On 21 July, Ministry of Economy, Trade and Industry (METI) announced a summary of Japanese Feed in Tariffs (FITs), in which electric power companies are required to buy the electricity generated by all types of renewable sources of energy by households and businesses. FITs seek to promote the adoption of renewable energy sources by offering long-term contracts for the ‘green’ electricity produced by them at fixed purchase prices.
Purchase prices are to be 48 yen/kWh for solar power, which will be gradually decreased, and 15 to 20 yen/kWh for the other types of the ‘green’ electricity. The contract periods are to be 10 years for solar power and 15 to 20 years for the others. In FITs, electricity users have to bear costs of purchasing the ‘green’ electricity and, according to the summary, the maximum monthly burdens for standard households and for large-scale factories in ten years after Japanese Feed in Tariff (FIT) is to be introduced will be approximately 150 to 200 yen and 1.2 million to 1.63 million yen, respectively.
METI expects that FITs would contribute to CO2 emission reduction by 2% (approximately 24 million to 29 million tons) in ten years after its introduction because FITs would accelerate technological development and promotion of renewable energy. Masayuki Naoshima, Minister for Economy, Trade and Industry, emphasized ‘total national benefits from FITs will be greater than total national burdens’ because they would expand the environment-related market. METI sought to start FIT in 2012 after working out its details within this year.
METI’s summary for FITs is unpopular not only for businesses but citizens. Regarding businesses, as mentioned above, as FITs would increase the electricity prices, they are basically against FITs. For instance, the Japan Iron and Steal Federation suggested in a hearing held by METI that FITs would put Japanese iron and steal industries in a disadvantageous position in a global competition with China.
Finally and most seriously, citizens are seemingly not for FITs suggested by METI. For an article on this news released by Jiji Tsushin, 84 visitors (Yahoo!Japan News) left 113 comments. Then, among the top 100 comments sorted by the number of ‘agrees’, there were only 3 comments that clearly supported FITs though the most agreed comment among them was ranked 38th. According to a brief discourse analysis of mine, citizens (or the visitors) are against FITs mainly because (1) FITs would worsen the income difference between the rich and the poor, (2) households would have to suffer more burdens while businesses would be able to reduce their burdens, and (3) METI’s FIT plan had flaws. Further, many of them did not support FITs because they were unsatisfied with climate change policies of Democratic Party of Japan (DPJ), a ruling party, especially on the ‘25%’ target and a large amount of money spent to buy credits from China, one of the world largest emitters.
The summary of Japanese FITs proposed by METI might be a great first step for Japanese renewable policies. However, it is not sufficiently supported by businesses, environmental groups and citizens. Thus, though it might be difficult to create FITs in which everybody agrees, it is necessary to improve the current ‘everybody is unhappy’ situation. Especially, it is very much problematic that FITs lacks citizens’ support as they have been recently frustrated with climate change policies of DPJ and DPJ itself. Details of FITs should be carefully examined so that renewable energy can be widely promoted, contributing to the energy security and CO2 emission reduction in Japan. However, successes of FITs or renewable energy policies and climate change policies in Japan depend more on whether public support for them can be increased.