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  1. Japan’s Priorities for NRETs 2003-2004 21st Meeting of the Expert Group on New and Renewable Energy Technologies October 13-15, 2003 Shanghai, PRC Mr. Yoshihiro ITOH Chief Officer International Projects Dept. New Energy and Industrial Technology Development Organization (NEDO)

  2. Outline 1. Japan’s New and Renewable Energy Targets 2. Policies for Development and Introduction of NRETs 3. RPS-Background, Outline, Explanation 4. ‘Biomass Nippon Strategy’ 5. NEDO’s Role in Japan’s New Energy Scheme 6. Measures to Overcome Grid-Connection Obstacles 2

  3. 1. Japan’s New and Renewable Energy Targets Energy Sources FY 2001Results FY 2010 Target on New Energy Introduction (Revised) Oil Equiv. Installed Cap. Oil Equiv. Installed Cap. 1,000 x kl MW 1,000 x kl MW Photovoltaic(Solar Power) 110 452 1,180 4,820 Solar Thermal 820 - 4,390 - Wind Power 127 312 1,340 3,000 Waste Power 1,250 1,110 5,520 4,170 Waste Thermal 45 - 140 - Biomass Generation 48 71 340 330 Biomass Thermal - - 670 - Black Liquor, Waste Wood, etc. 4,460 - 4,940 - Unused Energy(Including Cooling by Snow & Ice) 44 - 580 - New Energy Total (Ratio of total primary energy supply) 6,900 (about 1.2%) - 19,100 (about 3%) - Total primary energy supply (in million kl) 588 Mkl - about 602 Mkl - 3

  4. 2. Policies for Development and Introduction of NRETs Fiscal year FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 Budget (in 100 million \) 748 875 925 1,105 1,449 1,568 (in million US$) ※ 598 700 740 884 1,159 1,254 ※US$1 = \125 Ⅰ.Technological Development Ⅱ.Demonstrative Testing • (Budget for FY2003: • about \43.4 billion ≒ US$347 million) • Fundamental investigation • Development for practical application • (Budget for FY2003: • about \18.8 billion ≒ US$150 million) • Field test • Demonstrative research Ⅲ. Introduction Promotion (full utilization of market mechanism) • (Budget for FY2003: about \94.6 billion ≒ US$757 million) • Creation of initial demand for inducing market independency • Creation of environment suitable for introducing leading-edge new energy systems • Financial support (Tax system, Fiscal investment and Loans) • The Green Purchase Law • Enlightenment and public information activities • New market development mechanism ~RPS (Renewable Portfolio Standard) ←Additional Measure 4

  5. 3-1. Background on the Introduction of RPS 【Considerations】 - Certain effectiveness of new measure - Wide choice of sources for electric power company - Incentive for cost reduction - Maintenance of free competition in the energy market - Effect of financial burden on government, etc. Background • Difficulty in achieving the new 2010 target with only current measures. • To promote power generation by renewable energy, legislation in US, Europe, etc., had already been introduced/enacted for various systems. Necessity of studying the introduction of a new system adapted for Japan. Conclusion Japanese government decided to introduce a new measure making use of the market mechanism -Renewable Portfolio Standard (RPS)-. Establishment of the Law Concerningthe Use of New Energy by Electric Utilities (June 2002) 5

  6. 3-2. System Outline--Law Concerning the Use of New Energy by Electric Utilities Dec. 2002 National Government Apr. 2003 Accreditation of facilities for New Energy power generation Requiring use of a certain amount of electricity by New Energy Electricity Retailer (A) (certificate trading) Electricity Retailer (B) New Energy Generator Electricity supply by New Energy Solar Wind Biomass Small/Medium Hydro (to 1 MW) Geothermal Electricity supply Consumers The target for 2010 is 12.2 TWh, which would comprise 1.35% of national electric supply. 6

  7. 3-3. Basic Explanation of the RPS System The national government obliges each electric power company to use a certain amount of electricity arising from New Energy, according to its sales of electricity. An electric power company can select the most advantageous way among the following to carry out its obligation; a) generating by oneself b) purchasing from others c) causing other electric company to subrogate the obligation The national government verifies electric power companies’ use of electricity arising from New Energy each fiscal year. 7

  8. 4-1. Biomass Nippon Strategy Background 1. Prevention of Global Warming--carbon-neutral energy source; mitigate CO2 emissions-- 2. Creation of a ‘Recycling-Oriented Society’--more effective use of finite resources-- 3. Fostering of New and Competitive Strategic Industries--trailblazing business model to revive industrial competitiveness-- 4. Activation of Agriculture, Forestry, Fishery Industries and the Associated Rural Communities--effective use of abundant biomass in farm villages-- [http://www.maff.go.jp/biomass/eng/biomass_honbun.htm] 8

  9. 4-2. Biomass Nippon Strategy Biomass Production Recycling-Oriented Society (based on regional factors) Biomass Utilization Biomass Collection Biomass Transformation Global approach National perception Specific Targets 9

  10. 4-3. Biomass Nippon Strategy GOALS 1) Evolutionary Direction Today—Waste Biomass ca. 2010—Unused Biomass ca. 2020—Energy Crops ca. 2050—New Crops 2) Developmental Direction Construction of a Biomass Refinery Cascaded Utilization of Biomass Specific goals to be established, e.g. energy conversion efficiency, cost target of process equipment/systems, clear target level of biomass utilization…. 10

  11. 4-4. Biomass Nippon Strategy • Promotion of Biomass Utilization • Establishment of: Biomass Information Headquarters (information clearinghouse) and ‘Biomass Nippon Comprehensive Strategy Promotion Council’ • Study of new legislation • R&D for designing a social system in which efficient utilization of biomass is encouraged; demonstrative testing • Comprehensive package of measures in model communities under a coordinated program headed by relevant government offices • Evaluation of possible merits and demerits to establishing new competitive conditions for biodiesel fuels 11

  12. 4-5. Biomass Nippon Strategy • Production-Collection-Transport • Formulation of an efficient collection/transportation system • Exploration of possible means to expand the boundaries of the recycling qualification of waste biomass which shall meet certain requirements; e.g. the biomass should not decompose so easily • To produce biomass efficiently by utilizing special zones for structural reform 12

  13. 4-6. Biomass Nippon Strategy • Conversion • Development/promotion of conversion technologies • Support of the establishment of a ‘model facility’ • Exploration of means to simplify the approval procedure required for the installation of waste treatment facilities intended for handling biomass with similar properties 13

  14. 4-7. Biomass Nippon Strategy • Post-Conversion Utilization • Investigation of a procedure to be applied to biomass-derived plastic materials as specific procurement items covered by the Green Purchasing Law • Arrangements so that biomass power generation can be handled in the same manner as other kinds of new energy under the New Energy Law • Promotion of agriculture which is oriented toward environmental conservation • Facilitation of power supply by means of distributed power sources, including biomass power generation • Quality evaluation of biomass-derived automotive fuels, assessment of their safety and environmental performance, and driving tests on those fuels as well as evaluation of the merits and demerits of their introduction into Japan 14

  15. 5. NEDO’s Role in Japan’s New Energy Scheme 15

  16. 6-1. Measures to Overcome Grid-Connection Obstacles • Demonstrative Research on Combined Power Generation Systems (PV + Biogas) • Objectives • Early commercial application of a system that maximizes the utilization of RE to promote mass introduction • Establishment of an effective system on the demand side • Resolution of instable PV power generation • Demonstration of a combined system in which instable energy is transferred and utilized to produce stable, renewable energy, while stable PV energy is directly supplied to the grid 16

  17. 6-2. Measures to Overcome Grid-Connection Obstacles Demonstrative Research on Combined Power Generation Systems (PV + Biogas) Site: Sihanoukville, Cambodia Power Generation PV 50kW; Biogas 60kW 17

  18. 6-3. Measures to Overcome Grid-Connection Obstacles ~/- Demonstrative Research on High-Efficiency PV Power Generation Systems Medium-Voltage Power Line 110kV/10kV Switch System Design Transformer Site: Beijing City, PRC Bulk PV Amorphous PV Total Power Generation: 180kW 18

  19. 6-4. Measures to Overcome Grid-Connection Obstacles Demonstrative Research on Combined Power Generation Systems (PV + Wind + Advanced Battery) Turbine PV Adv. Batt. System Design Mini Grid PV Power Generation: 100kW Wind Power Generation: 100kW Site: Gansu Prov., PRC 19

  20. 6-5. Measures to Overcome Grid-Connection Obstacles Demonstrative Research on Combined Power Generation Systems (Water-cooled PV + DG + Advanced Battery) Adv. Batt. Water-cooled PV DG System Design Mini Grid Ballast Load Site: Xinjiang Prov., PRC PV Power Generation: 60kW DG Power Generation: 100kW 20

  21. Thank You!!!