Disaster-relief spending may boost energy-saving technologies
JAPAN’S quake, tsunami and nuclear crisis wiped out a quarter of the power-generation capacity in Tokyo and the Kanto region. As the government asks businesses and households to conserve electricity this summer, it is also considering incentives for energy-saving technologies. A green industrial policy, it hopes, would not only help a bit with the power shortage but also boost Japan’s struggling renewables firms.
One idea is to promote solar power by paying businesses and homeowners to feed energy into the grid rather than just buying their excess power, as happens now. Most new homes come with solar panels fitted but there is still scope for increasing the use of these. This might give Japanese panel-makers the scale they need to regain the market lead they have lost to Chinese and American rivals.
Another proposal is to subsidise the cost of installing LED lighting in place of incandescent and fluorescent lamps, which would mean energy savings of 80% and 50% respectively. Yet changing light fittings is expensive, and so are the bulbs themselves: an incandescent bulb costs less than $1, but an LED equivalent is $60, though it is said to last 40 times as long. This too could boost Japanese firms, which helped commercialise LED technology but now struggle against low-cost makers in China and South Korea.
A further suggestion is to subsidise big, rechargeable batteries for the home. These would draw energy from the grid overnight, then be used to reduce peak daytime demand for power. Toshiba is rushing out such a battery, which it had originally planned to start selling in two years’ time, to meet the expected demand from owners of electric cars. Panasonic is also hurrying out a similar home battery.
For the moment, all these are nothing more than proposals. The first disaster-relief bill, this month, included just ¥4 billion ($49m) for publicity to urge Japanese to save energy and ¥3.7 billion for consultants to advise small businesses on conservation. These are trivial sums compared with those being floated in the Japanese press, such as ¥100 billion for a switch to green appliances and LEDs.
Japanese renewables firms’ foreign rivals know it would be hard to object to such subsidies without seeming callous, given the scale of Japan’s post-quake crisis. They also see potential benefits: some of the extra Japanese spending on green-energy devices might flow in their direction; and if Japan’s government is subsidising its renewables firms, that makes it easier for the foreign rivals to demand similar treatment from their governments. One thing everyone agrees on is that in the short term, such energy-saving schemes will be insufficient to compensate for Japan’s lost generating capacity. Only cutting the use of electrical appliances will do that.