Japan's new Feed-in Tariff | 69 comments (69 topical, editorial, 0 hidden)

the resultant profit taking from homeowners will delegimtise the very idea of FiTs quite badly (in Japan)

I still don't get why you think the (intended) profit-taking by renewables installers is supposed to be delegitimizing, nor do I understand why you focus on PV-installing homeowners only when Japan's feed-in law disfavours them (with the 10-year guarantee in place of the general 20-year one while the rate is the same, see upthread).

Regarding the explicit intention to give renewables installers good profits:

New feed-in tariff system a rush to get renewables in play | The Japan Times Online

There is a specific section in the new tariff law that calls on METI to aim for large-scale renewable energy use over the first three years of the new tariff. To accomplish this goal, the law adds, METI is supposed to give special consideration to the profits of renewable energy suppliers.
Thus it is hoped high tariffs will encourage large-scale investment by current and new players in the renewable energy field, especially since the internal rates of return under the new system range from 4 percent for some biomass forms to 13 percent for geothermal, 8 percent for wind farms over 20 kw, and between 3.2 and 6 percent for solar.

_{*Lunatic*, n.

One whose delusions are out of fashion.}

by DoDo on Sat Jun 23rd, 2012 at 05:38:00 AM EST
[ Parent ]

Re: Potential (none / 0)

Because the profits come out of the pockets of consumers? Massive electricity rate hikes are not going to be popular. If this doesnt happen because the government decides to run the utilities at an ongoing loss, then sure, massively popular policy!

by Thomas on Sat Jun 23rd, 2012 at 05:39:53 AM EST
[ Parent ]

Re: Potential (4.00 / 2)

Because the profits come out of the pockets of consumers?

So what? On the other hand, I read of no similar exceptions for industrial consumers as in Germany.

Massive electricity rate hikes

Again with the strawmen...

_{*Lunatic*, n.

One whose delusions are out of fashion.}

by DoDo on Sat Jun 23rd, 2012 at 05:47:22 AM EST
[ Parent ]

Re: Potential (none / 0)

I think I see the problem. I am clearly expecting something along the lines of a full order of magnitude more solar to get installed as a result of this policy than you are. Thus I am expecting far larger impacts on electricity prices and so on. Should really put some numbers on this, I suppose. Try to get that done by tonight.

by Thomas on Sat Jun 23rd, 2012 at 05:50:09 AM EST
[ Parent ]

Re: Potential (4.00 / 4)

[Re-calculation after checking some figures]

I expect something in the order of 50 GW at most (and 20 GW more realistically) until 30 June 2015. Last year, when installed capacity jumped from 3.6 to 4.7 GW, 2.15 TWh was fed back (and 2.25 TWh produced). Not an awfully high capacity factor, and indeed IEA-PVPS claims 1,000-1,1000 kWh per kW is "typical" (I guess clouds plax a role). Going with that, I would expect at most 55 TWh and more realistically 20 TWh annual production from what gets installed under the launch feed-in rates, that would be c. 5% resp. 1.8% of total production. For a significant price effect of a ¥42/kwh feed-in rate vs. retail prices in the ¥11.5-23.1/kwh range (from winter high-voltage industrial to large-consumption household, 2008 TEPCO figures quoted by IEA-PVPS) that negates the benefits via marginal pricing (which should be substantial due to the "peak-shaving" daily power curve), I think something well above 10% of annual production would be needed.

_{*Lunatic*, n.

One whose delusions are out of fashion.}

by DoDo on Sat Jun 23rd, 2012 at 10:14:15 AM EST
[ Parent ]

Re: Potential (none / 0)

Global annual production capacity for solar cell production is currently somewhere in the region of 60 gw/year, (Google hits cannot seem to agree on an exact figure) which was an overcapacity of about 100 %.

Given Japanese household savings levels, and the impressive return on investment, that the islands of japan not could buy the entire 30 gw of potential production currently going without customers, but outbid other markets for the lion share of the entire global output and cause expansion of productive capacity. And I think they will. Further, given a market, said manufacturing capacity has increased by over 100% year-on-year before.
so.. eh, might very well hit 50 gw rated capacity by year end. If this doesnt cause the government to slam on the breakes somewhere in the region of 400 GW (rated) at law expiry would not shatter the supply chain, nor exceed what japanese construction firms can manage to put up. This is just solar, mind.

by Thomas on Sat Jun 23rd, 2012 at 12:35:05 PM EST
[ Parent ]

Re: Potential (none / 1)

Ugh. That was horrible. Where the heck is the edit button?

Cleaner:

Global production capacity for solar volatic elements is currently around 60 gw (rated). About half of this productive capacity is in search of buyers.

The japanese government just gave them a market for the entirety of this potential output, and the average japanese household can make this investment without having to loan the money. I expect them to do so, because the return is so very high. Further, productive capacity in this sector has doubled year-on-year to meet new demands before. It is not a strech to suppose this will happen again. Thus, by the time the law expires, it within the realm of physical and engineering possibility that over 400 gw (Rated) of solar has been put up in japan. And as long as the law is on the books, financial incentives make this maximalist scenario quite likely. This is just the solar sector - sales of windmills and so on to Japan are also likely to be extremely strong.

by Thomas on Sat Jun 23rd, 2012 at 12:49:22 PM EST
[ Parent ]

Re: Potential (4.00 / 2)

If such an extreme boom could be kicked off, I guess (1) degression would be imposed sooner than 3 years, (2) it would again speed up economies-of-scale cost reductions in the industry with global effect. However, I still don't think willing investors and the supply industry will grow from 1 GW/year to a 100 GW/year level overnight. Even if it's just about installing technicians: if German conditions are instructive (34,000 technicians among the 128,000 solar industry employees and 7.5 GW installed last year), that would require the training of 450,000 people.

What's more, I repeat that if we think of the specific investor circle of homeowners wanting rooftop solar, ¥42/kWh for just ten years (equivalent to c. €0.21/kWh over 20 years, ignoring maintenance costs and cell degradation) is not that stellar an offer, even with the somewhat higher annual yield per kW capacity than in Germany.

_{*Lunatic*, n.

One whose delusions are out of fashion.}

by DoDo on Sat Jun 23rd, 2012 at 02:23:08 PM EST
[ Parent ]

Re: Potential (4.00 / 2)

Forgot to add: downthread I gave a ministry estimate of 150 GW as the PV potential of Japan on suitable surfaces. I think that cap translates into another istallation speed constraint, but assuming all these surfaces can be filled in three years, we are speaking about a ceiling of 165 TWh a year or c. 15% of consumption.

_{*Lunatic*, n.

One whose delusions are out of fashion.}

by DoDo on Sun Jun 24th, 2012 at 06:23:13 AM EST
[ Parent ]

Re: Potential (none / 0)

Popular? As in Fukushima popular? Are nuke plants popular anywhere?
People will see panels everywhere and they'll get a whole new level of popular when they do the math and realise what a myth it is that we will always remain in peonage to utility companies for ever amen.

Quantities of energy fall unharvested that are vastly greater than our present consumption even with our hoggish and wasteful (ab)use patterns at this time.

We are standing thirsty in a clean river and being conned into buying dirty water to slake our needs.

There is zero need for further Fuku-traumatisation of entire regions with anachronistic technology now the cat is out of the bag.

Who ever regretted installing solar panels? Compare with Chernobyl survivors.

QED...

Worrying about who gets rich off of this is an unaffordable luxury. They should be in car rooves, bus stops, malls, hospitals, industrial areas, land too poisoned by our little 'experiments' for growing food or living on.
Sadly that's a Lot. Of. Land.

The new combination PV/greenhouse combos coming out of China look like a great step forward to diminishing the transport costs of food and other vittles.

The wonder if the internet is how robust it is, through distributed nodes of data. It's a great metaphor for PV too. The more people do it the less the strain on the grid.

"It's very hard to see what is kept invisible" Roseanne Barr

by melo (melometa4(at)gmail.com) on Sat Jun 23rd, 2012 at 06:52:27 AM EST
[ Parent ]

Japan's new Feed-in Tariff | 69 comments (69 topical, 0 editorial, 0 hidden)

Top Diaries

Newspeak to English pocket dictionary

Quantifying Utopia: A UBI Calculator for the USA

A Nomad's Life (A Farewell)

Standing on the Shoulders of Giants - Europe and the Mongol...

Simple Solar Principles

Rail News Blogging #24

Ferguson hates on Keynes

The Brussels Consensus: economic disaster in EU candidate...

Recent Diaries

Simple Solar Principles

Quantifying Utopia: A UBI Calculator for the USA

Newspeak to English pocket dictionary

Standing on the Shoulders of Giants - Europe and the Mongol...

Rail News Blogging #24

A Nomad's Life (A Farewell)

The Brussels Consensus: economic disaster in EU candidate...

Origins of German Neo-Austerianism

Ferguson hates on Keynes

Dionysian revels: Nice, May Day 2013:

Anglo Or Not, It's A Disease

The UK and the Euro

Free Energy: Solar and Dynamo LED Keychain Lights

Kruganomics 101

Gold

Corporate Profits and Aggregate Demand

VC Investment: Then and Now

An Ambush of Wishful thinking and Cargo Cult law.

The Intellectual Foundations of Austerity destroyed

Spring is Sprung - Photoblog

Occasional Series