Japan seeks consumer burden to push renewable energy

TOKYO Fri Jul 23, 2010 11:41am BST

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TOKYO (Reuters) - Japanese consumers will have to pay higher electricity bills under a government plan to help triple the generating capacity of renewable energy in the next decade and cut CO2 emissions.

Utility firms will be required to buy at a fixed rate electricity generated from renewable sources of energy -- mega solar, wind, geothermal, biomass and small hydro power -- from as early as 2012, the trade ministry said on Friday.

The cost will be passed on to consumers in a scheme called a "feed-in" tariff, which is already used in countries including Germany and Spain.

A pilot scheme for retail solar power in Japan has been in place since last November, with the government providing subsidies and tax breaks to owners of houses with solar panels as well as developers of solar and other renewable power sources.

The ministry estimates the new plan could boost carbon-free electricity capacity to almost 50,000 megawatts in 10 years after the launch, triple the current levels, and aims to finalize details of the plan by the end of this year.

The latest plan could help Japan achieve its goal to cut emissions by 25 percent by 2020 from 1990 levels and is also in line with its economic growth strategy of putting clean-energy technology innovation as one of the drivers to create new demand and jobs.

Renewable energy sources currently account for 6 percent of Japan's primary energy supply, half of it in hydro power. Tokyo aims to boost that ratio to 10 percent by 2020.

($1=87.01 Yen)

(Reporting by Risa Maeda)

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