Japan subsidies spur 200 MW of geothermal plans - report

Dec 14, 2012 - There are plans for eight geothermal power plants totalling up to 200 MW in Japan as companies look to take advantage of renewable energy subsidies, Nikkei reported today.

While no such plants have been constructed in the country since 1999, the subsidy programme of the ministry of economy, trade and industry has reinvigorate interest, according to the report.

Tohoku Electric Power Co (TYO:9506) plans to build an about 50-MW facility in a quasi-national park in the northern part of Honshu island, while JX Nippon Mining and Metals Corp looks to construct a 40-MW project in Sapporo city in Hokkaido. The companies planning geothermal facilities also include Idemitsu Kosan Co (TYO:5019) as well as Japan Petroleum Exploration Co (TYO:1662), which seeks to establish a plant with a capacity of tens of megawatts.

The ministry is to allocate JPY 20 billion (USD 239m/EUR 183m) to support site surveys and facility construction. The deadline for applications for the incentive is expected to be extended from November 30 to the year end so the number of the planned projects could increase.

Regulations for projects in national and quasi-national parks have been relaxed and geothermal energy will also be able to benefit from renewable feed-in tariffs.

Japan can rank among the biggest geothermal power producers globally, as its estimated geothermal resource is 23.5 GW, according to a study from June by Bloomberg New Energy Finance. Yet, 80% of the suitable sites for geothermal projects are in national parks, where restrictions have been in place for years to save the landscape and ecosystems.

(JPY 100 = USD 1.194/EUR 0.913)

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