Dec 5th - Japan: Climate Change and Energy Updates

Summary

Policy Updates

• 1. MOE calculate likely increase in CO2 emissions caused by shutdown of nuclear plants

2. Government decides framework for discussion of electricity reform

• 3. MOE plans an environmental tax on thermal power
• 4. Kyushu Electric restarts Genkai Nuclear Power Plant
• 5. PM Noda establishes National Policy Strategy Council as decision making committee on energy policy
• 6. MLIT plans to intensify energy saving obligations for newly constructed buildings and houses
• 7. Government submits a proposal on Rio+20 to the UN
• 8. Japan accelerates deployment of Smart Meters

Stakeholder engagement

9. UK’s nuclear policy presented at “Yomiuri-IEEJ Joint International Symposium on the Best Energy Portfolio and Nuclear Power”

10. Climate Change and Energy section supports the CDP Japan

Detail

Policy Updates

1. MOE calculate likely increase in CO2 emissions caused by shutdown of nuclear plants: MOE disclosed that if all of the 44 nuclear power plants were replaced by thermal power plants, annual CO2 emissions would raise by 150 to 170 million tons - a 12-14% increase from the 1990 level.  This suggests the shutdown of nuclear power plants would make a large impact on climate change countermeasures.  At the House of Councillors’ Environment Committee meeting on 27 October, Yoriko Kawaguchi (LDP, former Minister of Environment) emphasised the difficulty of achieving the 25% GHGs emission reduction target and the need to revise it.

2. Government decides framework for discussion of electricity reform:

• Minister of Economics, Trade and Industry Edano announced that a closed task force to discuss electricity market reform will be established within METI. Edano will chair, with the participation of senior officials including Vice Ministers. Starting November, they will invite experts to exchange opinions and produce a list of proposals by the end of this year.
• The Ministerial-level Electricity Reform Committee, chaired by Chief Cabinet Secretary Fujimura held its first meeting. The committee will discuss mid and long term electricity reform, while the Energy and Environment Council deals with the discussion about the best energy mix.

3. MOE plans an environmental tax on thermal power: MOE is planning to apply JPY 0.1 to 0.3 per 1 kW (£0.0007) of environmental tax (climate change tax) to thermal power. In total, tax revenue will be about JPY 240 billion (£1.8 billion) and will be used to reduce CO2 emissions. Originally, the tax scheme was due to be introduced in October 2011 but was postponed to 1 April 2012.

4. Kyushu Electric restarts Genkai Nuclear Power Plant: Kyushu Electric re-started the No.4 nuclear reactor of Genkai Nuclear Power Plant (PWR, 1.18 million kW). The reactor had stopped due to problems with the condenser on 4 October. It is the first reactor to resume operations in Japan since the Fukushima accident.

5. PM Noda establishes National Policy Strategy Council as decision making committee on energy policy: At the 1st meeting of National Policy Strategy Council, it was decided to transfer the Energy and Environment Council, currently under the Government Panel of New Growth Strategies which will be abolished, to the National Policy Strategy Council.  PM Noda, who chairs the Council, suggested that the Council should take the role of ‘commander of Japan’s regeneration’ and discuss various policy issues including budgets.

6. MLIT plans to intensify energy saving obligations for newly constructed buildings and houses: Ministry of Land, Infrastructure, Transport and Tourism (MLIT) is considering  obliging newly constructed buildings and houses to meet an energy saving standard by 2020. MLIT will ask construction companies to apply a certain level of energy saving standards. Currently, about 60% of newly constructed houses do not meet the energy saving standard. MLIT plans to phase in schemes such as tax deduction for energy saving houses starting next year.

7. Government submits a proposal on Rio+20 to the UN: Eyeing the upcoming Rio +20, the Government submitted a proposal to achieve environmentally sound economic development to the UN on 31 October. The proposal describes keys to achieve sustainable development such as disaster prevention, smart cities, and green economy.  Japan’s proposal is here: http://www.mofa.go.jp/announce/announce/2011/10/1031_03.html  (English)

8. Japan accelerates deployment of Smart Meters: According to the Government, 80% of the users of TEPCO, Chubu Electric, and KEPCO should have smart meters in 5 years time.  Among other power companies’ users, it should also reach 60-70%. The Energy and Environment Council will include these smart meter installation ratios among power companies in the next 5 years as part of its action plan for energy demand stabilisation.

Stakeholder engagement

9. UK’s nuclear policy presented at “Yomiuri-IEEJ Joint International Symposium on the Best Energy Portfolio and Nuclear Power”: Lord Hutton delivered his video message on the UK’s current nuclear policy as well as its history among speeches from other high-profile speakers such as METI’s Senior Vice Minister, the Chair of Keidanren’s Committee on Energy and Resources and energy, and nuclear specialists from USA, Germany, France, China, Korea and Malaysia. Keith Franklin, the Embassy’s First Secretary and Nuclear Specialist on temporary secondment from NNL took part in Q&A and panel discussion on behalf of Lord Hutton.

10. Climate Change and Energy section supports the CDP Japan: the Carbon Disclosure Project (CDP), advocating climate change as central to business strategy, held the launch event of its Japan 500 Report. David Warren made opening remarks to over 400 attendees about the importance of carbon management and the incorporation of sustainability concepts into business strategies. The Embassy’s Climate Change and Energy Section had a discussion with Paul Simpson, CEO of the CDP on the financial sector’s role in creating a transition to the low carbon economy before hosting a seminar for CDP champions in Japan. The CDP felt a positive response from Japan.