JAPAN | Softbank, 35 prefectures launch council to promote renewable energy

Posted on July 14, 2011

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JAPAN | MAINICHI | 14 July 2011

Softbank Corp. President Masayoshi Son, second from left, talks about the Renewable Energy Council, in Akita on July 13, 2011. (Mainichi)

Softbank Corp. President Masayoshi Son, second from left, talks about the Renewable Energy Council, in Akita on July 13, 2011. (Mainichi)

AKITA — Telecom giant Softbank Corp. and 35 prefectural governments have launched a council to promote renewable energy across Japan as part of ambitious efforts to reduce dependence on nuclear power in response to the ongoing Fukushima nuclear crisis.

The “Renewable Energy Council” was formally established on July 13 by Softbank President Masayoshi Son, who wants to start a new utility business based on mega-solar power plants across the country, and the prefectures, which want to revitalize their local economies by hosting renewable power plants. But there were some subtle mismatches in ideas between Son and the governors, as well as between governors.

After the general meeting here on July 13, Son said that Softbank would build more mega-solar plants in addition to about 10 such facilities he has already pledged to construct, saying, “I have received affirmative proposals.” He also unveiled a plan to build an experimental plant in Obihiro in Hokkaido designed to compare the qualities of solar power generation systems developed by various companies.

With the backing from the 35 prefectures, Son wants to help Prime Minister Naoto Kan’s Democratic Party of Japan (DPJ) push for the enactment of a bill obliging utilities to buy power from green sources at fixed prices. In the longer term, Son also envisages building a smart grid next-generation electricity transmission and distribution system.

“I had never thought of going into electricity business before the quake-triggered disasters,” Son said. But he said when he visited Fukushima in late March, he had the impression that local residents were not complaining because they were caught in the grips of government subsidies and jobs. Therefore, he said he came to think more strongly about the need to reduce dependence on nuclear energy.

Son also believes that the solar power business will remain profitable for a long time once investments in plants and equipment are made because the purchase prices of renewable energy is guaranteed. When he held talks with Kan on the electricity purchasing system and farmland deregulation in May, they hit it off on the idea of promoting renewable energy. Then many prefectural governors offered to host mega-solar plants, and Son was apparently convinced of the project’s potential.

Furthermore, Son said at the Softbank general shareholders meeting in late June, “If we can expect a synergistic effect between a smart grid and our main business, we will consider continuing and expanding the project.” The project could develop into a huge business, controlling power plants and their linkages to home electronics and appliances, paving the way for a cutting-edge business with huge added value.

But some people are concerned about the way Son has positioned the business. Son has sought changes to systems hampering the expansion of his business, involving politicians and public opinion in debates on such issues as the opening NTT Corp.’s fiber optic networks to third parties. “If a major company seeks special treatment on farmland regulations or start a new business with the help of local governments, it may disable fair competition with other companies,” said Toshinori Ito, a senior analyst at UBS Securities.

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Posted in: JAPAN