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Japan bets on new solar technology to boost renewables

  • Market: Electricity
  • 07/06/24

Japan is stepping up efforts to expand renewable energy to achieve its carbon neutral goal by 2050. Solar power generation is among the most prominent, although it is increasingly looking to new technology that is commercially unproven.

Japan's trade and industry ministry (Meti) on 29 May launched a public-private joint council with 150 organisations participating. This aims to expand solar power generation with a special focus on the new solar power technology perovskite, which is a lightweight bendable film attachable to even the wall of the building of any shape.

Meti plans to set a generation target exclusively for perovskite, aiming to announce this as early as this autumn, although the specific target year is still unknown. Under the current basic energy policy, Japan plans to lift solar output to 129-146TWh by 2030, up from 92.6TWh in the April 2022-March 2023, although this goal may be revised during this year's review of the policy.

Meti in May started a discussion of the basic energy policy, which is due for review every three years. This time plan will be hugely different from previously, said Petroleum Association of Japan chairman Shunichi Kito on 30 May, given that the country needs to shift fundamental assumptions about electricity demand.

Perovskite will play a key role to boost solar power generation in Japan, as the mountainous country is facing difficulty installing conventional solar panels that require flat areas. Japan's solar power capacity per flat area is already at 514kW/km², leading the major advanced economies with its closest rival Germany at 243kW/km², according to Meti.

But it remains unclear if perovskite will be economically feasible, given that it is commercially unproven. Meti, along with private-sector firms, are carrying out trials, aiming to achieve ¥20/kWh ($128.60/MWh) of generation costs with perovskite. This is almost double that of a conventional solar panel, according to a Meti official. Whether the perovskite market will grow globally is another issue to consider, as a limited market could weigh on its manufacturers to lower production costs.

The new technology is gaining attention in Japan to ensure its decarbonisation and energy security, especially when the future of the nuclear industry is still uncertain.

Wind boost

Japan is also accelerating the roll-out of wind power capacity, aiming to install 23.6GW by 2030, including 5.7GW offshore and 17.9GW onshore. It is eyeing the development of offshore wind farms, especially by promoting floating technology. Tokyo aims to have offshore wind projects of 10GW by 2030 and 30-45GW by 2040.

Tokyo has agreed to new legislation that will allow the construction of wind power facilities in its exclusive economic zone, beyond its territorial and internal waters regulated under current laws, while striving to protect the marine environment. It is aiming to pass the amended legislation in an ordinary parliament session that will end on 23 June.

Japan is under pressure to secure clean power sources to meet rising electricity demand from domestic semiconductor facilities and data centres, which are being driven by the rapid growth of artificial intelligence.


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21/02/25

German power industry split on capacity market design

German power industry split on capacity market design

London, 21 February (Argus) — Stakeholders in the German power market are divided on how best to implement a capacity market in Germany, or whether it is needed at all, Argus heard on the sidelines of the E-World conference in Essen last week. Instead of entertaining the "misleading" debate over centralised versus decentralised mechanisms, in which the government tries to "delegate accountability for security of supply", what is really needed is "centralised accountability with decentralised assets", Stefan Joerg-Goebel, senior vice-president for Germany at utility Statkraft, said. "The market should be centrally organised but technologies bidding into the market should include, for example, decentralised demand-side response and batteries," he said. But "only the state can really secure supply". Transmission system operator Amprion prefers a centralised capacity segment with a "local component" over the combined capacity market proposal, according to Peter Lopion, consultant in the firm's international regulation management and market development team. He emphasised the importance of knowing "when and where" power plants will come on line. Amprion also stressed that "incentives for grid-serving behaviour" are needed for batteries in particular . In contrast, a decentralised capacity market — not too dissimilar to that of France — is the "best solution" for Germany, although it would first need to adapt to the "German reality", Davide Orifici, director of public and regulatory affairs at energy exchange Epex, said. Such a system would "better help to integrate flexibility" and "further develop demand response", he said, adding that the impression that a centralised system would be simpler is "false". And a decentralised element is "crucial" to "fully leveraging the potential of the demand side", according to Jan Bruebach, managing director at utility MVV. Nevertheless, the addition of the centralised element would add "long-term security" and thus the German energy ministry BMWK's combined proposal is "fine". And while not specifying a particular design, "something at least similar to a capacity market" is important for security of supply and to "provide incentives to hold capacity on stand-by" during periods of low renewable generation, said Andre Jaeger, senior vice-president of product management at trading and risk management firm Ion Commodities. Kerstin Andreae of energy and water association BDEW agreed at a press conference that Germany "needs" the transition to a capacity market. But Peter Reitz, chief executive of energy exchange EEX, does not see the introduction of a capacity market in Germany as being essential. "The same effect can be achieved much more cheaply by introducing the obligation to deliver into the energy-only market," he said, although a decentralised market would "interfere the least with liquidity". And the introduction of a capacity market in Germany would be "costly", Andy Sommer, head of fundamental analysis and modelling at utility Axpo, said. The costs would probably be absorbed by grid operators and the state, and eventually offloaded on to end-consumers, he said. Energy ministry BMWK in August opened a consultation on the country's future power market system, with four options to finance controllable power capacities: a capacity-hedging mechanism through peak price hedging, a decentralised capacity market, a centralised capacity market, and finally, the ministry's preferred option of a "combined capacity market". Despite the deadline for member states to incorporate the EU-mandated electricity market design having passed on 17 January, the design will "probably" be implemented by the next government, BMWK deputy director Andre Poschmann said at an industry event last month . The capacity market question is likely to draw the most political attention after the federal election on 23 February, Joerg-Goebel said, adding that the successful continuation of the coal phase-out — which is currently an "uncomfortable issue" for market participants — can be "fixed" only with new capacity. And without a capacity mechanism, it will be "very difficult" to invest in new peak generation plants, Bruebach said, with Lopion adding that the coal phase-out is "dependent on" new capacity mechanisms. A bidding zone split would harm liquidity And the decision over whether to split Germany into multiple bidding zones remains a concern, with Argus having heard a general consensus that a bidding zone split would negatively affect liquidity in power trading. Larger price zones acting as a "larger mass" are better for liquidity, according to Reitz, citing the German-Austrian bidding zone split and subsequent reduction in Austrian power liquidity. A split would cause "disruption" to the entire market, owing to regulatory changes and the loss in liquidity, agreed Joachim Bertsch, senior business development manager at utility RWE, while Bruebach said it would "crush" liquidity, disadvantage smaller market participants and drive up costs for industries in the south of the country. While BMWK in August rejected the "reconfiguration" of the single German-Luxembourg bidding zone , the "pressure" to introduce multiple bidding zones will intensify if grid expansion does not, according to Joerg-Goebel, while Parasram said he believes "some form of split" will happen. By Bea Leverett Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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EU draft plan seeks to cut energy costs


19/02/25
News
19/02/25

EU draft plan seeks to cut energy costs

Brussels, 19 February (Argus) — The European Commission has set out plans to tackle the cost of energy in the EU, warning in a draft document that Europe risks de-industrialisation because of a growing energy price gap compared to global competitors. High energy prices are undermining "the EU's global standing and international competitiveness", the commission said, in a draft action plan for affordable energy, seen by Argus . The plan is expected to be released next week, alongside a clean industrial deal and other strategy documents. Much of the strategy relies on non-binding recommendations rather than legislation, particularly in energy taxation. Officials cite EU reliance on imported fossil fuels as a main driver of price volatility. And they also highlight network costs and taxation as key factors. For taxation, the commission pledges — non-binding — recommendations that will advise EU states on how to "effectively" lower electricity taxation levels all the way down to "zero" for energy-intensive industries and households. Electricity should be "less taxed" than other energy sources on the bloc's road to decarbonisation, the commission said. It wants to strip non-energy cost components from energy bills. Officials also eye revival of the long-stalled effort to revise the EU's 2003 energy taxation directive. That requires unanimous approval from member states. The commission pledges, for this year, an energy union task force that pushes for a "genuine" energy union with a fully integrated EU energy market. Additional initiatives include an electrification action plan, a roadmap for digitalisation, and a heating and cooling strategy. A white paper will look at deeper electricity market integration in early next year. EU officials promise "guidance" to national governments on removing barriers to consumers switching suppliers and changing contracts, on energy efficiency, and on consumers and communities producing and selling renewable energy. More legislative action will come to decouple retail electricity bills from gas prices and ease restrictions on long-term energy contracts for heavy industries. By 2026, the commission promises guidance on combining power purchase agreements (PPAs) with contracts for difference (CfDs). And officials will push for new rules on forward markets and hedging. There are also plans for a tariff methodology for network charges that could become legally binding. Familiar proposals include fast-tracking energy infrastructure permits, boosting system flexibility via storage and demand response. Legislative overhaul of the EU's energy security framework in 2026 aims to better prepare Europe for supply disruptions, cutting price volatility and levels. Specific figures on expected savings from cutting fossil fuel imports are not given in the draft seen by Argus . But the strategy outlines the expected savings from replacing fossil fuel demand in electricity generation with "clean energy" at 50pc. Improving electrification and energy efficiency will save 30pc and enhancing energy system flexibility will save 20pc, according to the draft. The commission is also exploring long-term supply deals and investments in LNG export terminals to curb prices. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Japan sets stricter climate goal in government sector


19/02/25
News
19/02/25

Japan sets stricter climate goal in government sector

Osaka, 19 February (Argus) — The Japanese government is planning to boost the use of renewable electricity at ministries and state-owned facilities, setting a tougher goal to cut greenhouse gas (GHG) emissions from public sector operations. The government aims to reduce its own GHG emissions by 79pc in the April 2040-March 2041 fiscal year against the 2013-14 level, it said in a plan approved on 18 February. This objective comes after the intermediate goal of a 50pc reduction in 2030-31 and 65pc in 2035-36. The government's climate plans are more ambitious compared with Japan's nationally determined contribution (NDC) , which was submitted to the UN climate body the UNFCCC on 18 February, because it wants to take the initiative to accelerate the country's decarbonisation drive. Japan's new NDC targets for a 73pc reduction in GHG emissions by 2040-41, after a 60pc cut in 2035-36. Tokyo plans to ensure at least 60pc of its power use comes from renewable sources in 2030-31 and more than 80pc from zero-emission power sources in 2040-41. Renewable power use at ministries was 27pc in 2021-22. The government aims to install solar power systems at more than 50pc of its own facilities and lands by 2030-31 and ensure 100pc penetration by 2040-41, actively adopting perovskite, the Japanese innovation for solar panel manufacture that uses iodine instead of conventional raw material silicon. Tokyo will also gear up efforts to improve energy efficiency at its buildings and switch all official vehicles to electric vehicles (EVs), fuel cell vehicles, plug-in hybrid vehicles (PHVs) and hybrid vehicles (HVs). Japan plans to generate 40-50pc of its electricity from renewables in 2040-41, up from 22.9pc in 2023-24. The share of thermal power will fall to around 30-40pc from 68.6pc, while the share nuclear power will increase to around 20pc from 8.5pc over the same period. The 2040-41 target is based on the expected Japanese power demand of 1,100-1,200 TWh, which is higher by 12-22pc from 2023-24. The breakdown of thermal output for 2040-41 is unclear. But gas-fed output is expected to hold the majority share, given that gas has already outpaced coal in power generation and Tokyo has pledged to phase out inefficient coal-fired plants by 2030. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Singapore adds $3.7bn clean energy funds, mulls nuclear


19/02/25
News
19/02/25

Singapore adds $3.7bn clean energy funds, mulls nuclear

Singapore, 19 February (Argus) — Singapore will add a further S$5bn ($3.7bn) to its clean energy fund, and is also studying the potential for nuclear deployment, said the country's prime minister Lawrence Wong on 18 February. Singapore's Future Energy Fund was set up in 2024 with an initial injection of S$5bn to develop clean energy options. Expanding access to clean energy is a major national imperative as "the industries of the future," such as artificial intelligence and semiconductors, are highly energy intensive, said Wong at the unveiling of the country's budget for 2025. "Be it electricity imports, hydrogen or nuclear, we need to make major investments in new infrastructure," said Wong. A short-term solution is to import low-carbon electricity from the region. Singapore expects about a third of its projected electricity demand in 2035 to be met through electricity imports, according to Wong. The country aims to import 6GW of low-carbon electricity by 2035 , and has signed supply agreements with Malaysia , as well as granted conditional approvals to projects in Indonesia. But Singapore needs to have its own domestic sources of clean power, said Wong. Singapore has been evaluating the use of low-carbon hydrogen for power, "but there are inherent challenges in the production, storage and transportation of hydrogen, which make it hard to scale up in a commercially viable manner," Wong added. Nuclear power could be another option. Singapore had considered the possibility of developing nuclear power in 2010, but assessed that conventional nuclear technologies were not suitable. Since then, there have been significant advancements in nuclear technologies such as small modular reactors (SMRs), which have better safety features than conventional reactors, said Wong. Interest in nuclear energy is also rising in the region, with several countries planning to include it in their energy mixes, such as Indonesia and the Philippines. Singapore has signed agreements with the US on civil nuclear co-operation, and is working on similar collaborations with other countries that have capabilities and experience, especially with SMRs, said Wong. Singapore submitted its new emissions reduction target on 10 February, aiming to reduce emissions to 45mn-50mn of CO2 equivalent (CO2e) in 2035 as part of its nationally determined contribution. Singapore aims to decarbonise its transport sector, which currently accounts for about 15pc of total emissions, in line with its emissions reduction goals. Singapore will introduce a new heavy vehicle zero emission scheme and a heavy electric vehicle (EV) charger grant to accelerate the adoption of cleaner heavy vehicles. The grant will provide incentives for the purchase of heavy EVs and co-funding of charging infrastructure, said Wong. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Japan approves new energy mix target, climate plans


18/02/25
News
18/02/25

Japan approves new energy mix target, climate plans

Tokyo, 18 February (Argus) — Japan has approved its targeted power mix portfolio for the April 2040-March 2041 fiscal year, as well as its new greenhouse gas (GHG) emissions reduction goal, it announced today. The new power mix goal, the centrepiece of the country's Strategic Energy Plan (SEP), is in line with Japan's aim to reduce GHG emissions by 73pc by 2040-41 compared to 2013-14 levels. Tokyo plans to submit the 2040-41 emission target, as well as a 60pc emissions reduction goal for 2035-36, to the UN climate body the UNFCCC on 18 February as the country's nationally determined contribution (NDC). The country has not made major changes to its draft proposal that it unveiled in December. The new SEP sees renewable energy making up 40-50pc of the country's power generation in 2040-41, up from 22.9pc in 2023-24. The share of thermal power will fall to around 30-40pc from 68.6pc, while that of nuclear will increase to around 20pc from 8.5pc during the same period. The 2040-41 target is based on Japanese power demand of 1,100-1,200 TWh, which is higher by 12-22pc from 2023-24. The government has planned the power portfolio so that it is not heavily dependent on one specific power source or fuel type, the country's minister for trade and industry (Meti) Yoji Muto said on 18 February, although the new plan suggests making maximum use of low-carbon power supply sources. Public consultation over 27 December-26 January revealed that some think Japan should slow or even stop the decarbonisation process, given the US government's reversal of its climate policies, including its withdrawal from the Paris climate agreement, said Meti. But global commitment to decarbonisation will remain unchanged, said Muto, adding that Japan will lose its industrial competitiveness if the country delays green transformation efforts. But US president Donald Trump's "drill, baby, drill" policy has prompted the Japanese government to delete a segment from the draft SEP that had initially proposed bilateral co-operation through Tokyo's green transformation strategy and the US' Inflation Reduction Act. Despite Tokyo's decarbonisation goals, the new SEP assumes that fossil fuels, including natural gas, oil and coal, will still account for over 50pc of primary energy demand in 2040-41 in all of its scenarios — although this is down from 93pc in 2013-14 and 83pc in 2022-23. The scenarios vary based on the degree of uptake of renewables, hydrogen and its derivatives, and carbon capture and storage (CCS) technologies, to fulfil the 73pc emission reduction goal by 2040-41. Worst-case scenario Tokyo also has also set out a potential worst-case scenario, assuming slower development of clean technologies, in which fossil fuels would still account for 67pc of primary energy supply in 2040-41. Under this scenario, which assumes Japan will only reduce its GHG emissions by around 61pc by 2040-41, natural gas is estimated to account for about 26pc, or 74mn t, of Japan's primary energy supply, which is higher than the 53mn-61mn t in the base scenarios that are formulated in accordance to the 73pc emissions reduction target. Japan would need to address the potential 21mn t gap in gas demand, which will mostly be met by LNG imports, in 2040-41, depending on the development of clean technologies. The gap is equivalent to 32pc of the country's LNG imports of 65.9mn t in 2024. When asked by Argus whether the government will continue to try securing LNG to ensure energy supply security when considering the worst-case scenario, a Meti official said Tokyo should continue pursuing its 73pc GHG reduction target, but it is necessary to consider the potential risks for each individual policy and the measures that need to be taken, instead of making decisions based on the worst-case scenario. The new SEP has highlighted the role of LNG in the country's energy transition and the necessity to secure long-term supplies of the fuel. It is unclear what ratio gas-fired capacity will account for in Japan's 2040-41 power mix, as the SEP does not include a breakdown of thermal generation. But gas-fed output is expected to take up the majority share, given that gas has already outpaced coal in power generation and Tokyo has pledged to phase out inefficient coal-fired plants by 2030. By Motoko Hasegawa and Yusuke Maekawa Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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