Japan expects clean energy to edge out nuclear power

[TOKYO] Japan anticipates that by 2030 clean energy such as solar and hydro will generate slightly more electricity for the nation than nuclear power plants.

Clean energy sources will supply as much as 24 per cent of Japan's electricity in 15 years, while atomic power will account for as much as 22 per cent, according to a draft report from the Ministry of Economy, Trade and Industry on what Japan's electricity mix should look like by 2030.

As part of the draft, hydro power is seen by 2030 accounting for as much as 9.2 per cent of Japan's total power generation, with solar at 7 per cent, wind at 1.7 per cent, biomass coming in at as much as 4.6 per cent and geothermal as much as 1.1 per cent, according to the release.

Though the eagerly awaited report - the result of months of study by a ministry panel debating the energy mix - continues to see a need for nuclear, the draft proposes a diminished role compared with before the Fukushima disaster in March 2011. Nuclear power accounted for almost a third of Japan's electricity generation before the meltdowns at the Fukushima Dai-Ichi reactors.

Nuclear's role has been the central focus of the panel's discussions. The 2011 disaster triggered strong opposition to atomic power among the public, while the subsequent spike in electricity prices has seen business groups lobby intensively for the nation's nuclear reactors to resume operations.

Nuclear provided slightly less than 29 per cent of Japan's electricity in fiscal 2010, while clean energy sources supplied 9.6 per cent with most of that coming from hydro. None of Japan's commercially operable nuclear reactors are working at the moment.

The latest proposal signals less reliance on nuclear than a previous plan released in 2010. Japan had been envisioning nuclear and renewable sources supplying 53 per cent and 21 per cent of power, respectively, by 2030 under the government led by the Democratic Party of Japan.

The DPJ's stance shifted following the Fukushima disaster, with the party eventually calling for all nuclear to be phased out. The DPJ was replaced by a coalition led by the Liberal Democratic Party in Dec 2012.

By 2030, gas will supply 27 per cent while coal and oil will provide 26 per cent and 3 per cent, respectively, according to the latest proposal.

The release came a day after the trade ministry issued draft estimates of power generation costs. Nuclear is estimated to be the cheapest source at 10.1 yen per kilowatt hour or more by 2030.

Large-scale solar was estimated to cost 12.7 yen to 15.5 yen, while onshore wind was projected to cost 13.9 yen to 21.9 yen, according to the ministry.

BLOOMBERG