The government enacted the bundled bill including revised Act on Rational Use of Energy

The government enacted the bundled bill including revised Act on Rational Use of Energy

On May 13th, the government enacted the energy related bundled bill including revised Act on Rational Use of Energy at plenary session of the House of Representatives.  It encourages the changing structure of energy supply and demand for the achievement of carbon neutrality in 2050 and a 46% reduction in greenhouse gas emissions by 2030. The bundled bill promotes the non-fossil energy transition by consumers, reduction in output control of renewable energy, and securing and use of hydrogen and ammonia.  JOGMEC (Japan Oil, Gas and Metals National Corporation) changes its name to Japan Organization for Metals and Energy Security. The bundled bill will be enforced in April 2023 with some exceptions.

The bundled bill consists of the Act on Rational Use of Energy, Act on Sophisticated Methods of Energy Supply Structures, JOGMEC Law, Mining Act and Electricity Business Act. The Act on Rational Use of Energy changed dramatically towards decarbonization.  The government reviewed the definition of energy in its act and added non-fossil energy for the rationalization target. The government requires business operators of a certain scale to submit the mid-to-long term plan and periodic report on non-fossil energy transition. In order to facilitate the optimization of DR (demand response), the government requests electricity supply business operators for the plan on development of the rate system which promotes optimization of demand in response. The government will work on the detailed plan at the Energy Conservation Subcommittee of the Advisory Committee on Energy and Natural Resources (Advisory body of METI).

For the Act on Sophisticated Methods of Energy Supply Structures, hydrogen and ammonia are added to the non-fossil energy source and thermal power stations equipped with carbon dioxide capture and storage (CCS) are also added in its act.  As with nuclear power, same as renewable energy, the certificate will be made available to electricity retailers to improve their ratio of non-fossil power sources. The details will be stipulated in public notice, etc.

In the revised JOGMEC ACT, geological structure survey for offshore wind generation will be added to the scope of JOGMEC.  The manufacture and storage of hydrogen and ammonia, CSS, etc. are added to the scope of investment and debt guarantee services.  In the revised Mining Act, rare earths become subject to the grant of mining rights. Mining without permission of the Minister of Economy, Trade and Industry is no longer allowed.

The Electricity Business Act establishes a prior notification system for the suspension of power plants, which comes into effect within six month after promulgation. Large storage batteries will be regarded as a power generation business and provide with good the environment for connecting to the system.