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Japan's Kyushu Electric shuts off renewable suppliers from grid
September 25, 2014 / 9:22 AM / 3 years ago

Japan's Kyushu Electric shuts off renewable suppliers from grid

TOKYO (Reuters) - Kyushu Electric Power Co said on Thursday it would cut access to its grid for renewable energy suppliers, the third of Japan’s 10 regional monopolies to place limits on their cleaner energy intake because of network limitations.

The decision by Japan’s fifth-biggest utility by sales is another blow to the government’s plans to increase renewable energy supply as much as possible following the Fukushima disaster in March 2011, which has shaken public faith in atomic power and left all the country’s reactors idle.

In 2012 Japan introduced a so-called feed-in-tariff scheme, whereby power companies are required to purchase all electricity generated from renewable sources, such as geothermal, solar and wind, at guaranteed rates for set periods.

The rates, which were initially among the highest in the world, led to a rush of planned investment, and suppliers had received approval for 71 gigawatts of capacity under the scheme as of April 30, the latest industry ministry data shows.

Most of that, more than 68 gigawatts, has been for solar-powered projects.

If Japan managed to connect all the sun-powered capacity to utilities’ tightly controlled grids, the total would be almost double that of Germany, the world’s biggest user of solar power with installed capacity of 35.7 gigawatts at the end of 2013.

But the regional monopolies, which dominate generation and transmission of electricity in Japan, have said they reserve the right to reject applications to connect renewable sources if grid stability is threatened.

Only 9.8 gigawatts of government-approved renewable capacity, or 14 percent, had been connected by the end of April, the industry ministry figures show.

Kyushu Electric, which accounts for a fifth of the renewable capacity connected since the scheme started, will stop taking applications from projects to connect to the grid from Thursday, spokesman Masatoshi Hasako said by phone.

The company is concerned about potential supply imbalances that could cause blackouts and needs to study the impact of the solar capacity connected so far, Hasako said, adding that the study was expected to take several months.

The utility, which supplies electricity to the southwestern island of Kyushu, will continue accepting applications for solar installations of under 10 kilowatts, typically household size.

Kyushu is home to Japan’s largest operating solar plant, which has capacity of 82 megawatts.

Hokkaido Electric Power Co and Okinawa Electric Power Co have already placed limitations on solar projects due to a lack of grid capacity in their regions.

“The balance sheets of many power utilities are very strained, which means it is hard for them to make investments (in their grids) beyond what is deemed absolutely necessary,” said independent energy analyst Toshinori Ito.

Reporting by James Topham; Editing by Aaron Sheldrick and Alan Raybould

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