Wind lobby raps environment reports

by Chisaki Watanabe

Bloomberg

Japan’s effort to obtain more power from wind turbines is being held up by requirements that force developers to conduct environmental impact assessments, undermining government support for the industry, according to a lobby group.

The rules requiring the assessments for wind developers took effect in October 2012, three months after the government introduced an incentive program for wind, solar, small hydro, biomass and geothermal power.

“Wind is far from being accelerated,” Tetsuro Nagata, president of the Japan Wind Power Association, said in an interview in Tokyo. “We aren’t even at the starting block.”

The trade group’s 240 members include turbine makers such as Mitsubishi Heavy Industries Ltd. and Hitachi Ltd. The comments are aimed at coaxing the Abe administration away from cutting support for wind power.

Incentives for cleaner forms of energy were rolled out to build up alternatives to nuclear energy after the disaster in Fukushima almost three years ago. Solar accounts for 96.8 percent of the capacity added since the program started, with wind at only about 1.2 percent, according to government data.

Japan installed 73 megawatts of wind capacity in fiscal 2013 ending March 31, according to JWPA estimates. That’s the lowest since fiscal 2001, when the group began collecting data.

A committee of experts advising the Ministry of Economy, Trade and Industry is reviewing tariffs for fiscal 2014 covering new applications for support. The solar tariff was reduced by 10 percent for fiscal 2013 to reflect falling system costs as the use of solar panels spreads. Tariffs for other renewable energy sources remained unchanged in the first two years of the program because little new capacity was added.

Fiscal 2014 will be the last of the three-year period when tariffs for new applications are set at favorable prices to boost clean energy. The incentive for wind, currently ¥23.21 per kilowatt-hour, including the 5 percent consumption tax, was set to grant developers an internal rate of return of 8 percent. The tariff is good for 20 years.

The lobby group is urging the government and ruling parties to preserve the current return level to encourage more investment because the industry isn’t yet able to advantage of the support program, Nagata said.

The group is also calling for a faster and simpler environmental impact process, he said. Many projects have been delayed because developers have been asked to study items that may seem unrelated, such as dust, he added.