Illegal Behavior by Tohoku Denryoku Must Stop Immediately

Tetsunari Iida just pointed with this tweet to an article at Mainichi Shimbun (in Japanese) reporting on the illegal and corrupt behavior of Tohoku Denryoku, the utility trusted with the monopoly to serve North Eastern Japan.

The article says that Tohoku Denryoku has decided to allow 26 wind power projects to go ahead, with a total of 3.4 GW of capacity.

Update: I’m sorry, I messed up in the translation. That should be 340 MW of capacity.

Apparently, they have not changed their practice of announcing a ceiling for the amount of wind energy they might be inclined to buy and then choose between proposals of wind projects.

This is of course clearly illegal under the new feed-in tariff system. The first thing any feed-in tariff system needs to make sure is that utilities have no influence on who gets to do any projects. They have to be required by law to buy the electricity. They don’t get to choose projects.

For the record, here again is the relevant Article of the Japanese feed-in tariff law, in my translation:

Article 4

Note: The original Japanese text of Paragraph one is quite unreadable. Like many modern Japanese laws it contains inserts in brackets that are confusing and damaging to clarity. To illustrate (illustrating means explaining by example (example is meant in the usual way, so this insert may be ignored) to the readers) I have just written an example for a sentence containing two inserts nested into each other.

This might be acceptable when writing computer programs. It is not when writing a text you want people to understand.

To deal with this problem, I am just leaving out most of the stuff inserted in my translation. While losing some of the meaning in the process, the gain in clarity by far outweighs that. As far as it is necessary to keep the content, I reject the original nested construction of the sentence and write some normal prose more easily understood by readers instead.

This said, here we go again:

——–

(Duty to accept an offer for special contract)

Article 4

(1)  When a supplier of renewable energy extends an offer regarding renewable energy to an electric utility at the feed-in tariff and for the period specified in the Ordinance of the Minister of Economy, Trade and Industry, the utility must accept it. However, when the content of the offer would be damaging to important interests of the utility or other valid reasons as specified in the Ordinance of the Minister of Economy, Trade and Industry apply, the utility may refuse the offer.

(2) When it is necessary to assure the smooth conclusion of special contracts, the Minister of Economy, Trade and Industry may offer the necessary advice and orientation to an electric utility.

(3) When an electric utility refuses to conclude a special contract without a valid reason, the Minister of Economy, Trade and Industry may recommend to the utility to accept the offer.

(4) When an electric utility after receiving the recommendation of the previous Paragraph without a valid reason fails to take the measures to implement it, the Minister of Economy, Trade and Industry may order it to take the measures implementing the recommendation.

This Article, while not perfect since it allows for refusing to buy for vague reasons, does contain a sanction mechanism.

Article 4 of the Economic Ministry Ordinance 46 of 18 June gives some more detail on when an utility may refuse buying. For example, if the operator of a wind farm is involved in organized crime, or for smaller scale utilities (not for Tohoku Denryoku) if the expected amount of electricity is too much for them to handle.

No exceptions provided there seem to apply for this practice of Tohoku Denryoku.

Obviously, violating the law in this systematic way is not acceptable. The Minister of Economy, Trade and Industry should “offer the necessary advice” to Tohoku Denryoku.

“Obey the law” would seem to be the advice called for in this case.

 

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

6 thoughts on “Illegal Behavior by Tohoku Denryoku Must Stop Immediately

    1. The bright side is that now we will see if the sanctions in the new law are sufficient. Maybe some of the developers snubbed can sue Tohoku Denryoku under the law and set a precedent. You can’t do that if they obey the law in the first place.

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  1. But 3.4 GW is already some very significant capacity. I mean it’s plausible that they know their grid capacity will not allow them to receive more than that without some large upgrade that they don’t have the time to do soon enough.

    And upgrades frequently requires local approval that frequently takes a lot of time, even in Germany they are some major problems with approval for the grid deployment that end up not allowing the electricity in the north to reach the south.

    Actually I think, in the German article you just previously linked to, we see a more similar spirit showing out than would be expected : “Wir lassen den Zubau von Windenergie nur dann zu, wenn die Trassen wirklich stehen” (Let’s allow the building of wind power only the required lines are really there, from http://www.wiwo.de/politik/deutschland/energiewende-liebe-leute-so-geht-es-nicht-weiter/7374704.html ).
    There’s also the politician who wants to change the renewable the law to give more leeway to decide what deployment makes sense : “[…] forderte deshalb eine rasche Reform des Erneuerbare-Energien-Gesetzes (EEG). Es gebe dem Staat bislang nicht genügend Möglichkeiten, die Entwicklung zu steuern,”.
    And not anymore have to blindly approve all projects.

    China is the one country that built some very large renewable capacity without caring about grid constraints. At one point, they had several tens of GW wind power that were actually contributing nothing to the grid.
    And therefore it was a complete waste and they were still using just as much coal power.

    I can understand why people want to build wind power in the north of Japan first, there’s more wind and also more room, the land is cheaper and a bit less crowded.
    But if Tohoku Denryoku says no they’ll have to reconsider and probably invest their money rather more in the south where the newly built capacity will be able to actually reach customers sooner.

    OTOH this show a negative side ot FIT’s, as project all receive the same subsidy, they all want to build the capacity where it’s easier, and don’t care at all if it can be integrated easily in the grid. I wonder if this could be enhanced, whilst keeping the strengths of FIT for pushing for more deployment, by giving a premium to those who accept to invest in the less popular areas, and organizing a bid contest in the too popular one to see if they are ready to accept a lower FIT in exchange for a higher priority to their project.

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  2. First off, I messed up with the translation. It needs to be 340 MW instead of 3.4 GW.

    Then, you are right that indeed SPIEGEL just published another interview with someone who thinks renewable deployment in Germany moves too fast. And you are also right that there are some problems with the grid, most clearly with offshore where projects are delayed because the power lines don’t get build in time.

    The German FIT for wind pays different rates for different locations already, depending on the wind resource (the Japanese does not). One might think of doing something like this with location relative to the grid, as you propose. Sounds convincing to me.

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  3. If it’s only 340 MW, then yes it doesn’t sound like it’s enough to cause any serious problem to integrate that in the grid.

    About that article, the source here in not Der Spiegel, it’s coming from Handelsblatt which belong to the same groupe as the Wall Street Journal. Anyway let’s not shoot the messenger except if we believe he’s lying, but I don’t expect that the chief of the German energy agency and EU energy Commissioner would accept that newspapers misrepresent what they are saying ?

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  4. Yes, the article you cited is in Handelsblatt, but Handelsblatt in turn was citing SPIEGEL. I have blogged about that Kohler interview here:

    http://k.lenz.name/LB/?p=8168

    I don’t assert that anyone misrepresents what Kohler said, I just don’t agree with him.

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