Japan’s METI Subsidizes Battery Storage, Energy Efficiency, Changes FIT
Japan often seems to exemplify the pushmi-pullyu nature of energy politics. It’s perhaps most evident in the warp and woof of nuclear power’s position since the meltdowns at Fukushima. 
But signs are that renewables may be regaining strength, within limits. In the more favorable news, the country’s Ministry of Economy, Trade and Industry is implementing a $779 million incentive scheme to boost distributed battery storage and energy-efficient technologies.
The other renewables news, which concerns the feed-in tariff rules, seems more double-edged. Last fall, you may remember, half of the utility generators (a loose association of monopolists that are also electricity distributors) refused to sign contracts to purchase renewable energy. Two restarted their programs in December, and three will do so by the middle of this month.
Since Japan’s high FIT program started in July 2012, solar energy has benefited more than other renewables by far. The utilities’ move back to tariff acceptance came after the government instituted a centralizing measure, allowing them to restrict the amount of renewable power they purchase if it would exceed limits set by the ministry. In other words, the government seems to have reserved to itself the ultimate decision-making power. Says Mainichi Shimbun:
Under current rules, power companies can tell suppliers to limit their output of energy generated through solar and wind power without paying compensation for up to 30 days a year, but only for levels reaching 500 kilowatts or more. Under the new rule, the 500 kilowatt restriction will be removed. Additionally, the industry ministry decided to do away with the 30-day limit for the five utilities, as well as for Hokuriku Electric Power Co. and Chugoku Electric Power Co.
By transferring risk from the utilities to the renewable energy providers, the new arrangement could limit activity of clean energy generators in the feed-in tariff system.
However, by providing incentives for distributed battery storage and ramped-up efficiency measures, the Japanese government is continuing to support clean technology development. It’s a delicate balance, but Prime Minister Shinzō Abe seems to enjoy the bongo board. When the electric generator-distributors took action and restricted feed-ins last fall, they justified the slowdown by complaining that inadequate grid technology limited their ability to commit to renewables and caused blackouts.
METI has thus moved to increase and strengthen grid capacity by offering incentives to deploy distributed battery storage at PV power plants and transformer stations. This ultimately benefits solar. METI is also supporting more efficient boilers and LED installations and clean energy equipment for the Fukushima earthquake and tsunami region. The new program aims at the commercial sector: factories and small businesses.
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