Japan Solar Update: No.107 (July 29 ~ Aug 2, 2024)
The Ministry of Economy, Trade and Industry (METI)plans to implement a “split supply” system where electricity is provided by two separate retailers at a single demand location.
The primary goal is to boost offsite Power Purchase Agreements (PPAs) using renewable energy sources.
<Key points>
- The Ministry of Economy, Trade and Industry (METI) plans to introduce a “split supply” in which electricity is supplied by two electricity retailers at one demand location in order to promote offsite PPAs that utilize renewable energy power sources
- It is limited to extra-high and high voltage. The image of acceptable supply forms was presented
- By the beginning of October 2024, acceptance of applications for the current partial supply will be stopped and acceptance of applications for split supply will be started
Introduction of split power supply
It is planned to introduce “split supply” in which electricity is supplied by two electricity retailers at one demand location
* At present, the number of electricity retailers that can provide split supply is limited to two because there is not a large need for split supply by three or more retailers. At this time, it is not permitted to conduct split supply when using self-wheeling
Voltage category allowed for split supply
| Image of forms of split supply |
(1) Following demand + Not -following demand |
(2) Following demand + following demand | |
| (2)-1 Slot split type | (2)-2 Time zone split type | ||
| Overview | One party supplies a certain amount of electricity, and the other party supplies electricity by following demand | Multiple split suppliers in the same slot supply electricity by following demand | One retailer supplies electricity in a certain time zone and the other supplies electricity in another time zone by following demand |
| Category in partial supply | Notice type, vertical cut type | – | Vertical cut type |
| Availability | Yes | No (to be considered in response to needs) | Yes |
Shortage in imbalances on the demand side are borne by those who supply electricity by following demand
Response to termination of retail supply contracts, etc. in split supply
In consideration of the viewpoint of protecting consumers and the lack of stability in power generation investment through offsite PPAs, etc., in principle, the remaining suppliers shall carry out normal retail supply. It is allowed to offer pre-agreed countermeasures between the split supplier and the consumer
Adjustment of distribution costs
Upcoming events
- Around mid to late July 2024: Public comments, etc. on the abolition of the “Guidelines for Partial Supply”
- Around the beginning to middle of September 2024: Notification of changes to the terms and conditions of wheeling supply by each general power transmission and distribution business operators
- Around the beginning of October 2024: Acceptance of applications for partial supply will be suspended, and acceptance of applications for split supply will be started.
* Existing contracts for partial supply will be shifted to split supply by April 1, 2025.
Figure 1 Summary of deliberations on the introduction of split supply
Source: Materials of the 76th meeting of the Electricity and Gas Basic Policy Subcommittee (June 17, 2024), compiled by RTS Corporation