No. 79: Ventures are rushing to the renewable energy business (September 1, 2011)

With the approval of the special measures law for renewable energy, many ventures rushing to the renewable energy business with a focus on cost advantage and high generation efficiency. WINPRO in Niigate Prefecture plans to produce medium-sized wind generator with an output of 10 kW next spring. The model scheduled for mass production can generate even by a breeze of 1.5 m/sec with lower wind noise. The price will be about 5 million yen. The company wishes to have it installed on the roof of buildings inside the city and in idled places. It plans to entrust the production to five companies with shipbuilding technology, and sell 1,000 units in the initial year.

EneDream in Ishikawa Prefecture has developed a wind generator that has a ring on the edge of each blade. The company is building a plant with an output of 20 kW, and it is scheduled to start the substantiative experiment within the year. Because of the gimmick to gather wind as much as possible, heavy rings on the edge rotate with the wings with the help of inertia. This enables the generator to achieve 1.5 times more generation than the existing model by the same wind velocity. It plans to launch large generators toward October next year.

PVG Solutions in Yokohama started trial production of solar cells that have a generation surface on both side. The company plans to increase generation efficiency by generating power on both sides. Seabell International in Tokyo will start the generation business using small hydraulic generators capable of generating in rivers with a small drop. The company will build a generation plant with 100 units in alliance with local governments and financial institutions.

In foreign countries, photovoltaic generation equipment enjoys great demand from such industrial uses as manufacturing plants and large scale generation plants. In Japan, however, renewable energy is mainly for household use. Photovoltaic generation for household use grew rapidly after 2009 when the subsidy system was established. Wind generation is suffering from slow growth because of the time and cost needed to build a plant and complaints from local residents of noises. In fact, some plans were cancelled because of the inability to mitigate the opposition of local residents.

Venture companies are required to focus on technological innovation in tough days to spread renewable energy in Japan.

No. 78: The future of solar cell (August 30, 2011)

Currently, silicon solar cell and compound solar cell are the two major solar cells. Silicon solar cells are produced by Sharp, Kyocera, Mitsubishi Electric, and Sanyo Electric. There are two kinds of silicon solar cells: crystalline silicon cell and amorphous silicon cell. The former provides high conversion efficiency between 15-20%, but it is costly. The latter is reasonable in price and easy to mass produce, but its conversion efficiency is about 9%. Compound solar cells are produced by Honda and Showa Shell Sekiyu. They have the ability to use lights of various wavelengths rather effectively, but they need rare metals.

The solar cell has been increasing the performance thanks to the improvement of its materials and structure. For example, Sanyo Electric’s “HIT”, made up of crystalline silicon cell and amorphous silicon cell, provides conversion efficiency of 21.6%, the world’s highest level. According to the road map of the development of solar cells drawn by the New Energy and Industrial Technology Development Organization (NEDO), photovoltaic generation cost is scheduled to decrease in incremental steps from 23 yen per kW, 14 yen per kW, and to 7 yen per kW by 2050.

A Toyota Technological Institute professor predicts that the generation cost of silicon solar cell would level off in 15-20 years. The light focusing type that collects lights using lens and mirror and the multilayer type that utilizes lights of different wavelengths will increase the presence. The NEDO and Europe started the joint research on the light focus solar cells in June this year with a view to obtaining the conversion rate of 45%.

The quantum dot type that uses particles of nano meter size is expected to replace the light focusing type in the future. Theoretically, it has the ability to provide the conversion rate of higher than 60%. Bendable organic thin film type that can be produced by applying organic semiconductor materials will follow the quantum dot type in the future. A Tokyo Institute of Technology professor emphasizes the necessity of making steady efforts because the solar cell has the possibility of increasing the performance quite rapidly in a certain stage of research and development.

No. 77: Smart city gets a grip on reality (August 29, 2011)

Panasonic is building a smart city in its ex-plant site in Kanagawa Prefecture to build a community that is self-reliance in energy. All the 1,000 houses will be equipped with a photovoltaic generator and a battery with the state-of-the-art environment technology like the energy controlling system to reduce carbon dioxide emissions to 70% of the 1990 level. In alliance with Tokyo Gas and Orix, the company plans to open the community in 2013.

Another smart city project is going on in Chiba Prefecture under the initiative of Mitsui Fudosan. Named Kashiwanoha Campus City Project, it will be composed of hotels and office buildings near the Kashiwanoha station of Tsukuba Express railway. It is scheduled to be opened in the spring of 2014. It will have an integrated system to manage energy for an area of 127,000 square meters. The developer plans to introduce a system to curb energy consumption automatically when consumption exceeds the upper limit and a system to share electricity by photovoltaic generation between facilities.

The world smart city market is estimated to increase from 4.5 trillion yen in 2010 to 18 trillion yen in 2020. Japan is behind the world in introducing renewable energy and slow in investing smart grids because 10 electric power companies have been enjoying monopoly in their respective areas. However, the situation is changing quite rapidly. Seeing the current power shortage, it is an urgent task for Japan to build an energy-saving society. Companies involved in energy-saving technology both at home and abroad are rushing to the Japanese market.

No. 77: Smart city gets a grip on reality (August 29, 2011)

Panasonic is building a smart city in its ex-plant site in Kanagawa Prefecture to build a community that is self-reliance in energy. All the 1,000 houses will be equipped with a photovoltaic generator and a battery with the state-of-the-art environment technology like the energy controlling system to reduce carbon dioxide emissions to 70% of the 1990 level. In alliance with Tokyo Gas and Orix, the company plans to open the community in 2013.

Another smart city project is going on in Chiba Prefecture under the initiative of Mitsui Fudosan. Named Kashiwanoha Campus City Project, it will be composed of hotels and office buildings near the Kashiwanoha station of Tsukuba Express railway. It is scheduled to be opened in the spring of 2014. It will have an integrated system to manage energy for an area of 127,000 square meters. The developer plans to introduce a system to curb energy consumption automatically when consumption exceeds the upper limit and a system to share electricity by photovoltaic generation between facilities.

The world smart city market is estimated to increase from 4.5 trillion yen in 2010 to 18 trillion yen in 2020. Japan is behind the world in introducing renewable energy and slow in investing smart grids because 10 electric power companies have been enjoying monopoly in their respective areas. However, the situation is changing quite rapidly. Seeing the current power shortage, it is an urgent task for Japan to build an energy-saving society. Companies involved in energy-saving technology both at home and abroad are rushing to the Japanese market.

No. 76: Problems with the special measures law for renewable energy (August 23, 2011)

The special measures law for renewable energy is scheduled to be approved within August. It will ask all electric power companies to buy electricity generated by renewable energy at a fixed price. The cost electric power companies pay to buy such electricity will be added to the electricity bills sent to consumers and companies. Electricity by photovoltaic generation in the residential area is not subject to this law, and only surplus electricity will be bought by electric power companies. The law is scheduled to be enforced next July. The future of renewable energy seems to be bright. However, there are several problems with the spread of renewable energy.

Because a solar panel has a very low conversion efficiency of 15%, it is necessary to pave solar panels in the area of 20,000-30,000 square meters to get a generation capacity of 1 megawatt. In Japan, the plant location law stipulates that the area occupied by generation equipment should be less than 50% of the total area. This means that an area that is two times as big as the area required to pave the solar panels is needed to build a photovoltaic power plant. A government agency estimates that the amount of renewable energy will grow three times in 10 years. However, the fact remains that land cost is enormous in big cities that have great power demand.

The purchase price is of great importance to renewable energy operators. The purchase price of electricity by wind generation will supposedly be fixed between 15 and 20 yen per kW, while it is between 16 and 17 yen per kW under the current support measures. Japan Wind Power Association is worried about the purchase price because lower price than 20 yen per kW will not support the spread of wind generation. In addition, it takes at least two years to build a wind generation plant, and it takes much longer to build a geothermal power plant. The purchase price of electricity by photovoltaic generation will be set higher than 30 yen per kW.

Foreign companies involved in the renewable energy business are supposed to rush to the Japanese market. The Japanese market seems to be bright not only for manufacturers of solar cells but also for investment funds. Actually, Japanese companies are receiving inrush of inquiries from foreign companies. It is quite natural that domestic companies concerned are worried about the price competition of solar panels. Few domestic companies can compete successfully with foreign companies in terms of price. And there is a fear of bubble. As Spain showed in 2007, speculation creates a bubble, and a bubble ends in a short time leaving the country in a devastated situation.

No. 75: Special measures law for renewable energy will be approved (August 13, 2011)

The special measures law for renewable energy is scheduled to gain approval in the Diet within this month. It is good for companies involved in the renewable energy business because it asks electric power companies to purchase all power generated by such energy as solar energy and wind at fixed prices. The purchases prices are subject to discussions. Power generated by energy sources other than solar energy will supposedly be 15-20 yen per kW, and power by photovoltaic generation will be higher. On behalf of the Ministry of Economy, Trade and Industry, an independent organization will be established to finalize the prices to make the decision process as transparent as possible.

The purchase prices will be added to electricity charges that companies and households pay. It is estimated that Japan as a country will need to bear 490 billion yen (0.5 yen per kW) in 2020 to cover the purchase prices. Manufacturing companies in such industrial fields as steel and chemical are concerned about the increasing power cost because increased power costs will accelerate overseas transfer. Responding to this voice, the special measures law contains the clause to mitigate the burden of industries that consumes lots of power. It will be the subject for future discussion which industries and which companies are subject to mitigation.

The special measures law will surely expand the mega solar market, and it is expected that domestic shipments of photovoltaic cells for non-residence will grow more than three times in 2012 over the level in 2010. Renewable energy was 14.7 million kW in 2009, and it is estimated that another 32-35 million kW will be created after the special measures law is introduced. However, the fact still remains that renewable energy except large scale hydraulic generation accounts only for less than 1% of Japan’s power generation as of 2009 and that it cannot be a powerful card to make up for the serious power shortage created by the Fukushima disaster. In addition, it is estimated that investments of 4,000-7,000 billion yen will be required to build infrastructure for the increasing renewable energy generation.

No. 74: Spread of clean generation under the initiative of citizens (August 10, 2011)

Citizens jointly invest in the construction of a natural energy power generation facility. This is the concept of “Citizens cooperative generation facilities (Citizen-funded facility),” and it is attracting attention nationwide. It pays back profits that it gets from selling electricity to electric power companies. After the March 11 disaster, organizations that plan clean generation receive increasing amounts of investments and contributions, and people involved in the projects believe that grass-roots activities will help clean energy spread nationwide.

Citizens of a community in Saitama Prefecture installed photovoltaic panels on the roof of its community building (about 200 square meters) last December. The photovoltaic generation with a maximum capacity of 3.6 kW produces 70% of the power requirements of this building. The president of this community is very happy with the photovoltaic generation because citizens using this building for community activities like dancing class get aware of the importance of electricity.

Sayama Environment Citizen Network took the initiative in the construction of this building. It collected about 900,000 yen from citizens and received subsidies from the prefecture. The building was constructed with a total investment of 2,400,000 yen, and it is designated as an evacuation center of the community. The community office is considering installing photovoltaic panels on other buildings with the profits it gets by selling electricity.

Ohisama (Sunlight) Energy Fund in Tokyo has so far built about 160 citizen-funded generation facilities, and it has been receiving an increasing number of inquiries on investment. It is planning a small hydraulic generation facility in Toyama Prefecture, and it has already received about 700 requests for information on investment, three times more requests before the 3/11. Environment Partnership Office Hokkaido is planning to construct a wind generation facility in Hokkaido next year, and the study meeting held by this office drew about 100 participants.

Kiko Network in Kyoto conducted survey on citizen-funded generation facilities. The first citizen-funded generation facility was construction in Miyazaki Prefecture in 1994. There were 185 facilities of clean energy, of which 165 facilities are for photovoltaic generation, 19 for wind generation, and 1 for small hydraulic generation in 2007. Currently, more than 200 citizen-funded generation facilities are supposed to be operating. Their generation capacity ranges from a few kW to more than 1,000 kW.

The political turmoil is still prevailing without any sign of termination. As is often the case, grass-roots activities are going on regardless of the disgusting leadership struggle in the government.

No. 73: Spread of renewable energy depends on the purchase price paid by electric power companies (August 9, 2011)

A city of Akita Prefecture in the Tohoku district built a woody biomass power plant with a maximum capacity of 3,000 kW eight years ago. A company affiliated with a leading plywood producer and a lumber sawing cooperative association jointly built this plant with an investment of about 1,500 million yen. The plant tried to sell generated power to Tohoku Electric Power, but the price offered by Tohoku Electric Power was 3.5 yen per kW. This price was totally out of the question. The plant is currently selling power to a neighboring plywood producer for 10 yen per kW in the red.

The Japanese government eventually started to discuss the special measures law for renewable energy in the House of Representatives. It is supposed to set the purchase price of renewable energy (except photovoltaic generation) at 15-20 yen per kW. The president of a company that builds hydraulic power units told that the purchase price should be more than 20 yen per kW to spread renewable energy. His company has installed more than 10 small hydraulic generators, which use agricultural water and spring water, across the country. However, the purchase price paid by electric power companies is generally less than 10 yen per kW. Not a few municipalities are reluctant to introduce the small hydraulic generator because the purchase price of 10 yen per kW is too low to introduce a unit that needs about several tens of million yen including installation and maintenance.

A small town in the Tohoku district has 16 wind generators and generates 1.6 times more power than needed by this town. It has the potential capacity to generate 190 times more power than town’s requirements. This town is abundant in energy resources including wind and sunlight. The leaders of this town are making efforts to make Japanese understand the reality that rural areas can supply renewable energy. Despite the energetic activities by rural areas, the central government is rather slow to respond.

In Japan, 10 electric power companies monopolize the electric business, and each of them enjoys the regional monopoly. In the early 20th century, Monzaemon Matsunaga dubbed the King of Electricity laid the foundation of Japan’s current power business. The power business was monopolized by only one company until he took the initiative in the power business. He divided the one-company monopoly into nine companies (Okinawa joined later to make the total 10). It is true that his strong initiative helped Japan achieve such tremendous economic success.

He was truly a great leader. His secretary purchases a first-class train ticket (most expensive ticket) for him. When he received the ticket, he said to the secretary, “Take it back to the window and purchase a third-class train ticket (Cheapest ticket).” Can you believe this? He was 75 years old. This alone is good enough to show how great he was.