Japan accelerates purchase of surplus solar electricity at homes

Nov 1, 2009 - The Associated Press

The government launched Sunday a new program that enables power companies to purchase at higher rates surplus electricity produced by solar power generation systems installed in homes, schools and hospitals.

The move is Japan's latest attempt to make photovoltaic generation, which is cleaner in terms of carbon emissions than fossil fuels, more popular at the public level and to step up efforts to fight global warming.

On Saturday, the government said it may further accelerate such efforts, with Deputy Prime Minister Naoto Kan expressing his hope to launch another program during the year through March 2011, under which utility companies would buy all the solar electricity generated at homes and elsewhere.

Kan said that would help give incentives to people to install solar panels on their roofs with "the state not required to spend even 1 yen."

Japanese power companies had earlier introduced their own purchase programs for surplus home-generated electricity. But it was left up to them how much they pay for it.

Under the program begun Sunday, effective through the next 10 years, many of the utility firms will almost double payments to 48 yen for each kilowatt generated per hour by households and 24 yen by schools, hospitals and other facilities.

To cover the rise in costs, the electricity companies will collect a monthly surcharge of around 30 yen from every household and organization using electricity in the country, starting in April.

The surcharge is expected to rise to 50 to 100 yen in the next five to 10 years and critics say the additional burden will only weaken consumer sentiment, delaying Japan's emergence from the economic downturn.

The number of Japanese homes with solar power generation systems has been increasing due mainly to a government subsidy program reintroduced in January, the Ministry of Economy, Trade and Industry said.

But some utility company officials say they are concerned that the new purchase program could fail to win people's understanding.

In order to fight global warming, Prime Minister Yukio Hatoyama has pledged to cut carbon dioxide and other greenhouse gas emissions 25 percent from 1990 levels by 2020 on the condition that large economies such as China and India join a post-Kyoto framework being discussed to reduce such emissions.

The government and Hatoyama's ruling Democratic Party of Japan are also considering allowing power companies to buy electricity generated using other renewable energy sources such as wind and geothermal heat.

Experts say, however, that the government must urgently study measures to prevent such policies from adding to the burden on low income households.