Japanese firms shift to clean energy despite state’s cling to nuclear power
While Japan’s government clings to atomic power even after the Fukushima nuclear crisis, its private sector is moving ahead with more use of renewables to power their operations amid growing international awareness of global warming.
Daiwa House Industries Co, for instance, became in March a member of both RE100 (Renewable Electricity) and EP100 (Energy Productivity), two global initiatives by the Climate Group.
RE100 is a global, collaborative initiative of influential businesses committed to using 100 percent renewable electricity, while EP100 brings together companies committed to doubling energy productivity to lower greenhouse gas emissions.
Among RE100’s 136 members are U.S. General Motors Co and Dutch consumer goods giant Unilever.
Printer maker Ricoh Co, the first Japanese firm to join RE100, was followed by five firms such as online stationery retailer Askul Corp and retail giant Aeon Co., aiming to meet the electricity needs of their global operations with renewable energy between 2030 and 2050.
Daiwa House says it is the world’s first company in the construction and housing sectors to join both campaigns and the first to declare it is taking bold action as part of EP100 among Japanese firms. Currently, there are 15 EP members. Daiwa aims to achieve the both by 2040.
Katsuhiro Koyama, general manager of Daiwa’s environment department, spurred debate to achieve the targets after returning to Japan from the COP23 global climate round in Germany last November.
He had previously taken a cynical view of such tech giants as Apple Inc, Google Inc and Microsoft Corp participating in the RE100 clean energy initiative, seeing it as an “atonement for their sins” of consuming huge amounts of electricity.
But Koyama, one of the Japanese delegate members to the global conference, said he was “inspired” by the firms’ “serious aspirations to leverage clean energy producers” after hearing various discussions.
The Osaka-based Daiwa group has invested an estimated 46.6 billion yen (about $424 million) in the construction of its own solar, hydro and wind power plants nationwide since 2007, producing power equivalent to about 60 percent of the group’s annual use of 481 million kilowatt hours. Meanwhile, it doubled its electricity use efficiency in fiscal 2016 compared to fiscal 2005.
Japanese businesses became much more aware of renewable energy in the wake of the Hokkaido Toyako summit in 2008 in which the Group of Eight countries set a long-term target to reduce greenhouse gas emissions.
The 2011 Great East Japan Earthquake, which triggered the suspension of all nuclear power plants in Japan, also sparked public concerns over the country’s energy mix.
The ratio of renewable energy to the nation’s entire power output capacity has risen from 10 percent in fiscal 2010 to 15 percent in fiscal 2016, according to the Agency for Natural Resources and Energy, boosted by a feed-in tariff system that obliges utilities to buy electricity generated by renewable energy at fixed prices.
The scheme has attracted businesses large and small, even individuals, to pour money into the photovoltaic field as it requires less effort to install and operate in a shorter period of time compared to other types of energy sources, said Yushi Inoue, a research director at Mitsubishi Research Institute, a think tank.
Individual power producers are actively trying to connect with grids in northeastern Japan, and sought to supply “more than three times what we can accept” in a recent offering, said a spokesman of Tohoku-Electric Power Co, the regional utility.
The region, part of which was devastated by the mega quake seven years ago and the subsequent nuclear disaster, has a number of favorable locations for wind power plants. “A vast majority of the seekers are renewable-energy oriented,” he said.
Meanwhile, a similar scheme in Europe that utilizes renewable energy certificates under a guarantee of origin of electricity generated from such sources has gained momentum among environmentally conscious firms, particularly after the 2008 summit on Japan’s northernmost island.
The tradable green certificate proves “environmental added value” created by renewable energy producers and can be purchased by electricity users.
Despite the financial burden, Ajinomoto Co switched its energy source to renewable energy for its entire annual electricity use of 4.5 million kilowatt hours at the Tokyo headquarters and major sales bases at home in the business year to March 2018.
Japan’s major seasoning and food maker extended the move to its four group arms in April, aiming to boost its renewable energy use to 50 percent of the group’s total energy consumption by fiscal 2030.
The targeted figure is part of various non-financial targets compiled for the first time in its three-year business management plan that started in fiscal 2017, said Mototsugu Shiratsuchi, general manager of the environment management support group of Ajinomoto.
Although the size of renewable energy certified is fairly small relative to the entire clean energy output in Japan, it has been steadily on the rise, reaching 378 million kilowatt hours in the year to March 2018, according to the Japan Quality Assurance Organization, the accreditation body.
Japan Natural Energy Co, the leading certificate issuer, has over 150 firms as long-term clients, such as Sony Corp and Asahi Breweries Ltd, and about 300 customers on a one-time contract basis.
The company is the pioneer in the field with about an 80 percent market share, according to the accreditation body.
President Masaru Terakoshi said that one of Japan’s global carmakers employed the certificate as part of its corporate social responsibility policy for 15 years but terminated a contract with the issuer two years ago.
The automaker, however, is set to repurchase the warrant this year following re-examination of how it can apply the certificate to its production activity.
Terakoshi declined to specify which automaker but indicated how Japan’s multinational corporations are becoming more aware of taking leadership roles in the fight against climate change.
“Otherwise, companies face a risk of losing clients,” he said, as the most of the world backs the landmark Paris accord of effectively reducing net CO2 and other greenhouse gas emissions to zero in the second half of this century.
The tradable certificate is widely used. Some hotels, for example, buy the warrants to claim their banquets are sustained by clean energy.
The Ministry of Economy, Trade and Industry drafted the latest energy mix plan due to be finalized this summer, calling nuclear power “an important baseload energy source.” This stance appears to conflict with public opinion which shifted after the 2011 Fukushima disaster. In addition to public sentiment against nuclear power plants, the government’s tougher safety standards led to the shutdown of all the countries reactors.
In the fiscal year through March 2017, fossil fuels accounted for 83 percent of Japan’s electricity output capacity. Renewables are currently at 15 percent.
The ministry proposes nuclear power should account for 20-22 percent of the country’s power source and renewables 22-24 percent in 2030, which still lagged behind the equivalent figures of major European nations in 2015.
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