Japan seeks to launch certificate of origin for renewables


Japan seeks to launch certificate of origin for renewables


Japan Electric Power Exchange (JEPX) plans to create a scheme by 2023 to certify the origin of green energy, aiming at identifying the types and locations of renewable power plants, Nikkei reported in May.

There is currently no such system in Japan to disclose the production location of power plants, making it hard for businesses to prove that the power they use came from renewable sources. The country thus seeks to refer to the US and EU in implementing a certification system for renewable energy sources in order to encourage businesses to adopt green electricity.

Currently, the JEPX operates a “non-fossil certificate” scheme that validates the environmental worth of renewable energy, giving renewable-derived power a “decarbonization value.” The new certificate is expected to include information about the power plant’s location, installation environment, and the type of renewable energy employed. Companies will be able to better understand how the power system can reduce carbon emissions in the future.

By launching the new certification system, JEPX hopes to make a difference in the transaction price of renewable energy. For instance, if the electricity comes from a solar power plant that has a negative environmental impact, the transaction price of the certificate will be relatively low. Power plants that contribute to the environment, on the other hand, will be able to sell the certificates at higher prices.

The system is designed to prompt power suppliers to match the needs of electricity consumers. Meanwhile, in order to increase the added-value of renewable electricity, suppliers will be urged to adopt more environment-friendly approaches to develop power plants.

With the certificate, it will be easier for electricity consumers to track the source of electricity, helping them to explain its carbon reduction timeframe to suppliers and shareholders.

European and American countries have taken the lead in implementing the system for certifying the provenance of renewable energy. The European Union’s Guarantee of Origin system provides member states with systematic information on where and how renewable energy is produced. In the United States, it is also mandatory to certify the origin of renewable energy in several states.

In Japan, the demand for green electricity with a certificate of origin is increasing as the concept of carbon reduction gain momentum. Household names like SONY have boosted the share of green electricity that employs carbon tracking data.

Furthermore, according to research conducted by Japan’s Ministry of Economy, in November 2021, the total amount of non-fossil certificates with carbon tracking information is approximately 1.8 billion kilowatt-hours, which is eight times higher than the previous period in 2020.

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