It’s 38 °C on
the Atsumi Peninsula southwest of Tokyo: a deadly heat wave has been
gripping much of Japan late this summer. Inside the offices of a newly
built power plant operated by the plastics company Mitsui Chemicals, the
AC is blasting. Outside, 215,000 solar panels are converting the
blistering sunlight into 50 megawatts of electricity for the local grid.
Three 118-meter-high wind turbines erected at the site add six
megawatts of generation capacity to back up the solar panels during the
winter.
Mitsui’s plant is just one of thousands of renewable-power
installations under way as Japan confronts its third summer in a row
without use of the nuclear reactors that had delivered almost 30 percent
of its electricity. In Japan people refer to the earthquake and nuclear
disaster at Tokyo Electric Power Company’s Fukushima Daiichi nuclear
power plant on March 11, 2011, as “Three-Eleven.” Radioactive
contamination forced more than 100,000 people to evacuate and terrified
millions more. It also sent a shock wave through Japan’s already fragile
manufacturing sector, which is the country’s second-largest employer
and accounts for 18 percent of its economy.
Eleven of Japan’s 54 nuclear reactors shut down on the day of the
earthquake. One year later every reactor in Japan was out of service;
each had to be upgraded to meet heightened safety standards and then get
in a queue for inspections. During my visit this summer, Japan was
still without nuclear power, and only aggressive energy conservation
kept the lights on. Meanwhile, the country was using so much more
imported fossil fuel that electricity prices were up by about 20 percent
for homes and 30 percent for businesses, according to Japan’s Ministry
of Economy, Trade, and Industry (METI).
The post-Fukushima energy crisis, however, has fueled hopes for the
country’s renewable-power industry, particularly its solar businesses.
As one of his last moves before leaving office in the summer of 2011,
Prime Minister Naoto Kan established potentially lucrative feed-in
tariffs to stimulate the installation of solar, wind, and other forms of
renewable energy. Feed-in tariffs set a premium rate at which utilities
must purchase power generated from such sources.
The government incentive is what motivated Mitsui to finally make use
of land originally purchased for an automotive plastics factory that
was never built because carmakers moved manufacturing operations
overseas. The site had sat idle for 21 years before Mitsui assembled a
consortium to help finance a $180 million investment in solar panels and
wind turbines. By moving fast, Mitsui and its six partners qualified
for 2012 feed-in tariffs that promised industrial-scale solar facilities
40 yen (35 cents) per kilowatt-hour generated for 20 years. At that
price, says Shin Fukuda, the former nuclear engineer who runs Mitsui’s
energy and environment business, the consortium should earn back its
investment in 10 years and collect substantial profits from the
renewable facility for at least another decade.
Sanyo
Electric’s so-called Solar Ark, built in 2001 during the heyday of the
country’s initial solar boom, was designed to generate 630 kilowatts of
power, making it one of the world’s largest solar facilities. It boasts
5,046 solar panels.
Overnight, Japan has become the world’s hottest solar market: in less
than two years after Fukushima melted down, the country more than
doubled its solar generating capacity. According to METI, developers
installed nearly 10 gigawatts of renewable generating capacity through
the end of April 2014, including 9.6 gigawatts of photovoltaics. (The
nuclear reactors at Fukushima Daiichi had 4.7 gigawatts of capacity;
overall, the country has around 290 gigawatts of installed
electricity-generating capacity.) Three-quarters of the new solar
capacity was in large-scale installations such as Mitsui’s.
Yet this explosion of solar capacity marks a bittersweet triumph for
Japan’s solar-panel manufacturers, which had led the design of
photovoltaics in the 1980s and launched the global solar industry in the
1990s. Bitter because most of the millions of panels being installed
are imports made outside the country. Even some Japanese manufacturers,
including early market leader Sharp, have taken to buying panels
produced abroad and selling them in Japan.
How Japan—once the world’s most advanced semiconductor producer and
a pioneer in using that technology to manufacture photovoltaic
cells—gave away its solar industry is a story of national insecurity,
monopoly power, and money-driven politics. It is also a tale with
important lessons for those who believe that the strength of renewable
technologies will provide sufficient incentives for countries to
transform their energy habits.
In Japan, for most of the 2000s, impressive advances in photovoltaics
were ignored because the country’s powerful utilities exerted their
political muscle to favor nuclear power. And despite resurging consumer
demand for solar power and strong public disdain for nuclear, the same
thing could happen again. Will a country with few fossil-fuel resources
and bleak memories of the Fukushima disaster take advantage of its
technical expertise to recapture its position as a leading producer of
photovoltaics, or will it turn away from renewable energy once more?
Riches
Longer than three football fields and over 37 meters tall, the Solar
Ark is clearly visible from the Tokkaido Shinkansen as the bullet train
crosses central Japan. The structure, covered with photovoltaic panels,
looks like a temple of energy from another era—a time when Japan owned
the solar-power industry. Sanyo erected the Ark in 2001, arraying on it
5,046 solar panels capable of generating 630 kilowatts of pollution-free
electricity.
An
image from Japanese television captures smoke rising after a hydrogen
explosion at Fukushima Daiichi’s unit 3 on March 14, 2011, days after
the initial earthquake. Following the Fukushima disaster, all the
country’s nuclear reactors were shut down.
The era that gave rise to this feat began with the energy crises of
the 1970s, when spiking global petroleum prices pummeled Japan’s
export-driven manufacturing economy. The country harnessed its dominance
in the production of electronic semiconductor chips to pursue
alternatives for cleaner, safer power in photovoltaics. And unlike other
countries, such as the United States, it stuck with the resulting solar
development programs even when oil prices dropped in the 1980s. Between
1985 and 2007, Japanese researchers filed for more than twice as many
patents in solar technologies as rival U.S. and European inventors
combined. Companies like Sharp, Sanyo Electric, Panasonic, and Kyocera
became the clear leaders in solar technology. Japanese producers began
ramping up sales and solar installations in the 1990s. By 2001 total
solar-power output in Japan was 500 times higher than it had been a
decade earlier—a decade in which U.S. solar generation edged up by a
meager 15 percent.
Then it all came crashing to a halt a decade ago as the country staked its future on nuclear power.
The government’s nuclear plans were ambitious: by the time Fukushima
Daiichi melted down, they would call for 14 additional reactors by 2030,
which would have nearly doubled nuclear generation to account for 50
percent of Japan’s power supply. Meanwhile, photovoltaic sales in Japan
declined during the mid-2000s, and by 2007 Japanese producers had ceded
global market leadership to U.S., Chinese, and European manufacturers.
In just a few years, the country had gone from industry leader to
has-been.
What turned Japan away from the sun was a pernicious blend of
perception, culture, and politics. Nuclear power had an aura of
strength, while energy based on intermittent renewable power sources
looked weak and unreliable—an impression encouraged by the country’s
politically powerful utilities. Though Japan has numerous locations that
are ideal for wind and solar power, power companies convinced the
public that energy choices were limited. “We are really severely of the
mind-set that we lack resources and that Japan has to depend on imported
fuel,” says Mika Ohbayashi, director of the Tokyo-based Japan Renewable
Energy Foundation.
What turned Japan away from the sun was a pernicious blend of perception, culture, and politics.
The utilities’ view was colored by self-interest. Japan’s 10
utilities were (and remain) vertical monopolies. Each controls power
generation, transmission, and distribution in its respective region, and
its grids are designed to deliver electricity from centralized power
plants—including large nuclear reactors. They lack, by design, the
interconnections that facilitate the safe use of variable power
generation. In most industrialized countries, governments have broken up
the monopolies in power markets, freeing operators of transmission
grids to build those interconnections, but Japan’s utilities have bucked
the deregulation trend. The interconnection problem is further
compounded by an artifact: two AC frequencies that split the country’s
electrical system in half. Eastern Japan operates at 50 hertz, while
western Japan uses 60-hertz power—a barrier that proved crippling in
2011, in the immediate aftermath of the Fukushima disaster, when a
suddenly underpowered Tokyo could access little of Osaka’s surplus
power.
Asked why Japan chose not to push solar power aggressively when it
dominated the global industry, former prime minister Kan told me he puts
the blame squarely on the country’s utilities: “The reason is very
clear. The electric power companies, the people who wanted to promote
nuclear power, were opposed.”
Revival
In a subdivision spreading over reclaimed land in the bay in Ashiya, a
city between Osaka and Kobe, a 400-unit residential development called
Smart City Shio-Ashiya (“Salty-Ashiya”) is taking shape, the brainchild
of the Panasonic subsidiary PanaHome. On a Sunday in July, solar panels
atop each of the 50 houses built to date are pumping surplus power into
the local grid, and PanaHome salespeople are selling a couple with
toddlers on the homes’ energy benefits and earthquake resistance.
Shio-Ashiya’s two-story homes include geothermal heating and cooling
and other green design features to minimize power consumption, while the
high-efficiency rooftop solar panels maximize power generation. The
surplus power should, according to PanaHome saleswoman Saho Watanabe,
earn residents roughly 100,000 yen ($825) each year. Watanabe touts
another feature, which should be invaluable when the grid goes down—say,
in an earthquake or typhoon. She opens a cupboard in the dining room of
a model home to reveal a lithium battery that, working with an energy
management system near the kitchen, can run the family’s AC/heat pumps,
first-floor lighting, and refrigerator for about two days.
Panasonic’s solar hopes rest on a technology invented by
researchers at Sanyo in the 1990s and acquired by Panasonic four years
ago when the corporations merged. The solar cells combine conventional
crystalline-silicon and thin-film amorphous-silicon technologies to
achieve relatively high efficiency in converting sunlight to
electricity. Called HIT, for heterojunction with intrinsic thin layer,
the hybrid technology has become a mainstay of the company’s solar
strategy.
Shingo Okamoto, a materials scientist who spent his career at Sanyo
Electric before becoming director of solar R&D for Panasonic’s
EcoSolutions business group, says the panels are earning premium pricing
in domestic sales because they produce far more electricity from a
given rooftop than the cheaper polycrystalline panels that dominate the
market. Assuming that each household consumes electricity at the
Japanese average of 1,400 kilowatt-hours per year during daylight hours,
he says, a household with the Panasonic system will have 52 percent
more surplus power to return to the grid than a home with an ordinary
solar system.
Residential power in Japan is pricey—at 24.33 yen (20 cents) per
kilowatt-hour in 2013, it was nearly double the U.S. average. And given
that electricity prices are “sure to keep going up,” says Okamoto, the
most efficient rooftop photovoltaic systems will have a strong
advantage. When we met in July at Panasonic’s Shiga plant, east of
Kyoto, the plant had just started shipping its newest and most powerful
panel design. The advances behind the panel, which uses cells with an
efficiency of 22.5 percent, include a light-scattering film on the
backside to enhance light absorption. Assembly lines were running 24
hours a day to keep up with domestic demand.
Further advances are in the pipeline. In April, Okamoto’s group
produced a silicon solar cell that reached 25.6 percent efficiency,
breaking a 15-year-old world record of 25.0 percent. Though the record
was set in the lab using a prototype device, Okamoto predicts that the
group will ultimately be able to produce commercial cells whose
efficiency is within a few percentage points of crystalline silicon’s
theoretical limit, 29 percent.
Repowering
Across the coastal mountains from the smashed reactors at Fukushima
Daiichi and the contaminated landscape they created, one of the world’s
most advanced facilities dedicated to renewable-energy R&D is
gearing up. The $100 million complex opened in April in Koriyama,
Fukushima Prefecture’s commercial center, and pulls together previously
disparate research by Japan’s science and technology agencies. The
institute is not here by accident. It’s an explicit commitment to the
emotionally and economically devastated region.
The verdant prefecture north of Tokyo remains depopulated after the
earthquake, tsunami, and meltdowns of March 2011. Many of the more than
100,000 residents rendered homeless by the disasters will never return.
Replacing lost residents and businesses in an area known for radioactive
contamination is not easy. Solar-powered radioactivity monitors in
Koriyama show that the air is safe, but 100 kilometers to the east,
Tokyo Electric Power Company (TEPCO) still struggles to keep
contamination from polluting both groundwater and the sea.
The Koriyama R&D facility boasts state-of-the-art labs for
crystallizing, slicing, and patterning silicon wafers, and its
production line can churn out up to 360 wafers an hour. Outside, a
variety of photovoltaics are being tested, along with a modest-sized
wind turbine and a large grid-connected battery. Its most ambitious
program is directed by Makoto Konagai, one of Japan’s most celebrated
solar scientists, who has moved to Koriyama from the Tokyo Institute of
Technology. His goal is to smash through the theoretical efficiency
limit of silicon cells, demonstrating rates of 30 percent by 2016 and up
to 40 percent by 2021. It is an ambitious plan, but three large
manufacturers, including Panasonic, have signed on.
Workers
watched in October as a crane lifted a section of a radiation shroud
that had been placed over a reactor at Fukushima after the earthquake.
Lifting the cover exposed the debris inside the destroyed building for
the first time since 2011.
While some other researchers seek more efficient alternatives to
silicon, which accounts for 90 percent of current solar production,
Konagai seeks to redesign the silicon cell from top to bottom. One of
his teams, for example, is developing a casting method to produce
higher-quality silicon ingots. Another team is rethinking the way
semiconductor structures are patterned to turn silicon wafers into
cells: Konagai’s plan is to etch or build vertical structures just a few
nanometers across, almost 100,000 times narrower than the silicon wafer
itself. If his simulations are good, the resulting nanowires or
nanowalls will alter the electrical behavior of the silicon within,
boosting its potential to absorb light and gather electrical charge.
In June 2011, Fukushima’s previously pro-nuclear governor, Yuhei
Sato, declared that Fukushima should pin its future on renewable energy.
Community activists initiated dozens of projects across the prefecture,
and in 2012 it set a goal of increasing renewable energy from 22
percent to 100 percent of its power supply by 2040.
The cold reality of Japan’s energy predicament, however, is that such
bold ambitions are likely to fall short. The type of solar expansion
that can be expected from feed-in tariffs alone isn’t likely to meet the
prefecture’s goals—or even to replace the power that Japan’s nuclear
fleet once delivered. And political and economic forces don’t seem to
favor policies that would expand renewables more dramatically.
Projections by the Japan Photovoltaic Energy Association, a
Tokyo-based trade group, suggest that annual solar installations will
peak this year just shy of seven gigawatts. The group predicts that
total installed solar capacity in Japan will reach 102 gigawatts by
2030, which would be enough to meet only a small fraction of the
country’s electricity needs. Moderate deployment of wind power would
provide some additional electricity. But Japan needs far more. While
Japanese consumers and industry have cut power demand since 2011,
utilities covered most of the nuclear shortfall by ramping up combustion
of imported natural gas, petroleum, and coal. Fossil fuels accounted
for some 89 percent of Japan’s electricity generation in 2012. As a
result, its total greenhouse-gas emissions were 7 percent higher that
year than in 2010.
The prospects for renewable power could get worse. To hedge against
the possibility that they may be unable to restart nuclear reactors,
utilities are building a new generation of coal-fired power stations. By
Ohbayashi’s count, some 13 gigawatts of new coal-fired power generation
are now in development.
Meanwhile, the relatively high cost of Japan’s solar power threatens
to incite a backlash against renewable energy, encouraged by the
pro-nuclear utilities. “There is no doubt that with the current
photovoltaics, power generation is expensive,” says Okamoto, expressing
his personal viewpoint rather than Panasonic’s. He fears negative
reactions from ratepayers, whose rising power bills pay the tariffs that
fund photovoltaic systems on rooftops and at power plants like Mitsui
Chemicals’: “If we continue to expand our business with the current
level of costs, we may have objections.”
What’s more, the old politics that favor nuclear power seem to be
returning. Though opinion polls consistently show that a majority of
Japanese oppose restarting the utilities’ idled reactors, Prime Minister
Shinzo Abe vows to restart those deemed safe by Japan’s Nuclear
Regulation Authority. In July the agency issued the first such
certification, to a pair of reactors on the southern island of
Kyushu—even though offsite emergency control centers mandated after
Fukushima have yet to be completed and the reactors are dangerously
close to an active volcano. Iodine pills were quickly distributed to the
reactors’ neighbors, and the precedent-setting restart is expected
soon, after getting the green light from the local governor and the
plant’s host city, Satsumasendai, whose economy is crippled without the
jobs, tax dollars, and business that the plant provides.
At the same time, utilities are delaying grid connections to
renewable developments or imposing grid-upgrade fees that render
renewable projects infeasible. The pushback is hitting wind power
hardest. Japan’s meager market for wind turbines has actually slowed since Fukushima.
This summer METI launched a committee to manage the implementation of
new energy policies. One topic: recent efforts by utilities and the
government to restrain further solar installations. Ohbayashi says METI
is backpedaling because it misjudged the commercial potential of
renewables and their potential impact on the utilities. Says Ohbayashi,
“They didn’t foresee the explosive growth of photovoltaics.”
The Japanese government has plans to radically overhaul the country’s
balkanized wholesale market and power grid, preparing for a future in
which producers compete for the right to deliver power. In that
scenario, renewable energy could thrive.
The most critical step, however, is still years away: forcing the
vertically integrated utilities to “unbundle” their power generation and
transmission businesses. Unbundling is essential to create a level
playing field for producers and a system optimized to deliver the
cheapest and cleanest power available in real time.
Reëngineering the grid to accommodate massive flows of renewables
such as wind and solar is a potentially expensive route for Japan.
However, it’s not necessarily more costly than the path back to nuclear
that the current government and the utilities are charting. Factoring in
the cost of insurance against accidents and upgrades to prevent them
could double the cost of nuclear energy.
As former prime minister Naoto Kan told me, the disaster at Fukushima
Daiichi has forever altered the economics of nuclear power. “In the
past, nuclear power was said to be able to supply power at a very cheap
cost, but we know now that is not correct,” he said. “That calculation
assumed that no accidents could occur. Now we know they can.”
Peter Fairley is a contributing editor for
MIT Technology Review.