Solar Energy, Energy Storage and Virtual Power Plants in Japan
Total Page:16
File Type:pdf, Size:1020Kb
SOLAR ENERGY, ENERGY STORAGE AND VIRTUAL POWER PLANTS IN JAPAN - Potential Opportunities of Collaboration between Japanese and European Firms - JONATHAN ARIAS Tokyo, October 2018 EU-Japan Centre for Industrial Cooperation ABOUT THE EU-JAPAN CENTRE FOR INDUSTRIAL COOPERATION The EU-Japan Centre for Industrial Cooperation (http://www.eu-japan.eu/) is a unique venture between the European Commission and the Japanese Government. It is a non-profit organisation established as an affiliate of the Institute of International Studies and Training (https://www.iist.or.jp/en/). It aims at promoting all forms of industrial, trade and investment cooperation between the EU and Japan and at improving EU and Japanese companies’ competitiveness and cooperation by facilitating exchanges of experience and know- how between EU and Japanese businesses. ABOUT THE AUTHOR Jonathan Arias is a Mining Engineer (Energy and Combustibles) with an Executive Master in Renewable Energies and a Master in Occupational Health and Safety Management. He has thirteen years of international work experience in the energy field, with several publications. He is passionate about renewable energies, electric vehicles and sustainability. He can be reached at [email protected] and on LinkedIn. I Table of Contents Table of Contents ........................................................................................................................... I List of Figures ............................................................................................................................. III List of Tables ................................................................................................................................. V List of Abbreviations ................................................................................................................... VI 1. EXECUTIVE SUMMARY ..................................................................................................... 1 2. INTRODUCTION: THE FRAMEWORK OF THE PARIS AGREEMENT AND THE GREAT EAST JAPAN EARTHQUAKE ................................................................................. 4 2.1. Energy scenario after the Great East Japan Earthquake ..................................................... 6 3. SOLAR ENERGY MARKET IN JAPAN........................................................................... 12 3.1. Current Status in Japan ..................................................................................................... 19 3.1.1. Main Manufacturers .................................................................................................. 30 3.1.2. Floating Solar PV Systems ........................................................................................ 35 3.1.3. Solar sharing .............................................................................................................. 38 3.1.4. Net-zero Energy House (ZEH) .................................................................................. 41 3.1.5. Solar Roads ............................................................................................................... 49 3.2. The Fifth Energy Basic Plan ............................................................................................ 50 3.3. The Feed-in Tariff Scheme .............................................................................................. 54 3.3.1. Secondary Market ..................................................................................................... 61 3.4. Electricity Market Deregulation ....................................................................................... 64 3.4.1. Non-Fossil Value Trading Market ............................................................................ 69 3.5. Operation and Maintenance (O&M) Business ................................................................. 71 3.6. Recycling and Reuse Business ......................................................................................... 74 4. ENERGY STORAGE BATTERIES IN JAPAN ................................................................ 80 4.1. Current Status in Japan ..................................................................................................... 92 4.2. Electric Vehicles and V2G Connection.......................................................................... 104 4.2.1. Current Status in Japan ............................................................................................ 107 4.2.2. Quick Chargers ........................................................................................................ 110 4.2.3. V2G Connection ...................................................................................................... 116 4.2.4. Solar Panels in Electric Vehicles............................................................................. 118 4.3. Reuse and Recycling Businesses .................................................................................... 120 I 5. VIRTUAL POWER PLANTS AND DEMAND RESPONSE IN JAPAN ..................... 127 5.1. Negawatt Trading Market .............................................................................................. 130 5.2. Virtual Power Plants in Japan ........................................................................................ 135 5.3. Blockchain Technology.................................................................................................. 139 6. CONCLUSIONS AND POTENTIAL OPPORTUNITIES ............................................. 147 7. REFERENCES .................................................................................................................... 154 ANNEX..................................................................................................................................... 158 Relevant Exhibitions in Japan ............................................................................................... 158 II List of Figures Figure 1: Replacement of Nuclear Electricity Generation in Japan after Shutdown ..................... 6 Figure 2: Targets for the Electric Power Supply-Demand Structure in Japan in 2030 ................. 7 Figure 3: Licensing Status of the Japanese Nuclear Facilities .................................................... 10 Figure 4: Global Cumulative Solar PV Capacity ........................................................................ 13 Figure 5: Global TOP 10 Solar PV Markets ............................................................................... 13 Figure 6: Average Selling Price for Solar Module ...................................................................... 14 Figure 7: Global Solar Price Deflation (USD/MWh) .................................................................. 15 Figure 8: Estimated Average Solar Project Internal Rate of Return ........................................... 17 Figure 9: Renewable Energy Share in Electricity Consumption in 2017 .................................... 20 Figure 10: Cumulative Solar PV Capacity in Japan (GW) ......................................................... 20 Figure 11: Japan’s Total Shipments of PV Modules by Fiscal Year .......................................... 21 Figure 12: Japan’s Domestic Shipments of PV Modules by Application and Fiscal Year ......... 22 Figure 13: Energy Mix in FY 2017 ............................................................................................. 23 Figure 14: Operating Renewable Power Capacity in each Utility as of March 2017 ................. 24 Figure 15: Timing of Excess Power Purchase Agreement (PPA) Termination and Output of PV Systems covered by the Previous and Current FIT Programmes ................................................ 25 Figure 16: Detailed breakdown of utility-scale solar PV costs by country ................................. 29 Figure 17: Largest 30 Solar Portfolios in Japan by Region ........................................................ 32 Figure 18: Installation of Floating PV by Country and Region from 2016 to 2022.................... 36 Figure 19: PV Modules Suppliers for the 54 Largest Floating Solar PV Power Plants in Japan 38 Figure 20: Strategic Road Map for Promoting ZEH ................................................................... 42 Figure 21: Strategic Road Map for Promoting ZEB ................................................................... 43 Figure 22: Definition of ZEH ...................................................................................................... 44 Figure 23: Definition of ZEB ...................................................................................................... 45 Figure 24: Coal Power Plants Planned in Japan .......................................................................... 51 Figure 25: Installed Capacity of Renewable Energy in Japan after the New FIT Scheme ......... 55 Figure 26: Basic Mechanism of the FIT System ......................................................................... 55 Figure 27: Status of FIT in Japan (as of March 2017) ................................................................ 56 Figure 28: Status of FIT Certified Capacity in each Utility (as of March 2017) ........................ 57 Figure 29: Business Plan Utilizing FIT ....................................................................................... 57 Figure 30: Contractual Supply of Electricity .............................................................................. 58 Figure 31: Levy Burden to Average