Proposal for constructing HVDC connections using submarine cables from the north to south of Japan ( “Ryugu” Power Transmission Plan)
Amended and restated proposal dated October 28, 2020
The original proposal was made on April 30, 2020
Proposal for constructing HVDC connections using submarine cables
from the north to south of Japan
( “Ryugu” Power Transmission Plan)
Satomi Ushijima, Representative of Environmental Watch TOKYO
Toshihiko Goto, Chairman of HVDC Transmission Project
1-20-6-32 Higashiueno, Taito-ku, Tokyo
e-mail: envwatchtokyo@yahoo.co.jp
https://note.com/kankyowatchtokyo
1. Backgrounds
Numerous extreme weather disasters such as typhoons and forest fires are occurring around the world. In Japan, extremely severe climate disasters have occurred frequently in the last few years (Note 1). As global warming progresses, it is expected that adverse effects and meteorological disasters are likely to become more severe and larger in scale.
1.1 Background, purposes and significance
The “Paris Agreement” will be implemented starting from this year. Triggered by the Paris Agreement and Sustainable Development Goals (“SDGs”), measures to mitigate global warming and convert to renewable energy sources are progressing globally. Markets are also undergoing a major shift on the premise of de-carbonization and renewable energy (Note 2).
The cost of renewable power generation in the world has fallen to the level of thermal power generation or lower (International Renewable Energy Agency 2018, Note 3). In Japan, however, renewable energy has not been prevalent to date and renewable energy costs remain high.
Japan is blessed with a variety of renewable energy resources, and the renewable energy supply could potentially far exceed electricity consumption nationwide (Note 4). However, expansion of renewable energy is not making sufficient progress due to gird access constraints. Currently, new renewable energy generation projects encounter significant challenges in securing access to the national grid. The national grid is divided into ten blocks, where each incumbent utility manages grid access in its own jurisdiction by way of a separate but affiliated company under the current “separation” rule. The transmission system has been operated such that existing large power plants have priority and it has “no capacity in network access for renewable power generators coming afterwards” even when the existing power generators are transmitting to the system at a minimal level. Such difficulties in securing access to the national grid significantly delay new business operations by renewable power generators (Note 5).
Turning to transmission networks overseas, there are many expansion plans in North America and Europe, including international transmission networks (ENTSO-E, 2018), and China also has many plans for regional transmission networks. In Japan, there are plans to expand intra-regional and inter-regional interconnection networks, but progress has been limited to date (Note 6).
1.2 Purposes
Increasing renewable power generation is one of the main measures for tackling global warming and shifting to a de-carbonized society. With renewable energy growing in Japan, it would be possible to transmit (i) wind power generated in Hokkaido and Tohoku and (ii) solar power and wind power generated in western Japan, to large consumption areas in the Kanto, Chubu, and Kinki regions. While it is important to significantly reduce power consumption through energy conservation and to reduce power consumption in highly populated major cities by mitigating such extreme concentration, it is also necessary to effectively satisfy power demands in large consumption areas.
In addition, it would be necessary in the future to radically reform the grid connection system to be prepared for and tackle both excess and deficiency of energy when interchanging and preferentially consuming renewable energy within the community
1.3 Significance
The economic effects would be significant if large-capacity HVDC connections are constructed. For example, it would promote construction of large-scale offshore wind power plants in areas suitable for wind power generation. It would also contribute to maintaining the competitiveness of companies in conducting renewable energy business internationally if costs become lower in Japan.
Globally, policies are trending toward de-carbonization. For example, the EU Commission called for public comment on a carbon border adjustment mechanism (Note 7) to reduce carbon leakage in the Zero Emissions Bill. In order to remain in the international supply chain in such a decarbonizing market, infrastructure investment for transition to renewable energy society seems to be imperative for Japan as well.
At the national level, fossil fuel import costs would be significantly reduced (Note 8). At the regional level, it is expected that cash outflows from local areas in the form of utility payments would be prevented and that local companies would benefit by receiving orders when renewable energy investments are made by local governments, local companies, and foreign investors, which would stimulate regional economies, increase local employment, and help prevent local population declines.
It would be one of the desirable paradigm shifts towards humanity’s sustainability as recognized under the corona virus shock.
HVDC transmission has three (3) significant advantages compared to HVAC transmission as follows:
(A) Small transmission loss over long distance;
(B) Lower construction costs if deployed over long distances; and
(C) Different frequencies are used for electric power in Eastern Japan (i.e. 50 Hz) and in Western Japan (i.e. 60 Hz), which is a challenge for AC power transmission but would not be an issue for DC power transmission.
Several proposals have been made to date to achieve wider area power transmission, including:
① Junichi Nishizawa proposed connecting global hydroelectric power generation with a grid using DC transmission technology (Nishizawa, 2008).
② The Sustainable Management Forum of Japan proposed construction of an HVDC transmission network from Hokkaido to Kyushu at national expense (Environmental Management Society, 2011).
③ WWF Japan proposed to significantly strengthen the interconnection between regions to strengthen the grid capacity for the goal of 100% renewable energy in 2050 (WWF Japan, 2013).
④ The Renewable Energy Institute has proposed an Asian Super Grid concept that would connect with Northeast Asia (Renewable Energy Foundation, etc., 2014) (Renewable Energy Foundation, 2017, 2018, 2019).
⑤ The Japan Policy Council proposed the Asia-Pacific power grid concept (The Japan Policy Council , 2011).
Hence, in this proposal paper, we will provide an overview of national construction of HVDC connections from Hokkaido to Kyushu in Japan, our estimate of total costs, and the positive effects to be achieved
2. Our Proposal
2.1 Overview of HVDC connections construction
We propose to construct two HVDC transmission networks from Hokkaido to Kyushu, one on the Pacific coast and the other on the Sea of Japan coast, and use a DC/AC converter to connect to AC high-voltage transmission networks in each region.
We note that Okinawa and remote islands are not included in this proposal because they are far from Honshu. However, as the state of Hawaii in the United States stipulates the conversion to 100% renewable energy by 2045 by the state law, RE100 is considered technically possible independently of the remote islands. It is our hope that discussions will be held in the future, including the installation of batteries as a disaster countermeasure and the conservation of marine interests.
・Pacific route: a HVDC transmission network to be constructed from Hokkaido to the southern coast of Kyushu using submarine cables along the Pacific Ocean .
Submarine cables would be built for a distance of about 2500 km, a transmission capacity of 10 GW, and a voltage of 500 kV (a portion of the cables would also be on land in Hokkaido). It would be connected to the intra-regional transmission networks owned by Hokkaido Electric Power and Kyushu Electric Power at the end-points, and to intra-regional transmission networks (six power transmission lines in Tohoku, Tokyo, Chubu, Kansai, Shikoku, and Chugoku) along the route, for a total of eight locations. (See figure. Connections to transmission networks of less than 500kV would be made after reducing the voltage.)
・Japan Sea route: a HVDC transmission network to be constructed from Hokkaido to West Kyushu using a submarine cables along the Sea of Japan
Submarine cables would be built for a distance of about 2500 km, a transmission capacity of 10 GW, and a voltage of 500 kV (a portion of the cables would also be on land in Hokkaido). It would be connected to the intra-regional transmission networks owned by Hokkaido Electric Power and Kyushu Electric Power at the end- points, and to intra-regional transmission networks in the five electric power regions (Tohoku, Tokyo, Hokuriku, Kansai, and Chugoku) along the route, for a total of seven locations. Please note that TEPCO has a transmission network in Niigata. (See figure.)
・Additional HVDC transmission networks on land would also be helpful for promoting renewable power generation in regional areas, and it is also possible to deploy them under expressways or by using the railway network.
2.2 Estimated cost of HVDC transmission network construction
In short, the total construction cost would be in the range of approximately 5 trillion yen to 24 trillion yen which would include DC/AC converters, switching stations and transformers.
Each of the Pacific route and the Japan Sea route has a distance of 2500 km, a capacity of 10 GW, a voltage of 500 kV, and would be via submarine cables. The Pacific route has two end connection points (Hokkaido and Kyushu) and six intermediate connection points (Tohoku, Tokyo, Chubu, Kansai, Chugoku, Shikoku), and the Japan Sea route has two end-connection points and has five intermediate connection points (Tohoku, Tokyo, Hokuriku, Kansai, Chugoku).
For this cost estimation in our most conservative calculation, we have used the highest unit price of 400,000 yen/MWkm, which is the actual highest of the European HVDC interconnection network unit prices, which fall in the range of 170,000-400,000 yen/MWkm. With regard to DC/AC converters, etc., we have used the highest price of 33.4 million yen/MW (the single unit price used by OCCTO, 2017).
The combined length of the submarine cables would be 5000 km for both routes. The total cost of such submarine cables with the DC/AC converters would be approximately 20 trillion yen, as a result of calculation by multiples, i.e. 5000 km x 10GW x 400,000 yen
There would be 11 DC/AC converters in total with 6 on the Pacific route and 5 on the Japan Sea route. The total costs for such converters would be 4 trillion yen, as a result of calculation by multiples, i.e. 33.4 million yen/MW x 11 locations x 10 GW.
The sum of 20 trillion yen plus 4 trillion yen estimated above would be 24 trillion yen. Together with switching stations and transformers, the total construction cost would still be approximately 24 trillion yen in our most conservative calculation (Note 9).
If we were to apply the unit price actually used in the HVDC interconnection network between Norway and Denmark, the total cost of submarine cables would be approximately 2.9 trillion yen, as a result of calculation by multiples, i.e. 5000 km x 10GW x 58,000 yen/MWkm.
In this calculation, there would be 15 DC/AC converters in total with 8 on the Pacific route and 7 on the Japan Sea route. The total costs for such converters would be 2 trillion yen, as a result of calculation by multiples, i.e. 13.4 million yen/MW x 15 locations x 10GW.
The total construction cost in this calculation would be approximately 5 trillion yen, as the sum of 2.9 trillion yen plus 2 trillion yen estimated above. Again, this calculation is based on the actual costs indicated for such network between Norway and Denmark.
Thus, the total construction cost would be in the range of approximately 5 trillion yen to 24 trillion yen.
2.3 Owner of Construction/Manager in charge of Operation
In light of the nature of these HVDC transmission networks as an infrastructure project that forms the backbone of the state, we propose that the national government be the owner to undertake construction. This is an infrastructure project because of its large scale and the need for immediate construction in order to fill in the gap between the suitable areas for renewable power generation and the areas of large electricity consumption (Note 10).
The operator should be separated from the owner of such infrastructure, and it should be outsourced. We propose establishing a company specializing in interregional transmission operation which is completely independent from the incumbent utilities, or the “Organization for Cross-regional Coordination of Transmission Operators, Japan” (OCCTO) as appropriately strengthened and independent from the incumbent utilities. As an important condition, it would be necessary to create fair transmission network operation rules which satisfy the above-mentioned purposes of providing renewable energy effectively to the large consumption areas and providing access rights for local governments and citizens.
3. What would be achieved upon completion of the HVDC Transmission Project
・The renewable energy power ratio would be increased by 10% or more to 34 to 36% based on a conservative calculation, at an early stage by 2030, and there is potential to more than double the renewable energy power ratio to 45 to 47% by 2030 (on the assumption of constant power output control), by constructing these interconnection networks, strengthening transmission networks within the regions, and ensuring operation in accordance with proper transmission network operation rules (Note 11). In the future, the renewable energy 100% goal would become highly promising if construction is expanded further.
・Hokkaido, Tohoku, Chugoku, Shikoku, and Kyushu, which account for 80% of the potential for wind power generation in Japan, would also be able to provide with renewable energy throughout large consumption areas rather than only producing renewable energy for local consumption, which would significantly promote Japan’s shift to green energy (Note 4, Note 12). In addition, the stability of power generation would be improved. There is also the possibility to accommodate the growing need for renewable energy in connection with the shift to electric vehicles.
・Japan's fossil fuel import costs and electricity utilities’ fuel costs could be reduced by at least 0.9 and up to 2.8 trillion yen per year (Note 13).
・Construction of wind power plants would be promoted. Private investments in such wind power projects could be increased in the amount of 1.4 to 2.8 trillion yen per year. By improving the existing power systems, local companies would become able to participate in renewable energy management and local companies would likely receive more orders for construction and operation. In totality, the capital expenditure and operation expenses for local renewable energy projects would be recovered through the expected significant reduction of utility costs described below (Note 14).
・It would become possible for local communities to promote local self-sufficiency, local power grids and local production and local consumption. At present, local communities pay a large amount toward utility bills and most of such cash flows out from local communities. On top of such cash outflow from local communities, most of the amount spent on fossil fuel costs flows out of the country. Through local renewable energy investment and consumption, it would become possible to significantly reduce cash outflows from local communities as utility bill payments. In addition, by selling electricity to large consumption areas, it would become possible to earn cash locally and use such cash within the country. If each of the local governments establishes a city public corporation and a regional electricity retail company to supply local renewable power to the region, this would also promote the use of such cash locally and within the country.
・Offshore wind power plants would have clear fish reef effects, and are expected to contribute significantly to revitalization of coastal fisheries.
Notes
Note 1:
According to the climate risk report of environmental NGO German Watch, Japan was the worst affected country in the world by 2018 weather disasters (German Watch, 2019).
Note 2:
Under the Paris Agreement, the overall target is a temperature rise of less than 2°C (compared to pre-industrialization temperatures), with additional efforts to limit the rise to 1.5°C. Furthermore, after the IPCC (Intergovernmental Panel on Climate Change) “1.5°C Special Report” (IPCC, 2018), there is a significant movement aimed at achieving a temperature rise of less than 1.5°C 120 countries and the EU, and hundreds of cities, declared zero emissions as a goal for 2050 (Climate Ambition Alliance, 2019). There are more than 230 major companies (RE100, 2020) in the world aiming for using 100% renewable energy power by participating in RE100. The EU and others are promoting legislation targeting zero emissions, and have also agreed on a border carbon tax (European Commission, 2019.12.11, 2020.3.4, Nihon Keizai Shimbun, 2019.12.14). Japanese companies may also be subject to such taxation if they do not take measures to reduce emissions. Furthermore, as the market moves toward 100% de-carbonization, renewable energy, de-carbonization is becoming a new commercial rule. If the introduction rate of renewable energy stays at a low level, it may make it difficult for Japanese companies to expand their businesses globally, such as by being removed from the supply chain of companies with zero emissions targets (Ministry of Foreign Affairs, Climate Change Experts' Meeting, 2018).
Note 3:
According to the summary of the International Renewable Energy Agency (IRENA), the power generation cost of renewable energy power is about 9 yen/kWh for solar power, about 6 yen/kWh for onshore wind power, about 14 yen/kWh for offshore wind power, on average in 2018. Biomass, geothermal and hydropower are about 5-8 yen/kWh. This is in the range of about 5-18 yen/kWh for thermal power generation; offshore wind power is at the average level of thermal power generation, and the other costs are low (IRENA, 2019). Recent renewable energy auctions are even cheaper. Competitors of Japanese companies use such cheap renewable energy electricity to appeal to customers based on their small environmental impact and to develop their business with an advantageous cost structure.
Note 4:
According to a survey of Japan's renewable energy power capacity, conducted by the Ministry of the Environment (MOE), the potential of wind power (excluding geographical land use restrictions such as in national parks) alone is approximately 5 trillion kWh/year, which would likely be about 5 times more than the total currently generated amount of power in the country (MOE, 2011, 2016).
Moreover, Hokkaido, Tohoku, Chugoku, Shikoku, and Kyushu have huge potential, and more than half of the total onshore wind power could be generated in Hokkaido alone, and the total in the five areas would be close to 90%. Offshore wind power also could be generated 30% in Hokkaido alone, with the total capacity in the five regions being 80% (MOE, 2011, 2016). However, those promising regions are located far from large consumption areas.
Note 5:
With respect to the “no vacancy of transmission networks for renewable power generators” issue, it is understandable only to the extent that existing large power plants may need to have priority in the case that one of the large power plants becomes unable to transmit energy due to an accident and the other existing power plants may need to transmit energy to fill in the temporary gap immediately. The current system is operated in an extremely inflexible manner such that existing large scale power plants have priority and are treated as if they were always generating energy at maximum capacity, and even if they are operating at minimum capacity and there is actually “vacancy for transmission network connections”, the system is treated as being “full.” Accordingly, new businesses for renewable energy power stations encounter difficulties in securing access to the transmission networks. Yasuda et al. have analyzed the issue with concrete calculations (Yasuda and Yamaya, 2017).
Note 6:
Discussions on cost burden have begun with the goal of strengthening regional transmission networks (METI, 2019a). The interregional interconnection network between Hokkaido Electric Power and Tohoku Electric Power was strengthened in 2019 from 600MW to 900MW, and the interregional interconnection network between Tohoku Electric Power and Tokyo Electric Power will be increased from the current 5.5 GW, with a plan to expand to 10.28 GW in 2028, and the inter-regional interconnection network between Tokyo Electric Power Company and Chubu Electric Power Co., Ltd. is planned to be expanded from the current 2.1 GW to 3 GW in 2028 (according to METI 2012, OCCTO 2019. These numbers are artificially determined as operating capacities, and the heat capacities i.e. physical capacities are larger). In addition, as of January 2020, there are discussions the expansion of the Hokkaido to Tohoku interconnection on the same scale, but there are no plans for expansion of regional interconnection networks in other areas.
Note 7:
The EU proposes a border carbon tax (or Carbon Border Adjustment Mechanism) in the de-carbonization bill (European Commission, 2019, European Commission, 2020, Nihon Keizai Shimbun, 2019). In order to prevent carbon leakage, the border carbon tax is a tax imposed on imports from countries that do not have a carbon tax/carbon price policy or on imports of products with large CO2 emissions per unit.
Carbon leakage means “leakage” of carbon. Since there is international trade, even if one country takes measures against CO2 emissions, the effect of the measures will be reduced without measures such as border tax adjustments, due to the increase in imports from those countries which do not adopt policies such as a carbon tax and continue to over-utilize fossil fuels.
Note 8:
Japan's cost for fossil fuel imports was about 19 trillion yen in FY2018 (Ministry of Finance, 2019).
Note 9:
For the transmission network with a unit price of 400,000 yen/MWkm, the unit price of the transmission network part and the substation (DC/AC conversion) part is not clear. If we estimate each unit price, the maximum unit price of the transmission network is 185,000 yen/MWkm and the maximum unit price of the substation is 33.4 million yen/MW.
18.5 [10,000 yen/MWkm] x 2500 km x 10000 [MW] x 2 [networks] = 9.3 trillion yen
The substation construction cost is
33.4 [million yen/MW] x 10000 [MW] x 15 [units] = 5 trillion yen
The total is 9.3 trillion yen + 5trillion yen = about 15 trillion yen.
Note 10:
Recently, there has been private sector development, but basically such infrastructure projects are publicly constructed and operated, similarly to infrastructure such as water supply and sewage systems, and in the past communications were also operated by public corporations. The total length of the water supply system is about 670,000 km and the annual investment is about 1 trillion yen (Ministry of Health, Labor and Welfare, 2017). The total length of the sewage system is about 480,000 km, and the budget is about 2 trillion yen per year (MLIT, 2019a, 2019b).
In terms of transportation, infrastructure includes roads, ports and airports which are basically constructed and managed publicly. The expressway is owned by the state and operated by statutory companies. At present, there is a vertical separation method in which railways are often publicly constructed and then operated by private companies.
Note 11:
Renewable energy power connected to the transmission network system is 10 GW each for onshore and offshore wind power in eastern Japan and 10 GW for onshore and offshore wind power in western Japan, calculated conservatively based on the capacity of the transmission networks. In the case of newly constructing a total of 40 GW and connecting it to the HVDC transmission network through the regional transmission network and sending it to the consuming areas, and assuming the facility utilization rate from the survey by MOE (MOE, 2016) (average wind speed of 6 m/s or more ), fixed-foundation type (7 m/s or more) on the sea floor, and floating type (7.5 m/s or more), 120 TWh of new renewable energy power could be obtained. This is equivalent to approximately 12% of Japan's power generation of 1,047.1 TWh in FY2018 (Ministry of Economy, Trade and Industry, 2019b, including in-house power generation). In addition, if this is simply added to the 22% to 24% renewable energy power ratio assumption for 2030, which is the long-term energy supply and demand outlook from METI’s Comprehensive Resource and Energy Study Group, the total renewable energy power ratio would increase to 34 to 36%.
The above calculation is based on matching the capacity of the renewable energy equipment to be connected with the capacity of the transmission network. Considering that the capacity factor of onshore wind power generation is 30%, there is a possibility that more than twice as many power plants can be constructed and connected, assuming a certain curtailment . If the amount is doubled (about 23% of the amount of power generation in FY2018), the renewable energy power ratio will be 45 to 47%, which is determined by simply adding such amount to the long-term energy supply and demand outlook for 2030. In addition, it is possible that a large proportion of regional power consumption can be covered by renewable energy.
There is also the idea of operating the transmission network with a large margin, such as leaving half the heat capacity (physical capacity) unused. In the case of such an operational method, additional construction of transmission networks can be considered.
Note 12:
Regarding solar power generation, solar power output constraints from restrictions on connecting to transmission networks have frequently occurred within Kyushu Electric Power’s region since autumn 2018 (Kyushu Electric Power Transmission and Distribution, 2020). It would be possible to transmit power to large consumption areas and big cities by constructing interconnection networks. Furthermore, when the supply and demand in each region fluctuates, power can be mutually exchanged regionally to limit fossil fuel power generation. This would also avoid the issue of restricting connection to transmission networks for renewable energy power, and it would promote effective use of solar power.
Note 13:
Japan's fossil fuel import cost was about 19 trillion yen in FY2018 (Ministry of Finance, 2019). The unit price of fossil fuels for power generation is expected to be close to the unit price of fossil fuel imports. The annual fuel cost of Japanese 10 electric power companies in FY2010-2015 was 3.7--7.7 trillion yen, the fuel cost of the 10 electric power companies was FY2015 is 4.5 trillion yen, and the thermal power generation amount of the 10 electric power companies in the same FY2015 was 579 TWh. (The Federation of Electric Power Companies of Japan, 2016). The introduction of renewable energy does not necessarily reduce the thermal power of 10 electric power. But comparing with the fuel cost of 10 electric power in FY2015, we can reduce fossil fuel costs of about 900 billion yen for 10 electricity, if we obtain about 120 TWh renewable energy power that can be added to the available power via the transmission network at the lower price level described in Note 11 (based on conservative assumptions) and conservatively reduce coal, oil and natural gas thermal power generation by the same amount. If we estimate using the unit price in FY2013, the total cost will be reduced by about 1.4 trillion yen. In the case of reducing the thermal power generation by obtaining an additional 240 TWh of renewable energy power, which is twice the amount in the top of Note 11, the fuel cost of 10 power would have been about 1.8 trillion yen per year in 2015, and using the annual unit price in 2013, the fuel cost could be reduced by 2.8 trillion yen.
Note 14:
The Cost Verification WG Report Review Sheet of METI (Comprehensive Resource and Energy Study Group, 2014) shows that in the case of international price convergence, the onshore wind power generation cost in 2030 will be about 8 yen/kWh (here, the capacity factor is not the default value of 20%, MOE (2016) sets the wind speed to 6 m/s or more), and the offshore wind power cost will be 14 yen/kWh (where the capacity factor is not the default value of 30%, MOE (2016), the fixed-foundation type has an average wind speed of 7.0 m/s or more and the floating type has an average of 7.5 m/s or more.
In addition, the international price in 2018 is about 6 yen/kWh for onshore wind, and for offshore wind the international price is expected to fall to about 14 yen/kWh and thereafter further decline (IRENA, 2019).
If both the onshore wind power and the offshore wind power are to receive income equivalent to the power generation cost based on the values calculated by Comprehensive Resource and Energy Study Group as mentioned-above, the power generated by wind power construction that matches the installed capacity of the transmission network will be approximately 120 TWh. Sales revenue would be 1.3 trillion yen/year (26 trillion yen in 20 years). Assuming that the output is limited to a certain level, constructing twice that amount of equipment could generate twice the amount of power generation, and power sales revenue would increase to 2.6 trillion yen/year (52 trillion yen in 20 years). If investment is made mainly in the local community, the revenue from selling electricity will also be retained locally.
Assuming that capital investment costs will decline from 2020 to 2030, following the cost verification WG report (Comprehensive Energy and Natural Resources Study Group, 2014), the total cost of onshore and offshore wind construction will be about 14 trillion yen over approximately 10 years (1.4 trillion yen per year) based on the installed capacity of the transmission network.
If twice the amount of equipment is built under the assumption of a certain output limitation, the construction cost will be about 28 trillion yen over 10 years (2.8 trillion yen per year).
The capital investment cost is about 14 trillion yen, and the operation and maintenance cost is about 500 billion yen per year, or about 10 trillion yen over 20 years (estimated from the unit cost of operation and maintenance of (Research Institute for Natural Resources and Energy, 2014)).
If domestic industries and regional industries receive orders, the sales will be national or regional.
Assuming that the proportion of domestic company orders for equipment costs is 50% and operation and maintenance costs are 90%, domestic orders will reach 16 trillion yen over 20 years (about 800 billion yen per year). Also, as mentioned above, the reduction of fossil fuel costs due to renewable energy power that may be added to the transmission network will be about 900 billion yen per year, or 18 trillion yen over 20 years even if the unit price for fuel does not change.
The 40 GW wind power generation assumed above is equivalent to 2% of the potential for wind power, and even if more than twice that is assumed to be built, there is sufficient margin compared to the potential.
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・ http://www.policycouncil.jp/pdf/prop01/siryo1.pdf
・ Yasuda and Yamaya (2019): “Is there really no “empty capacity” on the transmission network? “
・ http://www.econ.kyoto-u.ac.jp/renewable_energy/occasionalpapers/occasionalpapersno45