Japan scheme barely helps renewable power in 2010

Japan Feed-in Tariff (FiT) expands from pilot to full scheme, boosting renewable energy and solar power as utilities buy surplus at set rates, modestly raising electricity bills and supporting grid access toward the 2030 target.

A Japanese government scheme helped replace only 0.16 percent of annual power demand with renewable sources of electricity, namely solar power, last year, Japan's 10 power firms' data showed recently.

The data underscored the government's move to make the pilot scheme into a full-fledged one, aimed to help more than double the share of renewable sources in electricity to about a renewable target of 20 percent by 2030.

Related bills for a full-fledged scheme on renewable tariffs are expected to be submitted in the upcoming parliamentary session starting this month.

Like many countries in Europe, Japan launched a so-called "feed-in" tariff scheme in November 2009 to make utilities buy electricity from renewable sources at a higher rate, initially starting with surplus electricity of small-volume solar only.

Power companies are required to pay 48 yen per kilowatt hour for surplus electricity from house owners who put solar panels on the roofs and allowed to add on the extra costs to all users evenly.

The 10 power firms' data showed they spent a total 63 billion yen $767 million for 1,400 gigawatt hours of such electricity in the past 12 months.

The volume was tiny when compared with their total electricity sales of 889,000 gigawatt hours a year on average in the past three years.

In the first two months of the launch, the 10 firms spent a total of 17 million yen, which together with the 63 billion yen are a part of power bills users will pay in the business year starting in April 1. Additional monthly bills per household are estimated to range from 2 yen for customers of Hokkaido Electric Power Co 9509.T in northern Japan to 21 yen for those of Kyushu Electric Power Co 9508.T of the south, even as Japanese solar faces Chinese competition on panel prices, based on calculations of each power firm.

A government estimate on the pilot scheme has shown an average household with monthly power usage of about 300 kilowatt hours may have to pay an extra 30 yen per month in the first year of its launch.

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