Nagoya-based Toho Gas recently announced that it sold its 1,000th fuel cell unit since the household power generators hit the market in May 2009.

Demand for the Ene-Farm system, which can be used to generate electricity and heat for hot water and heating, has surged nationwide amid the power shortages created by the March 11 Great East Japan Earthquake.

The gas company, which sells the system in three prefectures in the Tokai region, expects to sell 900 units this year alone.

While Toho Gas sold 220 units in fiscal 2009, the figure jumped 2½ times to 515 units in 2010.

As of Sept. 2, 283 units had been installed this year, bringing accumulated sales to 1,000 units since 2009. Combined with earlier installation orders, the figure comes to 920 for the five months from April to the end of August.

"Since the March 11 disasters, more people have been revisiting the way they use energy at home and paying attention to the combination of electricity and gas for their use," said Hironari Tachi, senior manager for marketing.

The Ene-Farm system generates electricity by combining hydrogen extracted from city gas and liquefied petroleum gas with oxygen in the air to create a chemical reaction. Heat produced from the process is used to boil water.

Toho Gas estimates that the unit's annual output when generating 3,000 kwh is enough to cover about 50 to 60 percent of the energy consumed by the average household, saving around ¥50,000 a year in energy costs.

If a home also has a solar power generator, annual output exceeds consumption and owners can sell the surplus power back to a utility.

It doesn't hurt that the government has offered subsidies to homeowners who install the system. The program had drawn applications for 8,133 units as of July 7 and the government has stopped taking applications for the rest of the year.

A Panasonic plant in Kusatsu, Shiga Prefecture, manufactures the products commissioned by eight gas companies, including Toho Gas. Production is expected to surpass 6,000 units this year, compared with about 3,000 last year.

The Ene-Farm, however, comes with a big price tag — about ¥3 million per unit. Even with the government subsidy covering as much as ¥1.05 million of the cost, homeowners still need to shell out nearly ¥2 million.

"After this year's grant program was closed, sales have been slowing to a sluggish pace," said Tachi.

In response, the gas industry is building up its lobbying effort and pressing the government to provide more funding for the subsidies in the third supplementary budget for 2011.

If the Ene-Farm system is to really take off, production costs will have to come down dramatically. Toho Gas is eager to bring the customer's burden below ¥1 million.

"We are still in a transition period and accumulating the technologies," a Panasonic official said. "We need a breakthrough to simplify the complicated system."

This section, appearing Saturdays, features topics and issues from the Chubu region covered by the Chunichi Shimbun. The original article was published Sept. 8.