Japan moving towards decentralised energy

The fallout from the recent Fukushima nuclear accident has created desire for utility reform and support in Japan for alternative forms of energy, with decentralized energy coming more to the fore.

Debate on utility reform will formally kick off at an expert panel on Thursday, one key strand of a potentially sweeping remake of Japan's energy policy intended to reduce the role of nuclear power, promote renewables, spur energy conservation and address the problem of greenhouse gas emissions.

Reformers are betting that tattered public trust in Japan's utilities will give impetus to changes they argue are needed to give users more choice, bring down electricity costs that disadvantage Japanese firms globally, and promote clean, renewable sources of energy such as solar power.

"Because we must increase renewable energy and thoroughly promote energy conservation to reduce reliance on nuclear power and solve the problem of CO2 emissions, we must create an electricity system that promotes renewables and conservation. That means a decentralised energy system," said Satoshi Kusakabe, a former trade and industry ministry official now advising the government on energy policies.

"The question is not whether or not to liberalise, but how to liberalise the electricity system," he told Reuters.

"The debate from now on will be over the speed and scope of liberalisation."

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