TOKYO -- Biomass power plants in Japan will be able to meet the electricity needs of at least 9 million households by the early 2020s, up 50% from the current level, a sign that power generation by burning wood chips and other renewable materials is catching on here.
Forty-two companies responding to a Nikkei survey sent to 45 companies, including major power providers and members of a renewable energy industry group, have a combined biomass power generation capacity of 800,000kW, and that is set to increase by 1.7 million kilowatts by 2023.
Overall biomass power generation in Japan currently stands at 3.1 million kilowatts, only about a tenth of solar power. But the figure is expected to rise at least 50% to 4.8 million kilowatts by the early 2020s, accounting for 3% or more of the country's power consumption. Investment is seen exceeding 700 billion yen ($6.42 billion).
The price of solar power has continued to fall under the government's feed-in tariff program, which requires utilities to purchase power generated from renewable energy sources at fixed rates, resulting in biomass power fetching a higher price starting this year. Meanwhile, power generation costs are about the same for both types of energy.
But biomass power is not influenced by the weather and time of day the way solar energy is. Biomass energy actually produces about four times as much electricity as solar when the capacity is the same. This profitability advantage is fueling the emergence of biomass energy.
Electricity supplier eRex will set up a 50,000kW biomass plant in Okinawa Prefecture in collaboration with Okinawa Gas. The plant is to start operations in fiscal 2020, with its output to be sold to businesses and households on the prefecture's main island. In western Japan, eRex will set up a 75,000kW biomass plant. Investment is seen totaling around 50 billion yen.
These and other steps will quintuple eRex's total power generation capacity to 350,000kW. The company will import fuel made of palm kernel shells and other materials from Southeast Asia.
Midtier renewable energy company Renova will invest a little over 30 billion yen in Shizuoka Prefecture to open a 75,000kW biomass plant by around 2022. It plans to construct more facilities in Sendai and western Japan in collaboration with partners including Sumitomo Forestry, in an effort to raise its total power generation capacity 15-fold from the current level to more than 300,000kW.