Japan’s Clean Energy Market Attracts Investors

Japan is the scene of several renewable energy projects, many of which have stemmed from tariff incentives the country started to offer in July 2012 after the Fukushima nuclear-plant crisis caused by the March 2011 earthquake and tsunami. As a result, Japan is likely to become the largest solar market in the world after China in 2013, says Bloomberg.

Investors in Japan’s clean-energy market range from billionaire Masayoshi Son’s Softbank Corp. and financial-services company Orix Corp. to the country’s biggest banks led by Mizuho Financial Group Inc. Companies that stand to benefit include solar-panel makers Kyocera Corp., Sharp Corp. and Suntech Power Japan Corp.

Goldman Sachs Group Inc. (GS) announced that it will invest $487 million in renewable energy projects in Japan over five years, specifically tapping demand for solar- and wind-generated electricity, according to Bloomberg. The firm also plans to take as much as $2.5 million in bank loans and project financing over the same period to move ahead with projects that would cost a total of $3 billion.

Goldman Sachs formed the Japan Renewable Energy Co. unit in August to plan, design and operate power plants that run on sun, wind, fuel cells and biomass fuels, it said on its website.

“We believe that we can leverage our global expertise in investing in renewable energy in places such as the U.S. and India, to help expand Japan’s renewable power capabilities,” Ankur Sahu, co-head of the merchant banking division in the Asia-Pacific, told Bloomberg.

Japan’s Innovative Clean Transportation Sector

Japan is also gearing up to launch fuel-cell vehicles as the next-generation of environmentally safer cars, according to the Japan Times.

Oil distributors have started to establish hydrogen station networks. By 2015, 13 companies, including automakers and oil distributors, aim to establish a total of 100 hydrogen supply bases, mainly in major cities.

One of them, JX Nippon Oil & Energy Corp., installed its first hydrogen supply equipment at a gas station in the city of Ebina, Kanagawa Prefecture, in April. The firm aims to set up such equipment in 40 locations. Gas trader Iwatani Corp. also plans to establish hydrogen supply stations in 20 other spots.

The government is set to provide financial assistance to these firms, and is considering deregulation to make it easier to set up the fuel supply networks. In fiscal 2013, the Agency for Natural Resources and Energy started a subsidy program to cover half of the construction costs for each station. The government’s Regulatory Reform Council has discussed deregulation measures like a hike of the limit of hydrogen that can be stored at supply stations.

Channel Asia News reports that global atmospheric concentrations of carbon dioxide broke through the watershed level of 400 parts per million. Rapidly developing Asian economies have played a significant role in the sharp rise in atmospheric carbon dioxide. Japanese startup Terra Motors, however, believes its electric motorcycles and its three-wheeled vehicles can help.  It recently launched its electric tuk-tuk, a three-wheeled electric vehicle common in Asia, which costs just over $6,000 and gets 31 miles on a two-hour charge.

Toru Tokushige, president Terra Motors, has been working with former engineers from Honda, Yamaha and Panasonic to manufacture environmentally friendly two-wheeled vehicles. Terra Motors is looking beyond Japan to market the bikes.  Mr. Tokushige also felt that because his vehicles don’t use gasoline, they will be a boon to many Asian countries faced with high fuel prices.

Terra’s prime investors are former presidents of Sony, Compaq, Apple Japan and Google Japan.


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