 23: Current status of energy transition and low carbon ... · 11/7/2017  · 1. Current status on energy transition in Japan 1-1 Decreasing energy demand 1-2 Increasing renewable energy

Paradigm Shift in Energy

Renewable Energy Institute

Yuko Nishida

[email protected]