KOTRA Publishes Report on 'Japan's Renewable Energy Expansion Strategy Analysis'

Japan's Decarbonization Policies and Trends... "Highlighting the Core"

[Asia Economy Reporter Park Sun-mi] Amid the rapidly spreading global movement toward carbon neutrality, KOTRA has closely examined the Japanese government's key policy goals for carbon neutrality and policies to expand the supply of renewable energy through its report titled "Analysis of Japan's Renewable Energy Expansion Strategy and Implications."

On the 2nd, KOTRA summarized Japan's basic strategy to realize the goal of making renewable energy the main power source as 'S+3E' in the report. 'S+3E' means achieving the goals of safety (S) as a major premise, stable energy self-sufficiency (E) of 25% by 2030, economic efficiency (E) through reduction of power generation costs, and eco-friendliness (E) for greenhouse gas emission reduction simultaneously.

Securing price competitiveness of renewable energy is a prerequisite for making renewable energy the main power source. It was reported that the cost incurred by power companies to purchase renewable energy electricity is charged to electricity bills paid by households and businesses, amounting to 2.7 trillion yen as of 2021. To suppress the potential burden on the public that may increase with the expansion of renewable energy, the Japanese government introduced the Feed-in Premium (FIP) system in April 2022, which links renewable energy power purchase costs to market prices instead of fixed prices.

Additionally, to expand the introduction of renewable energy in harmony with local communities, measures were established to mandate consultations with local areas when installing renewable energy power generation facilities such as offshore wind power. As concerns from local governments increased due to abandoned or illegally disposed solar panels, the system was strengthened to allow power generation businesses to secure disposal costs for solar power facilities in advance.

Renewable energies such as solar and wind are dispersed in small scales depending on regional site characteristics, making the maintenance of the grid (transmission network) connecting generation and consumption areas an important task. Therefore, to efficiently utilize the existing grid mainly built for thermal power generation while expanding renewable energy grid connections, a conditional renewable energy connection method called non-firm connection has been implemented since 2021.

Through this report, KOTRA advised that South Korea also needs to prepare with specific implementation strategies, customized support, deregulation, and technological innovation to expand renewable energy.

First, to achieve the challenging goal of carbon neutrality, it is urgent to establish technology development roadmaps for key sectors and to specify phased execution plans for industry-wide response and dissemination. Second, to expand the supply of renewable energy, it is important to remove existing obstacles and strengthen customized support. Furthermore, long-term support for next-generation technology development and commercialization is required so that the transition to renewable energy can become a growth opportunity rather than a constraint on economic growth.

Kim Tae-ho, Head of KOTRA's Economic and Trade Cooperation Headquarters, said, "We also need to present a consistent policy direction and linked growth strategy to achieve the long-term goal of carbon neutrality by 2050," adding, "We will support exploring new entry opportunities in the Japanese renewable energy market by seeking entry methods through collaboration such as forming consortia with local companies."

This content was produced with the assistance of AI translation services.