METI
Agency for Natural Resources and Energy
Renewable Energy
Fostered by All
Understand the feed-in tariff scheme and cooperate
with us
October 2011
Agency for
Natural Resources and Energy
1
Summary of the Feed-in Tariff Scheme
for Renewable Energy
METI
Agency for Natural Resources and Energy
 This is a scheme to foster renewable energy in Japan with the help of all electricity customers.
 Electric utilities will be obliged to purchase electricity generated from renewable energy sources such as solar PV
and wind power on a fixed-period contract at a fixed price. This will promote the introduction of renewable energy.
 Costs of purchased electricity generated from renewable energy shall be transferred to electricity customers all over
Japan in the form of a nationwide equal surcharge. They shall pay the surcharge for renewable energy proportional
to electricity usage.
Electricity generated from
renewable energy sources
shall be connected to and sent
via the power transmission line
of the electric utility.
Electric utility
etc.
The electric utility shall pay a
fixed price corresponding to
the amount of electricity sent.
Surcharge
Electricity customers
(Costs to purchase the electricity generated from renewable energy shall be shared
by all electricity customers in the form of a surcharge.)
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Household with a solar PV panel installed (example)
METI
Agency for Natural Resources and Energy
 In case of typical household with a 4-kw solar PV panel (that costs about ¥2 million at present) installed, the
monthly electricity charge will be reduced from about ¥7,000 to ¥3,660 by using the electricity generated by the
solar PV panel for the household.
 In addition, by selling the excess electricity generated by the panel, the household will be able to earn about ¥9,000.
Electricity usage and
electricity charge will be
reduced for the amount of
electricity generated
privately.
If more electricity than the
power used in the house is
generated, the excess can
be sold under the feed-in
tariff scheme.
Electricity usage: 300 kWh
Electricity charge: 7,000 yen
Electricity usage: 157 kWh
Electricity charge: 3,660 yen
(including surcharge of 80 yen)
Income obtained by selling electricity:
9,000 yen
Power
generation
with solar
PV panel
Distribution
panel
All electricity customers
shall bear the surcharge
proportional to electricity
usage whether or not they
have solar panels installed
at their houses.
Inverter
Home appliances etc.
Conventional Electricity
meter
purchase
meter
(Note) The above calculation is based on the assumption that the use ratio of solar PV power generation facilities is 12%, the price/kWh of the electricity sold is
42 yen/kWh, redundancy ratio is 60%, electricity usage per month is 3,000 kW and costs 7,000 yen, and the electricity usage of 300 kWh is kept unchanged
in the house even after introduction of solar PV generation.
The surcharge/kWh used here is the price after the renewable energy becomes quite popular (0.5 yen/kWh).
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Mechanism of Feed-in Tariff Scheme
for Renewable Energy
Those engaged in
the power generation
business using
renewable energy
sources
METI
Agency for Natural Resources and Energy
Sale of electricity from
renewable energy sources
Electricity supply
Electric utility
Purchase of electricity
at a fixed price
for a government
specified period
Deliver of
purchase cost
Electricity
customers
Submission of
collected surcharge
Collection of
surcharge together with
the electricity charge
Genki-kun No. 1, symbol of
“Tsuru City, Town of Water”
Cost bearing adjustment organization
Specification of
purchase price and
purchase period
Approval of
facilities
Those who generate
power at home
(Organization to collect and
distribute the surcharge)
Decision of
Surcharge unit price
per kWh
Procurement price calculation committee
(appointment of five committee members
requires consent by the Diet)
Government
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METI
Progress of examination

Agency for Natural Resources and Energy
Feed-in tariff scheme for renewable energy has been examined as follows:
From November 2009
March 2010
From April 2010
A project team on Japan’s Feed-in Tariff Scheme
(five meetings and six hearings were held)
Options for the scheme were presented and opinions were invited on the website
(318 opinions were received until May 2010)
Regional forums were held (Explanatory meetings were held at 21 places throughout Japan
and opinions were invited)
July 2010
From October 2010
“The framework of the system” was announced
Examination of detailed design was started at the council
(Advisory Committee for Natural Resources and Energy)
From November 2011
December 2010
Renewable energy symposium was held (at nine places throughout Japan)
“Report on the Detailed Design (Draft)” was presented and public comments were called for
(8840 comments were received until January 2011)
February 2011
March 2011
August 2011
Compilation of “Report of Feed-in Tariff Scheme Subcommittee”
Cabinet decision of the bill
Passing and approval of the bill (August 26)
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Renewable energy to be purchased
METI
Agency for Natural Resources and Energy
 Fives types of energies:
Solar PV, Wind power,
Small and medium scale hydraulic power
(generation of power below 30,000 kW),
Geothermal power and Biomass (that does
not affect the existing applications such as paper and pulp)
 Those who can newly start power
generation using approved facilities
All of the generated power
shall be purchased
Genki-kun No. 1, symbol of
“Tsuru City, Town of Water”
Source: “Japan’s Energy 2007” by the Agency for Natural Resources and Agency
“The 11th New Energy Award” by New Energy Foundation etc.
 Solar PV power generation for residences (below 10 kW)
 Those who generate power using approved facilities
Excess electricity shall be purchased
• It is not necessary to change the wiring at present. You can use it as it is.
• The more you save energy, the more you can sell electricity and can obtain
more income from sale of electricity.
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Purchase price and purchase period
METI
Agency for Natural Resources and Energy
○ Purchase rate and period shall be decided every year corresponding to the type, form of installation and scale of
renewable energy sources.
○ Specifically, the price and the period shall be decided based on the opinion from an independent committee
(members shall be appointed after authorization by the Diet) after consultation with the ministers concerned
(Minister of Agriculture, Forestry and Fisheries; Minister of Land, Infrastructure, Transport and Tourism; Minister
of the Environment； and Minister of State for Consumer Affairs).
[Reference] Comparison example of current power generation costs
Appointment
requires consent by
the Diet
yen/kWh
50
40
30
After open examination at the third
party committee, the purchase
price and the purchase period shall
be decided.
20
10
< Points >
• Power generation cost
• Profit to be received by those who
installed facilities
• Service life
• Premium price for three years from
the launch of the scheme
etc.
0
(Source)
Geothermal: Geothermal Generation Workshop (June 2009)
LNG: Subcommittee to Study Costs and Other Issues, Electricity Industry Committee (January, 2004)
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METI
Collection and distribution of surcharge
Agency for Natural Resources and Energy
 The equal cost (surcharge/kWh) shall be borne all over Japan. The government shall decide the surcharge/kWh
based on the results of the previous fiscal year. However, enterprises that consume an extremely large amount
of energy (eight times or more the average unit of manufacturers in case of a manufacturer) and customers
affected by the Great East Japan Earthquake shall be exempted from the surcharge.
 Since it is possible that the introduction speed of the renewable energy would vary depending on the region, an
organization to adjust the burden will be established. The surcharge collected by electric utilities shall be first
collected by the cost bearing adjustment organization and then delivered to the electric utilities as grants
corresponding to the actual purchase costs.
Organization
to collect and
distribute the
surcharge
(Cost bearing
adjustment
organization)
This organization first
collects the surcharge
and, after adjusting the
surcharge/kWh so that
it becomes equal all
over Japan, distributes
the necessary cost to
the electric utilities.
Supply of electricity
(Payment for purchased electricity)
Payment of
the purchase cost
(Grant)
Electric utility A
Payment of
Surcharge together
with the electricity
charge
Collected
surcharge
amount
Customers of
electric utility A
Electric utility B
Customers of
electric utility B
Electric utility C
Customers of
electric utility C
Electric utility D
Customers of
electric utility D
Those affected by
the Great East Japan Earthquake
(exempted from surcharge payment from July 1, 2012
to March 31, 2013)
Designation
Government
Approval
Enterprises that consume a large amount of
energy
(exempted from payment of 80% or more of the Surcharge)
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Relationship with the current Excess Electricity
Purchasing Scheme for Solar PV Power
METI
Agency for Natural Resources and Energy
 Excess Electricity Purchasing Scheme has been already introduced for solar PV power generation systems.
The electricity purchased under this scheme will be continuously purchased under the newly introduced Feed-in
Tariff scheme for renewable energy.
Mechanism of Excess Electricity Purchasing
Scheme for Solar PV Power
Solar energy
Support of Future
Support by All
Unused electricity
among generated power
[Solar PV power generation]
Electricity customers
Income
by sale
Electric
utility
(¥42kWh for residences)
(¥40/kWh for non-residences)
Electricity
Surcharge to promote
solar PV power generation*
Understand the Excess Electricity
Purchasing Scheme for Solar PV Power
and cooperate with us.
(borne by all electricity customers)
[Institutions]
[Residences]
[Offices]
* Cost required for purchase of excess electricity from solar PV power . It is added to the ordinary
electricity charge and borne by all electricity customers.
Scope of purchased electricity is enlarged to that from
other renewable energy sources; all generated
electricity will be purchased
Renewable Energy
Fostered by All
Understand the feed-in tariff scheme and
cooperate with us
Genki-kun No. 1, symbol of
“Tsuru City, Town of Water”
9
(Reference) Difference from the Excess Electricity
Purchasing Scheme for Solar PV Power
Excess Electricity Purchasing
Scheme for solar PV Power
METI
Agency for Natural Resources and Energy
Feed-in Tariff Scheme for Renewable Energy
Generated electricity is entirely purchased
Excess electricity is purchased
All generated
electricity
(purchased)
<Image of excess electricity in case of a residence>
Excess
electricity
(purchased)
Electricity generated
with solar PV
Electricity consumed
in the residence
Electricity generated from renewable energy sources
In case of electricity from solar PV system for residences, excess electricity will be
continuously purchased.
Excess
electricity
(purchased)
Purchase rate and purchase period
Decided after invitation of opinions from the general public on
the basis of discussion at the governmental council.
Residences
¥42/kWh
for ten years
Non-residences
Electricity generated by
solar PV system
Electricity consumed
in the residence
Purchase rate and purchase period
After consultation with the ministers concerned, the purchase price and
purchase period corresponding to energy source, form of installation and
scale shall be decided based on the opinion from the third-party committee.
The price and period shall be fixed after invitation of public comments.
<Image>
¥40/kWh
for ten years
* Price is for FY 2011
Cost bearing
Cost bearing
Electric utility
Electricity customers
Adjustment organization
Surcharge will be collected by each electric utility.
Electric utility
Electricity customers
Adjustment to make the surcharge equal all over Japan
10
Handling of existing renewable energy power
generation facilities
METI
Agency for Natural Resources and Energy
 Industrial power generation facilities using renewable energy sources are already subject to the Renewables
Portfolio Standard (RPS) system introduced in 2003. This system obliges electric utilities to procure a certain
amount of renewable energy and has largely contributed to increased use of renewable energy in Japan so
far.
 New Feed-in Tariff Scheme is for the facilities newly installed. About 1,400 existing facilities for power
generation can continue their operation under the same environment as before under the RPS Act.
Transfer from RPS system to
Feed-in Tariff Scheme
(100 million kWh)
120.0
110.3 110.3
100.0
74.3
80.0
65.1
60.0
40.0
20.0
0.0
49.1
40.6
32.8
FY
2003
15年度
36.0
55.8
38.3
91.7
89.1
86.1
79.2
74.7
60.7
44.4
Results of supply
供給実績
Total of obliged amount imposed
on the electric utilities
Image of total obliged amount
imposed on the electric utilities during
the transitional measure period
各電気事業者に課してきた義務量の合計
FY 2004 17年度
FY 2005 18年度
FY 2006 19年度
FY 2007 20年度
FY 2008 21年度
FY 2009 22年度
FY 2010 23年度
FY 2011 24年度
FY 2012 25年度
FY 2013 26年度
FY 2014
16年度
* Total supply of electricity all over Japan in FY 2009 was 874,100 million kWh
(Electric Power Investigation Statistics, Agency for Natural Resources and Agency)
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Other important matters
METI
Agency for Natural Resources and Energy
Review of the Scheme
 The Act clearly specifies that the scheme should be actively reviewed corresponding to the actual situation.
 The scheme shall be reviewed at least every three years. In addition, if the Basic Energy Plan is
changed, the scheme shall be reviewed on the basis of the contents of the plan after change.
 The scheme shall be drastically reviewed by FY 2020.
Responsibility of the Government
 The government will further enhance PR activities. Further, it will use all possible measures including
research and development promotion and review of various regulations in order to popularize renewable
energy.
Responsibilities of Electric Utilities and Renewable Energy Enterprises
 Electric utilities and renewable energy enterprises are required to make efforts in cost reduction.
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