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Energiepolitik und Klimaschutz

Energy Policy and Climate Protection

Lutz Mez · Lila Okamura


Helmut Weidner Editors

The Ecological
Modernization Capacity
of Japan and Germany
Comparing Nuclear Energy, Renewables,
Automobility and Rare Earth Policy
Energiepolitik und Klimaschutz
Energy Policy and Climate Protection

Reihe herausgegeben von


Lutz Mez, Berlin, Deutschland
Achim Brunnengräber, Berlin, Deutschland
Diese Buchreihe beschäftigt sich mit den globalen Verteilungskämpfen um knappe
Energieressourcen, mit dem Klimawandel und seinen Auswirkungen sowie mit den
globalen, nationalen, regionalen und lokalen Herausforderungen der umkämpften Ener-
giewende. Die Beiträge der Reihe zielen auf eine nachhaltige Energie- und Klimapo-
litik sowie die wirtschaftlichen Interessen, Machtverhältnisse und Pfadabhängigkeiten,
die sich dabei als hohe Hindernisse erweisen. Weitere Themen sind die internationale
und europäische Liberalisierung der Energiemärkte, die Klimapolitik der Vereinten
Nationen (UN), Anpassungsmaßnahmen an den Klimawandel in den Entwicklungs-,
Schwellen- und Industrieländern, Strategien zur Dekarbonisierung sowie der Ausstieg
aus der Kernenergie und der Umgang mit den nuklearen Hinterlassenschaften.
Die Reihe bietet ein Forum für empirisch angeleitete, quantitative und internatio-
nal vergleichende Arbeiten, für Untersuchungen von grenzüberschreitenden Trans-
formations-, Mehrebenen- und Governance-Prozessen oder von nationalen „best
practice“-Beispielen. Ebenso ist sie offen für theoriegeleitete, qualitative Untersu-
chungen, die sich mit den grundlegenden Fragen des gesellschaftlichen Wandels
in der Energiepolitik, bei der Energiewende und beim Klimaschutz beschäftigen.

This book series focuses on global distribution struggles over scarce energy
resources, climate change and its impacts, and the global, national, regional and local
challenges associated with contested energy transitions. The contributions to the series
explore the opportunities to create sustainable energy and climate policies against
the backdrop of the obstacles created by strong economic interests, power relations
and path dependencies. The series addresses such matters as the international and
European liberalization of energy sectors; sustainability and international climate
change policy; climate change adaptation measures in the developing, emerging and
industrialized countries; strategies toward decarbonization; the problems of nuclear
energy and the nuclear legacy.
The series includes theory-led, empirically guided, quantitative and qualitative
international comparative work, investigations of cross-border transformations,
governance and multi-level processes, and national “best practice”-examples. The
goal of the series is to better understand societal-ecological transformations for
low carbon energy systems, energy transitions and climate protection.

Reihe herausgegeben von


PD Dr. Lutz Mez PD Dr. Achim Brunnengräber
Freie Universität Berlin Freie Universität Berlin

More information about this series at http://www.springer.com/series/12516


Lutz Mez · Lila Okamura · Helmut Weidner
Editors

The Ecological
Modernization Capacity
of Japan and Germany
Comparing Nuclear Energy,
Renewables, Automobility
and Rare Earth Policy
Editors
Lutz Mez Lila Okamura
Freie Universität Berlin Dokkyo University
Berlin, Germany Saitama, Japan

Helmut Weidner
Freie Universität Berlin
Berlin, Germany

Funded by Dokkyo University, Saitama

ISSN 2626-2827 ISSN 2626-2835  (electronic)


Energiepolitik und Klimaschutz. Energy Policy and Climate Protection
ISBN 978-3-658-27404-7 ISBN 978-3-658-27405-4  (eBook)
https://doi.org/10.1007/978-3-658-27405-4

Springer VS
© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020
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Contents

Introduction and Research Approach ............................................................................... 1


Helmut Weidner, Lutz Mez, Lila Okamura
Ecological Modernization – a Paradise of Feasibility but no General Solution ............. 13
Martin Jänicke
Ups and Downs in Environmental Policy: Japan an Germany in Comparison ............... 25
Helmut Weidner
Energy Policy in Japan ................................................................................................... 41
Lila Okamura
Energiewende in Germany – the Dawn of a New Energy Era ........................................ 53
Lutz Mez
Nuclear Waste Management in Japan ............................................................................. 69
Lila Okamura
Rise and Fall of the Nuclear Dream in Germany............................................................ 87
Lutz Mez
Renewable Energy in Japan.......................................................................................... 103
Lila Okamura
40 Years promoting Renewables in Germany............................................................... 119
Lutz Mez
The Future of the Japanese Automotive Industry ......................................................... 137
Martin Schulz
Market and Technology Trends of Automotive Future in Germany ............................. 155
Weert Canzler
Rare Earth Strategies of Japan and EU/Germany ......................................................... 171
Lutz Mez
Findings of the Research Project .................................................................................. 185
Helmut Weidner, Lutz Mez, Lila Okamura
Contributors ................................................................................................................. 207
Acknowledgements

This book is the scientific result of the international cooperation project between
Dokkyo University (Japan) and Freie Universität Berlin (Germany), with the fi-
nancial support for the research coming from Dokkyo University.
We wish to express our sincere gratitude to Professor Kotaro Oshige from
Dokkyo University, for supervising and monitoring our project, and for providing
helpful suggestions and constructive criticism during the preparation of this pub-
lication.
We would like to thank all the survey respondents, the research institutes,
and the experts, for their valuable information, insightful contributions and useful
answers to our questions.
We extend special thanks to Dokkyo University, without whose generous fi-
nancial support this work would not have been possible.
We hope that these research results will positively contribute to environmental
policy development in Japan and Germany.

Berlin-Tokyo, March 2019 Lutz Mez


Lila Okamura
Helmut Weidner
Abbreviations

AGEB Arbeitsgemeinschaft Energiebilanzen (Germany)


ANRE Agency for Natural Resources and Energy (Japan)
AtG Atomgesetz (Nuclear Power Act, Germany)
BAU Business as usual
BfKE Bundesamt für kerntechnische Entsorgung (Germany)
BMBF Bundesministerium für Bildung und Forschung (Ger-
many)
BMF Bundesministerium für Finanzen (Germany)
BMU Bundesministerium für Umwelt, Naturschutz und nukle-
are Sicherheit (Germany)
BMUB Bundesministerium für Umwelt, Naturschutz, Bau und
nukleare Sicherheit (Germany)
BMWi Bundesministerium für Wirtschaft und Energie (Ger-
many)
BMWT Bundesministerium für Wirtschaft und Technologie
(Germany)
BNA Bundesnetzagentur (Federal Network Agency, Ger-
many)
BNG British Nuclear Group
BWR Boiling Water Reactor
CDU Christlich Demokratische Union Deutschlands (Ger-
many)
CHP Combined heat and power
CO2 carbon dioxide
CSU Christlich-Soziale Union in Bayern (Germany)
DeNOx Denitrification
DeSOx Desulfurization
EEA European Environment Agency
EEG Erneuerbare-Energien-Gesetz (Renewable Energy
Sources Act, Germany)
X Abbreviations

EIP European Innovation Partnership


EM Ecological Modernization
EnEV Energieeinsparverordnung (Energy Conservation Ordi-
nance, Germany)
ERECON European Rare Earths Competency Network
ESI Energy supply industry (Germany)
EU European Union
FBR Fast Breeder Reactor
FDP Freie Demokratische Partei (Germany)
FEC Final Energy Consumption
FEPC Federation of Electric Power Companies (Japan)
FIT Feed-in tariff
FY Financial year
GDP Gros Domestic Product
GHG Greenhouse Gas
GJ Giga Joule (1 Million Joule)
HLW High-Level Waste
HREE Heavy rare earth element
HTR High Temperature Reactor
ICCT International Council of Clean Transportation
IEA International Energy Agency
IPCC Intergovernmental Panel on Climate Change
IRENA International Renewable Energy Agency
ISEP Institute for Sustainable Energy Policies (Japan)
ITF International Transport Forum
IUPAC International Union of Applied and Pure Chemistry
JAEA Japan Atomic Energy Agency
JAEC Japan Atomic Energy Commission
JAPC Japan Atomic Power Company
JNFL Japan Nuclear Fuel Limited
KEIDANREN Japan Business Federation
Abbreviations XI

kWh kilowatt-hour
KWU Kraftwerk Union AG
METI Ministry of Economy, Trade and Industry (Japan)
MIPS Material input per service unit
MITI Ministry of International Trade and Industry (Japan)
MoE Ministry of Environment (Japan)
MOX Mixed plutonium-uranium oxide fuel
MP Member of Parliament
MW Megawatt (1,000 Watt)
NAPE National Action Plan on Energy Efficiency (Germany)
NATO North Atlantic Treaty Organization
NBS Nature-based solutions
NEDO New Energy Development Organization (Japan)
NGOs Nongovernmental organizations
NPE National Platform for Electric Mobility (Germany)
NPP Nuclear Power Plant
NPS Nuclear Power Station
NRA Nuclear Regulation Authority (Japan)
NUMO Nuclear Waste Management Organization (Japan)
NW Nuclear waste
OECD Organisation for Economic Co-operation and Develop-
ment
P-2-X Power-to-X
PV Photovoltaic
PWR Pressurized Water Reactor
R&D Research & Development
REE Rare Earth Element
RE Renewable energy
REI Renewable Energy Institute (Japan)
REN21 Renewable Energy Policy Network for the 21st Century
RES Renewable energy sources
XII Abbreviations

RESA Renewable Energy Sources Act (Germany)


RES-E Renewable Energy sources-electricity
RMI European Raw Material Initiative
RPS Renewable Portfolio Standard (Japan)
SDGs Sustainable Development Goals
SIP Strategic Implementation Plan
SME Small and medium-sized enterprises
SO2 Sulphur dioxide
SPD Sozialdemokratische Partei Deutschlands (Germany)
StandAG Standortauswahlgesetz (Repository Site Selection Act,
Germany)
StrEG Stromeinspeisungsgesetz (Electricity Feed-in Law, Ger-
many)
SUVs sport utility vehicles
TEPCO Tokyo Electric Power Company
THTR Thorium High Temperature Reactor
TRU Transuranic waste
TWh Terawatt-hour (1 billion kWh)
UK United Kingdom
UN United Nations
UNEP United Nations Environment Programme
USD US Dollar
VCI Verband der Chemischen Industrie (Germany)
VDMA Verband Deutscher Maschinen- und Anlagenbau (Ger-
many)
WEEE Waste Electrical and Electronic Equipment
WTO World Trade Organization
Introduction and Research Approach

Helmut Weidner, Lutz Mez, Lila Okamura

Introduction
The late 1960s saw the beginning of an intense debate on the societal conse-
quences of environmental disruption and resource depletion. A considerable num-
ber of environmental action groups, journalists, and social scientists took the view
that the existing institutional system was unable to prevent the emergence of eco-
logical crises (Helfrich 1971, Roos 1971). Japan was even thought to be commit-
ting “ecological hara-kiri” (Tsuru & Weidner 1989). Impressed by talk of ecolog-
ical crisis and under pressure from a rapidly growing environmental movement,
many industrial countries and some developing countries created specific capac-
ities for environmental protection and management. International organizations
also took up the subject of the environment. In 1969, NATO established the Com-
mittee on the Challenges of Modern Society, and in 1970 the Organization for
Economic Cooperation and Development (OECD) set up a panel for environmen-
tal issues. In 1972, the first United Nations Conference on the Environment was
held in Stockholm.
Forms of response to environmental challenges changed over time(see Wal-
lace 1995). The prevailing approach shifted from pollution control (reaction and
cure, dilution/end-of-pipe treatment), to pollution prevention (precaution, sophis-
ticated end-of-pipe treatment/integrative environmental technology), toward eco-
logical modernization (emphasizing structural ecological transformation of the
economy and society) which is sometimes related to the vision of sustainable de-
velopment (a holistic and integrative societal development approach). However,
after decades of systematic environmental policy at the national and international
level there are still strong differences between the countries with respect to their
environmental concepts and strategies, even between the more progressive and
rich countries.
In the developed countries, capacity building has continued apace since the
1970s in almost all areas of society in the shape of organizational-institutional
differentiation or integration (for the following paragraphs see Jänicke & Weidner


Helmut Weidner | Freie Universität Berlin | fu.weidner@t-online.de
Lutz Mez | Freie Universität Berlin | lutz.mez@fu-berlin.de
Lila Okamura | Dokkyo University | lilaokamura@dokkyo.ac.jp

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_1
2 Helmut Weidner, Lutz Mez, Lila Okamura

1997; Weidner, Jänicke & Jörgens 2002). Be it in science, culture, politics, eco-
nomics, or in civil society, all relevant organizations have created institutions spe-
cializing in environmental matters or have expanded competencies in existing
structures through training and education. This is also the case in research insti-
tutions, the churches, the trade unions, the media, in business—including in me-
dium-sized firms and in broader social networks. In civil society, the institution-
alization of environmental interests has been particularly marked. The number of
nongovernmental organizations (NGOs) in some countries almost defies listing.
Sometimes NGOs have larger memberships than traditional interest groups such
as trade unions or political parties. Thus, the environmental movement in many
countries has been subject to institutionalization for some time. Green parties
have been founded. In Western Europe, the United States, and elsewhere, a wide-
ranging ecological commercial sector has emerged, including consulting firms,
research facilities, and service companies. Such businesses’ affinity for the envi-
ronmental movement and NGOs has helped stimulate environmental organiza-
tions’ interest in and enhance their capability for cooperation with polluting in-
dustries. In Germany, for instance, all major environmental organizations are en-
gaged in cooperative projects with business and government. Such projects have
addressed a wide array of issues, from the development of environmental stand-
ards to product environmental life-cycle analysis. Over the past decade, NGOs
and even some of their most serious foes such as the chemical industry increas-
ingly have sought to solve problems together. The development of environment-
related organizations and networks has been supported and stimulated by politico-
legal institutionalization in the form of laws and regulations. Environmental leg-
islation has created new markets, areas of activity, and demands to which private
businesses have reacted through specialization. Changes in fiscal or electoral law
have promoted the emergence and stabilization of NGOs and green parties (espe-
cially in Germany). In some countries as in Germany, this has fostered the capac-
ity and need for cooperation among different interest groups.
In the 1970s, environmental institution building was initiated and strongly
influenced by countries such as the United States and Sweden. Japan, after a se-
vere ecological crisis, became a short-term pioneer in pollution control during this
period as well: Japanese flue-gas purification technology, the compensation sys-
tem linked to an SO2 charge, and voluntary environmental agreements stimulated
progress in Japanese environmental policy overseas as well as at home (see Miya-
moto 2014; Tsuru & Weidner 1989).
In the 1980s, Germany quite unexpectedly became a leader in environmental
policy and a major exporter of pollution control technology. Much of this impetus
was lost in the 1990s following German reunification and the most severe eco-
nomic recession since World War II., but capacities were reduced only in periph-
eral areas of environmental policy. Germany has remained a progressive player
Introduction and Research Approach 3

in many areas of international environmental policy, however, it lost momentum


in two policy-areas decisive for a transition to ecological modernization: in the
transport (automobile) sector and in climate policy (here related to the coal-fired
power plants). Nevertheless, there are still major capacity deficits in advanced
countries that are a serious hindrance to “ecological modernization.” There are
weaknesses in subnational implementation, and environmental monitoring and
reporting systems are deficient (see the current debate on air pollution by auto-
mobiles). There are particular inadequacies in inter-policy cooperation (“integra-
tive environmental policy”) and in the capacity for legal and political intervention
against powerful polluters (but recently introduced class action laws increased the
veto power of consumers and environmental action groups). Shifting structural
asymmetries in the societal parallelogram of power in favor of environmental pro-
ponents is, of course, also a matter of a general redirection of the development
paths of the automobile. the brown coal (lignite) and the (in this study not in-
cluded) agricultural sectors where environmental interests confront almost closed
policy networks that have been strong enough nearly everywhere to obstruct pre-
ventive environmental measures that go beyond end-of-pipe treatment.
In most average countries, especially highly developed ones, certain prob-
lems have increased rather than abated. This has been the case with traffic emis-
sions, waste production, soil contamination, and extensive land use. Even envi-
ronmental front-runners display major shortcomings if, from the perspective of
concepts such as ecological modernization, evaluation takes account of general
resource consumption, biodiversity, and inter- and intragenerational environmen-
tal equity and equality. In most advanced countries too, existing environmental
capacities have usually sufficed for more or less standard solutions based mainly
on technological progress.
Greater capacities are clearly needed to develop effective strategies against
environmentally harmful land use patterns and materials flow management and
for soil and climate protection. This points to persisting structural limits to envi-
ronmental policy and management even in the environmentally most advanced
countries. Although in some areas environmental problems can be ascribed to un-
used or underused capacities (capacities may exist but lie idle owing to actors’
lack of will and skill), the problems mentioned indicate an overload of existing
capacities and a need to develop new capacities suitable for handling economic
and politico-societal conflicts of interest and power.
The ecological modernization of societies thus remains a daunting task de-
spite the broad achievements of environmental policy. Strengthening existing ca-
pacities favorable to environmental proponents and objectives is not enough. Pro-
ponents need great strategic skill and will in developing a mixed strategy of co-
operation and conflict if they are to win new friends in all sectors of society and
to prevail over the powerful interest groups rooted deeply in most ecologically
4 Helmut Weidner, Lutz Mez, Lila Okamura

obstructive sectors such as mining, transport, energy, and agro-business. The suc-
cess of such strategies is likely to depend largely on how skillful proponents are
in using and systematically creating situative opportunities („opportunity win-
dows“) that render even powerful opponents vulnerable--i.e. it depends largely on
their „cognitive-strategic capacities“ to fundamentally change established devel-
opment paths („path dependence“).
After the USA, Japan and Germany are the largest Western industrial nations
and important global players. In order to maintain and expand their position as
leading industrial nations in a global context, they must overcome major social,
political and economic challenges, both domestic and global. Both countries have
similar institutional, technological, economic and "intellectual" capacities to react
to this high pressure to modernize. Nevertheless, in recent decades they have in
some cases embarked on very different development paths in important policy
areas. At first sight, Germany seems to have chosen a far more radical moderni-
zation path than Japan in some areas -- namely the path of a profound "ecological
modernization". The former "coal country“ Germany (see Ziegler 2013) has left
some firmly established, historically grown development paths': An abrupt and
far-reaching policy change is particularly visible in energy policy. The so-called
energy turnaround/transition („Energiewende“) began in Germany after the oil
price crises; the dynamics were then intensified by the strong problem and polit-
ical pressure resulting from the forest dieback („Waldsterben“). The move away
from nuclear energy began in particular after the Chernobyl disaster. In the years
that followed, and in connection with climate policy, there was an increasingly
strong link between environmental and energy policy.
In Japan, there was also ,and earlier than in Germany, a strong pressure for
solving environmental and energy-related problems and a call for industrial
change, mainly due to extremely high environmental pollution, but this pressure
was strongly influenced by the country's lack of resources and its great depend-
ence on imports of raw materials and energy sources. The Japanese climate and
energy strategy therefore relied heavily on nuclear energy -- and even after the
nuclear catastrophe of Fukushima in 2011 only a moderate modernization of the
energy sector was taking place, without any profound structural changes in the
energy sector (Schreurs & Yoshida 2013). In national and especially international
climate policy, Japan never played a role as a „pioneer country“ as did Germany
for a rather long time period. And with respect to „renewable energy“ Japan is
clearly a latecomer compared to Germany.

Aims of this Study


In this research project, the differences and similarities of developments in four
selected policy areas that are closely intertwined and central to the modernization
Introduction and Research Approach 5

of the national economy have been analyzed and compared using theory-based
empirical policy analysis.
The comparative analysis and explanation concept of this research project
aims to contribute to central questions of the modernization capacity of advanced
industrial societies: Which factors and factor combinations are relevant for the
actual strength of modernization capability, and which suggestions for policy
learning result from this for Germany and Japan?
The project compared four policy areas that are of central importance for the
global development opportunities of large industrialized countries:
- Automobility (passenger cars fueled by gasoline, diesel, fuel cell, hy-
brid, electricity, gas)
- Nuclear Energy (including disposal of nuclear waste and dismantling of
nuclear power plants)
- Renewable Energies (e.g. non-fossil fuels like wind and solar power),
and
- Rare Earths (a group of metal chemical elements that are difficult to find
in large quantities, like tellurium, indium, gallium, neodymium and dys-
prosium, which are increasingly important for technology and manufac-
turing, especially in the realm of renewables, like photovoltaic and wind
energy technologies and e-mobility).

These four policy areas were also chosen because they are highly interde-
pendent and therefore need a complex policy to manage their future development.
For example, rare earths are important resources for safe and efficient power
plants (including nuclear power plants), for "smart" automobiles and for sustain-
able wind and solar power plants. A forward-looking, strategic rare earths policy
is therefore an important prerequisite for development opportunities in the three
other selected policy areas.
Furthermore, the four policies are central for an efficient and effective cli-
mate policy. In many countries they (with the exception of rare earth policy, which
is usually stronger related to the economic and mining sector) were framed by the
national climate program, as it is the case in Japan and Germany, too. This close
interweaving with the climate policy results in a relatively strong dependence of
the policy concepts of these three areas on the programs, objectives and strategies
of the national climate policy. It is this interrelationship and formative influence
that an analysis of the national climate policy will contribute to the understanding
of the development in the other policy areas. Accordingly, we will provide an
outline of the most important steps and basic features of the national climate and
environmental policy in Japan and Germany.
6 Helmut Weidner, Lutz Mez, Lila Okamura

As the research questions are essentially directed at the modernization ca-


pacity in environmentally relevant areas, the concept of "ecological moderniza-
tion" and the „capacity-building approach“ were chosen as a framework for the
study and for the research design. The theoretical-analytical concept of "path de-
pendency" was chosen because of the automotive and energy policy areas, which
have grown over many decades and are thus anchored in strong and deep institu-
tional structures habitated by powerful actor groups from business, government,
science sector, and trade unions. These powerful groups which exhibit a persistent
influence on climate policy, too, are particularly challenged by a deliberate policy
of ecological modernization as the established development paths were to be fun-
damentally changed and redirected towards ecological modernization bringing
new actor groups and institutions into power.
The following paragraphs will provide an overview of the selected concepts
and approaches. The concept of ecological modernization is only briefly dealt
with here as it is described in detail in a separate chapter by Martin Jänicke.
Introduction and Research Approach 7

The Research Approach


Ecological Modernization
Ecological Modernization (EM) could be understood as government-promoted
industrial and societal transition and innovation to decrease pollution, to improve
the environment and to save natural resources. It strives for changes in production
and consumption patterns within existing politico-economic frameworks (by us-
ing the capitalistic market-forces and dynamics in favor of environmental activi-
ties/policies). It has a strong “win-win-win”-orientation by aiming at the increase
of economic profits, improving the environmental situation, and increasing the
national welfare.
The concept of EM as a rule tries to avoid hard political, social and economic
conflicts, for instance by compensating the “losers” (whether business or social
groups) to get their consent (see the coal sector in Germany). It also puts strong
emphasis on co-operation of the various stakeholders, on economic incentives,
societal and economic innovations, world market for green technologies, and the
idea of “pioneer pay-offs”. There is, however, also strong emphasis on govern-
mental leadership, guidance and regulations (e.g. to promote renewable energy).
The concept of EM is well-known and highly accepted in Germany; it is presum-
ably the leading paradigm in German environmental policy (including climate
and energy policies). As the EM concept is more pragmatic, concrete and less
oriented to (radical) structural changes it plays a stronger role in actual policy-
making than the vision of “sustainable development”. Its strengths (and at the
same time its weakness from a broader ecological perspective) are to be seen in
tackling problems which have high visibility and for which technical solutions
are feasible. And it is also not a concept for global justice as it primarily strives at
increasing welfare within Germany, assuming that there will be positive trickle-
down effects for other countries, too. In Japan, the EM concept is also rather well
known, but often there are different labels used (for example, industrial transition,
green growth).

Capacity Building Approach


The research reported here analyzes the prerequisites, development and effects of
environmental policy, utilizing a "capacity building" approach. The approach has
proven to be well suited for qualitative, cross-national research (see Weidner &
Jänicke & Jörgens 2002). According to the OECD Task Force on Capacity Devel-
opment, “capacity in environment relates to the abilities of a society to identify
environmental problems and solve them, capacity development in environment
relates to the ‘process’ by which those abilities are developed” (OECD 1994:9).
This approach offers a set of categories for the analysis and tentative explanation
8 Helmut Weidner, Lutz Mez, Lila Okamura

of environmental policy outcomes in national systems. According to Jänicke


(1997:14), capacity in environment is the ability of societies to identify and solve
ecological problems. Using a combination of actor and system-oriented ap-
proaches, the development of environmental capacity may thus be defined as a
multi-factorial process determined by: (1) usually conflicting organized actor
groups, their resources, their ability to form alliances, and their ability to cooper-
ate in identifying and seizing (or even creating) situational opportunities; (2) cul-
tural, political and economic (structural) conditions, the environmental situation,
and public awareness; and (3) the nature of the problem to be resolved (as partly
constituted by these factors); how easy it is to solve—which usually depends on
the kind of interests and the clout of the polluters involved, the systemic nature of
the problem, whether it is conventional or latent/ creeping, etc. As this approach
is concerned primarily with building and expanding capacities for environmental
protection, the focus is on environmental protagonists, whereas target groups
(polluters) are in principle seen as restrictive factors—without excluding possible
changes for the better.
In more analytical terms, capacities for environmental policy and manage-
ment are constituted by: (1) the strength, competence and configuration of gov-
ernmental and organized non-governmental protagonists of environmental pro-
tection; and (2) (a) cognitive-informational (specified here as cognitive-strategic
capacity), (b) political-institutional, and (c) economic-technological framework
conditions. The utilization of existing capacities depends on: (3) the strategy, will
and skill (“cognitive-strategic capability”) of protagonists and (4) their situative
opportunities. This has to be related to: (5) the kind of problem: its urgency, its
complexity, and the power resources and options of target groups, their allies and
supporters (Jänicke 1997:8). This core definition of capacity building, together
with some basic assumptions about the interaction of the central categories (see,
e.g. Weale 1992), provides a useful analytical framework for examining the im-
portance, development and interplay of environmental capacities. It was used by
Jänicke and Weidner in a cross-national study of environmental capacity building
in 30 countries (Jänicke & Weidner1997; Weidner & Jänicke & Jörgens 2002).
A country with a high capacity for environmental policy and management
would have, for example: (1) many well-organized environmental player groups
with well-established cooperative inter-organizational relations; (2a) comprehen-
sive and accessible monitoring and reporting systems, a high degree of environ-
mental awareness among political elites, the general public and the mass media
as well as the capability to interpret the information in a politically strategic way;
(2b) comprehensive and effective regulations, instruments and well-resourced in-
stitutions as well as a high degree of intra- and inter-policy co-operation; (2c) a
flourishing, innovative environmental business sector and a modern industrial
structure; (3) committed and strategically skilled actor groups; (4) highly visible
Introduction and Research Approach 9

damage for which feasible solutions are available and a target group striving for
a “greener image.” If these ideal conditions were met, along with a sound level of
social welfare, good economic prospects and a pro-innovation culture with a high
esteem for post-material values, environmental success would, so to say, be inev-
itable.
However, there is no country where all these ideal conditions are met. Thus,
it remains a task of the proponents (supporters) of a transition towards ecological
modernization to try hard to achieve the needed capacities. For the success of such
a pro-active political engagement various factors and preconditions are decisive:
The degree of available financial and technological resources, the overall envi-
ronmental consciousness of the public and of groups inside the government and
the business sector, the strength of environmental organizations and networks,
and, first of all, the degree of the cognitive-strategic capability of the groups striv-
ing for a transition towards ecological modernization.
The cognitive-strategic capacities refer to the capabilities of proponents of
strict environmental and energy policy to analyze the political arena, to assess the
power of the veto groups and to relate and compare these information with their
own power resources in order to assess whether they have chances to push for
structural changes , and finally to develop on this knowledge a realistic political
strategy how to reach their policy targets against usually strong opponents.

Path Dependence
In a nutshell, the theorem of path dependence is based on the premise that “history
matters”: That decisions made in the past concerning institutions, products, tech-
niques, policies etc. can strongly limit the choices of today to change the core
features of the path if certain conditions have led to a stable development trajec-
tory or even a “lock-in”. Path dependence is often a result of positive feedbacks
related with the chosen matter, leading to self-reinforcing processes.
Such constraints on a change are usually a result of prohibitive high costs of
reversing past institutional choices, massive changes in the power-balance result-
ing possibly in losses for the central stakeholders, the risk of an unfavorable
change of the cost-benefit or winner-loser constellation, and of a possible deval-
uation of well-functioning routines that have been adopted over the course of
time. Thus, a specific trajectory of development (path) may be hard or impossible
to reverse even in circumstances when better alternatives are available that would
increase the benefits of the involved actors and institutions.
Therefore, the option range for change is more dependent on choices made
in previous times than simply on current conditions of technology and preferences
(for basic literature on path dependence see David 1985, Arthur 1989, Thelen
1999, Pierson 2000).
10 Helmut Weidner, Lutz Mez, Lila Okamura

Path dependence in environmental policy could embrace features of different


size, importance, complexity, and age: It may range from small technical stand-
ards (e.g. for measurement and monitoring) to large-scale institutions, technolo-
gies or even policies (e.g. water management authorities, nuclear energy, transport
policy).
Important conditions giving rise to path dependence are sunk costs (of in-
vestments), technical and institutional interrelatedness/interdependence of vari-
ous factors/system components contributing together to the outcome; positive
feedbacks like increasing returns/profits/markets, decreasing costs including low
transaction costs, well-established (sometimes even “cosy”) relationships be-
tween the stakeholders; and a favorable winner-loser-balance for established
groups/institutions related to the outcome which could get lost after a path change.
Path dependence is related to the theory of “historical institutionalism”, often used
in political science to focus on the effect of institutions and to investigate the issue
that political institutions rarely experience quick and deep changes. However,
path dependence is not related to determinism: Although studies suggest that sig-
nificant changes of path dependent processes/arrangements can be affected often
only in exceptional situations, there are also examples of changes in less extreme
situations. Thus, incremental or fundamental change is principally possible (crit-
ical juncture), for instance by a sophisticated political strategy performed by ac-
tors with high cognitive-strategic capabilities; by elite dissent; certain exogenous
crisis situations and events opening “windows of opportunity”, or even by exit
negotiations with the stakeholders combined with adequate “loser compensa-
tions”.
The transition to low-carbon economies will need to be carefully managed
(Cecere et al. 2014), as the provision of secure, affordable energy is critical for
economic growth and social development. Because of special characteristics of
industries and societal systems based on carbon fuels (like power production, but
also the automobile sector) a “lock-out” of the established developing path is a
hard, complex and usually long-term task, needing fundamental technological,
institutional and behavioral change and a sophisticated political strategy “with a
long breath”, similar to a process of drilling hard wood with sound judgement and
patience as the famous German sociologist Max Weber (in: Politik als Beruf/Pol-
itics as a Profession, 1919) once said. This conclusion goes conform with the
findings of various other studies specifically based on a carbon lock-in approach
as a strand of the path dependence theorem (Unruh 2000, IEA 2014, Erickson et
al. 2015, Seto et al. 2016).
The basic assumptions and premises of the carbon lock-in approach are as
follows:
“Carbon lock-in arises when the infrastructural and technological lock-in (...) is rein-
forced by institutional lock-in (...) and behavioral lock-in (...). Political scientists,
Introduction and Research Approach 11

sociologists, and other social scientists have developed theories of institutional lock-
in as part of broader theories of institutional stability and change, reflecting the view
that institutional choices at one point in time significantly shape later choices. Insti-
tutional lock-in differs from technological lock-in in important respects. (…) Lock-
in is an intended feature of institutional design, not an unintended by-product of sys-
temic forces. Because institutions are “distributional instruments laden with power
implications,” institutional lock-in arises (…) from conscious efforts by powerful
economic, social, and political actors. (...)These actors engage in intentional and co-
ordinated efforts to structure institutional rules, norms, and constraints to promote
their goals and interests in ways that would not arise otherwise. (…) This intentional
nature of institutional lock-in means that it is beneficial for the winners in the “battle
over the nature of institutions,” even if it is suboptimal from an aggregate social wel-
fare perspective. (...) Differences between political processes and market forces make
institutional lock-in likely to occur more often and with greater intensity than tech-
nological lock-in. Despite these differences, institutional lock-in parallels technolog-
ical lock-in in that institutions end up in an inertial equilibrium state on a trajectory
that proves quite resistant to change and that creates increasingly costly and challeng-
ing barriers to switching to any alternative trajectory.“ (Seto et al. 2016:9).
In their conclusion the authors again emphasize the difficulties to change carbon-
intensive development paths, as this is not only dependent on demonstrating bet-
ter and feasible alternatives but will require to overcome a network of powerful
actors, and also a transformation of individual habits, preferences and practices
that are often deeply rooted in culture and traditional social norms:
„Our current trajectory of carbon emissions reflects, in important respects, the phe-
nomenon of carbon lock-in. Technological and economic, political and institutional,
and social and individual factors and dynamics tend to create stable equilibria that
may be suboptimal for planetary health but are difficult to disrupt. The realms of
infrastructure and technology, institutions, and individual behaviors contain distinct
but parallel dynamics that favor existing carbon-intensive technologies and develop-
ment paths. Lock-in in each of these realms and the global-scale systemic lock-in that
emerges because of their mutual reinforcement pose significant obstacles to adoption
of less-carbon-intensive technologies and development paths. (...) Current under-
standings of lock-in demonstrate that lock-in is highly likely because of unintentional
features of these systems as well as because powerful actors often benefit from cre-
ating and maintaining a state of lock-in.“(Seto et al. 2016:21).
In view of these great difficulties in changing a development path marked by "car-
bon lock-in“, the nuclear phasing-out policy, the planned phasing-out policy for
coal-fired power plants and the establishment of a broad development path for
renewable energies (which also has characteristics of path dependence! see Sim-
mie 2012) in Germany (see also Grabher 1993) is a great political-strategic
achievement and a phenomenon that is unique in international comparison. In
stark contrast to this is the German automotive policy, which is still strongly dom-
inated by carbon lock-in, while in this area (as in the rare earth sector) Japan has
12 Helmut Weidner, Lutz Mez, Lila Okamura

developed greater flexibility and more promising strategies for overcoming the
carbon lock-in syndrome.

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2). Berlin, Heidelberg, New York.
Ecological Modernization – a Paradise of Feasibility
but no General Solution

Martin Jänicke

Introduction
Ecological Modernization (EM) intends to preserve or restore environmental
quality by resource-efficient innovation. Today there are several synonyms or
similar concepts such as, “eco-innovation”, “green development” “green growth”,
or transition towards “green economy” (OECD 2011; UNEP 2011). This environ-
mental policy approach has meanwhile become a well-established strategy and
stimulated nothing less than a real Global Industrial Revolution. It achieved a high
speed and a global dimension of technological change with pioneers such as Ger-
many, Denmark, Sweden, California or China. It has been highly successful e.g.
regarding the use of renewable energy in the power sector, waste recycling or eco-
efficient water supply. Its economic co-benefits - additional employment, reduced
production costs, or innovation – has given the political process a particularly
high feasibility.
There are on the other hand significant weaknesses: The ecological effec-
tiveness of EM is often only selective and restricted to market-based solutions
(Machin 2019). EM is no effective alternative where it only adds the clean(er)
technology to the existing “dirty” branch structure. There are also problems of
equity regarding the attribution of costs or the global distribution of benefits. The
strengths of this environmental strategy are as remarkable as its weaknesses. EM
therefore needs a differentiated evaluation and a better understanding of environ-
mental policies beyond EM. A policy of structural change (e.g. phasing out fossil
fuels) is the necessary supplement of EM on the road to sustainable development.
But this is a different approach with a significantly lower feasibility. Strict goal-
oriented approaches, the increase of feasibility by capacity building and innova-
tive governance seem to be important if the full potential of EM is to be used.

The Concept
EM is the innovation and diffusion of marketable technologies with positive im-
pacts on both, the environment and the efficiency of resource use. EM is the sys-


Martin Jänicke  Freie Universität Berlin  hauptman@zedat.fu-berlin.de

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_2
14 Martin Jänicke

tematic transition from a high-polluting techno-structure to an ex ante more envi-


ronmentally friendly technology base of the economy. It is an essentially policy-
driven process. The term denotes environmental policies that proceed from tradi-
tional pollution control to an innovation-oriented “green industrial policy” (Walz
2015, Altenburg & Assmann 2017).
The concept and term of EM was first used in Germany to open a new field
of innovation and employment for environmental policy. Instead of adding a pol-
lution control technology to a “dirty” process or product an ex ante clean(er) tech-
nology would be introduced. Instead of an unproductive additional investment in
pollution control a new type of resource-efficient, knowledge-intensive technol-
ogy would be preferred. The new eco-efficient technology therefore could in-
crease productivity by saving costs of add-on technologies as well as resources.
“Ecological modernization” has been used first by the author as a political
formula in a parliamentary speech in January 1982 and later on in a special issue
of the magazin NATUR which was conceived as an alternative to the government
statement (Mai 1983) of the new chancellor Helmut Kohl (Abgeordnetenhaus von
Berlin 1982, Jänicke 1983). While this took place in the public policy discourse
the concept was 1984 also proposed as a scientific concept in a study for the Ber-
lin Science Centre (Jänicke 1985). The term was adopted first in the so-called
“Berlin School of Environmental Policy Research” (Jänicke & Jacob 2006, Si-
monis 1988, Zimmermann et al. 1990, Prittwitz 1993, Foljanty-Jost 1995, Mez &
Weidner, 1997) and later by other authors influencing the German policy debate
(e.g. Hauff & Müller 1985) before it became a political formula of the red-green
federal government in Germany (1998-2005).
One of the core ideas of EM was to use the inherent pressure for innovation
in competitive market economies to transform the resource- and environment-
intensive mode of industrialism. This was similar to the idea of “ecologizing the
economy” which was developed at the same time in Berlin (Huber 1982). In the
environmental science debate the concept of EM has been in widespread interna-
tional use since the early 1990s (Spaargaren & Mol, 1992, Weale 1992; Hajer
1995; Young 2000; Mol 2001; Mol, Sonnenfeld & Spaargaren 2009; Andersen
2010). While authors such as Mol and Spaargaren discussed EM in the context of
the sociological theory of modernity, the German discourse had a stronger policy
orientation and a focus on policy advise. Jänicke and Jacob for instance under-
lined the multiple interactions between policy and technology. This was particu-
larly exemplified by the case of policy-induced lead markets for clean technolo-
gies (Jänicke & Jacob 2006). Today EM, in a broader perspective, includes all
kinds of innovative “nature-based solutions” (NBS) (Maes & Jacobs 2017) and
sustainable bio-economy (Sillanpää & Ncibi 2017).
EM can lead to structural change, which reduces the share of environment
and resource-intensive sectors. In this case it is a process of innovation which
Ecological Modernization – a Paradise of Feasibility but no General Solution 15

leads to the “creative destruction” (Schumpeter 1942) of the former technological


basis. However, very often we find that a creative destruction does not take place,
or only to a certain degree. “Dirty” sectors such as the fossil fuel industry or the
agro chemical sector can coexist over a long time. Infra structures such as the
basic conditions of car traffic can similarly co-exist with high fuel-efficiency.
Therefore, EM needs the supplementation of eco-reconstruction (Jänicke 1985)
to become sustainable.

Ecological Modernization as Global Green Industrial Revolution


The fascination of EM comes from success stories of market-based innovation. It
is characterized by high speed and a global dimension of change. There is a
“green” clean-tech sector of most national economies which is rapidly growing.
It has been defined as the industry producing “environmental technology and re-
source efficient products, processes and services” (BMU 2018). The enterprises
of this sector are providing the means of EM to be used by other parts of the
national economy. Its importance, therefore, is not restricted to the clean-tech sec-
tor as such. A recent study of Roland Berger (2016) estimates the global market
volume of the main segments of the green clean-tech industry to be 3,214 bn. €.
The authors of the study expect a market volume of 5,902 bn. € by 2025, with an
annual growth rate of 6.9% (BMU 2018).  
Nearly 4.2 million people (full-time equivalent) in the European Union (EU)
were working in the environmental economy in 2014. 60% of these jobs are re-
lated to environmental protection, i.e. preventing, reducing and eliminating pol-
lution and any other degradation of the environment. The remaining 40% are jobs
related to resource management activities. Between 2000 and 2014, employment
in the environmental economy grew considerably faster (+49%) than employment
in the overall economy (+6%) (Eurostat Press Release 29.5.2017). The global em-
ployment effect of renewable energy alone was, according to REN21, 10.3 mil-
lion in 2017 (REN21 2018).
The speed of change in the renewable energy sector is particularly high. Sev-
eral countries increased their RE targets more than once (particularly China, but
also countries like Germany, Portugal or India). The diffusion of climate-related
targets and policies has also a remarkable speed and a global dimension. National
renewable energy targets existed in 2017 already in 179 countries – about three
times more than ten years ago . 157 countries had already energy-efficiency tar-
gets at that time (REN21 2018).
It is highly remarkable, that the described diffusion processes are completely
voluntary and mainly based on “lesson-drawing” from pioneer countries (Rose
1993, Jänicke & Wurzel 2019). Nobody has forced the 179 countries to introduce
16 Martin Jänicke

renewable energy targets. The rapid catching-up of developing countries is an-


other interesting aspect of this rapid global change (REN21 2018). The World
Bank expects that developing countries increasingly drive the growth in the global
climate and clean technology market. It expects an investment across 15 clean
technology sectors in these developing countries to top 6.4 trillion USD by 2023
(World Bank Group 2014).

The Co-benefits of EM
How can this rapid political and technological change worldwide be explained?
One explanation is of course the influence of global policies, such as envi-
ronmental and climate policy, supported by the process of policy formulation re-
garding sustainable development since the UN-summit in Rio de Janeiro (1992).
This was an interactive process of policy learning in the system of multi-level
governance which has developed from that time on (Geels 2011, Ostrom 2010).
Peer-to-peer learning about EM began as a process between national govern-
ments, as lesson-drawing from pioneers. Meanwhile this learning process can be
observed also at the level of provinces/states as well as cities or even villages
(Jänicke 2017b).
A second explanation of the global dynamics of EM is the lesson to be
learned. It is the lesson, that there are co-benefits of EM. “Co-benefits refer to
multiple benefits in different fields resulting from one policy, strategy, or action
plan. Co-beneficial approaches to climate change mitigation are those that also
promote positive outcomes in other areas such as concerns relating to the envi-
ronment (e.g. air quality management, health, agriculture, forestry, and biodiver-
sity), energy (e.g. renewable energy, alternative fuels, and energy efficiency) and
economics (e.g. long-term economic sustainability, industrial competitiveness, in-
come distribution)” (Ministry of the Environment, Japan, 2009).Co-benefits have
been discussed first in the context of climate mitigation (Mayrhofer & Gupta
2016). But the concept could be extended to the green economy in general. Early
on, co-benefits became a “no-regret” argument, according to which the positive
side-effects should suffice for legitimizing the respective climate change mitiga-
tion measure (Adler 2000). Over time, in addition to positive side-effects, multiple
benefits were increasingly addressed. In 2014, the International Energy Agency
(IEA) published a list of 15 potential co-benefits, which can occur alone through
greater energy efficiency (IEA 2014). The Fifth Assessment Report issued by the
Intergovernmental Panel on Climate Change (IPCC 2014) arrived at 18 potential
economic, ecological, and social co-benefits of climate change mitigation. The
global co-benefits of renewable energy have been reported by IRENA. The 2018
Report gives the figure of more than ten million jobs in the main countries in-
cluded in the study (IRENA 2017), 4.2 million jobs in China alone. The World
Ecological Modernization – a Paradise of Feasibility but no General Solution 17

Bank has calculated the health and energy benefits from climate mitigation in
China, India, USA, EU, Brazil and Mexico for 2030. The figure was $ 1.23 trillion
(World Bank Group 2014).
It is not easy to explain why the “multiple benefit approach” has been re-
stricted so far to climate protection. EM may have even more co-benefits. Like
the low-carbon economy it is characterized by a general double advantage of
higher resource-efficiency and lower environmental damage, both offering a
broad spectrum of innovation, lower costs, new markets and jobs. A recent study
describes the potential co-benefits of a green industrial policy also in developing
countries, from health effects and energy security to new markets, (net)employ-
ment and increased productivity (Altenburg & Assmann 2017). Co-benefits there-
fore, particularly those for relevant economic actors, are an important argument
for EM in general. Together with environmental and resource-related concerns
they are also an important explanation for the Green Industrial Revolution.
This can be exemplified by the flow of material resources along the value
chain of a certain product: At each stage of the production process a broad variety
of resources are used, the reduction of which can lead to cost reductions and other
economic, ecological and social co-benefits.

The Case of Germany


Germany had some experience with innovation-oriented approaches to environ-
mental policy already before the red-green government (particularly under the
environmental minister Klaus Töpfer). However, when 1998 a government of So-
cial Democrats and a green party came into power, it started a green industrial
policy explicitly under the headline of EM. This “red-green” government was in
power until 2005. The second coalition treaty of this government (2002) mentions
already relevant potential co-benefits of this approach. EM was characterized as:
“…integration of labor and environment“, based on „increased eco-efficiency,
lower production costs and improved competitiveness” (SPD–Bündnis90/Die
Grünen 2002).
Later on, since 2005, the ministry of environment published a regular report
on “GreenTech in Germany”. The term was also used to describe the process of
EM: “…environmental technology and resource efficiency promote the green
transformation in all branches of industry, injecting powerful stimulus for ecolog-
ical modernization” (BMU 2018, 13). The report is a regular statistical review of
the environmental industry (GreenTech sector), the hard core of the larger “green
economy” sector of the country, which includes also additional activities such as
organic farming, eco-tourism, or green finance. The GDP share of the turnover of
the GreenTech sector increased steadily from 8% (2007) to 15% (2016), with a
forecast of 19% (2025) (BMU 2018). No other industrial sector had a similar
18 Martin Jänicke

growth in Germany, neither the successful car industry nor the strong mechanical
engineering sector. The estimated employment effect of the German GreenTech
sector is – according to Roland Berger - 1.5 million. The expected growth rate
until 2025 is 6.7% (BMU 2018). The employment in the broader environmental
sector in Germany is calculated in a different study at 2.2 million (2012) (Edler
& Blazejczak 2016).
Not only the employment but also the productivity of the German industry
seems to have been improved by the EM. This is true at least for the chemical
industry which according to a study of the branch organization of this sector (VCI)
achieved more than one co-benefit from EM: With a turnover growth of 41.2%
between 2000 and 2013 it reduced the energy consumption absolutely by 12.6%,
the water use by 20.8% and the disposal of waste by 61.9% (VCI 2015). This
means of course also a cost reduction which has contributed to the successful
export situation of this sector.
An indicator of the acceptability – and feasibility - of this strategy of resource
efficient eco-innovation may be the illegal pollution in Germany: It increased un-
til 1998 and was then steadily reduced in the following years. The main factor
was illegal waste disposal. It became obsolete not only due to better waste collec-
tion and regulation. An important reason was the increased value of recycled
waste. The recycling quota of total waste in Germany was 70% in 2016 (Statis-
tisches Bundesamt 2018).

Strengths and weaknesses - Evaluation of EM as global environmental strat-


egy
Using the generally accepted four criteria of policy evaluation (e.g. Wollman
2007; IPCC 2014:1156) – environmental effectiveness, economic efficiency, dis-
tributional equity and political feasibility – the following general assessment
could be made: EM has achieved a high speed of change and a global scale of
diffusion because it is the approach to environmental policy that is comparably
easy to realize. It has a high feasibility. One reason is the high efficiency of the
approach which intends to be resource saving and often leads to lower production
costs, particularly if they are compared with the high and unproductive investment
in end-of-pipe technology. This is part of the potential economic co-benefits of
EM, from increased competitiveness to innovation and employment. EM has a
high feasibility because its co-benefits can be addressed to relevant economic in-
terests of the society. Therefore it is essentially an approach which is more inter-
est-based than norm-based (Schaik, van & Schunz 2012), more voluntary than
“legally binding” and less a burden than an opportunity. The strength of EM and
its global dynamic as Industrial Revolution are economic efficiency and feasibil-
ity.
Ecological Modernization – a Paradise of Feasibility but no General Solution 19

There are however also weaknesses, which have been criticized in recent
times. This critique belongs mainly to the criteria of effectiveness and equity. The
effectiveness (the degree of achievement of the intended goal) has been disputed
by several authors (e.g. York & Rosa 2003; Ewing 2017). And indeed, many en-
vironmental problems have not been solved, often they have even deteriorated.
Soil pollution, loss of species and climate change are problems far from being
solved. Not all environmental problems can find a technical solution. And some
technical solutions are neutralized in the long run. Already in the first publication
on EM the environmental impact was seen potentially reduced by growth effects
(Jänicke 1985). Other authors stress the rebound effect, where increased resource
efficiency can be reduced by higher resource use due to the saved income (Gil-
lingham et al. 2014). This effect is generally no problem in case of radical inno-
vations (PV, plus-energy houses, or electric vehicles), where the positive environ-
mental effect cannot be easily neutralized by higher consumption. Other options
to prevent rebound effects are dynamic targets and standards, or a clear cap.
There is another weakness of EM which has been criticized in recent times:
the dimension of equity, or the fairness of this process. Too often it is not the
polluter who pays. The distributional equity problem has also a global aspect (e.g.
Bonds & Downey 2012; Ewing 2017). In many industrialized countries (and
meanwhile even in China) we find a de-location of “dirty industries” into less
advanced countries. The final production in developed countries may be relatively
“clean”, however the early stages of the production line can be based of heavy
industries in developing countries. This needs structural change of the global
economy, which so far only slowly takes place.

EM needs structural change to become sustainable


Insufficient structural change is one of the main explanations of the deficits of
EM. This approach was essentially perceived as process of eco-innovation. It is
expected to result in a “creative destruction” of the former economic structure.
However, EM often means only selective modernization leaving the former
“dirty” sectors or infrastructures more or less untouched. Ecological modernity
coexists with traditional “dirty” industries: renewable energy in the power sector
can coexist with coal-based power, organic farming with industrialized agricul-
ture, fuel-efficient cars with a growing oil industry. There are also sectors which
have an internal EM (such as the German Chemical industry) but nevertheless a
negative external impact by their products (such as pesticides).
Eco-restructuring and the phasing out of inherently polluting sectors are
therefore a necessary complement of EM. This is a different task. And it has a
different feasibility.
20 Martin Jänicke

Conclusion
EM has become a real "paradise of feasibility". The transition to a green economy
takes place with an unexpected speed of change and a global scale of diffusion. It
is strong where radical specific improvements instead of incremental innovations
take place – e.g. the introduction of renewable energy, plus energy houses, electric
vehicles, drought-resistant plants, recycling or water recovery techniques. EM is
driven by both, the pressure of the environmental and climatic crisis and the co-
benefits of resource efficiency. The co-benefits of EM are most important driver
of feasibility. They can be found at different stages of the value chain. They can
be highly attractive for relevant actors – if the lesson has been learned. The learn-
ing process is being supported by the polycentric framework of multi-level gov-
ernance as a multi-impulse-system of interactive learning. As far as EM is inter-
est-based it can rely on voluntary action. The global diffusion of renewable energy
for instance has been essentially a voluntary process. This is true even for the
global diffusion of the supporting policies.
However, the environmental effectiveness and the distributional equity and
fairness are often insufficient and have been often disputed. The environmental
improvements of the EM can be neutralized by growth and rebound effects. Suc-
cess is often selective and restricted to market-based solutions (Machin 2019).
Environmental problems as for instance loss of biodiversity typically cannot be
tackled by marketable technologies. “Green” sectors often co-exist with “brown”
industries (particularly the fossil-fuel sector), because structural change is suc-
cessfully resisted. The co-benefits of increased resource efficiency in rich coun-
tries have often negative impacts in countries where the resource-intensive input
in the value chain is being produced. Distributional equity is often violated by the
fact that it is too often not the polluter who pays. There is also a danger that the
high feasibility of EM leads to the avoidance of the more difficult approaches.
EM has become a broadly accepted concept towards global Industrial Revo-
lution. It seems to be the necessary first step for a more comprehensive transition
towards long-term sustainable environmental conditions. EM is however neither
a substitute for environmental policy nor for structural solutions. Environmental
justice as well needs its specific approach. The lower feasibility of some important
environmental policy approaches needs a steady increase of capacity (Jänicke &
Weidner 1997). EM therefore needs a parallel long-term process of political mod-
ernization. It also needs reflexive governance (Voss & Kemp 2005) which regu-
larly controls its effectiveness – improving the instruments and actor configura-
tions if the outcome is insufficient and raising the ambition if there is unexpected
success.
Ecological Modernization – a Paradise of Feasibility but no General Solution 21

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Ups and Downs in Environmental Policy: Japan and
Germany in Comparison

Helmut Weidner

Introduction
Japan, once a forerunner in environmental and energy policy, became a laggard
especially in climate change and energy policy (but belongs to the forerunners in
“rare earth”-policy and electrification of automobiles). Germany turned from a
late-comer in environmental policy to a pioneer in climate and energy policy (es-
pecially “renewables”) and became the first large industrial country phasing-out
nuclear energy. These Ups and Downs in environmental policy will be explained
by the capacity building approach, focusing economic-technological, institutional
and cognitive-strategic capacities of proponents of progressive environmental
policy. Whereas the two first mentioned capacities are altogether similar in both
countries, the cognitive-strategic capacity exhibits strong differences. Therefore,
the focus will be on this special kind of capacity.
This chapter will demonstrate inter alia that in Germany the environmental
proponents have acted very politically, guided by the idea of an “ecologicaliza-
tion” of society, followed by the more differentiated and broadly accepted “vi-
sion” of ecological modernization. They used a multitude of (medium- and long-
term oriented) strategies and tactics to (successfully) penetrate the relevant polit-
ico-administrative as well as educational-cultural institutions, in order to push en-
vironmental policy from “inside the system”. The formerly quite disparate envi-
ronmental movement showed high strategic “will and skills” in establishing a so
to say two-level movement: one that co-operates with actor groups from all
spheres to promote environmental policies; and another one that acts as a broad
societal network, which could easily be mobilized for confrontative actions
against the “polluters” and for large protest rallies. A sophisticated combination
of these two (“inside & outside”) strategies, using the Chernobyl as well as the
Fukushima nuclear catastrophes as “opportunity windows”, successfully forced
the government to decide to phase-out nuclear energy and to push for a “Ener-
giewende” (energy transition), i.e. a massive turn of German energy policy to-
wards “Renewables”. Obviously, the Japanese proponents of new energy and en-
vironmental policy have so far been only able to promote an altogether strong
technocratic environmental policy but did not change the structures of prevailing


Helmut Weidner  Freie Universität Berlin  fu.weidner@t-online.de

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_3
26 Helmut Weidner

policies so that no new paradigm will actually lead future policies. This stagnation
could be explained by their different strategic capacities for politics. Perhaps the
“strategic capacities”, how they were built up and used by the German environ-
mental movement, could provide good examples for lesson-drawing and “politics
learning” for Japanese actors – such as the German environmental actors profited
once much from studying Japanese policies and politics of the 1960s and 1970s.
The concept of “pioneers” is not a static concept, as is demonstrated by the
above mentioned up-and-down developments in the two countries. Furthermore,
recent developments in both countries indicate that Germany is losing dynamic
towards ecological modernization in two policy areas which once where widely
acknowledged as “success stories”, also from abroad: In climate policy it is pri-
marily the issue of “brown coal” (lignite), related to domestic production and as
dominant energy source; in the automobile sector it is the issue of strict and true
(working in practice) exhaust standards and also the evident failure of developing
and marketing so-called alternative (“climate friendly”) engines at an adequate
scale. In Japan, in contrast, the electric car is on the way to become mainstream,
and Japan's car-makers are now very busy in doing research on alternative en-
gines, like hydrogen engines, which are promising to have a better environmental
and energy balance than e-mobiles. And it is in the relatively new policy field of
“rare earth” where Japan is strategically and in practice ahead of Germany, where
this issue (in government, business sector and environmental movement organi-
zations) has still low priority in environmental strategy building.

Different Developments in Environmental Policy: Actors and Characteristics


Germany, now among the pioneers in some important environmental and energy
policy areas, was originally a late-comer in environmental policy if compared to
USA, Sweden or Japan who started earlier in taking up the challenge of environ-
mental pollution. It was not before the late 1960s that the establishment of a sys-
tematic environmental policy began in Germany (Weidner 1997). In those times
it was mainly a group of very committed politicians, administrators and some
scientists who worked very dynamically and also strategically very intelligently
to institutionalize and strengthen the environmental issue not only in the govern-
mental realm but also in economy and society. This group (which could also be
called an “environmental advocacy coalition”) was guided by the idea of the
“Vorsorgeprinzip” i.e. the precautionary principle, basically meaning that avoid-
ance of pollution is better than cleaning up, and the group was also convinced that
a policy guided by this principle would also proof to be the economically more
rational strategy from a long-term perspective. There was also the strong idea that
Germany as a latecomer in environmental policy could profit from the experi-
ences of the forerunners and that the lessons learned from these experiences could
help to support the case of precautionary policy in Germany.
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 27

From such a political-strategical point of view Japan seemed to be a good


case to be studied: Japan, in that time, enjoyed worldwide the dubious reputation
as having been (during the 1950s and 1960s) a show-case of environmental pol-
lution. Probably no other industrial country had come to feel the consequences of
unrestrained industrial growth as painfully as Japan. Critical observers even saw
the country as doomed do commit “ecological seppuku (harakiri)”. However, the
German observers –and especially the persons engaged in institutionalizing envi-
ronmental policy—were also fascinated by the big turn of Japanese policy which
made Japan a short-term leader in pollution control policies in the 1970s: Japanese
DeSOx/DeNOx-technology (desulfurization, denitrification), catalytic devices
for cars, the pollution-victim compensation system linked to a SO2-charge, vol-
untary environmental agreements (kogai boshi kiotei), etc. stimulated progress in
environmental policy abroad.
Japan became something like a blue-print for a feasible strategy to solve
massive pollution problems without making the economy suffering. And its pain-
ful development before the phase of an effective pollution control policy begun
provided also good arguments for the superiority of the precautionary principle.
This altogether led to a heavy “expert tourism” towards Japan, perhaps compara-
ble in volume with the number of Japanese experts who travel to Germany since
2011 to learn from the German experiences, especially in the areas of climate
policy, renewable energy, and phasing-out of nuclear energy. This article does not
intend to provide a broad and detailed historical overview of environmental policy
in both countries (see for Japan: Miyamoto 1991, 2014; for Germany: Weidner
1995, 2002; for both countries: Schreurs 2003). The main objective of this selec-
tive comparison of Japan and Germany is to find out or at least to get a notion of
what the main characteristics of environmental policy and politics in both coun-
tries could be which could explain the apparently strongly different ways Ger-
many and Japan walked with respect to environmental, climate and energy policy
since the 1960s, and whereby Japan, the former pioneer of an effective techno-
cratic pollution control policy (see Tsuru/Weidner 1989, Miyamoto 2014) became
a laggard in environmental policy, and Germany, the former latecomer became a
forerunner in complex and “wicked” areas of environmental and energy policy.
When looking back at the basic reasons, causes and political attitudes which
were decisive for leaving the phase of (an often deliberate) “ecological ignorance”
towards the establishment of a more systematic environmental policy some re-
markable differences between Japan and Germany become evident: In Japan it
were primarily the combined efforts of a variety of groups which forced a change
of policy: this anti-kogai movement was made up mainly by those suffering from
pollution, critical scientists, victims and consumer organizations, many mayors of
polluted villages and cities (the famous governor of Tokyo, Minobe Ryokichi,
among them), various environmental groups (NGOs) and networks like jishu
28 Helmut Weidner

koza, housewifes and fishermen to name but the most important ones. There ac-
tivities rather often led to hard and violent conflicts with the “pollution establish-
ment”. However when some courts started to decide in favor of the pollution vic-
tims (especially in the “four major kogai trials”) the polluters and their allies in
the politico-administrative system gave up their massive resistance and intro-
duced rather fast various laws (famous became a session of the so-called kogai-
diet 1970 when several laws and regulations were passed) which quickly met
broad international interest, including Germany. Although there were still deci-
sive gaps and weaknesses existent in environmental policy one could say that Ja-
pan had entered a new anti-kogai (but not an ecological) era during the 1970s,
which altogether lasted only for a relatively brief time span, after which economic
interests again became successful in weakening existing regulations and in pre-
venting the introduction of new and stricter ones. This trend could also not be
stopped by the very engaged director-general Oishi of the newly founded Envi-
ronment Agency (kankyu-cho). So, in sum, it was mainly the tremendous and
broad public pressure (also using some strong “blaming and shaming”-tactics) on
polluters and their allies which had forced them to change their policies. But the
then following improvements were mainly done unintentionally by the big pol-
luters, they were done because of the public pressure, they were not a result of
true “policy learning” and not due to a new and internalized environmental vision
or paradigm of the future development of Japan inside the circles of big industry,
KEIDANREN and (then) MITI.
In Germany, in contrast, the new systematic environmental policy was so-
to-say born inside the politico-administrative system. It was the “child” of a then
small group of very committed politicians and bureaucrats who not only had the
vision of an precautionary and integrative environmental policy (embracing all
relevant economic, political and societal spheres) but who also had as experienced
insiders of the politico-administrative system excellent strategic capabilities and
political know-how about how to establish and protect a young and still weak
policy against the manifold forms of resistance of influential lobby groups and
their supporters inside government. So, for instance, when pressures by those lob-
byists sometimes became strong and effective in slowing down the environmental
policy process this “environmental lobby inside government” remained alive and
waited for new chances to come (“opportunity windows”) to push again for im-
proving and extending environmental policy. Therefore, there was in Germany no
structurally (long lasting) weakening of environmental policy although there have
been occasionally some backlashes. And it is also to be strongly emphasized that
this group of environmental proponents followed a basic political strategy : They
seemingly had learned by studying the environmental conflicts in Japan that a
certain degree of public pressure is decisive to make things going and also helpful
for countering possible attempts by the “polluters’ lobby” to weaken progress.
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 29

Therefore this group actively contributed by various means to the strengthening


and the institutionalization of the then rather small and quite disparate environ-
mental movement, for instance by subsidizing conferences of NGOs, thus provid-
ing advice and education in environmental policy making, and by organizing
workshops which brought together members from NGOs, the scientific commu-
nity, the various levels of government, and from the (mostly small and medium)
business sectors having a business interest in “greening” the economy and society.
This kind of active networking was not the only but certainly a highly relevant
cause that over time a strong and well-organized environmental movement and a
flourishing green business sector developed in Germany – much stronger and
more dynamically than in Japan and in many other countries— and that a lot of
co-operation developed between the different actors.
To generalize (and theorize) these different developments in the beginning
of a systematic environmental policy in Japan and Germany: In Germany there
existed a much stronger political strategy to build and to institutionalize strong
capacities and capabilities favorable for environmental policy progress, in the so-
cietal, the economic and also in the politico-administrative spheres, and to stimu-
late networking and co-operation between the various groups. This indicates the
higher relevance given by the founders of environmental policy to the “cognitive-
strategic-informational” capacity in comparison to other capacities which are mu-
tually constitutive for the “capacity-building approach”.

Main Differences
Germany turned after a long and conflicting process from a laggard to a forerun-
ner in several environmental areas. Especially the bad experience of the so-called
“Waldsterben” (forest dying) made the country a European forerunner in air pol-
lution control policy, stimulating by this also progress in EU policy. In this con-
tribution the focus will be on three inter-related policy areas where Germany be-
came and remained for a long time-period, partly until today a pace-setter and
pioneer: Climate policy, renewables (renewable energy), and nuclear energy pol-
icy.
The German global and national climate policy was widely acknowledged
as one of the most progressive ones, due to its demanding targets and rather large
achievements (Weidner & Mez 2008). From the beginning of international cli-
mate negotiations up to now Germany supported as a rule more demanding goals
than many other countries did, and it reached the EU-target of a 21 percent reduc-
tion of CO2-emissions (based on 1990s levels) earlier (in 2007) than required. In
2005 the government made a commitment to reduce CO2-emissions by 40 percent
from 1990 to 2020. And Germany was and still is always very active in supporting
a global contract on climate protection, whereas other big countries became a
30 Helmut Weidner

brake in global negotiations or jumped out of the Kyoto-Process (or behaved am-
bivalent like Japan). Recently there were indications of a slow-down of the dy-
namic in Germany, however, from an international comparative view Germany
still belongs to the meanwhile small group of countries actively pushing for de-
manding climate policy goals.
The climate policy is strongly interlocked with what is called in German
“Energiewende”(energy transition, i.e. striving for a big turn of the current energy
policy), and Germany also became a forerunner in renewable energy (Lauber &
Jacobsson 2016, Geels et al. 2016, Rogge & Johnstone 2017, Mez 2019), stimu-
lating by its activities and achievements many other countries to follow this way
to an energy future with a strongly reduced use of fossil fuels and no nuclear
energy. The “Electricity Feed-In Law” (regulating grid access and subsidies for
electricity produced by renewable resources), for instance, became a blue print
for more than 70 countries worldwide. One of the most important international
diffusion effects of Germany’s pioneership in renewables policy is to be seen in
its empirical demonstration that a large industrial country could financially afford
and technically manage a basic change of its energy structure, away from fossil
fuels and nuclear energy and towards renewables. Renewables therefore became
a big and ever-increasing green business sector – what also means that this busi-
ness branch became a strong lobby group for increasing the share of renewables
in the energy policy, thereby competing with producers of fossil and nuclear en-
ergy and weakening their political influence. It is an explicit goal which is fixed
in the governmental program that Germany should achieve a fundamental “Ener-
giewende”. This goal was even strengthened when the second phasing-out deci-
sion on nuclear energy was made, shortly after the Fukushima nuclear catastrophe
in 2011. There was already a nuclear phasing-out policy existent years before
“Fukushima” which had been introduced by the then ruling red-green coalition
government, but which was cancelled by the following conservative-liberal gov-
ernment, which argued that nuclear energy is necessary for reaching the demand-
ing climate policy targets (but many experts and a broad public were convinced
that the government mainly had in mind to support the big power companies who
could make large profits with their nuclear power plants).
However, the so-called Fukushima catastrophe (like before the Chernobyl
catastrophe in 1986) led to a broad mobilization of anti-nuclear power forces in
the German society (Schreurs 2012). Almost every week after the Fukushima nu-
clear accident a demonstration took place somewhere in Germany, sometimes
with 10,000s of people of all ages and spheres of society participating. It became
evident for the government that the conflicts were unstoppable on the rise, and
that it would lose votes in political elections if it would continue to support nu-
clear energy. This realization resulted in a quick and surprising rochade (political
maneuver) of the government, mainly initiated by the chancellor Angela Merkel:
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 31

The government announced that it will again introduce a nuclear phase-out policy,
accompanied by the advice of a pluralistic ethic committee and an independent
expert group. Although the official arguments for justifying this second phase-out
decision emphasize the high risks of nuclear energy as demonstrated by the Fu-
kushima catastrophe it is an open secret that the dramatic drop-down of public
acceptance of nuclear energy and the strong and well-organized protest move-
ments against nuclear reactors and nuclear waste storage were actually decisive
for the governments’ decision. Germany again became a pioneer (among the large
industrial countries) in nuclear phasing-out and became by this again an empirical
demonstration case that an exit out of nuclear energy is possible without damag-
ing the economy and without negative effects on energy security. (And remember
that Germany already was an empirical demonstration case that a demanding
global climate policy and the strong expansion of renewables were not only pos-
sible but also having in sum positive economic effects).
In contrast to Germany, Japan has in essential areas turned from a forerunner
to a laggard. Whereas in the 1970s the world looked at Japan to learn from its
pollution control policies to avoid ecological hara-kiri and a dramatic rise of mil-
itant protests, in present times there is only little international interest in policy-
learning from Japan, the “top runner concept” being one of the few exceptions.
(Of course, there is internationally also a very strong interest in the post-Fuku-
shima energy policy, however, the activities of the current Japanese government
and of the utility sector have led so far to an incredulous astonishment of many
people and experts about the so to speak stubborn nuclear go-ahead policy). The
change of Japan into a laggard in important environmental areas is somewhat
striking because Japan has been very early very innovative not only in environ-
mental but also in energy policy, e.g. after the oil shokku in 1973 it became a
leading country in energy efficiency, and the government also started very early
a renewables policy called the “sunshine project” (promoting solar, wind etc.
power generation). However, in the course of time the old vested (fossil and nu-
clear) interests in the utility sector succeeded in keeping the support for alternative
(renewable) energy relatively small compared to fossil sources, and in making
nuclear energy again basic element of Japanese energy policy programs (see
Schreurs & Yoshida 2013).
The post-Fukushima energy policy still remains a puzzle to many observers
abroad, especially when considering the dramatic “Fukushima Effect” on Ger-
many, although being thousands of kilometers away from the concerned area. Al-
ready the “Chernobyl Effect” (1986) has been on Germany politically much big-
ger than it or the “Fukushima Effect” was with respect to Japanese energy policy.
This is surprising because the distance between Chernobyl and Berlin is 1,148
kilometers, whereas Fukushima is with about 240 kilometers close to Tokyo.
32 Helmut Weidner

As this comparison of the two countries primarily wanted to show the most
important features it focused mainly on some selected (however politically, eco-
nomically and ecologically highly relevant) policy areas and did for this reason
also not systematically discuss the still existing gaps and flaws in German envi-
ronmental and energy policy, e.g. the renaissance of climate damaging coal in
electricity production (which is, however, increasingly challenged), the socially
unfair economic distributional effects of the governmental subsidy system for re-
newables, the flaws of the emissions trading system, the generous time-period
granted for closing nuclear power plants, the unsolved nuclear waste disposal is-
sue (where the tax payer has to pay most of the costs), etc. (Weidner & Mez 2008).
Nevertheless, the overall result of the comparison of Germany and Japan has in
our opinion a high plausibility: That Japan became a laggard and Germany a pio-
neer in some important areas of environmental and energy policy obviously could
be largely explained by differences in the cognitive-strategic capacity of the two
countries. This thesis will now be explored on the theoretical grounds of the so-
called capacity building approach, concentrating on the cognitive-strategic capac-
ities in both countries, which refer to the capabilities of proponents of strict envi-
ronmental (and related) policies to analyze the power-networks in the political
arena, to assess the power of the veto groups and to relate and compare these
information with their own power resources in order to assess whether they have
good chances to mobilize sufficient number of people and organizations to push
for structural changes , and finally to develop on this knowledge a realistic polit-
ical strategy how to reach their policy targets against usually strong opponents
and how to make out of possible successes a long-lasting process.

Differences in Cognitive-Strategic Capabilities


With respect to their “institutional” and “economic-technological” capacities both
countries are obviously well equipped, having therefore both very good prerequi-
sites for being among the leaders in advanced environmental and related (climate,
energy) policies.
Japan belongs to the leading industrial countries, with a high technological
innovation capacity, based on a broad and in many respect excellent education
and training system. The Japanese engineers belong to the best of the world, and
they often have demonstrated that they were able to solve even tricky environ-
mental problems by innovative and salable techniques (e.g. hybrid cars, energy-
efficient consumer products and production lines, advanced pollution abatement
techniques as well as measurement and monitoring appliances). In Japan there are
also many and well-staffed institutions spread over the country which are essen-
tial for creating a robust and at the same time flexible environmental policy, and
the staff mostly is committed to its tasks and works hard and precise. Over a long
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 33

time (remember Japan was once a forerunner in various environmental policy ar-
eas) the country has accumulated basic knowledge of all kind to meet environ-
mental challenges, and also its capacities for actively participating and influenc-
ing international negotiations have been decisively increased over time. With re-
spect to the staff, financial and material basis these institutions have a very good
potential for progressive environmental policy – if only these potential capacities
were realized and do not remain un- or underused.
However, although Japan possesses this great potential concerning eco-
nomic, technological and institutional capacities, the country’s environmental
policy rarely escaped the frame of an advanced technocratic policy. Almost no
long-lasting steps were taken towards a real precautionary, integrative policy, i.e.
as a general concept applied to all sectors of policy-making, the consumer and
private business sectors. A striking example how troublesome even smaller steps
in this direction are in Japan is provided by the many years long and frustrating
attempt to introduce a comprehensive and effective law mandating environmental
impact assessment, which finally ended up with a weak regulation. A rather sim-
ilar story could be told for global climate policy where Japan changed from a
brake to a supporter, and again to an at least passive stance towards an urgently
needed post-Kyoto contract. Despite its heavy dependence on energy resources
from abroad the Japanese government until recently has never introduced some-
what like a trailblazing program for renewable energy. Not even the Fukushima
catastrophe provided sufficient incentives to leave the high-risk path of nuclear
energy.
Altogether, Japan seemingly has altogether similar institutional, economic
and technological capacities as Germany has. So, the question arises: Why are
these capacities not realized, why do they lay idle? This puzzle’s solution may be
found in the cognitive-strategic capacity. Whereas the German environmental
proponents have been over a long period highly and in a rather sophisticated kind
active to conceptualize and implement a political strategy to “conquer” all rele-
vant institutions deemed to be influential in environmental policy-making, the
Japanese actors did much less in this respect. The rather strong “anti-kogai move-
ment” that existed in the 1960s and early 1970s became weak after the govern-
ment had turned to an effective technocratic environmental policy, and at the end
of the 1970s well-organized and politically active environmentalism had largely
vanished from the political scene. Special political parties representing environ-
mental interests played always a negligible role in Japan. And the anti-kogai or-
ganizations never succeeded in establishing a dense national network or a power-
ful national roof-organization.
This all stands in strong contrast to Germany where the environmental and
anti-nuclear movement was able to penetrate many governmental institutions,
from the local to the national level. Thus, environmental interest became widely
34 Helmut Weidner

integrated into established institutions. Furthermore, the environmental propo-


nents created a well-organized network, covering the whole country (which could
be easily mobilized for protest actions); established their own research organiza-
tions and an effective national communication system ,and here the nationally
distributed (so to say green-red) newspaper “Tageszeitung”, called TAZ, played a
central role in the times before the internet. These great achievements became
possible because the various strands of the movement –which was in the begin-
ning rather disparate - got help by actors of the left-wing (student) movement who
were frustrated about the very little resonance they found for their revolutionary
ideas in the German society and so they joined the environmental/anti-nuclear
movement, and over time some of their best strategist became leading environ-
mental activists.
Having their own research institutes was also very helpful for the movement
to produce science based “counter knowledge”, with which they could challenge
the often manipulated or biased study results of some of the highly influential
established institutes and institutions. The successful foundation of several “green
parties” first at the local and regional and then (after having gathered political
experience at these levels) at the national level made it possible that members and
groups of the “extra parliamentarian opposition”–movement could enter the inner
circles of the politico-administrative system. This was altogether a success story
as, for instance, former political “radicals” and fundamental critics of the capital-
ist system finally even became high-ranking administrators or ministers, and in
one case (Joschka Fischer) even foreign minister and Vice-Chancellor. In 1998
the first red-green national government was established.
In the end, environmental interests became well integrated in all spheres of
society. And the very German invention of the concept of “Ecological Moderni-
zation” also helped much to make environmental ideas also attractive to trade
unions and the business sector, because this concept also promises promotion of
innovation capacities, employment and green growth. This relatively simple and
vague “vision” also contributed positively to the increasing cooperation of groups
from different spheres, which are usually at odds, as this “vision” is based on a
win-win-win idea (environment, business and society will profit). This deep in-
stitutionalization of green interests and actors in all relevant public spheres is a
highly important reason why there has been no massive roll-back in environmen-
tal policy in Germany as in some other countries. And the decision of the con-
servative-liberal (successor of the red-green) government to cancel the first phase-
out decision did not last very long, because the anti-nuclear movement intelli-
gently used the Fukushima catastrophe as an “opportunity window” to roll-back
again nuclear energy succeeding in the second phase-out decision—which this
time very probably will remain stable as almost all experts and politicians assume.
(In the wake of the Fukushima nuclear catastrophe the decision made in 2010 on
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 35

extended operating time of nuclear plants by up to 14 years was reversed: Eight


nuclear power plants were shut down, and the federal parliament decided that the
remaining plants must go offline in 2022).
In summarizing this comparison of Japan and Germany the most important
factors for the greater success of the German environmental proponents compared
to the Japanese ones will be emphasized:
- The sophisticated strategy to make environmental interests strong and sus-
taining by establishing two streams of environmental movements: one
within the politico- administrative system to push from “inside” for more
progressive policies (“formal power”), and another movement “outside”
the institutions, which could be mobilized for big events and which could
act much more aggressive and conflict-oriented than the “insiders” could
do (“street power”).
- The often intelligently managed balance of conflict and cooperation to fur-
ther environmental goals. This presupposes the enhancement of special
cognitive-strategic and politics-oriented capabilities.

What is the big lesson out of the German experiences with promoting envi-
ronmental, climate, and renewable policies, and phasing-out nuclear energy?
High attention should be given to cognitive-strategic capacity building. Not only
the German case but also a cross-national study of 30 countries (Weidner, Jänicke
& Jörgens 2002; Jänicke & Weidner 1997) revealed the outstanding importance
of a high degree of strategic “will and skill” on the part of environmentalist as a
necessary precondition for effective policy-making but also for overcoming
deeply vested interests, structural restrictions, and to render even most powerful
opponents of a deep environmental policy vulnerable.
Whereas the anti-nuclear/environmental movement finally succeeded in fun-
damentally changing the more than 50 years enduring path of nuclear electricity
production, on the other hand it was not able to reverse the specific trajectories of
development in the fields of coal-based energy production and automobility. Alt-
hough there have been reached improvements from the perspective of energy sav-
ing/security and climate protection (incremental change), the core elements fixing
the paths (lock-in) remained mainly intact.
This strong resistance against a transition towards ecological modernization
could be explained on grounds of the path dependence theorem (of the theory of
historical institutionalism): Both sectors are characterized by a very long tradi-
tion, combined with a strong institution-building, a broad and dense regula-
tory/governance system , a close and highly interrelated network comprising in-
dustrial actors, public bodies, research organizations, and trade unions (Weidner
& Mez 2008). The sectors are also deeply rooted in the cultural-behavioral norms
and preferences of large parts of the population either in coal-mining regions or
36 Helmut Weidner

nationwide (automobility). Especially mining was and still is deeply woven into
the fabric of everyday life in the coal-mining regions (see for "carbon-lock-in"
Kuzemboa et al. 2000, Stein 2017).
The mining sector and related industries served for more than a century as
a core pillar of economic development that laid the foundations for Germany's
industrial revolution and its postwar economic recovery (“German economic mir-
acle/Wirtschaftswunder”) (see Ziegler 2013). After the (hard) coal mining crisis –
caused mainly by cheap coal imports and the increase of other more competitive
fossil fuels (oil, gas) – it took a long time before the hard coal mining sector lost
much of its former political influence. It was only in the end of 2018 that the last
mine was closed in Germany – after decades of generous public subsidies paid to
this sector to smooth its decline and to establish new business sectors; also, the
phase-out compromise of 2007 (ending coal production by 2018) was accompa-
nied by large social-economic support programs to avoid political disturbances.
However, the open-cast brown coal mines remained in operation, and this
sector still has political clout and influence, due to its competitive prices and the
large demand of the huge brown coal fired power plants. It was only recently that
this sector became also a candidate of phasing-out policy, mainly because of its
negative contribution to the official German climate protection policy. The influ-
ence of environmental groups in this process was rather limited, and only became
stronger when it became clear that Germany would miss its demanding CO2-
reduction goals without phasing-out of coal-fired power plants (Germany still
generates two-fifths of its electricity from burning coal).
In February 2019 a government-appointed panel of experts and stakeholders
(“coal commission”) published a report suggesting a road map for a gradual phas-
ing-out of lignite mines and power plants. It is now the task of the government to
react to the report by developing a differentiated and binding phase-out policy,
which obviously must be combined again with a generous subsidy program to get
the consent of the mining-related stakeholders (including local, regional and state
governments).
Even though the automobile sector has been a subject of strong environ-
mental pressure for many decades, there have been no fundamental changes in
engine technology. In retrospect, this industry also proves to be highly resistant
to political interventions. Already in the early 1970s the car industry tried to pre-
vent the introduction of unleaded petrol with technical arguments (this would lead
to engine damage). It also intervened massively against the introduction of the
catalytic converter and only by a decision of the environment minister the car-
makers were virtually forced to introduce this technology. Afterwards it became
a forerunner within the EU but not in international comparison as this technique
was already used in Japan and the USA (see Boehmer-Christiansen & Weidner
1995).
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 37

Although this industry was rarely cooperative when it came to introduce


stricter environmental standards, it was generally treated very gently by politi-
cians and governmental representatives. Several times German government rep-
resentatives intervened in EU decision-making processes in order to weaken
planned environmental standards in favor of the German car industry. Even the
recent major fraud scandal ( called “Dieselgate”, in which all German car manu-
facturers are involved) over manipulated software that only appears to comply
with EU/international emission standards has not led to tough political action of
the German government against the fraudulent manufacturers. It were US author-
ities and courts who strongly punished the industry and some of their representa-
tives by court sentences and high damage compensation payments and fines.
However, the scandal over manipulated software and exhaust technology at
least led to the introduction of more realistic exhaust measurement methods and
the German car industry is now increasingly investing in the development and
production of electric cars -- again supported with generous financial support
from the government (including so-called purchase premiums for buyers of elec-
tric cars). Nevertheless, so far only few electric cars have been purchased, partly
due to deficits in the required infrastructure: there are very few charging stations
in Germany, and the expansion is progressing only slowly.
All in all, it can be said that the German car-maker and automobile policy
are among the absolute latecomers in terms of the development of alternative
drive systems to gasoline and diesel engines in international comparison and es-
pecially in comparison to Japan. (For a detailed treatise on German automobile
policy see chapter by Weert Canzler in this book).
The German automobile sector provides a prime example for the theorems
of technological lock-in and the development of a long-lasting path dependence
due to strong positive feedback mechanisms from within and outside the industry:
The German cars powered by petrol and later also the diesel engines – the latter
thanks to strong impulses of the climate change discussion/policy – enjoy a high
reputation worldwide for their quality and performance; they have become "best-
sellers" at home and abroad; industry has become a cornerstone of the German
economy; German carmakers (especially engineers) enjoy a high reputation and
are attractive employers; a highly specialized R&D infrastructure has developed
inside and outside universities, as well as a broad and close network of public and
private organizations involved in the control, support and development of the au-
tomotive industry; the great economic, employment policy and social importance
of this industry has led to corresponding supporting structures in politics, public
administration and science (sometimes Federal Chancellors are therefore also
called "car chancellors"); there is a broad network of "suppliers" to the car indus-
try, which also sometimes rank among the world market leaders. Finally, it is also
38 Helmut Weidner

of great importance for the strong political position of the car industry that a spe-
cial "car culture" has developed in German society, in which fast and powerful
engines are highly preferred and accordingly a suitable infrastructure is demanded
(which, for example, has partly prevented a general speed limit on motorways to
this day).
Although, firstly, in the course of the environmental and climate debate, crit-
icism of "automobilism" and the corresponding political influence has increased
sharply over the years, and in particular since the scandals of German car manu-
facturers mentioned above, and secondly, a "cultural change" is obviously emerg-
ing to the extent that younger people in particular are becoming strong advocates
and supporters of alternative, more environmentally friendly forms of mobility,
industry still has great political influence, as the recent interventions of the Ger-
man government in favor of weaker environmental standards in the EU, for ex-
ample, show. Nevertheless, the imposition of driving bans by the courts in air-
polluted parts of several German cities could not be prevented. This also increases
the pressure on the car industry to further reduce emissions (and develop alterna-
tive cleaner engines).
To sum up, in both sectors – the coal mining/fossil power plant and the au-
tomobile sector – the existence of very dense relationships between the public and
private sector that for a long period aimed at preserving the established structures,
allowed until recently only for marginal changes not challenging the dominant
technology and the existing power balance. This strong forms of lock-in and path
dependence could be characterized as “carbon lock”, which “refers to the dynamic
whereby prior decisions relating to GHG-emitting technologies, infrastructures,
practices, and their supporting networks constrain future paths, making it more
challenging, even impossible, to subsequently pursue more optimal paths toward
low-carbon objectives.” (Erickson et al. 2015:1).
In Japan, in contrast to Germany, path dependence played only a minor role
in the automobile and the coal-based power plant sectors. The Japanese car-mak-
ers started much earlier than the Germans to develop systematically e-mobiles
and hybrid cars. They also introduced the catalytic device already in the 1970s,
mainly in order to avoid possible trade restrictions imposed by the USA , based
on the so-called Muskie Act of 1970 (see Tsuru & Weidner 1989). In 1969 a large
national project for electric vehicles started, guided by the MITI. The Japanese
Electric Vehicle Council then fixed an objective of 200,000 electric vehicles by
1986, however, this goal was not reached (Cowan & Hultén 1996, Ahman 2006).
But the once started dynamic later on made Japan a forerunner in e-mobility; cur-
rently the Japanese car-makers put their focus on developing hydrogen-fueled
(fuel cell) engines.
Japan stepped out of coal-mining very early, switching to LNG and oil. Only
after the Fukushima nuclear disaster coal began again playing a prominent role as
Ups and Downs in Environmental Policy: Japan and Germany in Comparison 39

fuel for power plants. However, this is not related to path dependence, because in
that case coal was used for electricity production substituting the closed nuclear
power plants. In Japan it is the nuclear energy sector which is clearly character-
ized by a strong path dependence. And here are the lock-in effects much stronger
than in Germany, where a (very probably) final phase-out was initiated by the
Fukushima catastrophe (see Schreurs 2012; for a general perspective see Cowan
1990). That demonstrates the strong interrelationship between decisive parts of
the politico-administrative system and the nuclear energy (electricity producing)
business, which prevented until now fundamental changes in this scandal-ridden
sector.
In Germany, both endogenous (penetration of the nuclear energy decision
system by new environmental actors, who then tried from inside the system to
change structures and processes) and exogenous factors (pressure by large ralleys
against nuclear energy/power plants, waste disposal etc.) contributed to the
changes in this once “closed” system. In Japan, endogenous factors did not play
a decisive role, although after Fukushima the nuclear decisions system has been
moderately modified in favor of experts and groups who formerly had no access.
The exogenous factor (pressure from outside) obviously still is too weak for ini-
tiating radical reforms in Japan.

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Energy Policy in Japan

Lila Okamura

Abstract
Japan embraced nuclear energy as early as the mid-1950s, and developed its nu-
clear industry to achieve the world’s third largest nuclear energy capacity (behind
the United States and France) prior to the Fukushima accident. Japan spent many
years pursuing nuclear fuel reprocessing in hope of establishing a closed nuclear
cycle. Japan's post-war energy policy is intrinsically linked to its nuclear policy.
This chapter thus provides a broad overview of Japan’s energy policy, and conse-
quently of the country’s nuclear energy policy since 1955.


Lila Okamura  Dokkyo University  lilaokamura@dokkyo.ac.jp

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_4
42 Lila Okamura

Overview of Energy Governance in Japan


Japan has many organizations involved in energy governance, but the body which
actually determines policy and plays an integrating role is the Agency for Natural
Resources and Energy, which is an external bureau of the Ministry of Economy,
Trade and Industry (METI). While it is fair to say that, as an external bureau, it
has a high degree of independence, the Agency is just one organization within
METI and it is the Minister of Economy, Trade and Industry who makes decisions
on energy policy.
Before Fukushima, the Nuclear Energy Policy Planning Division, which pro-
motes the nuclear industry, and the Nuclear and Industrial Safety Agency, which
provided regulatory oversight for the industry, were both affiliated to the Agency
for Natural Resources and Energy. However, the Nuclear and Industrial Safety
Agency was abolished in the wake of the disaster and the Nuclear Regulation
Authority (NRA), which serves as an independent regulatory authority of the
Ministry of the Environment, was established in September 2012 along with the
Secretariat of the NRA.
There are many laws governing energy policy, but the overarching law in
this field is the Basic Act on Energy Policy, which was enacted in 2002. Although
bodies of law governing individual energy fields did exist prior to its enactment,
the Basic Act aimed to facilitate the development of a comprehensive policy
across all energy fields.
Article 12 of the Basic Act on Energy Policy obliges the government to for-
mulate a Basic Energy Plan. The Act states that the purpose of the Plan is to pro-
mote measures concerning energy supply and demand in a long-term, compre-
hensive, and systematic manner, and stipulates that the government shall review
the Plan at least once every three years and make any changes deemed necessary.
Based on the policy set out in the Basic Energy Plan, the Long-term Energy Sup-
ply and Demand Outlook (also known as the Energy Mix) is put together by the
Long-term Energy Supply and Demand Subcommittee of the Advisory Commit-
tee for Natural Resources and Energy’s Strategic Policy Committee. Revised
every three years or so since 1967, before the Basic Energy Plan began to be for-
mulated, the Outlook presents METI estimates of long-term energy supply and
demand. This enables the future direction of the energy mix to be set out in more
specific terms. These two documents work in tandem to provide an outline of
Japan’s energy policy.
Energy Policy in Japan 43

Energy Policy Prior to Fukushima

Nuclear Energy Policy


For seven years after the end of World War II, Japan was prohibited by the USA
from undertaking any research or development focused on nuclear energy. The
ban on nuclear energy research was lifted when the Treaty of San Francisco came
into force in April 1952. In November 1955, the Japan–US Atomic Energy Agree-
ment was concluded, and research into the “peaceful use of nuclear energy” com-
menced in earnest with the enactment of Japan’s “three atomic energy laws” (in-
cluding the Atomic Energy Basic Act) in the December.
In 1966, Japan’s first commercial nuclear power station, Tokai NPS, began
operation. At the time, there were fears that Japan might suffer energy shortages
as a result of its high economic growth, so expectations were high for nuclear
power generation. The oil crises of the 1970s triggered a growing need to over-
come Japan’s dependence on oil and so hopes were high that nuclear energy could
serve as an alternative form of energy to replace oil.
Against this historical backdrop, a succession of nuclear power stations went
into operation in Japan, starting in the 1970s, and nuclear power generation had
grown without incident by the mid-1990s. While the impact of the oil crises was
a significant factor behind the swift construction of nuclear power stations in Ja-
pan at this time, grants and subsidies also played a major role. The national gov-
ernment provided inducements to offer sites for construction by enhancing the tax
system via the Three Power Source Development Laws, among other measures.
Many of the areas that emerged as candidate sites for nuclear power stations had
become depopulated, with a low birth rate and an aging population, and the young
people having flocked to the cities during the era of high economic growth. Local
governments in the candidate areas sought to increase employment and tax reve-
nue by attracting nuclear power stations (Inoue 2015:15).
In the 1980s, anxiety about nuclear power generation began to grow, follow-
ing the accidents at Three Mile Island and Chernobyl. In Japan, however, nuclear
power was positioned as an environmentally friendly form of energy, paving the
way for its promotion and expansion as a key pillar of Japan’s measures to combat
climate change. Nuclear power generation was expected to play a major role in
cutting domestic CO2 emissions and to enable Japan to meet its reduction com-
mitments under the Kyoto Protocol, which had been adopted in 1997. However,
a series of accidents at nuclear installations led to growing anti-nuclear sentiment
among the citizens in candidate areas, and so the attraction and construction of
new nuclear power stations did not proceed as smoothly as it had in the 1970s.
44 Lila Okamura

In the 1990s, addressing environmental problems joined energy security as


a goal of energy policy. Although the renewable energy policy had already com-
menced and initiatives of this kind had been implemented, the government re-
garded nuclear power generation as the trump card that would simultaneously re-
solve all three energy challenges, namely a stable supply of energy, affordability,
and environmental protection. The 2010 Basic Energy Plan quintessentially en-
capsulates this approach. Regarding nuclear energy as “semi-homegrown energy
offering outstanding performance in terms of both stability of supply and afford-
ability,” the Plan stated that since nuclear power is a “low-carbon source of elec-
tric power,” it is a “key energy source for the medium to long term that simulta-
neously meets the requirements known as the 3Es: energy security, environmental
friendliness, and economic efficiency.” It also said that the government would
“actively promote nuclear power generation through the construction of new or
additional plants, as well as increasing capacity utilization.” The Plan included
numerical targets for nuclear power, stating that nine new or additional plants
would be built by 2020 and at least 14 by 2030. This meant that nuclear power’s
share of total power generation would be increased to 53% by 2030 (METI:
2010).

The Nuclear Fuel Cycle


From the very outset of its nuclear energy development program, Japan has aimed
to establish nuclear fuel recycling. The Long-Term Program for Nuclear Energy
formulated in 1956 stipulated that establishing a nuclear fuel cycle and commer-
cializing fast breeder reactors were the ultimate goals of Japan’s nuclear energy
policy (Funabashi et al. 2012:318). Since then, the nuclear fuel cycle has been
positioned as “state policy” in Japan. For a country with few natural resources
and which is completely reliant on imports for all of its uranium, introducing fast
breeder reactors to make the most of its uranium resources was also considered
important from the perspective of ensuring a secure, stable supply of energy.
The 1970s saw an expansion in nuclear power generation not only within
Japan, but also worldwide. This gave rise to fears of uranium shortages, so pro-
active efforts were undertaken in Japan to develop a fast breeder reactor. The 1967
Long-Term Program for Nuclear Energy set the target of commercializing fast
breeder reactors by the latter half of the 1980s; the Joyo experimental reactor
reached its first critical state in 1977.
However, from the latter half of the 1970s into the 1980s, there was a slump
in nuclear power station construction worldwide, due to the impact of the Three
Mile Island and Chernobyl nuclear power plant accidents, causing the price of
uranium resources to plummet. As a result, developing fast breeder reactors was
Energy Policy in Japan 45

no longer a matter of urgency, and thus some countries halted their development
programs.
Nevertheless, Japan continued to promote the nuclear fuel cycle, along with
nuclear power generation. The electric companies in Japan concluded a repro-
cessing contract in September 1977 with BNFL (British Nuclear Fuels Limited),
which is now Sellafield Ltd, and in May 1978 with Cogema (now Areva). It was
to be a provisional measure until a reprocessing plant in Japan began operations.
The amount of fuel which has been reprocessed overseas has reached approxi-
mately 5,600 tons and the entire amount will be sent back to Japan over time.
In 1984, the Federation of Electric Power Companies of Japan requested the
cooperation of Aomori Prefecture with regard to the siting of three nuclear fuel
cycle facilities (a uranium enrichment facility, a reprocessing facility and a low-
level radioactive waste storage facility), and the Governor of Aomori Prefecture
granted formal approval the following year.
In 1993, in the Aomori Prefecture village of Rokkasho, Japan Nuclear Fuel
Ltd., which had been established with contributions from the power companies,
began construction of a reprocessing plant with a maximum annual processing
capacity of 800 tons of uranium. Initially, it was expected to be completed in De-
cember 1997, with construction costs estimated at 760 billion yen, but due to var-
ious problems, the completion has been postponed 18 times and total construction
costs to date have soared to 2.19 trillion yen, more than triple the initial estimate
in 1979.
In 1993, in Rokkasho, Aomori Prefecture, Japan Nuclear Fuel Ltd., which
had been established with contributions from the power companies, began con-
struction of a reprocessing plant with a maximum annual processing capacity of
800 tons of uranium. Initially, it was expected to be completed in December 1997,
with construction costs estimated at 760 billion yen (ca. 5.74 billion Euro), but
due to various problems, the completion was postponed close to two dozen times.
Japan Nuclear Fuel Limited (JNFL) estimated in October 2014 that the total con-
struction costs had soared to 2.19 trillion yen (ca. 16.5 billion Euro), more than
triple the initial estimate made in 1979.
The commercialization of fast breeder reactors fell well behind the original
schedule and the target period for commercialization was deferred as far forward
as the 2030s. Moreover, the Monju prototype reactor, which had reached its first
critical state in 1994, suffered a sodium leak and fire in 1995, causing a further
delay to commercialization. As a result of the Monju accident, a fast breeder re-
actor was no longer a prospect, so it was decided that efforts to establish a nuclear
fuel cycle would - for the time being - focus on “pluthermal”, which uses MOX
fuel in light water reactors. However, and given that there have been few exam-
ples to date of the implementation of a pluthermal program, such a program also
brings with it its own safety issues.
46 Lila Okamura

In 2016, the government made a decision to close and decommission Monju.


This does not mean that Japan has completely given up on pursuing the develop-
ment of a demonstration fast breeder reactor. The government argues that by using
the Joyo experimental fast-breeder reactor and collaborating on a joint project
with France to develop an advanced experimental fast-breeder reactor for indus-
trial demonstration (ASTRID) the necessary level of technological knowledge
and data for development of a demonstration reactor can be obtained.
Currently, fast breeder reactors are being developed in China, India, and Rus-
sia, where energy demand is forecast to grow substantially, and both Russia and
India carry out reprocessing. Other countries, including Germany and France, are
abandoning or scaling back their reprocessing policies and Japan is the only de-
veloped democratic country that is continuing to pursue a nuclear fuel cycle that
includes fast breeder reactors.

Since “3.11”

Under the Democratic Party of Japan Government


The Democratic Party of Japan was in power at the time of the Fukushima nuclear
power plant accident. In 2011, the old energy policy emphasizing nuclear and
disregarding renewable energy was still in place, but the Fukushima Daiichi Nu-
clear Power Plant accident forced the government into a fundamental rethink of
its energy policy. The Cabinet at the time announced that it was completely re-
tracting the aforementioned 2010 Basic Energy Plan, which sought to increase the
nation’s reliance on nuclear power beyond 50%, and the Advisory Committee for
Natural Resources and Energy’s Strategic Policy Committee began discussions
of the energy mix in the autumn of 2011.
Discussions regarding the cost of nuclear power generation came under the
spotlight in the process of reviewing the national energy policy. The government
established the Committee of Electricity Generation Cost Verification within the
Cabinet Secretariat in October 2011, which reviewed the cost of each source of
electrical power in light also of their social costs, such as the cost of environmen-
tal measures and costs associated with addressing the risk of accidents. As a result,
the Committee calculated that the minimum cost of nuclear power as of 2030
would be ¥8.9/kWh, rising by ¥0.1/kWh for every ¥1 trillion increase in costs
associated with addressing the risk of accidents (Energy and Environment Coun-
cil Committee of Electricity Generation Cost Verification 2011:47) .
Prime Minister Noda and his Cabinet subsequently narrowed down the en-
ergy mix options to three scenarios. Focusing on the percentage of the energy mix
accounted for by nuclear energy in 2030, these were the Zero Scenario, involving
Energy Policy in Japan 47

the complete abandonment of nuclear power; the 15 Scenario, which meant re-
ducing dependence on nuclear energy from the level before the accident; and the
20-25 Scenario, which kept the nuclear share at about the same level as before the
accident.
In the normal policymaking process, the government chooses policies at its
own discretion, but the Noda Cabinet tried out an approach in which it decided
on the energy mix after a process of national debate. The media conducted opinion
polls, while the government distributed questionnaires at briefings held across the
country, as well as holding a deliberative opinion poll1. While local governments
and other bodies had used deliberative polling in the past in Japan, this was the
first time that a full-scale deliberative opinion poll had been implemented at the
national government’s behest. As a result of the debate, the proportion of partici-
pants who supported the Zero Scenario rose from 33% to 47%. The public com-
ment process also found that 81% of the opinions offered were seeking an imme-
diate reduction of nuclear power generation to zero (Nihon Keizai Shinbun 2012).
In response to this, the Noda Cabinet decided, in September 2012, on the
Innovative Strategy for Energy and the Environment, which aimed to reduce nu-
clear power plant operation to zero in the 2030s. However, Cabinet approval was
shelved in the face of strong opposition from the business community, among
others. While the Noda administration was exploring ways of building consensus
among the various ministries and agencies, a change of government occurred and
Japan’s energy policy was revised once more, steering it away from the zero nu-
clear approach.
In the field of renewable energy, Japan’s Act on Special Measures Concern-
ing Procurement of Renewable Electric Energy by Operators of Electric Utilities
(Feed-in Tariff (FIT) Act) was, oddly enough, approved by the Cabinet on the
morning of the Great East Japan Earthquake and enacted in August. The FIT sys-
tem began operating in 2012. The government set a target of raising the share of
electricity generated from renewable energy from 4% at the time to 20% by 2020.

Energy Policy under the Liberal Democratic Party Government


The Basic Energy Plan approved by Cabinet in April 2014 under the Liberal Dem-
ocratic Party government stated, “Japan will review from scratch the energy strat-

1
A means of policymaking used in Nordic countries, among others. It is a type of opinion poll
that involves investigating how the opinions of participants change through debate and a ques-
tion and answer session. Participants selected at random complete a questionnaire at the time
they are approached to participate in the debate session and again before and after the session
itself. The ways in which their views have changed are then analyzed.
48 Lila Okamura

egy that it mapped out before the Great East Japan Earthquake. Japan will mini-
mize its dependency on nuclear power. Needless to say, that is the starting point
for rebuilding Japan’s energy policy” (METI 2014:4).
However, the Plan positioned nuclear power as “an important base-load
power source” from the perspective of the 3Es and stated that the government
“will proceed with the restart of the nuclear power plants,” clearly retracting the
energy policy established by the previous government under the Democratic Party
of Japan. In addition, the government abandoned consensus-building with the in-
volvement of the public and returned to a policymaking process led by the Agency
for Natural Resources and Energy.
The Long-term Energy Supply and Demand Outlook formulated in July
2015 set out the energy mix for FY2030, with nuclear power accounting for 20-
22% and renewable energy for 22-24%.
Thus, it is fair to say that the policy on nuclear energy returned to what it had
been before the Fukushima accident. However, the nuclear power industry has
not made a similar recovery. First of all, there has been huge delays in restarting
the nuclear power plants. These cannot be restarted unless they pass an inspection
based on new safety regulations, which is conducted by the Nuclear Regulation
Authority established in 2012. Some nuclear power plants that have passed this
inspection have nonetheless been shut down under legal injunctions.
Takahama nuclear power plant’s No. 3 reactor was restarted in January 2016
and its No. 4 reactor the following month, but in March, citizens opposed to the
restarts went to court to seek an injunction to close the reactors, which was pro-
visionally granted by the Otsu district court. In March 2017, the Osaka High Court
overturned the provisional injunction in response to an appeal lodged by Kansai
Electric Power Company, but it would be fair to say that the case exposed both
the difficulty of gaining the public’s consent for restarts and the risk of associated
lawsuits.

"Fifth Basic Energy Plan"


In July 2018, METI published a long-term energy plan (METI 2018) outlining the
national energy policy to 2030 and beyond. This plan has two targets: to promote
reactor restarts and to promote the nuclear fuel cycle. These targets are, however,
contrasting, conflicting and impracticable.

Nuclear Policy
Under this plan, nuclear will remain a key energy source and the nuclear fuel
cycle will be promoted. The Fifth Basic Energy Plan shows that, by 2030, 20 to
22 per cent of Japan’s electricity will come from nuclear power.
Energy Policy in Japan 49

However, the details of the new plan are rather contradictory. On the one
hand, it states that nuclear energy in 2030 will continue to be "an important core
and baseload power source”. On the other hand, it claims that Japan's dependence
on nuclear energy will be reduced as much as possible.
The share of nuclear energy is now at 3.6%; Japan demonstrated after the
Fukushima accident that it could and can manage without nuclear power. Nuclear
power, therefore, does not play the same role in Japan today as it did before Fu-
kushima.
Under the Fifth Basic Energy Plan, 20 to 22 percent of Japan’s electricity
will come from nuclear power by 2030, which is approximately 20% more than
at present. This means that the dependence on nuclear power will increase rather
than decrease.
This target (22% from nuclear power before 2030) would be almost impos-
sible to achieve within this time. To reach this target, about 30 nuclear reactors
would have to be in operation. Japan has 32 power reactors that are theoretically
operable, but in practice it would be impossible due to strict safety regulations,
reactor lifespan, and public resistance. The existing reactors would have to have
their operational life extended or new nuclear reactors would need to be con-
structed.
In Japan, the operational limit of nuclear reactors is generally set at 40 years,
but the period can be extended by up to 20 years with NRA approval. In Novem-
ber 2018 the Tokai No. 2 station became the fourth nuclear reactor for which an
extension was approved (following the No. 1 and 2 reactors at Kansai Electric
Power Co.'s Takahama plant and the No. 3 reactor at the firm's Mihama plant).
Moreover, it was the first nuclear plant of those that sustained damage in the
March 2011 Great East Japan Earthquake and tsunami for which an extension was
approved. And the plant's reactor is a sole boiling-water unit, which is the same
type as those at the tsunami-ravaged Fukushima Daiichi Nuclear Power. Further-
more, about 960,000 people live within a 30-kilometer radius of the Tokai No. 2
plant, making it the most densely populated site among the nation's nuclear facil-
ities.
When the new regulations were introduced, the government said that such a
concession would be granted only in “a very limited number of highly exceptional
cases”. It is extremely difficult to find a convincing argument for an exception in
this case, and there would seem to be many factors which would advise against
an extension for Tokai No. 2. It is clearly necessary to review the regulations on
ageing reactors from the viewpoint of steadily reducing the nation’s dependence
on nuclear power generation.
50 Lila Okamura

Nuclear fuel cycle


As previously discussed, the direction of Japan’s nuclear energy policy is uncer-
tain. The direction of the nuclear fuel cycle is now just as indeterminate.
Japan is the only non-nuclear weapon state that is allowed to reprocess spent
fuel. This goes back to the Japan-US Nuclear Cooperation Agreement, which was
originally signed in 1968, and then extended automatically for another thirty years
in July 1988, and again in July 2018.
The agreement can be cancelled or renegotiated with six months written no-
tice by either Japan or the United States. If either side were to opt out of the agree-
ment, it would be cancelled after six months, and this would mean that Japan
would have to amend its nuclear fuel cycle policy accordingly.
When extending this Agreement, the US demanded that Japan reduce its plu-
tonium stockpiles, which had become contentious in light of negotiations with
North Korea, with the Trump administration seeking to convince North Korea to
abandon its nuclear weapons.
At present, Japan stores about 10 tons of plutonium inside the country and
about 37 tons in Britain and France, where spent fuel from Japanese nuclear plants
has been reprocessed and stored. The total amount is equivalent to 6,000 times
the force of the atomic bombs that devastated Nagasaki in 1945.
Japan is attempting to promote the reprocessing of spent fuel, with the re-
processing plant in Rokkasho scheduled to open in 2021. When the reprocessing
plant in Rokkasho goes into full operation, about eight tons of new plutonium per
year will be added to Japan’s surplus plutonium.
Japan promised to cap its stockpile and to eventually reduce it, but without
giving a specific timeline or targets. Japan has already decided to decommission
its fast breeder reactor. The government's draft policy states that plutonium should
be used at conventional nuclear reactors as mixed plutonium-uranium oxide fuel,
commonly known as MOX fuel. But MOX fuel would have to be used at between
16 and 18 reactors to keep Japan’s plutonium stockpiles from rising. At present
six are in operation and only four of these can use MOX fuel.
Thus, Japan would be unable to reduce its plutonium levels. The targets of
reducing plutonium stockpiles and promoting the nuclear fuel cycle cannot be
realized simultaneously.

Return to the old scenario


After Fukushima, there was a short window of opportunity for the movement to
abandon nuclear power in Japan to gain momentum. In July 2013, however, the
Nuclear Regulation Authority (NRA), which had been established in September
2012, embarked upon safety reviews of the country’s nuclear power stations,
Energy Policy in Japan 51

based on the new regulatory requirements formulated in the wake of the Fuku-
shima Daiichi NPS accident. Since then, there has been a series of applications
with, as of February 2019, seven power companies applying for reviews of 13
units at power stations. Fourteen nuclear reactors have passed the required safety
assessments, and nine of these reactors are now operational (FEPC 2019).
Hence, the restart of Japan’s reactors appears to be a foregone conclusion.
Japan will adhere to nuclear power, even though the country has the potential to
meet its electricity consumption from renewable energy alone (cf. chapter on Re-
newable Energy in Japan). However, the government’s excessive protection pol-
icy for nuclear power generation is both hindering the possibility of renewable
energy and complicating radioactive waste policy.

References
Aldrich, Daniel (2012) Networks of Power in Jeff Kingston (ed.) Natural Disaster and Nuclear Crisis
in Japan. London: Routledge, 2012, pp.127-139
Energy and Environment Council Committee of Electricity Generation Cost Verification (2011): Re-
port of the Committee of Electricity Generation Cost Verification
https://www.cas.go.jp/jp/seisaku/npu/policy09/pdf/20111221/hokoku.pdf, accessed February
11, 2019
FEPC (The Federation of Electric Power Companies of Japan) https://www.fepc.or.jp/theme/re-oper-
ation/, accessed February 11, 2019
Funabashi, H., Hasegawa, K., Iijima, N. (2012): Kakunenryo Risaikuru-shisetsu no Shakaigaku –
Aomoriken Rokkashomura [Sociology on Nuclear Fuel Cycle Facilities in Rokkasho Village].
Tokyo Yuhikaku.
Inoue, Takeshi (2015): Genshiryoku Hatsuden to Chiho Zaisei [Nuclear power generation and Local
government finance]. Kyoto Koyoshobo.
Kingston, Jeff (2012) Japan's Nuclear Village, The Asia-Pacific Journal, Vol. 10, Issue 37, No. 1,
September 10, 2012.
METI (2010): Basic Energy Plan
http://www.enecho.meti.go.jp/category/others/basic_plan/pdf/100618honbun.pdf, accessed
February 11, 2019
METI (2014) Basic Energy Plan
http://www.enecho.meti.go.jp/category/others/basic_plan/pdf/140411.pdf, accessed February
11, 2019
METI (2018) Basic Energy Plan
http://www.enecho.meti.go.jp/category/others/basic_plan/pdf/180703.pdf, accessed February
11, 2019
Nihon Keizai Shimbun, August 22, 2012
https://www.nikkei.com/article/DGXDASGC22005_S2A820C1MM0000/, accessed February
11, 2019
Ramseyer, J. Mark. (2012) Why Power Companies Build Nuclear Reactors on Fault Lines: The Case
of Japan. Theoretical Inquiries in Law. 13:2 (Jan.) 457-485.
Energiewende in Germany –
the Dawn of a New Energy Era

Lutz Mez

Abstract
The original energy policy of the Federal Republic of Germany could be equated
with coal policy. The policy of these early years was followed in the second phase
by a half-hearted attempt to counteract the crowding-out strategies of the oil mul-
tinationals. In the third phase, petroleum was accepted as a "cheap" energy source
and in 1973 nuclear power was accorded top priority in the nation's first coordi-
nated overall energy policy. "Away from oil" and energy conservation were the
bywords of the fourth policy phase, from 1974 to 1982. A recommendation of the
Bundestag-appointed Enquete Commission called for implementation of serious
measures in the areas of rational energy use and the development of alternative
energies by 1990. In response to the decline of German forests, environmental
protection figured ever more prominently in the formulation of energy policy
from 1983 onward. This ushered in the fifth and latest phase, which is character-
ized by climate protection, the forced expansion of renewable energies, the statu-
tory phase-out of nuclear power, and intensified energy conservation efforts. The
grand coalition government in 2018 set up a commission tasked with managing
the definite phase-out of coal-fired power production in Germany. The commis-
sion agreed on a final report that proposes to end coal-fired power production by
2038 or earlier.


Lutz Mez | Freie Universität Berlin, Germany | lutz.mez@fu-berlin.de

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_5
54 Lutz Mez

The development of the policy field


The development of Germany's Federal energy policy can be outlined as a suc-
cessively shifting focus, in five phases, on the supposedly "cheapest" energy
source during a given period (Meyer-Renschhausen 1977).
From 1948 to 1958 German energy policy meant, in essence, coal policy. Its
aim was to boost domestic energy production – above all, the extraction of hard
coal – to meet the growing energy demand. The coal mining industry enjoyed
extensive direct and indirect subsidies. At the same time, a price cap was set on
coal to stabilize its general price level.
In the second phase, from 1958 to 1966, national energy policy consisted of
the attempt to counteract an absolute reduction in hard coal extraction and to slow
down the structural change brought about by the increased use of mineral oil. This
policy failed because the state made no effort to strengthen the position of coal
mining in the electricity sector. Industry demanded cheap energy as a condition
for growth, providing an opportunity for "cheap" oil. The first wave of coal mine
closures began as a result of the Federal Government's failure to develop an ef-
fective plan to counter the strategies of the multinational oil companies to crowd
out competition.
During the third phase, from 1966 to 1973, the level of hard coal extraction
was adjusted in response to demand. "Cheap" petroleum became the primary en-
ergy source. State subsidies were redirected to key areas of "technological pro-
gress", such as the atomic energy industry. In September 1973, shortly before the
onset of the first oil price crisis, the Federal Government presented its first overall
energy policy plan containing objectives for all energy sources. Along with grant-
ing special status to nuclear energy – which showed the highest growth rate in
both relative and absolute terms – the program conspicuously sought to prevent
increased reliance on oil.
For a range of reasons, the expansion of nuclear energy did not take place as
planned. In successive updates of its energy program objectives, the Federal Cab-
inet repeatedly reduced the proportion of atomic power. Even as the construction
of nuclear plants slowed, however, their share in power production continually
rose. The last atomic power plant came on line in 1989. Since then, no further
plants have been built or planned.
The fourth phase, from 1974 to 1982, was the period of the second oil price
crisis, energy conservation legislation, and the 100-year contract between the coal
mining and electricity industries.
In the fifth phase, from 1983, environmental concerns began to help shape
energy policy. Forest decline prompted a 1983 ordinance placing limits on Sul-
phur dioxide, nitric oxide and particulate emissions from large combustion plants
and set deadlines for compliance with these standards. This legislation further
Energiewende in Germany – the Dawn of a New Energy Era 55

required that all large-scale coal-fired power plants either be retrofitted with flue-
gas cleaning systems or be decommissioned. Since 1990, in response to the debate
around the greenhouse gas carbon dioxide, climate protection has been added to
the catalogue of Federal energy policy aims. This has led to the first measures to
promote renewable energies (e.g., the Electricity Feed-in Act). The Social Dem-
ocrat-Green administration (1998-2005) attempted, with the phase-out of nuclear
power and the forced promotion of the expansion of renewable energies, to bring
about a fundamental change in Germany's energy landscape.
After the reactor disaster in Fukushima the German Federal Government, the
Bundestag and the Bundesrat reaffirmed the Energiewende. It is to the one the
gradual phase-out of the use of nuclear power plants by 2022. On the other hand,
renewable energies should be expanded to the mainstay of future energy supply.
Already in the integrated climate change and energy program, the Federal Gov-
ernment had brought the first packages for a state of the art, secure and climate-
friendly energy supply in Germany on the way and at the same time set on ambi-
tious, intelligent and efficient climate protection measures. Germany is aiming for
a sustainable energy system by 2050 and will be one of the most energy-efficient
and environmentally friendly economies in the world. That's why saving energy
and increasing energy efficiency play a crucial role in this process. But the energy
transformation affects not only energy policy. It is a fundamental choice about the
social, economic, technological and cultural development of Germany.
However, the course for an Energiewende in Germany was set not in 2011
but several decades previously. This applies for the nuclear phase-out, which is
inextricably linked to the setting change of nuclear power after the Chernobyl
reactor disaster, as well as for the promotion of renewable energy sources in elec-
tricity generation, as well as for the constant reduction of energy consumption in
all sectors of the economy.

The point of departure


The Federal Republic of Germany is one of the largest energy consumers in the
world. The consumption of primary energy reached the level of 12,900 petajoules
(PJ) in 2018. That is the lowest since German reunification in 1990 when 14,905
PJ were consumed, and lower as in the beginning of the 1990s (AGEB 2018b).
The impact of energy policy decisions in the years 2010 and 2011 to the
promotion of renewable energies, and to phase out nuclear energy until 2022 are
visible in the primary energy balance since 2012 by modified shares of various
energy sources. In the year 2018, mineral oil with a share of 34.1% was still the
most important energy source, followed by natural gas with a share of 23.5%.
Hard coal and lignite contributed with 10.1% and 11.5% respectively to the en-
ergy mix. Nuclear power accounted for only 6.4% in 2018, after almost 11% in
56 Lutz Mez

2010. The contribution of renewables reached 14%. Other energy sources con-
tributed less than 2% to cover primary energy consumption (ibid.).
Germany relies on petroleum, natural gas and uranium imports, but could
obtain full supply from coal. However, the production of domestic hard coal is
possible only at much higher prices than the purchase of imported coal, so that
only lignite covers the entire domestic demand. But after the Paris Agreement it
became obvious that Germany must phase out coal within the next two decades.
The import quota for oil, gas and coal in 2017 amounted to 98 and 93%. Renew-
ables - hydropower, wind power, biomass and solar energy - are almost for 100%
domestic energy sources. Currently still around two-thirds of the primary energy
consumption is covered by imports.
The share of electricity in final energy consumption is just around 20% in
Germany. And it is unlikely that German electricity consumption is much higher
in the coming decades. That's why the actual debate, which focuses mainly on
power generation, power consumption and development of electricity prices, does
not meet the central problems of the Energiewende.

The Energiewende
The first steps towards Energiewende took place in the Federal Republic of Ger-
many in September 1973 – shortly before the first oil price crisis.2 The then so-
cial-liberal Federal Government presented an energy program, which for the first
time included goal orientations of all energy sources. It was striking in addition
to the special importance of nuclear energy - which had relatively and absolutely
the highest rate of increase - that should be used to reduce a further expansion of
mineral oil.
At the same time, a diversification of energy imports was targeted. The use
of regenerative energy sources was first exclusively supported through R&D pro-
grams and later by the construction of test wind turbines.
In order to reduce energy consumption for heating and hot water, the Federal
Government set higher standards for thermal insulation and the Ministry of Econ-
omy launched a campaign entitled "Energy saving - our best source of energy".
The term "Energiewende" appeared in the wake of the second oil crisis in
the scientific literature on the future of energy supply of Germany. In 1980, a

2
The first oil price crisis was caused by the Yom Kippur war between Israel and Syria, and the
Federation of Arab States, accompanied by the oil embargo of OPEC, the Organization petro-
leum exporting countries. By throttling the oil production, oil prices of $ 3 per barrel climbed
to over US$ 5 - and in 1974 even on over $ 12 per barrel. The second oil crisis was raised by
the Iran's Islamic revolution in 1979. By the loss of oil production in Iran, the price of oil rose
to over US$ 38 per barrel.
Energiewende in Germany – the Dawn of a New Energy Era 57

study titled "Energiewende - growth and prosperity without oil and uranium" was
published by the Öko-Institute. The authors presented a scenario for the energy
supply of the Federal Republic without oil imports, and nuclear power plants
(Krause, Bossel, Müller-Reißmann 1980).
This was followed in 1985 by another publication of the Öko-Institute with
the title "The Energiewende is possible" (Hennicke et al. 1985). Here, arguments
were developed for the re-municipalization of energy supply. Local communities
should take electricity, gas and district heating supply back into their own hands,
so that the lost energy policy impact to the large private energy utilities could be
regained and political space recaptured.
The energy policy of Germany's Social Democrat-Green coalition govern-
ment (1998-2005) was born under the sign of ecological modernization. The
planned reforms enumerated in the coalition agreement of 1998 included an eco-
logical tax reform, the phase-out of nuclear power, and a fundamental change in
energy policy. In the area of fossil energies, however, the agreement called for a
continuation of the coal policy of preceding governments, the slowing of struc-
tural change in the coal mining industry through subsidies, special conditions and
exemptions, and a minimum extraction level for domestic coal.
The "red-green" administration set this energy policy shift in motion by
granting priority to renewable energies, energy conservation, and the phase-out
of nuclear power. The Renewable Energy Sources Act was seen as the "centre-
piece of red-green energy and climate policy" (Jänicke, Reiche, Volkery 2002:
53). It replaced the Electricity Feed-in Act of 1991 and was intended to sustain
the boom in the wind energy sector while at the same time providing stimulus for
the use of biomass, solar and geothermal energy.
The liberalization of the German electricity industry and the passage of the
new Energy Industry Act triggered a dramatic reduction in the number of compa-
nies (from around 1,000 at the time of the legislation) active at the various levels
of power, gas and heat supply. This concentration in the energy supply market
was connected with changes in the companies' strategies and with price reduc-
tions. Electricity prices for large-scale customers were cut nearly in half, which
in turn led to problems at combined heat and power plants operated by industry
and by local providers.
A basic change in nuclear energy policy was brought about by the "red-
green" government. Twenty months of negotiations with the electricity industry
yielded an agreement limiting the duration of operating licenses for existing
atomic power plants and prohibiting the construction of new ones. Further stipu-
lations included a ban on the reprocessing of nuclear fuel from the middle of 2005
onward. This agreement marked the first time that a large industrial nation had set
a clear signal in atomic energy policy. Implementation of the 100-day program
announced in the coalition agreement, however, was considerably delayed, while
58 Lutz Mez

consensus talks went on for not one, but nearly two years before achieving results.
Moreover, the prescribed course of Germany's nuclear phase-out left open a range
of questions and details (cf. Mez 2001). The agreement on the phase-out led to an
amendment of the country's Atomic Energy Law. The new legislation – the "Act
on the structured phase-out of the utilization of nuclear energy for the commercial
generation of electricity" – went into force on 27 April 2002 and fundamentally
changed the 1959 AtomG; instead of promoting nuclear energy generation, the
new law was designed to end it in a structured manner. A residual operating life
was set for every nuclear reactor, after which its operating license expired. The
law banned the construction of new atomic power and reprocessing plants. It ad-
ditionally required operators to build interim storage facilities and increased fi-
nancial security for existing power plants.
Since 1 February 2002 the energetics of buildings has been subject to the
Energy Conservation Ordinance (EnEV). The EnEV was amended in November
2004. It was subsequently changed again to allow German implementation of the
EU energy directive, with this latest amendment scheduled to come into effect in
autumn 2007 at the earliest.
The Renewable Energy Sources Act (EEG) was also amended in 2004. The
aim of the new version of the EEG (21/7/2004) was to increase the proportion of
renewable energies in the total power supply to at least 12.5% by 2010 and at least
20% by 2020.
On 1 January 2005 CO2 emissions trading was introduced across Europe as
the primary instrument in combating the threatening climate crisis and reducing
greenhouse gas emissions.
In the coalition agreement between the Christian Democrats (CDU/CSU)
and Social Democrats (SPD) of 11 November 2005, the coalition partners stated
that due to divergent views on using atomic energy to generate electricity, no
changes could be made to the existing pact between the Federal Government and
energy supply companies, the practices stipulated therein, or the underlying pro-
visions of the amended Atomic Energy Law. The coalition contract foresaw the
expansion of renewable energies in keeping with the objectives of the Renewable
Energy Sources Act (CDU, CSU, SPD 2005).
In April 2006 Federal Chancellor Angela Merkel convened the first energy
policy summit. The status report on energy supply in Germany (BMWT & BMU
2006) served as the basis for these top-level talks. A second summit discussion
between the Federal Government and energy industry representatives took place
in October 2006. This meeting was prepared by the three working groups – on
national policy aspects, international policy aspects, and research and energy ef-
ficiency – that had been established in the first summit talks. A third meeting was
held in July 2007.
Energiewende in Germany – the Dawn of a New Energy Era 59

On 8/9 March 2007, during Germany's European Council presidency, sweep-


ing resolutions on energy and climate protection policy were passed at the Euro-
pean "Energy Summit" in Brussels. The action plan "An Energy Policy for Eu-
rope" laid out concrete targets for the reduction of emissions, the proportion of
renewable energies to be attained, and energy productivity gains.
The Federal Government adopted an overall energy policy that addressed the
issues of supply security, competitive and affordable energy prices, and effective
climate protection in 2007. Elements of the general energy policy strategy are
investment in new power plants and networks; the expansion of economically
efficient, renewable energies; workable competition in the electricity and gas mar-
kets; increased energy efficiency; a research and innovation offensive for new
technology; international cooperation in modernizing global energy supply; and
a worldwide climate protection treaty with industrial and major newly industrial-
ized countries.
The integrated National Energy and Climate Plans defined the goals of the
Energiewende by the year 2050, to be achieved via partial goals for 2020, 2030
and 2040 (see table 1). By 2050, greenhouse gas emissions in Germany should be
reduced by 80 to 95% (base year 1990) and the share of renewable energy sources
in electricity consumption should reach at least 80%. National goals are based on
the goals set at the EU level.
The Federal Government's monitoring process "Energy of the Future" has
been set up in 2011 to track the energy transition on a continuous basis: how far
has Germany come with the energy transition? What measures have already been
implemented? What are the effects? Will the goals be achieved, or is fine-tuning
needed?
The central task of the monitoring process is to analyze the reams of statisti-
cal information on energy that have been collected and then condense it and make
it easy to understand. This involves an assessment of measures that have already
been taken and work to pinpoint areas in which further efforts need to be made.
In this way, each annual report provides an overview of the energy transition and
the stage that it is at this point in time. We need to know where we have got to
before we can decide what steps to take next.
The Federal Ministry for Economic Affairs and Energy has been appointed
lead ministry for the monitoring process for the energy transition. The Monitoring
Report for each year must be approved by the Federal Cabinet by 15 December
and submitted to the Bundestag and the Bundesrat. Also involved in the process
is an independent commission of four renowned energy experts, who provide a
scientific opinion on the Monitoring Report. Their scientific opinion is published
alongside the Federal Government's report.
60 Lutz Mez

Every three years, the Federal Government publishes a Progress Report on


the energy transition . The first report was published in December 2014. The Pro-
gress Report provides for a wide overview of the energy transition, thus allowing
for deeper analysis over a longer period, which makes it possible for trends to be
discerned. The report also looks at whether Germany is on track to attain the goals
and targets set out in the Energy Concept, and at what additional measures might
need to be taken.
Table 1: Status Quo and quantitative targets of the Energiewende (2016)
2016 2020 2030 2040 2050
Greenhouse gas emis- -27.3% at least at least at least 80 -
sions (compared with -40% -55% -70% 95%
1990)
Renewable energy
Share of gross final en- 14.8% 18% 30% 45% 60%
ergy consumption
Share of gross electric- 31.6% at least at least at least at least
ity consumption 35% 50% 65% 80%
Share of heat consump- 13.2% 14%
tion
Efficiency and consumption
Primary energy con- -6.5% -20% -50%
sumption (compared
with 2008)
Energy productivity 1.1% 2.1% per year
(since 2008) per year (2008-2050)
Gross electricity con- -3.6% -10% -25%
sumption
(compared to 2008)
Primary energy con- -18.3% -80%
sumption in buildings
Heat consumption in -6.3% -20%
buildings
Final energy consump- 4.2% -10% -40%
tion in the transport sec-
tor
Number of electric ve- 62,500 1 mil- 6 mil-
hicles lion lion
Source: BMWi, Sixth Monitoring Report "The Energy of the Future", Berlin
2018, p. 8
Energiewende in Germany – the Dawn of a New Energy Era 61

Improving energy efficiency is the key question in this context, therefore the
primary energy consumption compared with the consumption in 2008 must be cut
in halve. Since individual measures often only have a limited potential, the energy
transformation in all sectors - industry, transport, households and in the trade and
services sector – must start quickly.
The coalition agreement of the CDU, CSU and FDP of 26 October 2009 also
stresses that Germany needs an overall energy policy concept for a "safe, envi-
ronmentally sound, competitive and affordable energy" and that the way into the
age of renewable energy should be taken (CDU, CSU, FDP 20019).
The "Energy Concept for an environmentally friendly, reliable and afforda-
ble energy supply" and the 10-point immediate program were launched on the
28.9.2010 (BT Drs17/3049). Renewables are described "as a mainstay of future
energy supply" and energy efficiency as a key issue. In the future Germany should
cover its energy supply more and more from renewable sources. By 2020, the
share of renewable energy in gross final energy consumption 18%. The share re-
newable energy generation in gross electricity consumption of 35% should be
achieved in 2020. Then the proportion should be by 2030 50%, until 2040 65%
and by 2050 increased to 80%.
Climate protection may be a "driving force for competition" for new tech-
nologies and the conversion of the energy supply. Greenhouse gas emissions are
to be reduced by 40% by 2020, 55% by 2030, 70% by 2040 and by 80% to 95%
by 2050 compared to 1990 levels (ibid.).
The operation time of nuclear power plants has been extended by an average
of 12 years, arguing that nuclear energy is a "bridge technology" in this way – the
amendment came into force on 1.1.2011. A significant portion of the additional
profits from the term extension should be transferred from operators to the public
purse. This "phasing out of the nuclear phaseout" not only led to the protest of the
municipal energy industry, but also mobilized the anti-nuclear power movement
in Germany. There were very large demonstrations against nuclear energy.
The disaster in Fukushima in March 2011 promoted a broad anti-nuclear
consensus in Germany. Almost all social groups, churches, government and op-
position parties, agreed on the call for an "exit as soon as possible." The mouth-
piece of this consensus was an Ethics Committee "Safe Energy Supply," whose
report was handed over in May 2011 to the Federal Government.
"The environmental and energy policy of the third Merkel government is ...
– from an environmental point of view – no reason to celebrate." (Töller 2019:
570) The instruments of the Renewable Energy Act have been significantly mod-
ified, which has slowed down rather than increased the expansion of renewable
energy. The coal phase-out was adjourned. No concrete CO2 reduction targets
have been adopted for the sectors.
62 Lutz Mez

The double reform of the EEG (2014, 2016), envisaged in the coalition
agreement and led by Economy and Energy Minister Gabriel, led to a fundamen-
tal reorganization of the promotion of renewable energies. In particular, the fixed
feed-in tariff was replaced by a sliding market premium.
In December 2014, the National Energy Efficiency Action Plan was adopted
and a law on the partial implementation of the Energy Efficiency Directives was
adopted at the beginning of 2015.
In the coalition agreement of the 4th grand coalition between CDU, CSU and
SPD the necessary framework for the energy transition for the national energy
and climate goals is depicted (CDU, CSU, SPD 2018). The target for the renew-
able energy share of gross electricity consumption of at least 65% in 2040 was
moved to 2030. But the 2020 goal for 40% reduction of greenhouse gas emissions
will not be achieved. This is also due for some of the energy efficiency targets,
first of all energy productivity increase.

The nuclear phase-out


The reactor catastrophe of Chernobyl had a decisive influence on the use of nu-
clear power in Germany. The Green party, represented in the Bundestag since
1983, was asking for the immediate shut down of all nuclear facilities. Public
opinion was divided since the mid of 1970's in this question. In 1986, the situation
changed dramatically. Within two years, the share of nuclear opponents rose to
over 70% while approval declined to 10%. The position of the SPD and trade
unions changed; all nuclear power plants in Germany should to be closed within
ten years.
But only after the change of Federal Government in autumn 1998 the red-
green Government with the so-called "nuclear consensus" could obtain a funda-
mental turnaround in the German energy policy. Results of the agreement reached
after 20 months of negotiations with the operators of nuclear power plants were
among other things, that the operating licenses of the plants became temporary,
and the construction of new nuclear power plants, as well as reprocessing of nu-
clear fuel were banned. In 2002, the Atomic Energy Act was amended accord-
ingly. For the first time a big industrialized country made a clear decision in the
nuclear policy - towards phasing-out the use of nuclear power by the year 2023.
Although the SPD and the CDU/CSU had different positions in this question, the
nuclear exit law continued in force during the Grand Coalition.
After a further change of Government in 2009, the Black-Yellow Govern-
ment extended the operation licenses for nuclear power plants. This led to a re-
naissance of the anti-nuclear movement in Germany – and also the smaller energy
utilities took part. Despite these protests the revised nuclear law entered into force
January 1, 2011. But in March 2011 - just a few days after the reactor disaster in
Energiewende in Germany – the Dawn of a New Energy Era 63

Fukushima - a moratorium of the oldest nuclear reactors was announced. In June


2011, the Federal Cabinet decided the shut-down for eight nuclear power reactors
and the tiered shut-down of the remaining nine reactors between 2015 and 2022.
At the end of 2022 all German nuclear power plants must be inoperative.

Policy on the promotion of renewable energy sources


In Germany, the use of renewable energy took a rapid development. Their share
in gross electricity consumption rose from 6.8% (2000) to over 33% in the year
2017. End of 2018 about 50,300 MW onshore wind turbines, 5.500 MW offshore
wind turbines, 42,300 MW photovoltaic systems, and 7,700 bioenergy plants
were in operation. Since 2017, there is more generating capacity from renewable
than from conventional energy sources installed. The proportion of electricity
generated from renewables continues to grow as well, reaching 36% of consump-
tion in 2018. The framework conditions for this development were issued espe-
cially at the federal level. However, international factors, the directives of the Eu-
ropean Union, the energy programs of the Federal States and especially regional
and local actors have influenced this development too.
The instrument of the feed-in tariff for electricity from renewable energy
sources was implemented in Germany in the year 1990 as a Parliament initiative
in the form of the Stromeinspeisungsgesetz (StrEG). The producers received a
minimum compensation of electricity from renewable energy and the utilities
were obliged to take this power in its network.
With the adoption of the renewable energy sources act (EEG) by the red
green Federal Government in the year 2000 the StrEG was substantially extended.
The EEG supported almost all renewable energy sources, but also technology and
innovation incentives and continued the purchase obligation and guaranteed feed-
in tariffs and investment security for the operator.
While the StrEG contained no targets, the REG's share of total energy con-
sumption should be doubled by the EEG until 2010. The EEG continued the min-
imum price system from the StrEG for all renewable energy sources, promoting
the use of biomass, solar and geothermal energy. As the central control element,
the EEG provided compulsory purchase for REG power based on the amount of
electricity generated in a given calendar year. The operators are committed to re-
cording and compensation of REG-e, installing a nationwide compensation for
these payments.
The funding instruments for renewable energy have been developed not only
in terms of the fundamental transformation of the energy sector - and not first and
foremost to reduce of emissions, but to build up a powerful environmental indus-
try. Renewables are part of an energy mix, which is to ensure energy security and
generate new export opportunities.
64 Lutz Mez

The success of the instruments depends by no means alone on the amount of


the subsidies or feed-in tariff. Rather, several other conditions and factors helped
to ensure that the general framework for the expansion work. These included
among others the manner of the approval procedure, the method of financing, tax
law and investment security, public opinion and the acceptance by the locals and
residents for wind turbines or solar systems.
The 2017 Renewable Energy Sources Act introduced a paradigm shift to-
ward competitive funding rates, leading to substantially more cost-efficient de-
velopment of renewable energies. The 2017 act has three core aspects: (1) cost
effective annual quantitative steering, (2) actor diversity to bring renewable ener-
gies closer to the market, and (3) supporting development extension for renewable
technologies (wind onshore and offshore, photovoltaics and biomass). Since 1
January 2017, the level of funding has been determined on the market by auction.
The first auctions under the new rules have taken place and have shown that the
average level of funding awarded can even decrease.

Policy to increase energy efficiency


Energy efficiency is a key factor for a sustainable energy and climate policy. Na-
tional energy strategy adopted by the Federal Government has the objective, that
primary energy consumption is reduced 20 percent by 2020 and 50 percent by
2050. To achieve these goals, the energy efficiency must be increased constantly.
An effective measure of energy saving is the thermal insulation of buildings; the
use of combined heat and power technology in the power plant sector is another
example of improved energy efficiency. While improving thermal insulation in
buildings on the cycles of the repair of buildings and houses must be coordinated
and can therefore not be realized in a short or medium-term perspective for all
existing buildings, the conversion in the power plant sector is quite faster possible.
As the efficiency of co-generation plants or smaller, decentral heat and power
plants is significantly higher than in so-called condensation power plants, which
produce only electricity, thus also reduces the emission of the greenhouse gas
carbon dioxide significantly.
The National Action Plan on Energy Efficiency (NAPE) is the key focus of
measures to increase energy efficiency. It includes a broad range of measures,
including investments in energy savings and the consolidation of consultancy and
information services. Such measures include the mandatory energy audit for non-
SMEs, the national Top Runner Initiative and the National Efficiency Label for
old heating systems for example.
The progress made in improving energy efficiency are measured through a
monitoring process and evaluated. Essential to the formation of efficiency indica-
tors are current energy statistics and reliable information about the most important
Energiewende in Germany – the Dawn of a New Energy Era 65

influence and reference values of the energy consumption. Relevant benchmarks


are population, GDP, production value or gross value added.
The use of primary energy per unit of real gross domestic product (GDP) has
declined since 1990 by 7.7 GJ / €1000 of GDP until 2017 on 4.7 GJ/1000 € of
GDP. The Total Primary Energy Consumption per capita has fallen even more
during this period, from 188.7 GJ per capita on 166 GJ per capita (AGEB 2018a).
But to achieve the objectives in the integrated energy and climate concept,
energy efficiency must be improved in all sectors significantly. The Expert Com-
mission, which has reviewed the progress made in the Energiewende and submit-
ted its first report in December 2012, considers that a reinforcement of the current
trends. In particular, a support framework for combined heat and power is miss-
ing. The last Statement on the Monitoring Report of the Federal Government was
published in June 2018. Problems were localized especially in the area of energy
prices and energy consumption in the household, transport and industry sector.
The status of the implementation of the energy transition shows considerable need
for action to meet the targets. Not all areas are making the desired progress.
Mainly the overarching goal, to cut greenhouse gas emissions, will be missed for
2020 by a large margin (Löschel et al. 2018).
The Expert Commission acknowledges the positive trends in the field of re-
newable energy and points to the unsatisfactory development in energy efficiency.
“Energy productivity would have to be boosted by a factor of 4 in order to get
back on track to hit the Energy Concept target by 2020” (ibid.). And the transport
sector is missing the energy transition targets both in terms of increasing the share
of renewables and in terms of cutting final energy consumption.

Future electricity supply in Germany


According to scenarios for the future electricity generation in Germany the Fed-
eral Network Agency (BNA) assumed that net power requirement will not in-
crease, and that peak demand will not exceed 84 GW until 2022. In comparison
to the base year 2010 – before the Fukushima accident - a total capacity of 20.3
GW nuclear reactors will be substituted by a mix of conventional power stations
and remarkable renewable generation technologies must be added. The expansion
of pump storage and natural gas fired power stations are the most important con-
ventional technologies while three scenarios opt for labored but different exten-
sion of wind onshore and offshore, photovoltaic and biomass plants. The total
installed capacity will increase from 158.1 GW in 2010 to 206.7 GW (A), 218.9
GW (B) or 238.1 GW (C) in 2022. As the efficiency of the new power plants is
much higher than the old plants to be retreated, the CO2 emissions of power gen-
eration will not increase but shrink.
66 Lutz Mez

The BNA publishes on its web page a list of power stations with installed
capacity ≥ 10 MW. It also includes plants in Austria, Luxembourg and Switzer-
land that feed into the German grid. In addition, the list shows the sum of gener-
ating facilities with a capacity of less than 10 MW that are eligible for payments
under the Renewable Energy Sources Act (EEG). The information on new plant
capacity and plant closures is updated on a regular basis.
As of November 2018, a total net nominal capacity of 215.6 GW was oper-
able in Germany. Power stations with total 204.1 GW were participating in the
electricity market and the share of renewable energy technologies was 112.5 GW
(55%).

References
AGEB (2018a) Ausgewählte Effizienzindikatoren zur Energiebilanz Deutschland 1990-2017. Berlin
AGEB (2018b) Substantial Drop in Energy Consumption in 2018. Press Release 05/2018. Berlin
BMWi (2018) Sixth “Energy Transition” Monitoring Report. The Energy of the Future. Reporting
Year 2016. Berlin, June 2018
BMWT & BMU (2006) Energieversorgung für Deutschland. Statusbericht für den Energiegipfel am
3. April 2006. Berlin, März 2006
CDU, CSU and FDP (2009) Wachstum – Bildung – Zusammenhalt. Koalitionsvertrag für die 17. Le-
gislaturperiode vom 26.10.2009
CDU, CSU and SPD (2005) Gemeinsam für Deutschland – mit Mut und Menschlichkeit. Koalitions-
vertrag vom 11.11.2005
CDU, CSU and SPD (2018) Ein neuer Aufbruch für Europa. Eine neue Dynamik für Deutschland.
Ein neuer Zusammenhalt für unser Land. Koalitionsvertrag vom 14. März 2018
Deutscher Bundestag (2010) Energiekonzept für eine umweltschonende, zuverlässige und bezahlbare
Energieversorgung und 10-Punkte-Sofortprogramm – Monitoring und Zwischenbericht der
Bundesregierung. BT Drs. 17/3049 vom 28.09.2010
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stoffe. Verantwortung für die Zukunft. Ein faires und transparentes Verfahren für die Auswahl
eines nationalen Endlagerstandortes. BT Drs. 18/9100 vom 19.07.2016
Hennicke P et al. (1985) Die Energiewende ist möglich. Für eine neue Energiepolitik der Kommunen.
S. Fischer, Frankfurt/M.
Jänicke M, Reiche D, Volkery A (2002) Rückkehr zur Vorreiterrolle? Umweltpolitik unter Rot-Grün.
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Krause F, Bossel H and Müller Reißmann K-F (1980) Energie-Wende: Wachstum und Wohlstand
ohne Erdöl und Uran. Ein Alternativ-Bericht des Öko-Instituts. S. Fischer, Frankfurt/M.
Löschel A et al. (2018) Statement on the Sixth Monitoring Report of the Federal Government for 2016.
Berlin, Münster, Stuttgart. June 2018
Meyer-Renschhausen M (1977) Energiepolitik in der BRD von 1950 bis heute - Analyse und Kritik,
Köln
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Mez L (2001) Der deutsche Weg zum Ausstieg aus der Atomenergie – im Konsens zu einer Quote für
Atomstrom, in: Gourd A and Noetzel T (Hrsg.) Zukunft der Demokratie in Deutschland, Opla-
den, 416-432
Töller AE (2019) Kein Grund zum Feiern! Die Umwelt- und Energiepolitik der dritten Regierung
Merkel (2013–2017). In: Zohlnhöfer R and Saalfeld T (eds.) Zwischen Stillstand, Politikwandel
und Krisenmanagement, Springer VS, Wiesbaden, 569-590
https://doi.org/10.1007/978‐3‐658‐22663‐3_24 
Nuclear Waste Management in Japan3

Lila Okamura4

Abstract
Prior to the Fukushima accident, Japan was the world’s third largest producer of
nuclear energy. Japan had promoted nuclear power generation in order to ensure
a safe energy source and to combat climate change. In 2010 the nation’s 54 nu-
clear reactors generated 288 TWh (288 billion kilowatt hours), accounting for al-
most 30% of Japan’s total output (World Nuclear Association 2015). Greater ca-
pacity was planned with the Japanese government target to source about 40 per-
cent of its electricity needs from nuclear power.
This huge industry and research sector was built on the premise that Japan
would recycle its spent nuclear fuels. It is upon this unstable foundation that Japan
has attempted to establish its nuclear disposal construct. However noble the ide-
als, however advanced the technologies, however solid the financing, any discus-
sion on final disposal in Japan is constricted by the presupposition of spent fuel
recycling. This “vicious circle” has left the construct teetering, and government
after government at a loss as to how to deal with the disposal problem effectively.
The lack of transparency, the lack of alternatives, and the confusion surrounding
the management of nuclear waste in Japan has meant that the debate has never
really made it to the public arena.
This chapter will provide an overview of high-level radioactive waste man-
agement in Japan and those problems which are specific to Japan.

3
This article is based on Lila Okamura: “False premise, false promise Governance and Manage-
ment of Nuclear Waste in Japan” in: Achim Brunnengräber et al. (eds.) Challenges of Nuclear
Waste Governance. Wiesbaden: Springer VS, 2018, pp. 95-120.

Lila Okamura  Dokkyo University  lilaokamura@dokkyo.ac.jp

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_6
70 Lila Okamura

The Current Status of Radioactive Waste in Japan

Categories and the current status of as high-level radioactive waste (HLW) in


Japan
Japan is aiming to establish a nuclear fuel cycle. Accordingly, high-level radioac-
tive liquid waste (generated by the reprocessing of spent fuel) that has been vitri-
fied and sealed in containers will be classed as high-level radioactive waste, while
other waste products that are radioactive will be classed as low-level radioactive
waste, which is subdivided int a number of categories, according to the location
where it was generated and its level of radioactivity.
In Japan, high-level radioactive liquid waste (generated by the reprocessing
of spent fuel) that has been vitrified and sealed in containers is classed as. As of
March 2018, Japan had 2,482 packages of waste that had undergone reprocessing
and vitrification: 2,176 of these are stored at the JNFL reprocessing facility at
Rokkasho-mura in Aomori Prefecture, while the remaining 306 are stored at the
Japan Atomic Energy Agency (JAEA) reprocessing facility at Tokai-mura
(NUMO 2019). This includes the vitrified waste packages which were repro-
cessed overseas and sent back to Japan. The amount of fuel reprocessed by Areva
and BNG was approximately 5,600 tons, which corresponds to about 2,200 vitri-
fied packages. By the end of 2007 1,310 vitrified packages had been sent back
from France, 520 from the UK. If all of the spent fuel resulting from nuclear
power generation were to be reprocessed into vitrified packages, this figure would
rise to approximately 25,000 packages (NUMO 2019).
HLW is subject to geological disposal, as is transuranic (TRU) waste, in ac-
cordance with the 2007 revision of the Final Disposal Act. TRU is low-level ra-
dioactive waste with long half-lives containing more than a specified concentra-
tion of long-lived radionuclides, generated by the operation and dismantling of
reprocessing plants and MOX fuel fabrication plants. It includes hulls and ends,
emission filters, concentrated liquid and miscellaneous solid waste.

Quantity of spent fuel stored at Each Nuclear Installation


Currently, more than 14,000 tons of spent fuel are stored at nuclear power stations
in Japan. The total capacity of all nuclear power station pools is said to be ap-
proximately 20,000 tons, which means that almost 70% is deployed. The remain-
ing available capacity differs between stations, but it is estimated that the pools at
TEPCO’s Kashiwazaki-Kariwa NPS in Niigata Prefecture and Tokai No.2 NPS
in Ibaraki Prefecture will be full within approximately three years, as will the
pool at Kyushu Electric Power Company’s Genkai NPS in Saga Prefecture.
Nuclear Waste Management in Japan 71

Table 1: Quantity of Waste Stored at each NPS in tons (September 2018)


Electric Power Company/ NPS Quantity of Available Storage ra-
Waste tio
Capacity
Stored (%)
Hokkaido Tomari 400 1,020 59
Tohoku Onagawa 420 790 84
Higashidohri 100 440 50
Tokyo Fukushima Daiichi 2,130 2,260 94
Fukushima Daini 1,120 1,360 82
Kashiwazaki Kariwa 2,370 2,910 100
Chubu Hamaoka 1,130 1,300 90
Hokuriku Shiga 150 690 51
Kansai Mihama 470 760 89
Takahama 1,250 1,730 95
Ohi 1,670 2,100 91
Chugoku Shimane 460 680 79
Shikoku Ikata 710 1,080 50
Kyushu Genkai 910 1,130 77
Sendai 980 1,290 91
JAPC* Tsuruga 630 910 82
Tokai Daini 370 440 96
Amount 15,260 20,890 73
Source: FEPC (2018:7) JAPC*: Japan Atomic Power Company

Final Disposal
Basic Approach to Disposal
In Japan, the 2005 Framework for Nuclear Energy Policy placed emphasis on
radioactive waste treatment and disposal. The basic policy on the disposal of and
approaches to radioactive waste set out in the framework is to conduct technolog-
ical research and development for the effective and efficient treatment and dis-
posal, and to undertake treatment and disposal safely and efficiently. The four
principles that underlie the framework are:
(1) Liability of generators
(2) Minimization of radioactive waste
(3) Rational treatment and disposal
72 Lila Okamura

(4) Implementation based on mutual understanding with the public


In addition, the present generation assumes responsibility for the safe dis-
posal for future generations.
The laws regulating activities associated with radioactive waste management
are the Act on the Regulation of Nuclear Source Material, Nuclear Fuel Material
and Reactors (abbreviated to “the Reactor Regulation Act”), and the Act on the
Prevention of Radiation Disease Due to Radioisotopes, etc. (abbreviated to “the
Radiation Disease Prevention Act”).
The Designated Radioactive Waste Final Disposal Act (Final Disposal Act)
was enacted in 2000 as a law specific to high-level radioactive waste. This act
stipulated that:
 High-level radioactive waste must undergo disposal in a stable subterra-
nean geological formation at a depth of more than 3,000 meters
 An implementing body must be established
 A three-step process must be adopted for selecting disposal sites
 A contribution-based system must be used to secure the funds for final
disposal.
The Act on Special Measures for Handling Pollution by Radioactive Mate-
rials was enacted to address the issue of the disposal of waste polluted by radio-
active materials discharged as a result of the Fukushima Daiichi NPS accident;
the government has been at the center of efforts in this area.

Bodies Involved in Geological Disposal


(Assigning responsibility for research and development)
Ideally, an implementing body with responsibility for the disposal of high-level
radioactive waste would ensure both safety and the adherence to the principle of
generator liability. When it met in May 2000, the Atomic Energy Commission of
Japan’s Panel on the Disposal of High-Level Radioactive Waste deemed it more
appropriate for the implementing body to be a private sector body, rather than a
program directly implemented by the government, and insisted that the govern-
ment should apply laws and administrative measures to supervise and apply safety
regulations to the undertaking.
The Nuclear Waste Management Organization of Japan, NUMO, whose es-
tablishment had been authorized by the Minister of Economy, Trade and Industry,
was designated as the implementing body for geological disposal, in accordance
with the Designated Radioactive Waste Final Disposal Act of 2000. NUMO is
Nuclear Waste Management in Japan 73

responsible for selecting sites for the construction of disposal facilities, construct-
ing the facilities, carrying out geological disposal, sealing/closing the facilities
and managing them thereafter, and collecting contributions to cover the necessary
expenditure.
The 2005 Framework for Nuclear Energy Policy states that the government,
research and development institutions, and NUMO are expected to consistently
promote the research and development of geological disposal of high-level radi-
oactive waste, while giving due consideration to their own roles and working in
close partnership.
It states that NUMO is to carry out the following aspects of final disposal
operations involving high-level radioactive waste:
 Safe implementation
 Technical development aimed at improving economic performance
and efficiency.
In addition, the framework states that research and development institutions
will be led by the Japan Atomic Energy Agency (JAEA) (JAEA 2015). JAEA uses
underground research facilities in Japan, one of these is the Horonobe Under-
ground Research Center at Horonobe-cho in northern Hokkaido. It carries out re-
search and development on geoscientific issues and on geological disposal for
high-level radioactive waste. The others are JAEA Tono Geoscience Center in
Gifu Prefecture and JAEA Tokai Research and Development Center in Ibaraki
Prefecture.

The JAEA’s underground research facilities were established to ensure:


 scientific research on underground geology;
 basic research and development towards improving the reliability of
geological disposal technology and safety assessment methods; and
 research and development for safety regulations.

Waste disposal method and the Scale of Geological Disposal Facilities


With HLW and TRU remaining radioactive for a long time, the goal of waste
disposal is to isolate the waste from the human environment during this period.
In Japan the waste will be disposed of in stable host rock formation more than
300 meters underground. A “multi-barrier system” consisting of engineered and
natural (geological) barriers will isolate and contain the radioactive waste safely.
Spent fuel is reprocessed in order to separate re-usable uranium and pluto-
nium from the waste. The resulting liquid containing HLW is fed continuously
74 Lila Okamura

into an induction heated furnace with fragmented glass. The resulting glass is a
new substance in which the waste products are bonded into the glass matrix when
it solidifies. This product, as a melt, is poured into stainless steel cylindrical con-
tainers ("canisters") in a batch process. When cooled, the fluid solidifies ("vitri-
fies") into the glass. This glass, after being formed, is highly resistant to water.
Vitrified waste is about 1.3m in height, 40cm in diameter and 500kg in
weight. Vitrified waste will be stored in steel containers named “Overpacks”, and
their 20cm thick casing thickness will prevent contact between the groundwater
and the vitrified waste. The overpacks will then be covered by a 70cm thick com-
pacted clay “Buffer material”, and each of them will be disposed in a stable host
rock “natural barrier” with sufficient space around it (NUMO 2016:3).
TRU waste includes hulls and ends, emission filters, concentrated liquid and
miscellaneous solid waste. Each type has a prescribed container, and is placed
either in canisters, drums or rectangular containers, and in some cases will have
undergone a solidification process. The Cabinet’s “Final Disposal Plan” (2008)
anticipates a TRU waste volume of approximately 18,000 m3 (NUMO 2016:3).
NUMO plans to construct a facility where at least 40,000 of these vitrified
packages and 19,000m3 of TRU can be buried; the above-ground facility is ex-
pected to cover an area of 1–2 km2 and the underground facility 6–10 km2, with
the cost of the disposal forecast to be approximately 3.5 trillion yen (NUMO
2015:19).

The repository site selection process


Three-stage process
The “Final Disposal Act” provides for the selection of a repository site in a three-
stage process; the selection of preliminary investigation areas, the selection of
detailed investigation areas and the selection of a repository construction site. The
opinions of the local population will be fully respected in the selection process.
At each stage of the process, reports on the investigation will be compiled and
explanatory meetings held. The site selection process cannot move to the next
stage without the agreement of the local population, the municipal mayors, and
the prefectural governors.
The first stage involves a “literature survey”, analyzing previous earthquake
activity, volcanic eruption, fault activity, uplift and erosion and other relevant tec-
tonic phenomena. If the literature survey confirms that there is no indication of
pronounced geological perturbations resulting from natural phenomena such as
earthquakes, and that there will be no risk of such phenomena occurring in the
future, then preliminary investigation will be carried out.
Nuclear Waste Management in Japan 75

Preliminary investigations (borehole and trench) will be carried out on the


surface, analyzing the geological formations, rock properties, geological struc-
tures, groundwater characteristics and geodynamics. The analysis will confirm
that the host formations and nearby formations are stable, that there are no obsta-
cles to tunnel excavation and that there is no risk that groundwater flow and other
relevant phenomena would negatively impact the underground facilities. Concur-
rent with more detailed investigations at ground level, underground research fa-
cilities will be constructed. This research will determine the suitability of the ge-
ological formation for the construction of a repository for the waste disposal.
Following the identification and selection of a repository construction site,
the disposal facilities will be designed, and a safety evaluation undertaken. Con-
struction will then begin after a safety review by government experts (NUMO
2016:5).

Geological Selection Criteria


Given the amount of volcanic activity and the fact that earthquakes are a frequent
occurrence, is there anywhere in Japan which can honestly be said to be suited to
geological disposal? Among the populace there is widespread anxiety concerning
the safety of geological disposal.
NUMO claims that detailed surveys of the geological environment make it
possible to avoid areas affected by volcanoes or active faults, thus ensuring safety.
Looking at the distribution of volcanoes across the Japanese archipelago, one can
see that the locations where volcanoes occur have hardly changed at all over the
last couple of million years (NUMO 2015:15)
In the case of active faults, too, NUMO suggests that it is possible to avoid
the effects of active faults, because there have been no major changes in fault
movements over the last few million years; once a fault appears, it becomes the
site of repeated activity, because it is a weak point.
According to NUMO, sites to which the following criteria apply are unsuit-
able as disposal sites:
1. Sites located within 15 km of a volcano
2. Sites that have experienced more than 300 m (150 m in the case of
coastal areas) of uplift in the last 100,000 years
3. Sites located on an active fault, the width of the fault being given as one-
hundredth of its length.
76 Lila Okamura

Burden of Final Disposal Costs


In terms of the costs involved in final disposal, calculations in Japan are premised
on the nuclear fuel cycle. First and foremost, therefore, are the (1) spent fuel re-
processing costs. Other conceivable costs include (2) reactor decommissioning
costs; (3) geological disposal costs; and also (4) development and siting costs.
Regarding (1), under the Spent Nuclear Fuel Reprocessing Fund Act enacted
in 2005, the costs associated with reprocessing at the Rokkasho Reprocessing
Plant can be passed on by adding them to electricity charges. The costs for (2)
have already been added to electricity charges since 1989, under an item listed as
“nuclear power generation facility dismantling charge (Oshima 2010:21)”. Re-
garding (3), the costs of disposing approximately 40,000 vitrified packages, in-
cluding the cost of developing the technology required for geological disposal and
the costs associated with constructing, operating, and sealing the facility, are es-
timated at approximately 3 trillion yen (ca. 24 billion Euro). Under Article 11 (1)
of the Final Disposal Act, power companies are obliged to make an annual con-
tribution to NUMO, the implementing body with responsibility for disposal, com-
mensurate with the volume of waste resulting from nuclear power generation.
Since 2000, the citizens of Japan have funded this contribution, through a portion
of their electricity charges set aside for this purpose. In the financial year 2017,
this contribution amounted to 15.2 billion yen (ca.121 million Euro), making a
total of 1 trillion yen (ca.8 billion Euro) in contributions to date5. Thus, the system
is such that the burden of costs (1)–(3) falls on the populace, from whom electric-
ity charges and other fees are collected.
Regarding (4), the selection of a final disposal site will have a huge socioec-
onomic impact, due to the very long period of time involved. As such, recognizing
that it is vital to ensure that hosting the site helps to revitalize the host area, METI
has put together a budget for “Grants for areas hosting power facilities” under the
grant system based on the Three Power Source Development Laws, which are
available from the literature survey stage onwards. METI has decided to pay 1
billion yen per year to both the municipal and prefectural governments of the area
concerned at the literature survey stage, and 2 billion yen per year at the prelimi-
nary investigation stage. The grant system from the detailed investigation stage
onwards is set to be determined in due course.
Once a municipality is actually confirmed as a host area for a disposal site
and the site begins operating, it will receive annual income of approximately 2.7
billion yen (ca. 21.6 million Euro) in fixed asset tax for 60 years, making a total
of approximately 160 billion yen (ca. 1.28 billion Euro). In addition, the area can

5
http://www.numo.or.jp/tsumitate/kyoshutsu.html, last accessed February 10, 2019
Nuclear Waste Management in Japan 77

expect to benefit from employment creation, with the economic effect of the con-
struction and operation of the disposal site estimated at 39.8 billion yen (ca. 318
million Euro) annually (Ueda and Li 2014:7).

The Sole District to Apply for a Literature Survey (Toyo-machi, Kochi Prefec-
ture)
The Final Disposal Act prescribes a three-stage selection process with public par-
ticipation and the support of local government. As described above, it also pre-
scribes that grants are to be provided from the site survey stage for the purpose of
regional development.
Despite the creation of this site selection framework, the only municipality
ever to have applied for a literature survey since the application process opened
in 2002 is Toyo-machi in Kochi Prefecture.
Toyo-machi announced in January 2007 that it would apply for a literature
survey. A town of approximately 3,000 inhabitants, Toyo-machi is located on the
Pacific coast, close to the border with Tokushima Prefecture. The decision to ap-
ply was made by the town’s mayor without consulting with the town council, so
opinion in the town was bitterly divided. Beyond the town, the prefectural gover-
nors of both Kochi and Tokushima expressed their opposition to NUMO. The
incumbent mayor resigned over the issue, calling an election in April 2007, stand-
ing again and seeking a mandate from local residents. The opposition candidate
won a landslide victory and the application for the literature survey was with-
drawn on 23 April (Hokkaido Shinbunsha 2013:50). On 21 May, the town council
enacted an ordinance rejecting the proposal to bring radioactive and nuclear ma-
terial into Toyo-machi, settling the issue once and for all (Toyo-machi 2017).

A Shift in Policy on Site Selection Methods


To a Government-led Selection System
It is suggested that the survey stages for selecting a candidate site will take around
20 years, and that the subsequent process of building a facility, burying the waste
and ultimately sealing the facility will take about 100 years. However, with not a
single local government in Japan having undergone a selection survey hitherto,
Japan has not yet even reached the starting point of the long journey ahead.
To rectify this situation, on 22 May 2015, the Cabinet approved a revision of
the government’s Basic Policy based on the Final Disposal Act. The key point in
the revision is the switch from the system of voluntary application by local gov-
ernments to one in which the government plays the key role in choosing the site.
78 Lila Okamura

One of the problems with the application system in its current form is that it im-
poses a very heavy burden and duty of accountability on any local government
that announces that it wishes to host a disposal site.
Accordingly, Japan is shifting to an approach in which the national govern-
ment is at the forefront of efforts, with the aim of speeding up the process of
selecting candidate sites. The government plans to put together an extensive list
of areas thought to be geologically suitable; it then intends to approach several
areas to propose conducting a survey so that it can put together a color-coded map
of suitable and unsuitable sites. However, no decision has yet been made on how
to narrow down the list of candidate sites after that stage.
This is the first revision of the Basic Policy concerning the selection of final
disposal sites since 2008. The government is endeavoring to undertake thorough
and careful dialogue to promote understanding locally and among the populace
as a whole, but there are many who are anxious about the fact that the national
government is taking the lead in selecting candidate sites. There has even been a
backlash in certain quarters of local government, with some stating that “it is un-
acceptable for the national government to force this upon us” (Kochi Shinbun
2015).

“Nationwide Map of Scientific Features for Geological Disposal”


The government put together an extensive list of areas thought to be geologically
suitable and released a “Map of Scientific Characteristics” at the end of July 2017,
which was subsequently posted to the ANRE website (ANRE 2017). The map
does not pinpoint potential nuclear waste repository sites. It illustrates in four col-
ours (light green, dark green, orange and silver) the suitability of geological con-
ditions throughout Japan. The areas in light green are deemed suitable as final
disposal sites. The areas in dark green are suitable areas which lie within 20 km
of the coastline, which also renders them favourable from the standpoint of mar-
itime transport. The areas in orange lie within a radius of 15 kilometres from vol-
canoes or are located close to active faults. These areas are therefore deemed un-
favourable from the standpoint of underground stability and other factors. The
areas in silver are those with reserves of oil, natural gas, coal and other minerals
that could be exploited in the future. Approximately 900 municipalities, more than
half of all municipalities in Japan, are classified as dark green areas. These 900
municipalities account for about 30 percent of Japan’s total land area (NIKKEI
2017), the combined light green and dark green areas account for about 65 percent
of Japan's total area and are considered suitable for the construction of a disposal
site (Mainichi 2017). There should be some narrowing-down of the list of areas
which are deemed suitable, but thus far no decision has been made yet as to how
this will be realized.
Nuclear Waste Management in Japan 79

Figure 1. Map of Scientific Characteristics

Source: Asahi Shimbun (2017)

Problems in Japan

Uncertainty
In Japan, the discussion of final disposal began at more or less the same time as
the nation began developing and using nuclear power. As a result of research and
development over many years, the discussion of the technical aspects of vitrified
package manufacture and disposal methods has advanced. In addition, the gov-
ernment has established financial support to help deal with the enormous costs
80 Lila Okamura

that are expected to be incurred between the selection of the candidate sites and
the actual final disposal.
Why, despite this headway, has no progress been made on the question of
final disposal sites for radioactive waste? Any discussion of nuclear energy issues
in Japan hitherto has focused solely on the energy supply aspect. In addition, nu-
clear waste management in Japan is always discussed separately from energy and
nuclear power policy, which entail many uncertainties. Nuclear energy policy and
also nuclear fuel cycle policy have contrasting, conflicting scenarios (cf. chapter
on energy policy in Japan): The aims of nuclear energy policy are the “promotion
of nuclear power” and the “reduction of the dependence on nuclear power”. The
direction which the nuclear fuel cycle will take could be either the “promotion of
the nuclear fuel cycle” or the “reduction of plutonium stockpiles”. The direction
of nuclear waste policy in Japan will change according to which scenario is cho-
sen.
A comparison between the set of circumstances in Japan and Germany illus-
trates the problems specific to Japan. Although neither Germany nor Japan has
decided on its final disposal site, the situation in Japan is characterized by much
higher uncertainty.

Table2 Comparison between Germany and Japan

GERMANY JAPAN
1 Nuclear power until 2022 ✓ the core and baseload power source ?
2 Reprocessing Forbidden ✓ Promoting ✓
but not yet in operation ?
3 Spent fuel HLW ✓ recyclable materials ✓
?
4 HLW - vitrified package ✓ ONLY vitrified package ✓
- spent fuel ?
5 Final disposal - vitrified package ✓ -vitrified package ✓
Geological disposal - spent fuel -TRU-waste
- (possibly) spent fuel ?
3
6 Total amount of ca. 28.100 m ✓ undeter- ?
HLW mined
7 additional problems ---- radioactive waste from Fukushima
(Own compilation)
Nuclear Waste Management in Japan 81

Germany has already decided to withdraw from nuclear power (point1) and
given up the fuel cycle (2). Spent fuel will be directly disposed (5) and it is easy
to calculate the total amount of waste (6).
In Japan as of February 2019 nine nuclear power reactors have already re-
started, but it is unclear how many will eventually be restarted. Moreover, it has
already been decided that nuclear power generation will account for about 20%
of the energy mix by 2030, but it remains unclear whether nuclear power genera-
tion will continue thereafter, or whether the nation will seek to move away from
nuclear power (1). Furthermore, there is no active support for the restarts of nu-
clear power stations among the public, with many groups and individuals calling
for the country to abandon nuclear power in the future.
From the perspective of high-level radioactive waste, abandoning nuclear
power would mean zero generation of flow waste. Consequently, the only waste
which would need to be transported to final disposal sites would be the existing
stock waste. Even if the country does not immediately abandon nuclear power,
setting a clear deadline for abandoning it would facilitate precise calculations of
the quantity of flow waste that would be generated in the future.
However, if, as is presently the case, the question of whether nuclear power
will be sustained or abandoned remains undecided, there will be continued uncer-
tainty surrounding the quantity of radioactive waste that will be generated in the
future (6). In addition, if the government decides to abandon nuclear power en-
tirely, this will raise question marks over whether there is actually a need for nu-
clear fuel recycling, which is the major premise of Japan’s nuclear energy policy.
If the nuclear fuel cycle is not realized, the nature and quantity of flow waste will
change (5).
In Germany spent fuel means HLW (3), which is disposed of geologically
(5). In Japan, according to the law, high-level radioactive waste consists of vitri-
fied packages (4). This definition arises from the fact that the nuclear fuel cycle
is the major premise of policy in Japan, but the development of reprocessing
plants and fast breeder reactors has not gone anything like according to plan.
However, because Japan aspires to recycle its nuclear fuel (3), spent fuel is cur-
rently regarded as an asset.
The delays in these areas are not the only problem: the enormous cost of the
nuclear fuel cycle is also regarded as a crucial issue. Until now, the goal was to
reprocess all spent fuel, but given the present circumstances, direct disposal of at
least some of the spent fuel is now up for consideration. Whether all or just some,
direct disposal of spent fuel would mean that spent fuel would also be HLW.
From this perspective, it would seem appropriate to adopt the definition used by
the Science Council of Japan: “The term ‘high-level radioactive waste’ does not
merely refer to high-level radioactive waste emitted after the reprocessing of
spent nuclear fuel; it will also be used to indicate spent nuclear fuel in the event
82 Lila Okamura

that reprocessing of all spent nuclear fuel is halted and direct disposal is also car-
ried out.”
Discussing final disposal sites on the basis of a definition that equates high-
level radioactive waste with spent fuel would make it possible to avoid any major
changes in the approach to disposal sites, even if there was a change in the current
policy of reprocessing all spent fuel.
Furthermore, the Fukushima nuclear power station accident is generating
high-level radioactive waste. One must bear in mind that the disposal of radioac-
tive waste such as nuclear fuel material and reactors that have undergone a core
meltdown is notably more difficult than the disposal of conventional high-level
radioactive waste (7).
Even if one considers only this point, the data presented on the basis of the
quantity and nature of “high-level radioactive waste” as defined in law could dif-
fer quite substantially from the quantity of and possible disposal methods for the
actual high-level radioactive waste emitted, regardless of the legal definition
thereof (Ueda/Li 2014: 8).

“Vicious circle”
Nuclear waste management in Japan has stalled. Japan has abandoned neither nu-
clear power nor reprocessing, despite the increasing costs. The Rokkasho Repro-
cessing Plant is not progressing as planned. According to figures released in 2003
by the Federation of Electric Power Companies of Japan, the total cost of building
the Rokkasho Reprocessing Plant, operating it for 40 years, and decommissioning
it will be approximately 11 trillion yen (ca. 88 billion Euro). This figure of 11
trillion yen is based on the cost of reprocessing the 14,000 tons of stock waste
that had already accumulated by 2004, plus some 18,000 tons of the flow waste
that would be generated thereafter, making a total of 32,000 tons to be reprocessed
over the course of 40 years. The Rokkasho Reprocessing Plant has the capacity
to reprocess 800 tons annually and the estimates are based on it working at full
capacity over 40 years, but if operating levels were to fall, the costs would surge
even higher (ANRE 2003:25).
Moreover, if the restarts go ahead as planned and nuclear power generation
takes place at the same pace as it did before the disaster, approximately 1,000 tons
of spent fuel will be emitted annually. This scenario would make the annual re-
processing capacity of 800 tons inadequate, and the quantity of spent fuel requir-
ing “interim storage” on a temporary basis would grow to approximately 34,000
tons by 2046. Even if the government goes ahead with its policy of reprocessing
all of Japan’s spent fuel, the costs incurred by the new reprocessing plant will
increase even further.
Nuclear Waste Management in Japan 83

There are also costs involved in storing the vitrified packages. The govern-
ment expects the storage costs to be approximately 30 million yen per package,
but the vitrified packages returned from overseas are estimated to cost 120 million
yen per package to store (Oshima 2010: 20). Moreover, while the packages are in
storage, nuclear fuel tax will have to be paid; this will be approximately 730,000
yen per package per year in the case of Aomori Prefecture, and approximately
940,000 yen per package per year in the case of Ibaraki Prefecture. Thus, at least
1 trillion yen will have to be paid in tax just to store the packages for 50 years.
With no prospect of commercializing fast breeder reactors, there are fears
that the cost of the nuclear fuel cycle could balloon, so the nuclear fuel cycle is
currently being reviewed, with the option of direct disposal now up for consider-
ation.
In April 2012, the Atomic Energy Commission of Japan re-estimated the cost
of the nuclear fuel cycle. If nuclear power generation accounts for 20% of total
power generation in 2030, the cost of direct disposal of the full volume of spent
fuel will be 11.8–12.6 trillion yen, compared with a cost of 15.4 trillion yen if all
of it is sent for reprocessing. If nuclear power accounts for 35% of all power gen-
eration in 2030, the gap will widen further, with total direct disposal costing 13.3–
14.1 trillion yen and total reprocessing 18.0 trillion yen (JAEC 2012: 24, 66, 108).
This seems to suggest that whereas direct disposal would be better in eco-
nomic terms, Japan will nonetheless continue to reprocess. The Draft Revision of
the Basic Policy Based on the Final Disposal Act approved by the Cabinet on 22
May 2015 states that research will be conducted regarding direct disposal and
other disposal methods (METI 2015: 7). The Radioactive Waste Working Group
of the Advisory Committee for Natural Resources and Energy, which proposes
improvements to initiatives and systems, adopted the view that “direct disposal is
an alternative to the nuclear fuel cycle, not an alternative to final disposal” ANRE
2015: 7). This in effect means that SF should be reprocessed. Moreover, even the
recently revised Basic Policy stresses the importance of the nuclear fuel cycle,
with the criteria for selecting final disposal sites predicated on reprocessing
(ANRE 2014: 2, 3). There is a strong tendency not to exclude the option of repro-
cessing, both to honor the agreement with Aomori Prefecture and to ensure access
to interim storage facilities. There are also those who argue against relinquishing
a technology that could potentially be used for making nuclear weapons (Hok-
kaido Shinbunsha 2013: 119).
Nuclear policy and nuclear waste management present a real dilemma. Nu-
clear energy is still positioned at the center of energy policy in Japan, which in
turn prevents the development of renewable energy in Japan. Adhering to energy
technology with a high investment risk and a lack of flexibility will hinder both
the expansion of new energy technologies and the energy transition in Japan.
84 Lila Okamura

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ary 11, 2019
Rise and Fall of the Nuclear Dream in Germany

Lutz Mez

Abstract
In Germany, nuclear policy was initially quite central to German industrial policy
and then to national energy policy and later also to German environmental policy.
Nuclear and related energy policy decisions were made and coordinated for the
most part at the national level as part of the coalition party politics and its need
for reasonable consensus both within the party structure but also regarding ac-
commodations with Germany’s sectoral corporatist interest group structure. En-
vironmental concerns are since the 1970s deeply embedded in German society
and politics The Chernobyl nuclear accident galvanized these environmental con-
cerns in a very energy-focused way and finally paved the way to the nuclear
phase-out agreement.


Lutz Mez | Freie Universität Berlin, Germany | lutz.mez@fu-berlin.de

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_7
88 Lutz Mez

Introduction
Nuclear power stations were operating in West Germany since 1961 and in East
Germany since 1966. In the aftermath of the first oil price crisis 1973/74 West
Germany gave priority to nuclear power – and nearly all oil-fired power stations
were closed. East Germany started operation of its first reactor in 1966 and added
four blocks in the 1970s and one in 1989. The expansion of this technology oc-
curred for West Germany in the wake of the first oil price crisis. However, far
reaching nuclear expansion plans were given up already in the 1980s. For East
Germany the main driving force were energy policy agreements with the Soviet
Union. After the unification of Germany in 1990 all NPPs in East Germany were
shut down. In West Germany the nuclear exit was put on the agenda by a very
strong anti-nuclear movement and on the Federal level of the opposing parties
Social Democrats and Greens. The 1998 newly elected red-green Federal Gov-
ernment accomplished a phase-out agreement with the operators and three reac-
tors were permanently shut-down until 2005.
Nuclear exit has been on the German policy agenda since over three decades.
After the Chernobyl accident a majority of the public and relevant stakeholders
opposed nuclear power and strived for renewable energy alternatives. At the same
time climate change policy gained high attention of German policy makers and
ambitious targets for the reduction of Greenhouse gas emissions were approved.
In 2000 a phase out agreement was reached between the Federal Government and
the operators of nuclear power plants. Since 2002 the purpose of the Atomic En-
ergy Act is not more the promotion but to phase out the use of nuclear energy for
the commercial generation of electricity in Germany. After the Federal elections
in 2009 the conservative-liberal government targeted and implemented a slow-
down of the termination and provoked strong anti-nuclear reactions in the society.
As a response to the nuclear disaster in Fukushima, a nuclear moratorium was
announced and in summer 2011 the German cabinet and the Bundestag adopted
decisions on the gradual phase-out of nuclear power and on accelerating the en-
ergy transformation. Eight nuclear reactors lost their operation license on August
6, 2011 and the resting nine are stepwise shut down until 2022. Three key ele-
ments to replace the electricity produced by nuclear reactors will be implemented:
expanding renewable energy use with a corresponding infrastructure and signifi-
cantly improving the energy efficiency efforts - and for a transition period also by
operating new and more efficient gas-fired plants. But the ongoing Energiewende
of the German energy system demands much more than the substitution of energy
sources and the way to use energy. A fundamental reform of social, economic,
technological and cultural policy in Germany has to be realized.
Rise and Fall of the Nuclear Dream in Germany 89

Licensed Reactor Technologies, Industrial Policy and Public-Private Devel-


opment
In the then West Germany, the official nuclear policy initiative started in 1955 and
was closely tied to concerns about the Cold War relations with the Soviet Union.6
It was aimed at the development of a nuclear sector, including the production and
operation of nuclear power plants (NPPs) as well as all other facilities of the nu-
clear fuel cycle. Initially, the nuclear program was regarded an integral part of a
general industrial policy to re-establish Germany as a viable force in international
markets, summarized as the so-called “Modell Deutschland”. The German nu-
clear industry consisted of the electronics industry, the machinery industry, and
the chemical sector. They represented the majority in the “Deutsche Atomkom-
mission”, the main advisory body of the Ministry for Nuclear Questions, founded
in October 1955, and the unofficial center of nuclear policy making7 (Keck 1984:
56f).
The early nuclear power era in Germany was characterized by an enormous
technological optimism which until the early 1970s was based upon a general
political consensus among the governing parties. Major financial support for pub-
lic-private nuclear R&D, for producers and operating companies for individual
projects was central to the German nuclear program.8
In 1956-1957, Deutsche Atomkommission started the 'Eltviller Programm',
as the first official German nuclear program (Prüß 1974: 70). By 1965 five 100
MW nuclear reactor designs were to be developed parallel. The number five did
not arrive from scientific considerations but was due to the number of German
company consortia involved in the implementation of the program. All partici-
pants wanted to have a share of the financial support of the German Government.
Only two of the five planned reactors were built and already by the end of the
1950s the first nuclear program was dropped in favor of more “realistic” designs
(Mez 1981: 29ff).

6
   In 1955, the Parisian Treaties were signed, which lifted the allied ban of any nuclear (civil and
military) research from the losing parties of WW II. In the same year, the UN Conference on
the peaceful use of nuclear energy in Geneva was held, which to the German delegates under-
lined the urgency of a nuclear program to catch up to international standards (Keck 1984: 52-
56).
7
   The commission was in place from 1956 until 1971. More than 200 delegates from industry,
research centers and universities were members of its many working groups, and it thus
brought together the leading representatives of the German nuclear community.
8 In the course of the four nuclear programs from 1957-1976 (beginning with the so-called “Eltv-
iller Programm”) a total of 10 billion € of research funds of the Federal Ministry for Research
and Technology (BMFT) were spent. According to the German historian Joachim Radkau this
financial contribution was one of the preconditions for the success of Germany’s nuclear in-
dustry, since many private investors by the late 1950s had retreated from the nuclear venture
because of low profitability expectations (Radkau 1983: 196).
90 Lutz Mez

Nuclear power was already on its way, when the first nuclear power act of
the Federal Republic (Gesetz über die friedliche Verwendung der Kernenergie
und den Schutz gegen ihre Gefahren - AtG) was passed in December 1959. Until
then acts and ordinances of the Länder had regulated economic and public health
interests with respect to radiation, nuclear power, the production of isotopes and
their usage.
Despite the partial failure of this program the early consensus continued.
Siemens started the construction of pressurized water reactors (PWRs) on the base
of a Westinghouse license, and AEG, an affiliate of General Electric, started the
construction of boiling water reactors (BWRs) on a license base too. In 1958
RWE, the largest utility, ordered, together with Bayernwerk, the nuclear power
pilot plant Kahl (15 MW) from AEG, but all nuclear components were delivered
by General Electric. Already in 1958 AEG started in cooperation with General
Electric and Hochtief AG the planning of a 200 MW NPP for RWE. Construction
started at the end of 1962 and in 1967 the 237 MW NPP Gundremmingen was
connected to the grid.
The 2nd nuclear program (1963 - 1967) integrated research, development,
construction and operation of pilot plants and of prototypes. The nuclear reactor
development strategy tied in with the experiences of the United States. As a short-
term strategy, it involved the take-over of proven technology and reactor designs,
and the development of the high temperature reactor. It also involved an aid pro-
gram for construction and radiation protection, and a long-term strategy for the
development of fast breeder reactors.
Direct subsidies for the nuclear industry were multiplied by a factor five dur-
ing the 2nd nuclear program. By expiration of the program Germany had caught
up to international standards of nuclear technology with countries abroad.
Germany strived from the beginning for the establishment of a nuclear fuel
cycle in the country. Uranium enrichment technologies had been developed in
Germany during World War II. After 1955 Germany continued as a partner in the
tri-national enrichment company Urenco Ltd. During the 1970's the three partners
in Urenco constructed and operated pilot and demonstration plants at Almelo in
the Netherlands and at Capenhurst in the United Kingdom.
After analyzing several possible sites in Germany, Gronau, a town near the
Dutch border with about 50,000 inhabitants in the state of North Rhine-Westpha-
lia, was selected in 1978 as the site for Urenco's third uranium enrichment plant.
The plant started operation in 1985. The first stage of 1,000 tons annual separative
work was reached in 1998.9

9 In February 2005, a license for a second enrichment plant was granted, leading to a total ca-
pacity of 4,000 tSW/a at 31 December 2017.
Rise and Fall of the Nuclear Dream in Germany 91

Between 1971 and 1990 a pilot reprocessing plant was operated in the nu-
clear research center Karlsruhe, located in the state of Baden-Wuerttemberg.
After the chemical sector dropped all activities as part of the German nuclear
industry, utilities took over the initiative to construct and operate a reprocessing
plant in Germany. In 1980 sites were developed in Bavaria and Hesse. After the
site Volkmarsen in Hesse was dropped quite soon, the planning focused on the
realization of a reprocessing and fuel production facility in Bavarian municipality
Wackersdorf. The strong opposition of local population supported by the interna-
tional anti-nuclear movement led finally to the resignation of the nuclear industry
to finalize the reprocessing plant Wackersdorf in 1989.
Since 1967 AEG and Siemens offered in cooperation with Westinghouse and
General Electric developed reactor designs (AEG: BWR, Siemens: PWR) to Ger-
man utilities. Also, in 1967 the nuclear lobby succeeded in having nuclear opera-
tors receive subsidies on the same level as the hard coal subsidy scheme. This led
to the first commercial orders: AEG constructed the 670 MW BWR in Würgassen,
and Siemens the 672 MW PWR in Stade. The two reactors started operation in
1971 and 1972, respectively.
The German nuclear power station manufacturer KWU was created as joint
venture of Siemens and AEG in 1967. In 1975 KWU had gathered orders for 30
bn. DM (15 bn. €) and ranked as number three in the world nuclear industry.
The NPP Biblis A was set into operation in 1974. With a capacity of 1,000
MW the world’s largest nuclear reactor at that time. Further the explosive nuclear
export contracts with Brazil, Iran and Argentina had contributed to the industry’s
development.
This success was reflected in the government’s first energy program of Sep-
tember 1973.10 The commercial operation of large nuclear power plants in Ger-
many happened to coincide with the first oil price crisis of 1973/74. Nuclear
power became central on the energy policy agenda and the government decided
to substitute oil by an ambitious nuclear program.
This concluded the first phase of nuclear policy, which, in summary, was
largely restricted to one main policy field. It was forged as a key part of German
industrial policy. Since this phase was focused on research and development it did
not initially have many publicly palpable economic and social effects. It involved
a relatively restricted circle of political actors. Considering the results, one could
argue that the early nuclear policies of the German government were straight for-
ward and quite successful with respect to supporting the inception of a German
nuclear industry of acknowledged – albeit not indigenous – technical competence.

10
This program adopted the goal to increase nuclear capacity 20-fold until 1985, i.e. to install
total nuclear capacity of 40-50,000 MW and supply a share of up to 40% of electricity needs
through nuclear energy. This was reconfirmed in 1974 (Deutscher Bundestag 1974).
92 Lutz Mez

Technical Failures, the Chernobyl Accident, and Nuclear Phase-out


A second phase Germany’s nuclear policy started 1975. This phase was induced
by considerable public protests, and the first critical statements were published
by the evolving anti-nuclear alliance. The public protests had effects. The planned
NPP Wyhl facility in the Upper Rhine Valley in southwest Germany, where in
1975 the movement was “conceived”, had to be given up and in Lower Saxony,
in 1979, the prime minister had to declare the plans for a nuclear waste plant in
Gorleben to be “impossible to enforce for political reasons”.
In 1980 an Enquete Commission of the Bundestag proposed a paradigmatic
change in energy policy away from nuclear power. Such factors and events con-
tributed to a broad shift in German public opinion, the formation of the Green
Party, and finally its election to the German Bundestag in 1983 (Brand et al.
1986).
Then came the 1986 Chernobyl nuclear disaster. The disaster in the Ukraine
far exceeded the residual risk of a maximal credible accident and sparked a major
debate about nuclear dangers worldwide. Chernobyl also clarified the economic
risk dimensions of nuclear power stations for a national economy in a drastic way
and stimulated a novel appreciation of nuclear power in politics and industry.
However, the termination of the nuclear era in Germany needed more than the
Chernobyl disaster to bring it about.
In the then Federal Republic of Germany the CDU/CSU/FDP-led govern-
ment reacted to Chernobyl by establishing the Federal Ministry for the Environ-
ment, Nature Conservation and Nuclear Safety (BMU).
Probably no other country has conducted the discussion about nuclear phase-
out on as perfect a scenario base as Germany. The Green Party strived for the
immediate shut-down of all nuclear facilities. The SPD resolved the nuclear
phase-out within ten years.
In addition, Länder governments, municipalities, parties and trade unions
started to deal with the question of whether the use of nuclear power technology
was reasonable and sensible for the future.
Advanced reactor designs in Germany also turned out to be flops. Two fast
breeder reactors (FBRs) were built, but both were closed in 1991 without the
larger ever having achieved criticality. The small demonstration breeder KNK-II
was converted from a thermal reactor, KNK-I, which had been used to study so-
dium cooling. KNK-II had a capacity of 20 MW and achieved criticality as a fast
reactor in 1977. The second fast breeder – a 300 MW sodium natrium cooled
breeder, called SNR-300 – at Kalkar was started in 1972 and completed in 1985,
but was never operated. The project costed about 7 billion DM (about €3.5 bil-
lion). The SNR-300 was maintained and staffed until a decision to close it was
finally made in 1991 and has since been decommissioned. Today the site is used
Rise and Fall of the Nuclear Dream in Germany 93

for the amusement park “Wunderland Kalkar”, which incorporates much of the
power plant buildings into the scenery.
The High Temperature Reactor THTR-300 at Hamm-Uentrop was under
construction since 1970, started in 1983, but was shut down in September 1989.
The THTR was synchronized to the grid for the first time in 1985 and full power
operation started in February 1987. The THTR-300 was the German prototype for
high-temperature reactors (HTR) and was the first to use a pebble bed design and
TRISO fuel. The THTR-300 costed 2.05 bn. € and is predicted to cost an addi-
tional half a billion € until December 2009 for decommissioning and other asso-
ciated costs.
After also having dropped the reprocessing option in Germany, the nuclear
industry tried since 1992 to reach an energy consensus with all parties about a
“politically undisturbed” operation of nuclear power plants. It argued that for op-
erator purposes the energy consensus should comprise seven components: the def-
inition of regular service life of nuclear power plants; the acceptance of electricity
generation in large power plants; the exclusion of enlarged electricity imports; the
abandonment of reprocessing after termination of existing international contracts;
processing plutonium for MOX-fuel; the search for an international alternative
for final high level nuclear waste storage; and the disposability of two low- and
middle level nuclear waste storage facilities in Germany. In the spring of 1993,
consensus talks started, and all attempts failed (Mez 1997: 433ff).
When the red-green coalition took office in the fall of 1998, nuclear phase-
out consensus talks had the highest priority on the agenda. The result, after 20
months of negotiations with the nuclear plant operators was, among others, that
the operating license for nuclear plants was determinable, and that the construc-
tion of new reactors and the transportation of spent fuel for reprocessing were
prohibited.
The agreement restricted the operating life time of the existing reactors not
by restricting the operating license to a specified year or total number of years but
by pinning down total allowed amounts of electricity to be produced by each in-
dividual plant. Calculated in years and at current output, German nuclear power
plants were allowed total operating times (Regellaufzeit) of 32 years each. Fur-
thermore, should one plant be closed earlier, its leftover share of allowed electric-
ity production may be shifted to another plant.
Thus, from the agreement it was impossible to exactly predict when the
plants will be shut down and which company will provide how much nuclear
power capacity at which point in time. However, an approximate calculation
showed when the effects of the agreement will come and how these will affect the
individual operators. A first effect of the phase out agreement on the operational
nuclear capacity would become noticeable after 2006 and the number of shut
downs will accelerate after 2010.
94 Lutz Mez

The leading roles of the four largest operators, RWE, E.ON, Vattenfall Eu-
rope and EnBW were maintained. However, compared to E.ON and EnBW, who
continued to have greater stakes in nuclear energy, the share of RWE’s nuclear
production will be reduced substantially so that, based on the current sales num-
bers, other electricity sources will become much more important for RWE’s sup-
ply. Looking at Vattenfall Europe, the share of nuclear production will decrease
to less than one tenth of the current share by 2014, significantly reducing the cur-
rent importance of nuclear energy for this utility.
By this agreement, followed up by an amendment of the Atomic Act in 2002,
Germany introduced as the first large industrial country a clear signal to phase-
out nuclear power until 2023 (Mez & Piening 2006).
The red-green Federal Government had emphasized ecological moderniza-
tion and climate change policy as well as job creation and socio-economic devel-
opment in its overall approach and energy policy was to be a leading example of
it. It included tax reform (an eco-tax on energy), phasing out nuclear power, and
strengthening renewable energy sources and combined heat and power (CHP).
Additional reforms followed later when the government agreed to make the pro-
vision for a regulator obligatory in the new electricity directive of 2003
(2003/54/EC), a provision implemented in 2005.
The nuclear phase-out decision reflected the consensus among Greens and
many social democrats since the Chernobyl accident and was enshrined in the
Nuclear Energy Phase-Out Act. Licenses of existing plants were limited in time.
The legislative process was characterized by the government’s endeavor to reach
a consensus with nuclear power interests and to avoid legal disputes before the
courts and entailed the withdrawal of regulatory legislation that would have af-
fected the economics of nuclear power (liability insurance, taxation of funds for
plant removal and final storage etc.).
In November 2003 the NPP Stade was the first plant which was shut down
according to the nuclear phase-out consensus, and in May 2005 the NPP
Obrigheim followed.

Preserving or Extending the Phase-out?


Under the impact of the economic crisis in Germany and in particular of rising
unemployment and unpopular measures to fight it, support for the red-green gov-
ernment declined from 2003 on. When in the key state of North Rhine-Westphalia
a red-green Land government was replaced by a conservative-liberal coalition,
chancellor Schröder called for early elections about a year ahead of schedule. A
conservative-liberal victory at the national level was widely anticipated at that
time, and it seemed clear that it would make dramatic changes in German energy
policy.
Rise and Fall of the Nuclear Dream in Germany 95

At the national level, these two parties talked of reversing the nuclear phase-
out law, of making policy more favorable to the utilities and industrial interests
(in the name of competitiveness), of questioning the eco-tax and of replacing
RESA by a more competitive system. The Kyoto approach to climate protection
was also questioned. On the stock market, the shares of the utilities were boosted
by Schröder’s election announcement.
The Free Democrats (liberals) emphasized the need to return to nuclear and
coal and wanted to subject RES-E to market discipline. This had already been
their approach before 1990, with a liberal Minister of Economic Affairs prevent-
ing all substantial measures in favor of RES-E. In 2005, they proposed to install
a quota/certificate system for a similar purpose.
The position of CDU/CSU was more complex, partly due to internal con-
flicts which had not been resolved. Angela Merkel, the conservative leader, had
repeatedly made clear that changes in the energy sector would have to be substan-
tial, and she earned high praise from the association of utilities when she gave a
speech on her plans. But quite a few of her proposals lacked specific details.
On the nuclear power issue, she proposed to reverse the phase-out decision
but did not say clearly by how long the lifetime of reactors should be extended.
Some in the party argued in favor of an extension by 8 years (from 32 to 40 years)
and asked the utilities to respond to such a step – which would have increased
their profits by some € 20-30 billion, according to an estimate of the Öko-Institut
– by lowering prices for industry. The reaction of the utilities was to issue a state-
ment that price formation should be left to the market and that such a request did
not fit with the world of profit-oriented enterprises. Merkel also proposed to re-
duce the support for German hard coal.
When the close results of the 2005 parliamentary election became evident,
the pro RES and anti-nuclear community drew a big sigh of relief. A conservative-
liberal coalition would not have enough votes in parliament. This led to a grand
coalition between the conservatives and the social democrats. RES and nuclear
safety were to stay with the Environment Ministry (under a social democratic
minister). After some weeks of negotiation, the coalition agreement between the
CDU, CSU and SPD made clear, that energy policy was set to continue in the
footsteps of the red-green coalition.
With respect to nuclear power CDU/CSU and SPD continued to have differ-
ent opinions. In the coalition treaty therefore, the following formula was included:
“Hence the agreement between the Federal Government and the energy utilities
concluded on June 14, 2000, with respect to the agreed procedures and the amend-
ment of the Nuclear Act cannot be changed” (CDU, CSU, SPD 2005: 41).
But this formula was no guarantee that the nuclear dispute in Germany is
settled. It only reflected the fact, that pro nuclear politicians did not have a ma-
96 Lutz Mez

jority in the Bundestag. The Federal Minister of Economy, Mr. Glos (CSU), re-
sponsible for general energy policy matters, was using each suitable and unsuita-
ble opportunity to take a pro nuclear power stance, which was, even in the word-
ing used, the pure public relations of the nuclear lobby.
The operators of nuclear plants made several attempts to move the remaining
life time from newer reactors to the four NPPs scheduled for shut-down during
this legislature. The Federal Minister of the Environment, responsible for nuclear
safety, turned down all applications and challenged the utilities to take the eldest
nuclear power plants off-grid as soon as possible.
As a matter of fact, nearly all remaining German nuclear power plants were
located in Länder which at this time either were governed by conservative-liberal
or conservative-social democratic coalitions or – as in Bavaria – ruled by the CSU
alone. In general, these Länder governments were more or less in favor of life
time extension, albeit for different reasons.
Nuclear power was recommended as CO2-free electricity generation, alt-
hough the life cycle analyses of nuclear power plants calculate considerable emis-
sions of greenhouse gases. Other arguments offered were the economic ad-
vantages of depreciated old nuclear power plants and the outdated age structure
of the West German power station park in general, which did not afford the sub-
stitution in all plants of renewable energy technology.
The agreement on the phase out of nuclear energy production concluded be-
tween the red-green German government and the utilities on June 14, 2000, did
not include the nuclear fuel facilities, such as the Urenco Gronau enrichment
plant, or the Advanced Nuclear Fuels GmbH in Lingen, today an affiliate of Areva
NP. Finally, the grand coalition admitted national responsibility for the secure fi-
nal storage of nuclear waste and aimed at to find a solution during the legislature.

Germany’s energy concept and renewable energy action plan


In August 2007, the federal cabinet approved the key points of its detailed Inte-
grated Energy and Climate Program and set itself the target of reducing green-
house gas emissions by 40 per cent compared with 1990 by 2020. Several pieces
of primary and secondary legislation have already been implemented on the basis
of this program. To reduce CO2 in the electricity sector the share of Combined
Heat and Power plants shall be doubled until 2010. Insolation of the building
stock needs a longer perspective but because of the importance of heating as larg-
est consumer of Final Energy Consumption (FEC) the reduction of energy con-
sumption for existing buildings is crucial. With its 2010 Energy Concept the con-
servative-liberal federal government proceeded this comprehensive strategy for
transforming the energy system with a long-term focus. In doing so it set ambi-
tious targets for the expansion of renewables, increased energy efficiency and
Rise and Fall of the Nuclear Dream in Germany 97

greenhouse gas reduction. The launch of a new energy age is nothing less than a
fundamental transformation of the energy supply and the way to use energy. The
government’s energy concept therefore comprises two key elements: expanding
renewable energy use with a corresponding infrastructure and significantly im-
proving the energy efficiency (BMU 2012: 8). The German National Renewable
Energy Action Plan - which is part of the EU Directive 2009/28/EC - has adopted
the minimum target of 18 per cent share renewables of FEC until 2010. This man-
datory target requires the expansion of renewable generated electricity to nearly
40 per cent in 2020. With additional energy efficiency and energy saving
measures the renewable share of FEC will about 20 per cent.

The exit of Nuclear power in German energy supply


As a response to the nuclear disaster in Fukushima, in summer 2011 the federal
cabinet and the Bundestag adopted decisions on the gradual phase-out of nuclear
power by 2022 and on accelerating the energy transformation. This transfor-
mation marks a fundamental decision on social, economic, technological and cul-
tural development in Germany.
At the time of the Fukushima disaster 17 operational and 19 permanently
shut down reactors existed in Germany. Additional eight were halted in March
2011 and shutdown in August 2011. According to the amended nuclear act, in
force since August 6, 2011, the resting 9 reactors will be shut down when the
remaining operation time has expired, latest at the end of the respective final op-
eration year (see figure 1). In 2015 and in 2017 the NPPs Grafenrheinfeld and
Gundremmingen B were shut down.
98 Lutz Mez

Figure 1: Shut-down Schedule for Nuclear Power Plants in Germany


The last nuclear power plants still in operation in Germany are to be shut
down by 2022 at the latest. The Atomic Energy Act stipulates the following dead-
lines, on which the authorization for power operation expires:
 31 December 2019: NPP Philippsburg 2
 31 December 2021: NPPs Grohnde, Gundremmingen C and Brokdorf
 31 December 2022: NPPs Isar 2, Emsland and Neckarwestheim 2.
Regardless of the specific shutdown date, each NPP may generate an indi-
vidually assigned electricity volume. This amount of electricity is often referred
to as the “residual electricity volume”. Once a NPP has produced this electricity
volume, its authorization to operate expires. According to the Atomic Energy Act,
the authorization for power operation of a NPP may also expire before the above-
mentioned shutdown dates if the respective assigned electricity volume has been
generated.
The small nuclear share of FEC – before the last nuclear exit decision 4.6
per cent – dropped to 3.6 per cent in 2011 and continued to drop.
Rise and Fall of the Nuclear Dream in Germany 99

Nuclear waste policy and governance


On nuclear policy the problem of the final storage of nuclear waste was on the
agenda again. Three Federal ministries are the main actors. The Federal Ministry
for the Environment, Nature Conservation and Nuclear Safety (BMU) is the
regulatory authority, responsible for the development and implementation of the
waste management policy, and has a supervisory function with respect to the
Federal Office for Radiation Protection (BfS) and the nuclear licensing authorities
of the Länder. Further the Federal Ministry for Economic Affairs and Energy
(BMWi) is responsible for implementation related basic research on the disposal
of radioactive waste and for the remediation of the former uranium mining sites
of the former GDR. And the Federal Ministry of Education and Research (BMBF)
is responsible for the basic research in the nuclear waste management area.
In July 2013, the Repository Site Selection Act (StandAG) was adopted. The
Commission on the storage of high-radioactive waste materials published their
final report in July 2016 (BT Drs. 18/9100).
The StandAG represented a political consensus of the big political parties
including the Green Party and the Länder about a stepwise approach for selecting
a site for an underground repository for heat-generating nuclear waste and pro-
posed principles for developing improved site selection criteria (Hocke & Kallen-
bach-Herbert 2015).
This process started with a “white map” of Germany – including the very
controversially discussed Gorleben site. However, the act mainly regulated the
following issues:
 Appointment of a “Commission for the Disposal of High-active Waste”
which should prepare a report describing the siting process.
 A three staged, criteria based site selection procedure considering different
host rock formations (rock-salt, clay, crystalline) and the following schedule:
The official site selection process should start in 2016, decision on the sites
for surface investigations by the national parliament (year not specified), de-
cision on sites for underground investigations (2023), decision on the se-
lected site (2031). Each step is concluded by a federal law as a binding deci-
sion for the next steps.
 Setting up the Federal Office for Nuclear Waste Management (Bundesamt
für kerntechnische Entsorgung (BfKE)) as a new national authority acting as
the regulator in the context of nuclear waste disposal.
 Involvement of concerned authorities and the public.
The 2013 law did not specify the concrete steps and the mode of evaluation
in detail. But it filled the gap in the German legislative system that did not include
regulations for the siting process before.
100 Lutz Mez

It is one of the central tasks of the waste disposal commission to develop


details for the criteria and the procedure for the site selection. A major challenge
will be to show that lessons from the former conflicts were learnt and substantial
participation and pluralistic views of experts are going to be integrated in the pro-
cesses of decision making.
The amendment of the StandAG from March 2017 is based on the Commis-
sion's recommendations. The criteria for selecting possible final storage locations,
rules for participation procedures and the course of the site selection procedure
were fixed. And the law on the reorganization of responsibility in nuclear waste
management, the decommissioning, decommissioning and packaging of radioac-
tive waste was adopted at the end of 2016. Operators of NPPs continues to stay
independent. However, in the future, the federal government will be responsible
for the implementation and financing of interim and final storage.

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Renewable Energy in Japan

Lila Okamura

Abstract
The Fukushima Daiichi Nuclear Power Plant accident revealed the vulnerability
of Japan’s electricity supply system and triggered an awareness for the effective-
ness of locally distributed energy systems. Although the Japanese government be-
gan adopting renewable energy policies in the 1970s, it was only after the feed-in
tariff (FIT) system for renewable energy was launched in July 2012 that the in-
troduction of renewable energy would genuinely gather pace.
This chapter provides a broad overview of the history of renewable energy
policy in Japan, examines the current status of renewable energy in Japan and the
challenges faced in this regard, and also analyzes key points in the 2016 amend-
ment of the FIT Act.


Lila Okamura | Dokkyo University | lilaokamura@dokkyo.ac.jp

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_8
104 Lila Okamura

Prior to Fukushima
Of Japan’s energy policy, energy security has traditionally been the principal pil-
lar. The oil crises brought Japan the realization that its approach to energy use
with excessive reliance on oil left it vulnerable, indicating a need to remedy this
situation—especially the country’s over-reliance on the Middle East for its supply
of the resource—and create an energy supply structure that offered both stability
of supply and affordability.
In 1974, what was then known as the Ministry of International Trade and
Industry (MITI) launched the Sunshine Project, which marked the beginning of
government efforts focused on the development of renewable energy technologies
in such areas as solar, geothermal, hydrogen, and coal-based energy.
In the 1990s, addressing environmental problems joined energy security as
a goal of energy policy. The catalyst for this was the Framework Convention on
Climate Change, which was opened for signature in 1992, followed by the Kyoto
Protocol formulated in 1997. As reducing carbon dioxide emissions necessitated
a transformation in energy use, measures to combat climate change came to be
regarded as part and parcel of energy policy. The General Outline for Introduction
of New Energy was formulated by the Council of Ministers for Promotion of
Comprehensive Measures for Energy in 1994 and the Act on the Promotion of
New Energy Usage (New Energy Act) entered into force in 1997, the year when
the Kyoto Protocol was adopted. A system for the purchase of surplus power from
solar photovoltaic generation equipment at the retail value began operating in
1992 as a voluntary initiative by electric power companies. Combined with the
grants being offered for the installation of solar photovoltaic power generation
systems in homes, this resulted in Japan becoming the world number one in terms
of both solar photovoltaic power generation system installation and solar cell pro-
duction between the late 1990s and the early 2000s. In the early 2000s, Japan was
the world’s largest solar cell production base, supplying more than 50% of the
world’s solar cells.
In 2002, a Renewable Portfolio Standard (RPS) was introduced in accord-
ance with the Act on Special Measures Concerning New Energy Use by Operators
of Electric Utilities. An RPS is a system that sets a minimum amount of renewable
energy that must be used and divides that minimum usage obligation between
electric power companies. The level at which the minimum is set determines the
future growth of renewable energy and the speed of its spread. As of FY2010, the
minimum usage obligation imposed on electric power companies by the govern-
ment was 12.2 billion kWh, which was just 1.35% of actual electric power de-
mand (931.0 billion kWh, excluding private power generation) that year (MoE
2008:1). In other words, the minimum renewable energy usage obligation was too
low a target. While the RPS was the first direct support measure for renewable
Renewable Energy in Japan 105

energy to be introduced in Japan, it would be fair to say that the government has
not demonstrated a positive attitude toward promoting the spread of renewable
energy.

Figure 1: Trends of Solar PV in Japan and Germany

Source: IRENA data Graph: ISEP (ISEP2017:8)

Renewable Energy Policy: Current Status and Issues


The Fukushima Daiichi Nuclear Power Plant accident revealed the vulnerability
of Japan’s electricity supply system and triggered an awareness of the effective-
ness of local distributed energy systems. As described above, while the Japanese
government began to adopt renewable energy policies in the 1970s, it was only
after the feed-in tariff (FIT) system for renewable energy was launched in July
2012 that the introduction of renewable energy began to gather pace in earnest.
Remarkably, the FIT Act was approved by the Cabinet on the morning of the Great
East Japan Earthquake on 11 March 2011, before it was enacted in August of the
same year.
The Fifth Basic Energy Plan, published in 2018, set a target of generating
22-24% of all power from renewable energy. Moreover, in response to the Paris
Agreement, Japan stipulated that it would achieve a 26% reduction in greenhouse
gas emissions from FY2013 levels by FY2030. Renewable energy has a tremen-
dous role to play in creating a society prepared for a zero-carbon future.
106 Lila Okamura

Figure 2: Energy supply and demand in 2030

Source: METI (2017:16)

The next section examines the current status of renewable energy in Japan
and the challenges faced in this regard, while also looking at key points in the
2016 amendment of the FIT Act.

Outcomes of the FIT Act


Japan’s installed renewable energy generation capacity surged from approxi-
mately 20.6 million kW in June 2012, before the introduction of FIT, to about
43.09 million kW as of the end of December 2018, while the country’s FIT-
accredited capacity stood at approximately 87.9 million kW in December 2018.1
The proportion of power generated from renewable energy rose from 10.5% in
2011, prior to FIT’s introduction, to 14.5% (6.9% if the 7.6% accounted for by
hydropower is excluded) in 2017(METI/ANRE 2016:28), placing renewable en-
ergy in third place behind natural gas and coal as a source of electric power.
Figure 3: Trends in the Installed Capacity by Renewable Energy in Japan

1
See the Public Information section of the Online Renewable Energy Application Portal for the
Feed-in Tariff System (https://www.fit-portal.go.jp/PublicInfoSummary). (Last viewed: De-
cember 2, 2018)
Renewable Energy in Japan 107

Source: METI (2017:11)

There has been a fall in the cost of power generation as renewable energy
becomes increasingly prevalent. As of 2016, the cost of solar photovoltaic power
generation had fallen by about 38%, irrespective of scale, while onshore wind
power generation fell by 29% and woody biomass power generation by 16% (REI
2017: 5).
Moreover, electric power companies had had a virtual monopoly on power
generation before FIT was introduced, but the system’s introduction enabled other
bodies to enter the sector. The number of new electricity supply businesses estab-
lished went from an average of 39 per year between 2009 and 2011 to an average
of 1,973 per year between 2012, when FIT was introduced, and 2016. The total
number established from 2012 was 9,864, 91% of which were associated with
renewable energy (REI 2017:9).
Involvement in the sector not only by businesses, but also at the local gov-
ernment and citizen/community level has also been escalating. The number of
groups in Japan working on citizen/community-based power plants almost dou-
bled from 115 in 2013 to 200 in 2016, with the number of such power plants
108 Lila Okamura

climbing to 1,028 (Toyota 2017:15). Citizen/community-based power plants con-


sist of renewable energy power generation facilities collectively built and oper-
ated by citizens and local communities. The funds required to finance them are
jointly contributed in the form of donations or investment, and the income re-
ceived from generating the power is returned to investors as a dividend or rein-
vested into the community. It is fair to say that the operators involved in Japan’s
electricity supply system are becoming increasingly decentralized and diverse as
a result of the introduction of FIT.
Cutting CO2 emissions in the electricity sector will also be tremendously im-
portant in order to achieve the greenhouse gas reduction targets set in response to
the Paris Agreement. The electricity sector is the biggest emitter of CO2 in Japan,
accounting for about 40% of all CO2 emissions. It can be seen that the expansion
of renewable energy has yielded some positive effects in terms of reducing CO2.
Using FY2012, when FIT was introduced, as the base year, CO2 emissions from
power generation fell by 9 percentage points by FY2015. Total power generation
fell by 3 percentage points during this period, which is likely to have been the
result of energy conservation, but the remaining 6 percentage points are attributed
to changes in the energy mix. Japan’s nuclear power plants were progressively
shut down after the Fukushima accident, with the total power generated from nu-
clear energy in FY2015 falling by 6.5 billion kWh from the level in FY2012. This
will have been a factor in increasing CO2 emissions. However, power generation
from renewable energy increased by 39.1 billion kWh during this period, which
is thought to have contributed to the reduction in CO2 emissions from the elec-
tricity sector (REI 2017:6).

Issues Relating to the FIT Act


While the introduction of FIT has undoubtedly brought about an expansion in
renewable energy, it is a fact that the system has a number of issues. The total
purchase cost under FIT reached approximately ¥2.3 trillion in FY2016 (with sur-
charges accounting for approximately ¥1.8 trillion of this). With the aim of further
expanding renewable energy usage and reducing the cost burden of FIT, the Re-
vised FIT Act was promulgated in 2016 and entered into force on April 1, 20172.

2
See below for the text of the Act for Partial Revision of the Act on Special Measures Concerning
Procurement of Electricity from Renewable Energy Sources by Electricity Utilities (Revised
FIT Act).
http://www.enecho.meti.go.jp/category/saving_and_new/saiene/kaitori/dl/fit_2017/le-
gal/01_fithou.pdf
Renewable Energy in Japan 109

This section examines issues relating to the system’s operation in conjunction


with the Revised FIT Act’s key points.

Accreditation System
Under the original system, facilities could be accredited before it had begun op-
erating. Accordingly, Japan’s installed renewable energy capacity grew by an av-
erage of 26% per year (ANRE 2017:4) after FIT was introduced, with accredited
capacity reaching approximately 87.9 million kW as of December 2018. How-
ever, only about 33.7% of FIT-accredited capacity was actually operating as of
the end of March 2017 (ANRE 2017:3). Solar accounts for about 95% of installed
capacity and 80% of accredited capacity, but only about 460,000 of the approxi-
mately 940,000 accredited commercial solar power generation projects—less
than half, in other words—actually went into operation (ANRE 2017:3). Although
it is possible to cancel the accreditation of projects with no prospect of going into
commercial operation, this increases the burden on governmental bodies. There
were also fears that even if facilities were installed at a time when costs were low,
a high purchase price would increase the total purchase cost and surcharges.

Table 1: Status of FIT in Japan (as of March 2017)


Operating facili- Operating facilities Certified facilities by March
ties by RPS (Mio) by FIT (Mio) 2017 (Mio)

PV under 10kw 4.7 kw 4.74 kw (1,046,038) 5.49 kw (1,196,467)


PV over 10kw 0.9 kw 28.75 kw (464,811) 79 kw (941,215)
Wind 2.6 kw 0.79 kw (263) 7.0 kw (6,878)
Geothermal 0.5 kw 0.01 kw (29) 0.9 kw (110)
Small Hydro 9.6 kw 0.24 kw (285) 1.1 kw (598)
Biomass 2.3 kw 0.85 kw (218) 12.4 kw (845)
Total 20.6 kw 35 kw (1,511,644) 105 kw (2,146,113)
Source: Author’s compilation based on data from METI (METI 2017:3)

The recent revision made the conclusion of a grid connection agreement a


condition of accreditation. It is envisaged that sifting out projects with no prospect
of going into operation will make it easier to forecast the capacity installed within
a certain period and to make policy decisions on such matters as setting purchase
110 Lila Okamura

prices based on those projections. Furthermore, eliminating non-operational pro-


jects should make it possible to speed up the connection and entry into operation
of successor projects with a prospect of commercial feasibility.
New standards for accreditation were added, including requirements to en-
sure appropriate maintenance, inspections, and disposal, and to ensure compli-
ance with relevant legislation. The increase in installation of power generation
facilities has been accompanied by a rise in problems involving local citizens,
who harbor fears about safety and the impact on the scenery arising from the use
of land for such projects. Under the recent revision, an accredited power genera-
tion facility can have its accreditation canceled if its establishment is not in com-
pliance with legislation such as the Forest Act or River Act.

Purchase Price Setting

Price Targets
Among the issues that can be identified in respect of setting purchase prices for
renewable energy are the lack of clarity in differentiation on the basis of facility
scale and type, and, in particular, the tendency for large-scale power generation
projects to be at an advantage. In the case of solar power, a uniform purchase price
has been set for all commercial solar generation projects of 10 kW or above, so
the bigger the project, the lower its cost tends to be. The rise in the installation of
renewable energy facilities since the FIT system was launched in 2012 has there-
fore been particularly concentrated in the commercial solar photovoltaic power
generation segment. The majority of solar photovoltaic power generation facili-
ties installed before the introduction of the FIT system were domestic solar gen-
eration facilities with an output of less than 10 kW. However, the solar photovol-
taic power generation capacity installed under the FIT system through to the end
of FY2016 amounted to 38.45 million kW, with non-domestic (10 kW or more)
facilities accounting for 75.5% of this figure.3 Moreover, when FIT was first in-
troduced in Japan, the purchase price for solar photovoltaic power generation was
set at an extremely high level, triggering fears that the rise in the total value of
surcharges would gather pace.

3
Institute for Sustainable Energy Policies (ISEP) (2017), Renewables 2017 Japan Status Report
Renewable Energy in Japan 111

Figure 4: Tariffs and Durations (PV, Wind, Geothermal and Hydro)

Source METI (2012:4)

As can be seen from this, the cost of generating power from renewable en-
ergy varies according to its type and scale. Purchase price holds the key to the
spread of renewable energy, so it is necessary to be meticulous in setting purchase
prices according to the scale of the facility, the technology used, and the cost of
power generation.
Since the conclusion of a grid connection agreement is a condition of accred-
itation under the Revised FIT Act, investment in these sources of electric power
must be encouraged by indicating prices several years in advance, thereby in-
creasing the predictability of the return on investment. The Revised FIT Act also
revises the method used to set purchase prices; the government decided to point
the way to long-term cost reductions by establishing price targets (Article 3) to
encourage efficient use of renewable energy. This means that the purchase price
for accredited projects can be set several years in advance for sources of power
supply with a long lead time, such as wind and geothermal.

Introduction of a Tender Process


The recent revision also made it possible to tender for accreditation of specific
power generation facilities. It is anticipated that commercial large-scale solar and
other large-scale power generation facilities will be the focus of these tenders for
the time being. However, under the current system, participation in the tender
system requires risks, such as the vast sums of finance required for project devel-
opment and grid connection, to be addressed, so only operators with a large
112 Lila Okamura

amount of capital at their disposal can participate, raising a concern that commu-
nity-based local energy operators will be excluded. In fact, in the 2017 tender
process targeted at solar photovoltaic power generation facilities with an output
of at least 2 MW with an upper limit of ¥21.00/kWh for the procurement price, a
total of seven operators—including three foreign companies—were successful in
respect of nine projects, while local power operators were unable even to tender
a bid (ISEP 2018:3).
An analysis of the types of owner of large-scale solar photovoltaic power
generation facilities that were already operating by 2013 shows that the ownership
rate by large companies was extremely high, both in terms of the number of power
plants and the scale of their output. Thus, it is fair to say that ownership by indi-
viduals and citizen cooperatives was low even before the tender process was es-
tablished (Sakurai 2015:67). Ownership of large-scale wind power, too, is ex-
tremely disproportionately held by companies from outside the prefecture where
the projects are located, clearly demonstrating that local ownership is not being
achieved. In particular, large corporations headquartered in Tokyo own half of the
total output (Sakurai 2015:57).
With most large-scale power generation facilities tending to be owned by
companies in the first place, there would seem to be a need for caution about
introducing a system of tendering, to ensure that it does not impede the commu-
nity-based power generation projects now spreading across various parts of Japan
nor the regional revitalization initiatives of which they form a key pillar. Measures
such as the establishment of a local quota would also seem to be required.

Output Curtailment
Japan’s FIT Act does not contain any clear provisions on the “priority dispatch”
of electric power generated from renewable energy to the power grid. Conversely,
Article 6 of the Ordinance for Enforcement of the FIT Act stipulates “reasonable
grounds under which a request for connection may be refused,” thereby recogniz-
ing this as a right of general electricity utilities. For this, a “30-day, etc. output
curtailment quota”4 was set, but now those electric power companies whose level
of connections are anticipated to exceed the quota are able, as designated electric-
ity utilities, to request unlimited output curtailment without paying compensation.
As of the end of 2018, the seven electric power companies other than Tokyo Elec-
tric Power Company, Chubu Electric Power, and Kansai Electric Power Company

4
The level of connections when electric power companies cannot accept additional output unless
they impose output curtailment in excess of the limit of 30 days or 360 hours (solar) or 720
hours (wind)
Renewable Energy in Japan 113

had been designated as designated electricity utilities. In other words, not only
has priority dispatch of renewable energy not been provided for in Japanese law,
but there is also actually a mechanism that enables output curtailment to be im-
posed without compensation.
In fact, between October and November 2018, output curtailment was im-
posed on some solar photovoltaic power generation facilities and, on a smaller
scale, wind power generation facilities within the area served by Kyushu Electric
Power Company. If the supply of electric power exceeds demand, the adjustment
of supply to demand is carried out in accordance with the priority dispatch rule.
In Japan, nuclear power belongs to the group that has the top priority and is there-
fore supposed to be curtailed last of all. Japanese nuclear power plants have never
been run at reduced output. The flexibility of supply and demand adjustment has
been lost due to the restart of nuclear power plants within the area served by Kyu-
shu Electric Power Company, so output restrictions were imposed on solar power
facilities to maintain nuclear power generation. On the days when output curtail-
ment was imposed, four nuclear reactors were operating at full capacity.
It is highly likely that output curtailment will spread to other electric power
companies in due course. The fact that electric power companies can demand un-
limited output restrictions without having to pay compensation means that the
predictability of gaining a return on investment cannot be guaranteed for the op-
erators of businesses generating power from renewable energy. This increases the
risks for such operators, as well as affecting their procurement of finance. As a
result, this could cause the development of even outstanding resources to lose
momentum or could raise the cost of financing such projects.

Grid-focused Measures
Establishing a high purchase price under FIT does not necessarily encourage the
expansion of renewable energy. The primary objective of purchasing at a fixed
price is to increase the predictability of the return on investment, thereby encour-
aging investment in renewable energy. Grid-focused measures also are crucial
from the perspective of reducing the risk of investment. Renewable energy is cer-
tain to expand in the future and it has tremendous potential. However, the existing
system puts the cart before the horse: the greater the expansion in renewable en-
ergy, the stronger the possibility of unlimited output curtailment without compen-
sation, thereby increasing the risk of investment. A considerable portion of inter-
regional interconnection line capacity is currently allocated to existing sources of
electric power, as they have priority on a first come, first served basis. As such,
there are limits on spare capacity.
In the Revised FIT Act, the government decided to change the definition of
businesses obliged to purchase renewable energy from electricity retail businesses
114 Lila Okamura

to electricity transmission and distribution businesses. Electricity purchased by


transmission and distribution businesses is, in principle, made available on the
wholesale electricity market. It is anticipated that as the effective use of spare
capacity in interconnection lines progresses, the connection of renewable energy
to the power grid be ensured. This also includes responses to the electricity system
reform (deregulation of the electricity sector), thereby encouraging the neutrality
of transmission and distribution businesses. The separation of power generation
from transmission and distribution is not yet complete in Japan, so guaranteeing
the neutrality of the transmission and distribution operators that ensure connec-
tion and purchasing is of vital importance, whether in concluding a connection
agreement as a condition for securing accreditation or purchasing electricity via
the FIT system.
Although wind energy has much larger potential than other renewables in
Japan, the FIT has not increased wind installation to date, and the number of bot-
tlenecks has hindered large-scale market deployment of wind. The limited grid
capacity, the current electricity market structure, and grid operating practices by
the existing Electricity Power Companies have constrained the grid access of
wind projects. A layer of regulations related to development permits increases
lead-time, project uncertainty, and risk premiums. Difficulty in terms of social
acceptance is also high due to some of the past mistakes which did not address
local community concerns. Cost of wind energy is also high, compared with other
countries, due to lack of economies of scale and other reasons. Japan needs to
implement a more comprehensive policy package to address numerous bottle-
necks and risks to increase wind energy share in its energy mix.

Future Prospects
Under the Paris Agreement, Japan has set a target of reducing greenhouse gas
emissions to 26% below the FY2013 level by FY2030, with a reduction of 80%
by 2050. These targets are partly informed by the 2030 energy mix. As well as
setting a target of ensuring that renewable energy accounts for 22-24% of the en-
ergy mix, the Fifth Basic Energy Plan states that the government will make re-
newable energy a key energy source by working to reduce costs, overcome power
grid constraints, and secure load following capacity to cover unstable output. The
appropriate management and operation of the revised FIT system will be essential
if Japan aims to make renewable energy a key power source.

Potential in Japan
Renewable energy has expanded sharply in Japan since FIT was introduced, but
looking at where things stand in 2018, meeting the targets for 2030 will require
Renewable Energy in Japan 115

the share of biomass to more than double from the current level, while wind power
will need to treble and geothermal will have to expand fivefold.
Table2 Current Situation and Targets for 2030
2017 2030
Hydropower (including large- 7.6% 8.8-9.2%
scale)
Biomass 1.8% 3.7-4.6%
Geothermal 0.2% 1.0-1.1%
Wind 0.6% 1.7%
Solar 5.5% 7.0%
Compiled by the author from data by the Agency for Natural Resources and Energy
Although further increases in the share accounted for by renewable energy
are required, it would be fair to say that Japan has tremendous potential in the area
of renewable energy.
Japan is the 61st-largest country worldwide in terms of total land area, but,
with more than 30,000 kilometers of coastline, it rises to sixth-largest when its
exclusive economic zone is taken into account. Making use of the waters around
Japan to develop projects in such areas as offshore wind power generation, ocean
thermal energy conversion, and tidal current power would open up a great deal of
possibilities. In addition, Japan is third worldwide in terms of geothermal energy
(23 million kW of resources)5 and also third among developed countries in terms
of its share of forests, making biomass power generation a possibility (Food and
Agriculture Organization of the United Nations (2015).
Japan has significant geothermal potential and some of the world’s first ge-
othermal energy was developed in Japan. However, the ability for Japan to de-
velop this energy source is constrained by the location of geothermal sources in
its national parks, which have strict limits on their development. While directional
drilling has opened the possibility for some additional geothermal development
close to these park boundaries, without a significant revision of the restrictions on
development in national parks, geothermal energy is unlikely to significantly ex-
pand. In addition, the Japanese onsens – spas which rely on underground hot wa-
ter - are opposing the development of geothermal energy because of concerns it
will reduce the availability of hot water.
Japan’s potential to generate electricity from renewable energy as estimated
by the Ministry of the Environment is shown in Table 3. This illustrates the coun-
try’s huge potential to meet its electricity consumption from renewable energy

5
Japan Oil, Gas and Metals National Corporation (JOGMEC): http://geothermal.jog-
mec.go.jp/information/geothermal/world.html
116 Lila Okamura

alone. It is fair to say that the way in which this potential is realized will be deter-
mined to a substantial degree by the systems used for this. Detailed consideration
of purchase prices, the imposition of an obligation to prioritize the connection of
renewable energy, and/or grid-focused measures that will make large-scale intro-
duction possible are essential.

Table 3: Potential for the Introduction of Renewable Energy6 (equipment ca-


pacity: 10,000 kW)
Energy Potential for Introduction (10,000 kW)
Solar (non-domestic) 14,929
Onshore Wind 28,294
Offshore Wind 157,262
Geothermal 1,420
Small & Medium Hydropower 1,444
Compiled by the author with reference to Ministry of the Environment (MoE 2011:2)
A number of developed countries that are not endowed with as rich a natural
environment as Japan have set higher targets for 2030 than Japan (Table 4). The
expansion of renewable energy will require clear, ambitious targets to be set. As
pointed out in the chapter Energy Policy in Japan, Japan’s energy policy still pri-
oritizes nuclear power. However, placing nuclear energy at the forefront is diffi-
cult in the wake of the Fukushima accident, so the government has adopted a
rather opportunistic stance toward both nuclear and renewable energy, resulting
in a very unclear energy policy that is riddled with contradictions. It would be
desirable for the government to not merely solve the institutional problems, but
also to set out a clearer, more ambitious energy vision.

Table 4: Renewable Electricity Targets by Country (share of total power gen-


eration in 2030)
Germany 65%
Japan 22-24%
France 40%
UK 40-65%
USA About 26% by 2020 (federal target set by the Obama administration in 2013)

Compiled by the author with reference to Takamura (Takamura 2017:248)

6
Biomass resources have been omitted on this occasion, due to their highly diverse nature and
the consequent difficulty in providing a numerical assessment of their potential
Renewable Energy in Japan 117

Aiming for Locally Owned Distributed Energy Systems


The Fukushima accident exposed the vulnerability of Japan’s centralized electric-
ity supply system. Renewable energy can facilitate a shift away from the central-
ized approach to energy supply and demand in favor of a distributed model,
thereby enabling small and medium-sized enterprises based in Japan’s provincial
regions to enter the power generation sector, along with civic groups and local
governments.
However, at present, the output curtailment quotas have been calculated
based on the assumption that all nuclear power plants will be operating, except
for those whose decommissioning has already been decided. Moreover, most of
the capacity in interregional interconnection lines has been allocated to long-term
fixed sources of electric power, so Japan remains unable to break away from its
centralized electric power system.
The rise in the installation of renewable energy facilities since the launch of
the FIT system in 2012 has mainly been in the commercial solar photovoltaic
power generation segment, with corporate-owned mega-solar projects currently
accounting for half of this installed capacity. The Revised FIT Act opens up the
accreditation of certain electricity generation facilities to a tender process. It is
unlikely that this system will work to the advantage of local energy generation.
Even if renewable energy expands, most of the electricity generation facili-
ties are owned by companies based outside the provincial regions, so profits will
flow out of the communities, rendering such projects meaningless. Efforts to en-
courage the generation of power from renewable energy must yield benefits for
local communities in the form of local economic revitalization, industrial devel-
opment, and the promotion of employment.
Precisely because Japan has experienced Fukushima, it should aim for a sus-
tainable energy policy that has deep roots in local communities and does not cause
interregional inequality. Given the advantages that introducing renewable energy
could have for Japan and its provincial regions, it would be desirable to resolve
the institutional problems that are barriers to the expansion of renewable energy
and steadily build distributed energy systems.

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40 Years Promoting Renewable Energy in Germany

Lutz Mez

Abstract
A historical account of German RES-E policy will be given, focused in particular
on the evolution of feed-in legislation after 1990 and the recent policy of the En-
ergiewende. After the first oil price crisis of RES-E policy was devoted to R&D.
Market creation measures only came in the end of the 1980s; of these, the Elec-
tricity Feed-In Law was the most important. During the 1990s, it managed to sur-
vive, but several amendments were adopted. Significant improvement occurred
after the 1998 election; the new red-green majority greatly strengthened RES-E
support, particularly for photovoltaics and biomass. The key objection of this ar-
ticle is to draw attention to the merger of energy and climate policy and the ongo-
ing politics to reach the targets for energy efficiency and greenhouse gas emis-
sions reduction in Germany.


This article is an updated version of Volkmar Lauber & Lutz Mez, Renewable Electricity Pol-
icy in Germany 1974-2005, in: Lutz Mez (Ed.), Green Power Markets - Support Schemes, Case
Studies and Perspectives, Brentwood: Multi Science Publishing 2007, pp. 177-199.

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_9
120 Lutz Mez

The Beginnings
Renewable energy policy in Germany began after the first oil crisis. For about a
decade and a half, this policy consisted almost exclusively in the promotion of
research from training personnel to development of prototypes and laboratory
production. Spending was very modest in 1974 (about €10 million). It rose grad-
ually until 1978 (about €60m) and reached its peak with €150m in 1982, declining
thereafter until 1986 (€82m).
Since 1979, there were also first efforts to stimulate demand for RES-E by
use of the tariff. At that time the government relied on the national competition
law to oblige electricity distributors to purchase electricity from renewable
sources produced in their area of supply based on the principle of avoided costs.
The accident in the Ukrainian nuclear power plant Chernobyl in April 1986
had a deep impact in Germany. Public opinion had been divided about evenly on
the question of nuclear power between 1976 and 1985. This changed dramatically
in 1986. Within two years, opposition to nuclear power increased to over 70 per-
cent, while support barely exceeded 10 percent (Jahn 1992). While the social
democrats committed themselves to phasing out nuclear power within ten years,
the Greens demanded an immediate shutdown of all plants.
Also in 1986, reports warning of an impending climate catastrophe received
much attention, and in March 1987 chancellor Kohl declared that the climate issue
represented the most important environmental problem (Huber 1997). On the na-
tional level the Committee for the Environment, Nature Conservation, and Nu-
clear Safety of the German Bundestag agreed to establish an Enquete Commission
on Preventive Measures to Protect the Earth’s Atmosphere, with the mandate to
study the ozone problem as well as climate change and to make proposals for
action. An inter-ministerial working group “CO2 reduction” was also established.
The commission worked very effectively in a spirit of excellent co-operation be-
tween the parliamentary groups of both government and opposition parties. There
was general agreement that energy use had to be profoundly changed. (Kords
1996; Ganseforth 1996).
The first climate Enquete Commission recommended a goal of 30 percent
reduction of 1987 CO2 and methane emissions by 2005, and of 80 percent by 2050
(German Bundestag 1991), and also a fundamental reform of energy policy. A
series of proposals were formulated which included an electricity feed-in law for
generation from RES (Schafhausen 1996). There was growing consensus among
MPs of all-party groups that it was time to create markets for renewable energy
technologies (Lauber/Pesendorfer 2004).
40 Years Promoting Renewable Energy in Germany 121

First Steps to Market Creation


The measures adopted to create markets for RES-E technologies were in particu-
lar the 100/250 MW wind program, the 1,000 solar roof program and the creation
of a legal basis for utilities to pay higher costs for RES-E than were “competitive”
in the – actually quite distorted - market place.
When in 1988 two backbench conservative MPs in the Bundestag proposed a
feed-in tariff to support wind energy, the government, to buy off the dissenters,
initiated two important market creation programs for RES-E: a 100 MW wind
program and a 1,000 roof program for photovoltaics (Kords 1993). From 1991 to
1995, under the 1,000 roof program applicants received 50 percent funding of
investment costs from the federal government plus 20 percent from the Land gov-
ernment. Eventually 2,250 roofs were equipped with PV modules, leading to
about five MW of installations (Staiss 2000: I-140). As to wind energy, a subsidy
program for the operation of 100 MW – later 250 MW - wind turbines (by a pay-
ment of € 0.04/kWh, later reduced to € 0.03) was legitimated by the need to gain
practical experience with different approaches under real life conditions. As this
program in 1991 combined with the Electricity Feed-in Law, installed wind ca-
pacity grew rapidly. In subsequent years, these subsidies declined rapidly (Hirschl
et al. 2002).

The 1990 Electricity Feed-In Law


Buying off support for a feed-in tariff was successful only for a short period of
time. Soon afterwards, a new bill for such a tariff circulated among MPs, sup-
ported both by conservative (CDU/CSU) and green deputies who gathered sup-
port among the other parliamentary groups as well. In the Federal Ministry of
Economic Affairs and in parliament this idea got acceptance; support came also
from the Ministries of Research and of the Environment. The bill secured consent
from all parliamentary parties and became the Electricity Feed-in Law of 1990
(Kords 1993). The large utilities did not mobilize at that point, probably because
they underestimated the importance of the law which was expected to support
mainly small hydro.
The Feed-in Law required electric utilities to connect RES-E generators to
the grid and to buy the electricity at rates of 65 to 90 percent of the average tariff
for final customers. Generators were not required to negotiate contracts or other-
wise engage in much bureaucratic activity. Together with the 100/250 MW wind
program and subsidies from various Länder programs, the Feed-In Law gave con-
siderable financial incentives to investors, although less for solar power due to
the high cost (Hemmelskamp 1999). One of the declared purposes of the law was
122 Lutz Mez

to ‘level the playing field’ for RES-E by setting feed-in rates that took account of
the external costs of conventional power generation. In parliament external costs
of about 3-5 Eurocents per kWh for coal-based electricity were mentioned by
CDU MPs. Before adoption, the law was notified to the European Commission
for approval under state aid provisions. The Commission decided not to raise any
objections because of its insignificant effects and because it was in line with the
policy objectives of the Community. However, it announced that it would exam-
ine the law after two years of operation.

Challenges to the Feed-In Law


These incentives greatly stimulated the formation of markets and led to expansion
for wind turbines, from about 20 MW in 1989, to over 1,100 MW in 1995. This
encouraged technological and political learning in this sector, but also strength-
ened the resolve of the large supra-regional utilities to attempt a rollback of this
law, via both politics and the judiciary. This was more than just opposition to
small and decentralized generation. First, no provision had been made to spread
the burden of the law evenly in geographical terms; a satisfactory solution to this
problem came only in 2000. Second, the utilities were by this time marked by the
experience of subsidies for hard coal used in electricity generation which had
grown from € 0.4 billion in 1975, the year the Kohlepfennig was introduced, to
more than € 4 billion annually in the early 1990s. Two thirds of this was covered
by a special levy on electricity, one third had to be paid by the utilities directly
but was also passed on to the consumers. In 1994 the Kohlepfennig was ruled
unconstitutional by the Constitutional Court.
In April 1998 the Energy Supply Industry Act was adopted to transpose the
electricity directive 96/92/EC and modified the Feed-in Law in several points. In
particular, it created a new compensation mechanism for distributing the supple-
mentary cost to the utilities. The 1990 law had provided a hardship clause which
was practically never applied. Wherever RES-E exceeded five percent (“first ceil-
ing”) of the total electricity supply, the upstream network operator had to com-
pensate that undertaking for the supplementary costs caused by this excess
amount. A similar rule applied in favor of the upstream network operator, who
could ask for compensation from a network operator situated further upstream if
the compensation he had to pay exceeded 5 percent of his output (“second ceil-
ing”). As it was obvious that in some coastal areas the 10 percent limit would be
reached, wind power growth could stop unless an alternative solution was found.
This conflict led to insecurity for investors and stagnating markets for wind tur-
bines from 1996 to 1998.
40 Years Promoting Renewable Energy in Germany 123

Other programs
A federal energy research program from 1990-1998 amounted to more than € 1
billion to all forms of renewable energy. The Länder contributed another € 0.85
billion for the period 1990-1997, most importantly North Rhine-Westphalia. Loan
programs by the federal government’s banking institutions Deutsche Ausgleichs-
bank and Kreditanstalt für Wiederaufbau permitted more than €3 billion in re-
duced interest loans for RES installations in the period 1990-1998. Other
measures privileged wind turbines under the construction code (every local com-
munity had to present a plan with zones appropriate for wind power, which greatly
facilitated permitting), reformed training programs for architects, and stressed
public information (Staiss 2000: I-140).
Makeshift support for solar photovoltaics
While the Feed-In Law of 1990, combined with the 250 MW wind program, led
to the breakthrough for wind, solar photovoltaics did not benefit similarly. The
1,000 roof program of 1989 had been a success and led to installations of 5.3 MW
by 1993, but this market volume did not justify the installation of new production
facilities in the solar cell industry. The Feed-In Law provided little help since rates
did not come near PV costs, and a new demonstration program was not forthcom-
ing.
But help came from solar activists and municipal utilities. The 1989 modifi-
cation of the federal framework regulation on electricity tariffs permitted utilities
to conclude cost-covering contracts for electricity using renewable energy tech-
nologies, even if these “full cost rates” exceeded the long-term avoided costs of
the utilities concerned. While the supra-regional utilities generally rejected such
an approach, local activists now petitioned local governments to impose such con-
tracts on municipal utilities. Several dozen cities opted for this model.
Additional help came from several Länder market introduction programs,
most strongly in North Rhine-Westphalia. Some states acted through their utili-
ties, subsidizing solar installations for special purposes, e.g. schools. Some of-
fered “cost-oriented rates” somewhat below the level of full cost rates. Finally,
Greenpeace gathered several thousand orders for solar cell rooftop “Cyrus instal-
lations” (Ristau 1998). Due to these initiatives, the market did not collapse at the
end of the 1,000 roof program but continued to grow, attracting new firms and
demonstrating public support for PV. Various solar energy organizations lobbied
for a larger market creation program.
124 Lutz Mez

Energy Reform and Liberalization


Reforming Germany’s electricity sector proved to be a difficult task. Most reform
attempts were doomed to failure because of the political power of the German
energy supply industry (ESI) which was one of the industrial pillars of Europe’s
largest manufacturing economy. Already before unification it was partly privat-
ized and later opened for foreign investors. The powerful ownership links be-
tween the ESI and major financial and industrial interests in Germany indicate
that this industry is an integral part of what Shonfield (1968) termed German “al-
liance capitalism” to describe the corporate culture of German industry, domi-
nated by alliances with banking and insurance capital for decades. In contrast to
competitive capitalism, alliance capitalism is characterized by collaborative rela-
tionships between commercial entities, and success relies on the concerted or-
chestration of large resources for common goals. With its huge turnover, vast prof-
its and monopoly status, the ESI grew into the major cash cow of the German
economy. Its political status was consolidated by links to state bodies at all levels
and, through revenue sharing, to German municipalities by way of generous con-
cession fees.
German electricity regulation traditionally relied on a mix of public and pri-
vate law. Basic energy law was embodied in the Energy Supply Industry Act (En-
ergiewirtschaftsgesetz) adopted in December 1935 and laying down the frame-
work conditions for a cheap and secure electricity supply. It defined German state
control of the sector for more than 60 years. The other important piece of legisla-
tion was the Monopolies Act, which generally exempted electricity and gas sup-
ply. Contracts for concessions, territorial boundaries, supply to special customers,
the technical conditions for feeding surplus electricity into the grid, reserve deliv-
eries and other arrangements are all based on private law.
There have been numerous attempts at reforming the German energy sector,
but both bottom up and top down approaches always failed. In the mid-1980s a
strategic about-turn in energy policy and the re-municipalization of electricity
supply (Hennicke et al. 1985) were articulated and widely discussed. This re-
mained the policy position of the SPD and the Green Party and was also supported
by local activists.
The introduction of environmental concerns into the German system was
more successful than initiatives towards liberalization. The Ordinance on Large
Combustion Plants introduced 1983 strict limitations on all emissions such as
SO2, NOx and particulate matter. With the restrictions it places on private property
rights in favor of the environment, it constitutes an exemplary top-down policy
tool (Mez 1995). The same applies to the Technical Guidelines on Air Quality.
40 Years Promoting Renewable Energy in Germany 125

The Electricity Feed-In Law, enacted 1990 on the initiative of the German parlia-
ment, provides yet another notable environmentally oriented change in the frame-
work conditions.
In response to long-standing criticism of monopolistic practices in the elec-
tricity industry brought forward by the German Monopolies Board
(Monopolkommission 1976), the Deregulation Commission and international de-
regulation discussions, the CDU/FDP-led federal government after 1991 wanted
to subject the energy sector to more competition and more effective public con-
trol. A first concrete reform proposal drafted by the Ministry of Economic Affairs
in October 1993 included a partial break-up of the industry, third party access and
stricter control of electricity prices. However, it was heavily modified subse-
quently and finally retracted in March 1994 because of open resistance from the
municipalities and opposition signaled by the majority of the SPD-governed Län-
der in the Bundesrat, the upper chamber of the German parliament.
In autumn 1996, the German government submitted a second draft, this time
backed by the EU reform process around the directive on the internal electricity
market (96/92/EC, enacted on 19 December 1996). The reform’s main goal was
to reduce electricity and gas prices in order to strengthen Germany’s international
competitiveness. The draft included provisions to remove both the demarcation
treaties and the single supplier formulae in concession treaties. Proposals for state
control of investment in new power stations and transmission lines were dropped,
however. More than a year later, after much controversy, the Energy Reform Act
(Gesetz zur Neuregelung des Energiewirtschaftsrechts) was passed, amending the
Energy Supply Industry Act (Energiewirtschaftsgesetz) of 1935, the Monopolies
Act (Gesetz gegen Wettbewerbsbeschränkungen) and the Electricity Feed-in Law.
It entered into force on 29 April 1998. Only a few days later, PreussenElektra
(now E.ON) took the law to the Constitutional Court, joined shortly afterwards
by the SPD federal parliamentary party group and its Land counterparts from
Hesse, Saarland and Hamburg. The energy policy spokesman for the SPD an-
nounced that a review of the new Energy Reform Act would enjoy priority under
a newly elected, SPD-led federal government.
However, after the change of government in October 1998, the SPD lawsuits
were suspended. Finally, on 28 September 1999, the government, the parliamen-
tary parties of SPD and the Greens as well as leading unionists signed a common
statement confirming the basic principles of the energy law reforms, namely the
end of demarcation treaties, full opening of the network for all suppliers and free
choice of supplier for all customer groups (ARE 2000, 12). Liberalization made
a little more headway in 2003 and 2004.
Electricity liberalization favored the expansion strategies of the energy gi-
ants. The trend towards internationalization and globalization of German energy
undertakings was evident and led to mergers and higher yields. After protected
126 Lutz Mez

markets and guaranteed returns, the new period is characterized by risk and inse-
curity. Deregulation was followed by some re-regulation.

The New Energy Policy of the Red-Green Coalition


The new red-green Federal Government emphasized ecological modernization
and climate change policy as well as job creation and socio-economic develop-
ment; energy policy was to be a leading example. It included a green tax reform
(eco-tax on energy), phasing out nuclear power, and strengthening of renewable
energy sources and of combined heat and power (CHP). Additional reform of the
Energy Supply Act and of the Association Agreements followed in a second
phase, in response to a 2003 court judgement that ruled a recent Associations
Agreement illegal. This led the government to agree to the obligatory provision
of a regulator in the new electricity directive of 2003, to be implemented in 2004.
Nuclear power phase-out
The fundamental revision of nuclear policies reflected the consensus among
Greens and many social democrats since the Chernobyl accident. The basic deci-
sion against the future construction of nuclear power plants was enshrined in the
2002 Nuclear Energy Phase-Out Act; licenses of existing plants were reviewed
and limited in time. The legislative process was characterized by the govern-
ment’s endeavor to reach a consensus with nuclear power interests and to avoid
legal disputes before the courts. Due to the powerful position of nuclear vested
interests, these negotiations entailed many setbacks for nuclear opponents.
Climate change policy
Within the framework of the Kyoto Protocol and the European burden-sharing
agreement, Germany committed to reduce GHG emissions by 21 percent from
1990 to the first commitment period 2008/12. In addition, the government in 1995
had pledged a 25 percent reduction of CO2 emissions by 2005. Until 2000, a re-
duction of about 18 to 20 percent, corresponding to 180 to 200 million tons of
CO2, was already achieved, so that the gap amounted to 50 to 70 million tons of
additional reduction. This was to be achieved by the government’s Climate
Change Policy Action Program of October 2000. Both the Renewable Energy
Sources Act (RESA) and the CHP Act are integral parts of this program. These
two areas of activity were expected to contribute reductions of 15 Mt CO2 and 23
Mt CO2 respectively, or about 50 percent of the target (Bundesregierung 2000,
pp. 9, 77, 80).
Government support for this policy area has been given high priority by Ger-
many as host of various climate change conferences. However, within the gov-
40 Years Promoting Renewable Energy in Germany 127

ernmental actor’s constellation, it was primarily the Green Party and the Environ-
ment Ministry together with energy policy experts of the SPD - with a compara-
tively weak link to the Chancellor’s Office or the Economic Affairs Ministry -
which promoted an active approach to German climate change policies and have
shown serious commitment. In contrast, the Economics Ministry was stressing
potential conflicts with German industrial competitiveness.

The Eco-Tax Reform


This reform was passed as one of the first environmental initiatives of the red-
green government in two consecutive laws which introduced a tax on the con-
sumption of electricity (at a reduced rate for industry) and raised existing mineral
oil taxes, i.e. on petrol, diesel, natural gas and various mineral oils. Tax levels for
petrol, diesel as well as electricity increased in five steps until 2003. Coal and
nuclear fuels were not affected. The tax is not levied on fuels used in CHP and
decentralized production (up to 5 MW), nor for natural gas-fueled power plants
with an efficiency of 57.5 percent or more. The advantage for these sources of is
up to 1.53 ct/kWh. But on the at times low price market, this was not sufficient to
bring about their expansion.
The main part of the revenue - rising from € 4.3 billion in 1999 (€ 8.8 billion
in 2000, € 11.8 billion in 2001 and € 14.3 billion in 2002) to € 18.7 billion in 2003
(BMF 2004) - is earmarked to lower the retirement pension contributions from
employees as well as employers, lowering the production factor cost of labor
while increasing that of energy. A small amount of about € 102 million per year
(1999 and 2000) was reserved for renewable energy subsidies, particularly to fi-
nance the 100,000 roof program. The promotion of renewable energy sources in-
creased to € 153 million in 2001, € 190 million in 2002 and € 250 million in 2003.
The eco-tax reform is expected to reduce GHG reductions by about two to three
percent by 2005. For 2002, its impact on CO2 reduction stood at 7 million tons.

Combined Heat and Power and end use efficiency


The efforts to increase efficiency were also reflected in support for CHP, whose
share of 12 percent in 1999 was substantially below that of other European coun-
tries. CHP plants were under severe pressure since electricity liberalization. The
act for the support of CHP plants for public supply entered into force in April
2002 and was supposed to create incentives for modernization until 2010, leading
to a reduction of some 11 million tons of CO2. Additional support was provided
for small-scale CHP and fuel cells.
As to end use efficiency, activities were initiated in line with EU policy. As
a first step, the Energy Savings Ordinance entered into force in February 2002. It
set the total energy requirement of new buildings at 30 percent below current
128 Lutz Mez

standards; for old buildings insulation requirements and exchange of heating sys-
tems were prescribed.

Renewable energy
The red-green government formulated a target to increase the share of RES-E in
the electricity supply to 12.5 percent in 2010 and 50 percent in 2050; in 2004 the
goal of 20 percent by 2020 was added. The long-term target must be viewed as a
programmatic goal, which in concert with energy efficiency programs is ambi-
tious but not unrealistic either technically or economically.
Several measures were taken in favor of renewable energy. They included a
five-year market incentive program for RES which provided about € 445 million
from 1999 to 2002. A tax break on bio-fuels was applied in keeping with an EU
directive on the subject. On the international level, the German government in
2004 hosted the first international conference on renewable energy in Bonn. As
to RES-E, the most important measures adopted were the 100,000 roof program
for photovoltaics and above all the Renewable Energy Sources Act (RESA)
adopted in 2000 and substantially amended in 2004.

The 100,000 Roof Program


Solar photovoltaics had not been able to develop much during the 1990s. The red-
green government wanted to provide new impulses. As the design of a new feed-
in regulation was expected to take time, another market creation program along
the lines of the 100 MW wind and 1,000 roof program (both 1989) was adopted
in January 1999 as a stopgap measure. It provided for reduced loans for PV roof
installations; the goal was to achieve an installed capacity of about 300 MW. The
program was taken up slowly at first but took off when RESA was introduced. By
2003, the two measures had led to installations of 350 MW. At that point, the
100,000 roof program was terminated and PV market development turned over to
improved feed-in tariffs.

The Renewable Energy Sources Act of 2000


While the parliamentary party groups of the red-green majority pressed for more
favorable feed-in rates for RES-E, the Economic Affairs Ministry repeatedly de-
layed and diluted efforts (Lauber/Pesendorfer, 2004). The big utilities were of
course opposed; they placed their hope on a lawsuit pending before the European
Court of Justice which challenged the old Feed-In Law as state aid, an argument
that could be applied also to the new act. This was also the view of the opposition.
40 Years Promoting Renewable Energy in Germany 129

The Economic Affairs ministry at one point even managed to persuade the gov-
ernment to postpone this legislation until the Commission had had a chance to
react to it. But the two parliamentary party groups of the red-green majority man-
aged to find important allies, particularly with the association of the investment
goods industry (VDMA) and the metalworkers union. In April 2000, the Act on
Granting Priority to Renewable Energy Sources (RESA) was adopted; its declared
purpose was to double RES-E production by 2010. This act, which became one
of the pivotal acts of the red-green coalition (Mez 2003), repealed the Feed-In
Law of 1990 but maintained an essential feature, i.e. feed-in tariffs to stimulate
the development of RES-E. In many respects the law brought improvements for
generators in terms of rates and above all of security. It also declared expressly
that RES-E compensations should take external costs of conventional generation
into account, and also support an industrial policy aiming at the long-term devel-
opment of renewable energy technologies.
While under the Feed-In Law compensation rates were expressed as percent-
ages of average end customer tariffs, the new rates were now fixed for 20 years.
For wind power, they were made dependent on the quality of the location: all
operators would receive a favorably rate for at least five years, thereafter the rate
would decline, but later in the case of less favorably locations. Rates were partic-
ularly favorable for PV, offshore wind and biomass. At the same time, there now
was an annual decline in compensation for most sources, not for existing instal-
lations but for new installations and determined by the year they would go on line.
A key regulatory element of the act was the distribution of costs from RES-E
compensation across all power grid operators on a pro rata basis, calculated on
the ratio of RES-E in nationwide electricity sales. Also, the utilities were now
entitled to benefit from the special feed-in rates for their own RES-E generation
facilities. This had not been the case earlier and might become lucrative for utili-
ties, particularly in the case of highly capital-intensive investments such as those
in offshore wind farms where they may beat back the new RES-E generators that
arose in recent years.

The RESA Amendment of 2004


After the re-election of the red-green coalition in autumn 2002, responsibility for
RES changed from the Economic Affairs Ministry (held by a social democrat and
always sceptical of RES-E) to the Environment Ministry (held by a Green); the
parliamentary committee in charge changed in a parallel fashion. This opened
new perspectives. The first draft by the Environment Ministry led to a lively con-
flict with Economic Affairs minister Clement, a well-versed politician from coal
state North Rhine-Westphalia. Clement attacked the very principle of the feed-in
130 Lutz Mez

tariff and wanted to replace it by a tender system, arguing that particularly for
wind energy, rates were excessive. His main concern seems to have been to pro-
tect coal interests. After a compromise within the government, the red-green ma-
jority in parliament proceeded to revise the government bill largely against the
preferences of Clement. However, Clement was successful in obtaining reduced
rates for wind and in defending coal interests.
In the Bundesrat, the Länder ruled by conservative governments opposed the
bill. The Bundestag majority could simply have insisted on its earlier version.
However, the red-green coalition negotiated with the conservatives in an effort to
secure support for maintaining RESA beyond 2007. Some of the Länder wanted
an expiration date of 2007 for the Act, or a declaration reversing the nuclear en-
ergy phase-out; some criticized the 20 percent RES-E target for 2020. But the
Conciliation Committee was content with more modest changes, and the bill was
adopted in both houses.
Chief changes are a general strengthening of generators vis-a-vis the utilities;
reduction of rates for onshore wind and exclusion of low-wind zones, but also
improved rates for off-shore wind; inclusion of hydro plants up a 150 MW, and
significant new incentives for bio-mass (especially small plants) with additional
bonuses for innovative technologies (Bechberger & Reiche 2004). Probably most
important was the increase of photovoltaics rates, which made them commercially
attractive without additional support. This was introduced already in late 2003
and led to a veritable solar boom in 2004, expected to continue for several years.

The Merger between Energy Policy and Climate Protection Policy


On 1 January 2005 CO2 emissions trading was introduced across Europe as the
primary instrument in combating the threatening climate crisis and reducing
greenhouse gas emissions.
In the coalition agreement between the Christian Democrats (CDU/CSU)
and Social Democrats (SPD) of 11 November 2005, the coalition partners stated
that due to divergent views on using nuclear energy to generate electricity, no
changes could be made to the existing pact between the Federal Government and
energy supply companies, the practices stipulated therein, or the underlying pro-
visions of the amended Atomic Energy Law. The coalition contract foresaw the
expansion of renewable energies in keeping with the objectives of the Renewable
Energy Sources Act (CDU, CSU, SPD 2005).
In April 2006 Federal Chancellor Angela Merkel convened the first energy
policy summit. The status report on energy supply in Germany (BMWT & BMU
2006) served as the basis for these top-level talks. A second summit discussion
between the Federal Government and energy industry representatives took place
40 Years Promoting Renewable Energy in Germany 131

in October 2006. This meeting was prepared by the three working groups – on
national policy aspects, international policy aspects, and research and energy ef-
ficiency – that had been established in the first summit talks. A third meeting was
held in July 2007.
On 8/9 March 2007, during Germany's European Council presidency, sweep-
ing resolutions on energy and climate protection policy were passed at the Euro-
pean "Energy Summit" in Brussels. The action plan "An Energy Policy for Eu-
rope" laid out concrete targets for the reduction of emissions, the proportion of
renewable energies to be attained, and energy productivity gains.
The Federal Government adopted an overall energy policy that addressed the
issues of supply security, competitive and affordable energy prices, and effective
climate protection in 2007. Elements of the general energy policy strategy are (1)
investment in new power plants and networks; (2) the expansion of economically
efficient, renewable energies; (3) workable competition in the electricity and gas
markets; (4) increased energy efficiency; (5) a research and innovation offensive
for new technology; (6) international cooperation in modernizing global energy
supply; and (7) a worldwide climate protection treaty with industrial and major
newly industrialized countries.
The integrated National Energy and Climate Plans defined the goals of the
Energiewende by the year 2050, to be achieved via partial goals for 2020, 2030
and 2040. By 2050, greenhouse gas emissions in Germany should be reduced by
80 to 95 percent (base year 1990) and the share of renewable energy sources in
electricity consumption should reach at least 80 percent. National goals are based
on the goals set at the EU level.
The Federal Government's monitoring process "Energy of the Future" has
been set up in 2011 to track the energy transition on a continuous basis: how far
has Germany come with the energy transition? What measures have already been
implemented? What are the effects? Will the goals be achieved, or is fine-tuning
needed?
The central task of the monitoring process is to analyze the reams of statisti-
cal information on energy that have been collected and then condense it and make
it easy to understand. This involves an assessment of measures that have already
been taken and work to pinpoint areas in which further efforts need to be made.
In this way, each annual report provides an overview of the energy transition and
the stage that it is at this point in time. There is a need to know what has been
reached before a decision on what steps to take next can be done.
The Federal Ministry for Economic Affairs and Energy has been appointed
lead ministry for the monitoring process for the energy transition. The Monitoring
Report for each year must be approved by the Federal Cabinet by 15 December
and submitted to the Bundestag and the Bundesrat. Also involved in the process
is an independent commission of four renowned energy experts, who provide a
132 Lutz Mez

scientific opinion on the Monitoring Report. Their scientific opinion is published


alongside the Federal Government's report.
Every three years, the Federal Government publishes a Progress Report on
the energy transition. The first report was published in December 2014. The Pro-
gress Report provides for a wide overview of the energy transition, thus allowing
for deeper analysis over a longer period of time, which makes it possible for trends
to be discerned. The report also looks at whether Germany is on track to attain the
goals and targets set out in the Energy Concept, and at what additional measures
might need to be taken.
Improving energy efficiency is the key question in this context, therefore the
primary energy consumption compared with the consumption in 2008 must be cut
in halve. Since individual measures often only have a limited potential, the energy
transformation in all sectors - industry, transport, households and in the trade and
services sector – has to start quickly.
The coalition agreement of the CDU, CSU and FDP of 26 October 2009 also
stresses that Germany needs an overall energy policy concept for a "safe, envi-
ronmentally sound, competitive and affordable energy" and that the way into the
age of renewable energy should be taken (CDU, CSU & FDP 2009).
The "Energy Concept for an environmentally friendly, reliable and afforda-
ble energy supply" and the 10-point immediate program were launched on the
28.9.2010 (BT Drs17/3049). Renewables are described "as a mainstay of future
energy supply" and energy efficiency as a key issue. In the future Germany should
cover its energy supply more and more from renewable sources. By 2020, the
share of renewable energy in gross final energy consumption is 18 percent. The
share of renewable energy generation in gross electricity consumption of 35 per-
cent should be achieved in 2020. Then the proportion should be by 2030 50 per-
cent, until 2040 65 percent and by 2050 increased to 80 percent.
Climate protection may be a "driving force for competition" for new tech-
nologies and the conversion of the energy supply. Greenhouse gas emissions are
to be reduced by 40 percent by 2020, 55 percent by 2030, 70 percent by 2040 and
by 80 percent to 95 percent by 2050 compared to 1990 levels (ibid.).
The operation time of nuclear power plants has been extended by an average
of 12 years, arguing that nuclear energy is a "bridge technology" in this way – the
amendment came into force on 1.1.2011. A significant portion of the additional
profits from the term extension should be transferred from operators to the public
purse. This "phasing out of the nuclear phaseout" not only led to the protest of the
municipal energy industry, but also mobilized the anti-nuclear power movement
in Germany. There were very large demonstrations against nuclear energy.
The disaster in Fukushima in March 2011 promoted a broad anti-nuclear
consensus in Germany. Almost all social groups, churches, government and op-
40 Years Promoting Renewable Energy in Germany 133

position parties, agreed on the call for an "exit as soon as possible." The mouth-
piece of this consensus was an Ethics Committee "Safe Energy Supply," whose
report was handed over in May 2011 to the Federal Government.
"The environmental and energy policy of the third Merkel government is ...
– from an environmental point of view – no reason to celebrate." (Töller 2019:
570) The instruments of the Renewable Energy Act have been significantly mod-
ified, which has slowed down rather than increased the expansion of renewable
energy. The coal phase-out was adjourned. No concrete CO2 reduction targets
have been adopted for the sectors.
The double reform of the EEG (2014, 2016), envisaged in the coalition
agreement and led by Economy and Energy Minister Gabriel, led to a fundamen-
tal reorganization of the promotion of renewable energies. In particular, the fixed
feed-in tariff was replaced by a sliding market premium.
In December 2014, the National Energy Efficiency Action Plan was adopted
and a law on the partial implementation of the Energy Efficiency Directives was
adopted at the beginning of 2015.
In the coalition agreement of the 4th grand coalition between CDU, CSU and
SPD the necessary framework for the energy transition for the national energy
and climate goals is depicted (CDU, CSU, SPD 2018). The target for the renew-
able energy share of gross electricity consumption of at least 65 percent in 2040
was moved to 2030. But the 2020 goal for 40 percent reduction of greenhouse gas
emissions will not be achieved. This is also due for some of the energy efficiency
targets, first of all energy productivity increase.

Summary and Perspectives


Germany’s special position with regard to RES-E regulation is the result of a
complex process. With few colonies in the nineteenth century, Germany until the
late twentieth century was one of only two large industrial states without oil re-
sources and no large oil corporation of its own (Karlsch & Stokes, 2003), the other
one being Japan. It came to rely with particular intensity on domestic coal, and
later on nuclear energy. During the energy crises of the 1970s, coal and nuclear
were nursed to impressive dimensions, politically as well as economically. But
this policy also led to intense controversies and the rise of a strong anti-nuclear
movement in the 1970s, a strong environmental movement in the 1980s, the
spread of green ideas throughout society and the first big Green party in Europe.
This counter-movement viewed renewable energy sources as an alternative to a
nuclear plutonium economy, not merely as another additional source. Under pres-
sure from this movement, governments reluctantly supported the development of
renewable energy sources on a modest scale when compared to the funds spent
on coal and nuclear energy, and not even for domestic use at first. Particularly the
134 Lutz Mez

electricity feed-in tariff was successful in terms of usual economic and commer-
cial criteria saving small hydropower stations and opening the space for wind tur-
bines.
When the red-green government came into office in 1998, its parliamentary
party groups – once more against the Economic Affairs ministry – soon took
measures to improve the economics of RES-E. They also made PV attractive for
the first time. For this purpose, the coalition drew in yet new actors into the RES
policy network, composed of environmental associations, the renewable energy
sector such as equipment producers, owners and operators of installations and
their associations, but also “conventional” associations such as investment goods
industry association VDMA or the metalworker’s union, which had joined the
coalition during the preceding years. In 2003/2004, this coalition, supplemented
by new allies, repeated this feat against renewed opposition from nuclear and coal
interests.
In Germany, the use of renewable energy took a rapid development. Their
share in gross electricity consumption rose from 6.8% (2000) to over 33% in the
year 2017. End of 2018 about 50,300 MW onshore wind turbines, 5.500 MW
offshore wind turbines, 42,300 MW photovoltaic systems, and 7,700 bioenergy
plants were in operation. Since 2017, there is more generating capacity from re-
newable than from conventional energy sources installed. The proportion of elec-
tricity generated from renewables continues to grow as well, reaching 36% of
consumption in 2018. The framework conditions for this development were is-
sued especially at the federal level. However, international factors, the directives
of the European Union, the energy programs of the Federal States and especially
regional and local actors have influenced the German Energiewende too.

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https://doi.org/10.1007/978-3-658-22663-3_24
The Future of the Japanese Automotive Industry

Martin Schulz

Keywords: Japan, automotive industry, innovation

1 Introduction
According to the president of Toyota, Akio Toyoda, the Japanese automobile in-
dustry faces a “life-or-death battle” (Akio Toyoda 2018). The ongoing “CASE”
(Connected, Autonomous, Shared, Electric) revolution of automotive mobility re-
quires an all-out transformation of car designs, production and technologies, as
well as partnerships and services. Compared to their global peers, necessary
changes in the industry seem to be especially challenging in Japan. Japanese car-
makers operate as volume producers in a stagnating domestic market, derive
much of their profit from efficient combustion engine production, and excel in the
automation of complex hardware production, all of which will be challenged by
comprehensive digitalization.
Beyond the significant challenges, however, Japan’s automobile industry is
also a leader in terms of efficient production, hybrid electric vehicle (HEV) design
and Li-ion battery development. It has broad experience in navigating demo-
graphic change and fast ageing consumer markets. It operates in one of the most
urbanized environments with some of the highest developed public transport sys-
tems. It is therefore well-prepared to adjust to the global mega-trends of urbani-
zation, sustainability, demographic ageing and individualization, and should be
considered as one of the lead cases when thinking about the future of mobility
designs.
This article puts a strong emphasis on urbanization trends because they have
become increasingly important for the industry in Japan and seem to shape its
future in Asian key markets as well.


Martin Schulz | Fujitsu Research Institute Tokyo | schulz@fujitsu.com

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_10
138 Martin Schulz

2 Falling behind on e-mobility challenges


E-mobility is the accepted future of the automobile industry in Japan as much as
anywhere. In all four CASE dimensions, connected cars, autonomous driving,
shared use, and electric motors, however, foreign competitors seem to be more
advanced today. For connected cars, Tesla sets the standards with battery-based
electric vehicles (BEVs) that can update “over the air” and charge at a Tesla net-
work in many countries. For autonomous driving, the cooperation between
Google and Waymo is leading the industry with AI algorithms, developer ecosys-
tems and data access from an ever-growing number of field trials. For EV key-
components and parts supply, such as sensors, radars and steering control, Ger-
man OEMs and suppliers are leading the industry because they can build on a
dominant position in the luxury car segment, which introduces technologies first.
Car sharing and mobility platforms have been pioneered by Uber in the US, but
have already spread to even faster growth in China, and triggered the development
of more comprehensive MaaS (Mobility as a Service) platforms beyond car shar-
ing, such as Moovel in Europe. China is pulling particularly fast ahead in e-mo-
bility development. DiDi Chuxing, the Chinese equivalent to Uber, which is
closely integrated in Alibaba’s and WeChat’s e-commerce platforms, organizes
7,5 billion rides per year. The Chinese BEV market already has a global market
share of 40%, and has become the world’s largest.
Ironically, Japan’s automobile industry does not seem to have fallen back by
sleeping at the steering wheel, but by struggling to move beyond some of its early
successes. Japan’s OEMs, in particular Toyota, have been early leaders of car
electrification by developing hybrid electric vehicles (HEVs) first. Toyota’s Prius
has been on the roads since 1997, and the company still owns 47% of the world’s
EV market, if hybrid gasoline-electric cars are included. Japan’s transportation
system, which centers around its mega-cities with the 38-million-people agglom-
eration Tokyo at its core, has developed seamless MaaS public transportation for
decades. They work like clockwork across diverse private providers for public
transport, digital navigation and payment systems. In such an advanced environ-
ment, the auto industry has learned that developing e-mobility solutions needs to
be carefully balanced between government intervention for sustainability and
congestion control on the one side, and sometimes differing customer preferences
on the other. Many CASE opportunities have proven to be difficult to integrate
into profitable automotive business plans in this environment.
Shared mobility, for example, which has been pioneered by the early ad-
vancement of public transport in Japan’s mega-cities, has greatly diminished in-
dividual car ownership. Tokyo has almost one railway station per square kilome-
ter, a developed rental car industry, and an average taxi hailing time (at the road-
side) of three minutes. In such an environment, households use only 45 cars per
The Future of the Japanese Automotive Industry 139

100 households, compared with the national average of 106 (JAMA 2018). MaaS
platforms, which seamlessly stich together disperse traffic options, have emerged
as mostly free route planning services, such as Google Maps. Even the benefits
of autonomous cars are not as straightforward as often thought. Complex city
centers will remain hard to navigate for the foreseeable future, human services
are relatively affordable because of high customer and traffic turnover, and city
planning priorities will remain dominated by congestion concerns for individual
cars.

2.1 EV strategies
Facing significant challenges in the development of e-mobility systems, Japan’s
automobile industry has remained conservatively focused on “well to wheel” ef-
ficiency. Toyota, the global HEV market leader, has only reluctantly started to add
costly PHEV options (because of the larger batteries) and separate BEV develop-
ment to its EV lineup. It argues that the limited charging possibilities in crowded
Asian cities, slow grid development with a high share of coal-burning electricity
production, and high costs of batteries will limit significant demand for years to
come. It also faces little pressure from the government, which remains (largely)
neutral on the specific technologies that reduce carbon emissions. Only strongly
growing demand in China with its ambitious EV program, and the EU’s CO2
emission target of 81g/km by 2025 (compared to Japan’s current 122g/km) has
recently changed its course.
Other Japanese carmakers remain skeptical about BEV strategies as well.
Honda, a pioneer of EV and FCV development for 30 years, plans to electrify
50% of its global sales as HEV & PHEVs, but targets only a 15% share of EVs
by 2030, mostly for the Chinese market (Marklines 2019). Nissan, which has been
leading the global BEV market with its Leaf compact car for a decade, is planning
to skip further vehicle development for the PHEV market. It will continue to de-
velop BEVs, but with a strong focus on reducing prices and better integrating the
car batteries into owner’s home energy ecosystems (as an energy source and for
potential electricity sales into the grid during peak demand hours). The heart of
its strategy will be, however, a special HEV variant (“E-Power”), which consists
of an EV drivetrain and a gasoline generator for power, which has become popular
in Japan. Mazda, against any trend, continues to develop ever more efficient com-
bustion engines. Its latest “Skyactiv-X” engines introduce a diesel-type compres-
sion ignition technology for gasoline engines, which further reduces gasoline con-
sumption by 20%. Its EV strategy, on the other hand, increasingly relies on an
evolving partnership with Toyota.
140 Martin Schulz

Japan 2017 World 2020 World 2030 Japan 2030


(METI) (IEA) (IEA) (METI)

HEV 31% 6% 12% 29%


PHEV & 1% 9% 19% 16%
BEV
FC 0.02% 0% 1% 1%
Diesel 3% 18% 14% 5%
Gasoline 64% 64% 51% 45%

Tab. 1: Forecasts for automobile EV market shares in Japan and internationally (METI
2018 and IEA 2017)

As the forecasts in Tab. 1 show, Japan’s automobile industry continues to


focus on well-to-wheel efficiency based HEVs, rather than rushing towards an
electrified future. On the plus side, Japan’s market share of all EV categories
combined is higher today than it will likely be worldwide by 2030 (at 32%). The
use of PHEV and BEVs, on the hand, will likely only grow to 16% by 2030. On
the negative side, as Fig. 1 shows, Japanese carmakers have lost their leading
position in PHEV production and will be challenged to catch up with the market
soon.

3000

2500

2000

1500

1000

500

0
2016 2017 2018 2019 2020 2021 2022 2023

     North America      Western Europe
     Japan      China

Fig. 1: Forecasts for PHEV production by country (1,000 cars; Bloomberg 2019)
The Future of the Japanese Automotive Industry 141

2.2 Digital industry transformation


While the automobile industry feels challenged by electrification, digital transfor-
mation also provides strong opportunities. Automobile suppliers with digital po-
tential are gaining from the growth in demand for active safety systems, such as
braking and steering control. Compared to OEMs (even Tesla), who manage de-
sign, final assembly and control of the car, they can gain during the transformation
because a growing number of sensors needs to be integrated into automobile plat-
forms (see Fig. 2). This software-based integration into car platforms and into
OEMs production automation systems requires significant investment into soft-
ware development that cannot easily be lifted by smaller, hardware-oriented de-
velopers and integrators, nor can it be provided by ICT companies who lack the
production skills. To the frustration of the Japanese suppliers, however, German
companies have a large lead in the market. Compared to their global peers, they
gain because the German car industry dominates the automotive luxury segment,
which introduces advanced features first and has customers willing to pay for
them.

Fig. 2: Platform growth and systems integration (Toyota 2019; Bloomberg 2019)

It is the new role of software systems integrators which seems to provide the
most opportunities during digital transformation in the automobile industry. Con-
tinental, which placed some of the strongest bets on its digital future, has already
digitalized about 60% of its portfolio by selling sensors, electronics and software.
Its stock price has shot up by an astounding 976% while major OEMs such as
Toyota gained only 183% and a more traditional supplier such as Denso only
205% compared to 2009 (from April 2009 to April 2019). For the Japanese auto-
mobile industry, this switch towards integrated software development and system
142 Martin Schulz

integration is one of the largest challenges because it has focused on hardware


automation and integration more than others and neglected the development of
comprehensive software platforms for a long time.
Catching up on BEV and digital platform (including MaaS) development now
increases industry concentration with Toyota in a leadership role. To share costs
and better coordinate EV development, Toyota is increasing its investment in part-
ner companies beyond its Tier 1 suppliers (such as Denso and Aisin). It has turned
the small-car producer Daihatsu into a wholly owned subsidiary, and it has in-
vested in Mazda to become its main partner for EV development. It is closing in
on a partnership with its supplier Denso by entrusting it with all electronic com-
ponent development. Software and MaaS development of the Toyota/Denso part-
nership, on the other hand, is planned to be concentrated in a joint venture with
Softbank (a telecom company and digital investment fund), which also invests in
external partners such as Uber’s mobility services. Suzuki, Japan’s foremost
small-car producer and market leader in India, has been trying to build EV alli-
ances of its own. It first ventured into a cooperation with VW, which failed, and
finally decided to partner with Toyota and Denso to source and develop EV key-
components. Nissan’s (currently challenged) alliance with Renault and
Mitsubishi, in contrast, focuses on global alliances with external partners by co-
operating with online service developer DeNA for taxis in Japan, Google’s An-
droid for infotainment, Waymo for autonomic driving, and Chinese battery sup-
pliers for its BEVs.

2.3 Batteries and hydrogen as long-term bets on the future


Beyond the conservative approach towards EVs and digitalization, Japan’s indus-
try has placed two more long-term bets on the development of its e-mobility fu-
ture: batteries and hydrogen. Japan’s advantage in battery development is the
large electronics industry, which has developed Li-ion batteries for their consumer
electronics over decades. Panasonic, the global leader in Li-ion batteries still has
a global share of about 40% (compared to China’s CATL with 23% and Korea’s
LG Chem with 18%), but has already been surpassed by China’s CATL for car
batteries (see Fig. 3). The challenge for the industry in battery development for
the huge car market is that it is highly capital intensive while the products are
commoditizing fast. As a result, the Japanese Li-ion market has consolidated fast,
with Panasonic now being the only large producer. Even the position as a market
leader in electronic equipment batteries does not seem to be strong enough to
compete with CATL, which has the support of the Chinese government with its
“Made in China 2025” plan. Panasonic is therefore forming automobile alliances;
initially with Tesla to develop its US’ Gigafactory. Now, Panasonic and Toyota
The Future of the Japanese Automotive Industry 143

are pooling their resources and merging their automobile battery business entirely.
The joint venture will integrate Panasonic’s auto battery production and pool all
R&D activities, where Toyota is strong in solid state battery research. Consolida-
tion and integration do not stop at this mega-merger, however. Development of
solid-state batteries has become a government-led initiative, with Panasonic and
Toyota as lead partners, but now including 23 companies and 15 universities. To
address industry concerns towards further BEV development, creating massive
“national champions” seems to have become an accepted option.

12000

10000

8000

6000

4000

2000

0
2016 2017 2018 2019 2020 2021 2022 2023

     North America      Western Europe
     Japan      China

Fig. 3: Advanced automotive battery production (Bloomberg 2019)

An even more long-term shot is the heavy investment into fuel cell vehicles
and infrastructures, which stretches back to 1992 as well. Unlike batteries, which
could be developed for a broad range of applications and integrated into the ex-
isting electricity infrastructure, fuel cells for transportation are being custom de-
veloped for the automobile market, which drives up their costs. The low well-to-
wheel efficiency of fuel cell technologies, which results from their multiple en-
ergy transformation requirements, further delays feasible applications until sig-
nificant renewable energy surpluses are generated and need to be stored (with
144 Martin Schulz

hydrogen from wind power at sea or solar in deserts, for example). For the auto-
mobile industry, fuel cells do have the advantage, however, that much of its eco-
system and infrastructures development would remain closely connected to the
automobile industry. Since hydrogen has much higher energy density than batter-
ies, it can be used to build efficient trucks and diversify into airplane construction
(“flying taxis”) even before FCVs are on the road in significant numbers. For
infrastructures, as with gasoline before, energy supply chains can be built in close
cooperation with the energy and resource industries, including overseas produc-
tion in remote desserts.
During the 2020 Tokyo Olympics, industry and the government are planning
to promote hydrogen technologies by show casing a $350 million project with
solar-based hydrogen production in Fukushima, fuel cell busses and cars as a
means of transportation, and hydrogen stations for energy supply of apartment
buildings in the Olympic Village. More long-term hydrogen development plans,
however, remain by far more slow-paced.

3 Urbanization drives mobility trends in Asia


The conservative stance of Japan’s automobile industry towards e-mobility trends
while other players are pushing ahead can be better understood after having a
closer look at mobility trends in Asia’s mega-cities. Japan’s economy centers in
the urban agglomeration of Tokyo with 38 million inhabitants, Asia’s most ad-
vanced economic area. Many “future trends,” such as digital payment systems
(“e-money”), digital tollgates and guidance systems on trains and highways, as
well as smartphone-based GPS-guided navigation, have been tried and tested
here, but did not always yield the initially expected results. One important key-
lesson for the automobile industry seems to stand out, however: public transport
in urban areas is becoming increasingly important for mobility trends and needs
to be closely integrated in automotive strategies.

3.1 Mobility trends in Japan


Japan’s public transportation services are world-class on most accounts. Japanese
use public transport 246 times per year, compared to 177 times in Germany and
108 times in China or 40 times in the US (UITP 2017). The city of Tokyo (9
million inhabitants within a metropolitan agglomeration of 38 million) has almost
one train station per square kilometer and 40 million passengers per day. The use
of cars is not limited or discouraged, but expensive and rarely a match to public
transport speed, mostly because street-side parking is not available. As a result,
private cars in the city center are only used for about 12% of daily trips (Urban
The Future of the Japanese Automotive Industry 145

Land Institute 2018). Across major Japanese cities, the use of private cars is
higher at about 30%. Public transport is used here for about one third of daily
trips. The ready availability of public transport, however, allows citizens to cycle
and walk for almost 40% of their additional weekday trips (MLIT 2015).
While the use of public transport is impressive, there has not been a general
trend against car ownership. More than 62 million cars are used in Japan today,
ten million more than in 2000. Even the younger generation remains positive on
cars, if their use makes practical sense. During weekends, for example, the use of
private cars greatly increases for recreation activities. Across cities, 50% of week-
end trips are being done by car, and in the suburbs the usage jumps to 70%. In
cities with strongly developed public transportation systems, trends therefore
show an increasing transformation of the car from a commuter instrument towards
a leisure pastime for families.
Mobility trends seem to continue to work against the automobile industry,
however. In city centers, the growing number of dual income families has resulted
in a building boom for high-rise apartment buildings. Instead of commuting,
working couples want to gain access to a broad range of services in their imme-
diate neighborhood. They do not only have cars anymore, they also expect local
governments to offer a growing range of public transport services, including flex-
ibility for the first and last mile. One of the most significant mobility initiatives
of city governments during the last five years has therefore been the introduction
of bicycle lanes on central roads. This has not only reduced the already low rate
of road accidents, it has also changed the government’s perspective on city devel-
opment further away from car-based mobility. Growing use of e-commerce and
digital services results in another significant change in mobility. The younger gen-
eration makes fewer daily trips overall and sticks closer to their apartments. In a
reversal to earlier patterns, already the 30-39 years old make fewer daily trips
today then the retired generation. The 20-29 years old did only 1.4 daily trips in
2015 compared to 2.1 in 1992, while the older generation leads a more active life.
The 70-79 years old, for example, did 1.6 daily trips compared to 1.2 before.
Outside of Japan’s major cities, in contrast, demand for car ownership re-
mains strong, although this is also rapidly changing. The less populated prefec-
tures of Fukui, Toyama, and Yamagata use about 1.7 cars per household while
public transport services suffer from depopulation. Local governments are react-
ing by focusing their strained budgets on centralization of social infrastructures,
including hospitals, community centers and barrier-free areas. Access to more
centralized facilities is provided by developing more hub-and-spoke public trans-
portation, which makes the broad network of roads, tunnels and bridges for out-
lying villages even less sustainable. The resulting further concentration of (social)
infrastructures will increasingly drive not only the younger generations into the
cities for work but also the older generation for access to social facilities.
146 Martin Schulz

3.2 Industry impact


The segregation of mobility trends has a strong impact on the automobile industry.
Inner-cities have become filled with small transport vans and taxis for distribution
and last-mile commutes, private vehicles are often luxury cars, many with drivers.
Most significantly, however, MaaS solutions with public transport as a backbone
are growing. This trend is not only supported by governments and public service
provider, it also allows major retailer and marketing companies to cross-finance
the new services with their advertisement cash flow. Personal navigation plat-
forms (such as Google Maps) are therefore provided on smartphones mostly for
free. For individual transportation needs, car sharing is growing at about 24% per
year while registered customers have increased from 465,280 peo-
ple in 2014 to 1,320,794 people in 2018 (Orix 2018). The car-sharing platforms
remain largely in the hands of car rental and parking service companies who con-
trol the parking spaces. Demand for new vehicles has not been expanding signif-
icantly from this side because rental car companies now use their cars (on an
hourly basis) more efficiently. Taxi services remain limited to licensed taxis to
protect the huge industry from Uber-type competition and to keep city center con-
gestion under control. The introduction of ride-hailing apps for taxis, on the other
hand, is increasing the efficiency of the sector by reducing the number of empty
trips to customers, which should reduce demand for cars as well. It seems difficult
to develop significant value-added opportunities for the automobile industry cen-
ter-city environments.
In the affluent suburbs, demand for efficient family cars and functionally
advanced cars for the daily trips of the older generation dominate. Japan’s car-
makers therefore offer a wide variety of family vans and cars with sophisticated
assistance systems for driver interaction, self-parking, and passenger entertain-
ment. “Augmented Driving” tries to integrate the driver by observing the driver’s
eye movement, communication and body language. Most of these cars are effi-
cient HEVs. Since they are mostly used during the weekends for leisure activities,
the costs of upgrading to BEVs would be high while the carbon footprint would
hardly change. Major OEMs are therefore following more complex strategies to
increase the attractiveness of BEVs. They hope the seamless integration of car
batteries into household energy management systems increases their utility by al-
lowing for peak load balancing that could reduce increasing electricity bills. Nis-
san is working with major utility companies on such systems in Japan and abroad,
while Toyota and Panasonic have even merged their significant housing units to
share development costs for further “smart home” development.
For the mobility needs of elderly in rural areas, on the other hand, small,
simple and cheap cars have become the industry’s main engine of growth.
Honda’s small “N-Box,” for example, was sold 240,000 times last year, more than
The Future of the Japanese Automotive Industry 147

twice as much as Toyota’s leading middle-class “Prius” hybrid. More sophisti-


cated mobility options, such as autonomous driving, robo-taxis and buses, in con-
trast, will remain constrained by tight local budgets for the foreseeable future.
Governments will most likely focus on affordable public transport instead of sup-
porting costly individualized solutions or risk to drive up private transportation
costs by increasing environmental requirements for rural cars. Simple CEVs will
likely continue to dominate the countryside even as the gradual introduction of
Uber-type ride-hailing services increase transportation options.
A consequence of this segregation of trends is that Japan’s automobile in-
dustry is concentrating at a rapid pace. As seen in the digital platform industries
(Amazon, Apple, Google), digitalization costs, especially related to necessary
skill development, and network effects (i.e. increasing benefits for consumers
from platform integration), can be a powerful driver for concentration. As seen in
battery development, BEV and infrastructure development costs can further in-
crease concentration because costs could better be shared industry-wide with gov-
ernment support or shouldered by “national champions.” In Japan, Toyota has
emerged as the clear winner of such concentration pressures. While this might
help to develop technologies, build infrastructures and compete internationally
during a transformation period, significant risks of monopolies and concentration
are not only looming in the long run. Digital technologies tend to thrive in eco-
systems with many smaller companies competing for ideas, while mobility trends
towards individualization and localization might not be served well by “national
champions.” For Toyota, which has built its business by focusing on efficient,
vertically integrated production, a transformation to become a global partner for
individualized software solutions, partner co-creation and local smart-city devel-
opment would be a major departure from its past.

3.3 Japan’s mobility trends in line with global mega-trends


Japan’s mobility trends are no outlier and should be an important point of refer-
ence when analyzing developments in other, fast urbanizing and ageing countries
in Asia. Korea and China are already close followers. McKinsey and Bloomberg
New Energy Finance (2016) have therefore summarized three mobility trends that
match Japan’s experience and are already visible in international markets.
In fast growing cities, especially in developing countries, requirements for
an efficient as well as cost-effective use of cars (“Clean and Shared”) are driving
demand. Increasingly efficient gasoline engines and hybrids become replaced by
BEVs, while digital infrastructures spread the concept of use sharing. The changes
will be largely evolutionary because they are not driven by technological revolu-
tions but by cost considerations of budget constrained consumers and regional
148 Martin Schulz

governments. This is the core-scenario for Japan’s industry and its strong empha-
sis on production and infrastructure efficiency.
Autonomous driving (“Private Autonomy”), in contrast, is becoming the luxury
variant for car owners in large cities with affluent suburbs. Owners of luxury cars
will become able to spend time in their cars more conveniently and effectively
while not having to rely on a driver. Most likely, the transformation will be rather
evolutionary when added functions trickle down from luxury and commercial cars
(taxis) to broader consumer applications. Even where technically possible, the
mobility transformation will have a stronger appeal in the suburbs because traffic
complexity and restrictions for the use of private cars in the city centers will limit
the appeal of autonomous solutions for the foreseeable future. More radical
changes that can turn the car into a work and entertainment space will have to
wait until mode 5 autonomy becomes widely available (as discussed below).
City centers of large cities, on the other hand, will take advantage of broad
digitalization and connectivity by supporting MaaS systems centered around pub-
lic transportation networks (“Seamless Mobility”). Dynamic Asian mega-cities
and major digital platform providers can gain in such a scenario because they can
stitch together diverse partners from private and public transport, while working
together with city administrations for infrastructure planning. Startups can find
opportunities in this market when they help different mobility provider to develop
new apps and services. Major OEMs, on the other hand, are supporting the devel-
opment of MaaS applications because they want to remain relevant partners when
city landscapes and infrastructures are changing. It is not yet clear, however, how
they will gain from them.

4 Staying ahead with new mobility designs


The Japanese car industry has developed a rather conservative approach towards
CASE innovations. Instead of following fast-paced technology trends, major
OEMs are focusing on more slow-paced but perhaps even more fundamental
“mega trends.” As pointed out above, the mega-trends of digitalization, urbaniza-
tion, sustainability, and individualization are already fundamentally changing
consumer and mobility demand. The Friedrich Ebert Foundation (2018), for ex-
ample, has pointed out in its study “The Future of the German Automotive Indus-
try: Transformation by Disaster or by Design?” that the changes in the automobile
industry need to be addressed in a partnership model between industry and gov-
ernments.
Since plans and strategies for the ongoing mobility transformation need to
take the entire social transformation into account, the necessary changes in infra-
The Future of the Japanese Automotive Industry 149

structures, multi-modal city-planning, more digital lifestyles, and of industry re-


organization towards services and more individualized products cannot be lifted
and organized by industry alone. The foundation therefore believes that such a
broad transformation needs to be planned and guided by the government as part
of a “Future Pact for Mobility.” Japan’s government sees the ongoing changes in
mobility in an even broader context: “Society 5.0” (CAO 2018) covers most as-
pects of cultural and social change due to digitalization. Addressing mobility
problems, such as CO2 emissions, congestion, and the limited autonomy of older
people, would be solved along increasing productivity, replacing physical with
digital services, and connecting people through social media (see Fig. 4).

Fig. 4: Japan’s “Society 5.0” (Japan Cabinet Office; CAO 2018)

Perhaps not surprisingly, industry, while being quite positive towards the
overall approach towards digital social transformation, is more skeptical about
the possibilities of the government’s leadership role. Major companies are there-
fore focusing on those parts of plans they can work with, and hope to get policy-
makers onboard for actual implementation.
4.1 The Future of Mobility according to Toyota and Panasonic
Unlike in the US, China, and Germany, where digital platform companies, EV
startups and fast digitalizing suppliers drive e-mobility vision, automotive future
plans remain largely in the hands of major OEMs in Japan, especially Toyota.
Toyota’s “E-Palette” vision starts with mode 5 autonomy, entirely self-driving
150 Martin Schulz

cars. It has an integrated BEV chassis that can be scaled to various sizes and spec-
ifications while the cabin area can be independently designed by either the OEM
for individual customers or by the customer when a fleet of commercial vehicles
is needed. Toyota hopes that flexible service providers, from doctors to coffee
shops and retailers, will take the opportunity to design and operate the e-palette
pods for (autonomous) services in variable marketplaces where consumers gather,
depending on the time of the day or along with significant events (such as festi-
vals). Toyota envisions a new mobility business and partnership model that would
create “mobile communities.” While such a mobility vision still seems to be a
long way off, Toyota claims to be quite serious about trials and implementation.
It will introduce the first e-palette pods during the 2020 Tokyo Olympics, and
advertises the current restructuring of its dealership network as a starting point
for developing them into mobility focused “community centers.” The dealerships
will soon start to offer a range of mobility services, starting with car sharing, to
later expand them towards e-palette service hubs.

Fig. 5: Toyota’s “E-Palette” Mobile Market (Toyota 2019a)

Panasonic, Japan’s major electronics and battery maker, shares Toyota’s vi-
sion and cooperates on many levels. Its “SPACe_C” e-mobility platforms closely
resemble the “E-Palette” pods. Also, as in Toyota’s case, the company hopes to
The Future of the Japanese Automotive Industry 151

rent, franchise and custom fit its pods for retailers and service providers. Further-
more, for the electronics industry, the commoditization of automobile platforms
is a major opportunity to get into the market and offer its specialized equipment
and services outside families’ homes. Perhaps unsurprisingly, its first demonstra-
tions focus on refrigerated fresh food delivery. Put together, Japan’s industry en-
visions a rather radical departure from today’s vehicles and individual modes of
transportation. Cars, buses and small trucks will be replaced by variable pods,
which transport goods and services rather than their owner. Cityscapes will be
transformed when suburban malls and parking lots will be replaced by autono-
mously served marketplaces. In line with current mobility trends, commuting
times will be cut, personal daily trips will be reduced, and activities of families
and the older generation better supported.

4.2 From global exporter to local mobility solution provider


Changing globalization trends affect Japan’s export dependent automobile indus-
try almost as much as changes in mobility trends. Almost 60% of motor vehicles
in value terms are being exported, about 20% of all exports come from the auto-
mobile industry. This trade currently faces significant headwinds. Governments
require more value-added production in their local markets, supply chains are
changing because manual labor costs are playing a less important role today, and
BEVs will consist of far fewer parts in the future. Depending on the local market,
specifications of BEVs will be quite different and consumer lifestyles will start to
play bigger role. Since BEV production is becoming a comparatively simple pro-
cess, the potential for individualization and software differentiation is further in-
creasing. Later, when shared mobility visions (such as Toyota’s “e-palette”) are
emerging, commoditized BEV platforms will have to become entirely localized
in co-development with local partners, who will design the service cabins. MaaS
systems, which will provide a key part of new mobility solutions, will focus on
local services in cooperation with local governments and service partners. As has
been pointed out above, companies are increasingly building alliances to accom-
modate this process. From a global perspective, such alliance building faces ad-
ditional challenges because local diversification will become vastly more com-
plex.
The resulting changes in their global business models will not only affect the
automobile industry in the longer run. Immediate pressures for production
changes are building in key-markets already. In the US, which remains Japan’s
most important market (37% export share), the extreme automotive trade imbal-
152 Martin Schulz

ance, which accounts for almost 75% of Japan’s surplus with the US, faces re-
newed pressure from the Trump government for a correction. As during the 1980s
trade confrontation with the Reagan administration, industry is responding by
shifting more production to the US. Unlike before, however, some of the most
technologically advanced and value-added production, such as Toyotas Prius
HEV, will probably have to move. Overseas production is therefore increasingly
changing from “extended workbenches” to important localized development cen-
ters that need to be integrated into global production networks.
In China, by far Japan’s most important future market, the government’s
strong emphasis on BEV development requires local production not only for po-
litical reasons, but also because the fast developing BEV ecosystem (especially
for batteries and sensors) turns it into one of the best production locations. To
better establish its PHEV solutions in the market, Toyota even decided to open its
treasure chest of 24,000 hybrid technology patents to boost partner development.
Panasonic, whose current Chinese battery output capacity is believed to be nearly
5 gigawatt hours, is building two additional plants. Based on its cooperation with
Toyota, it expects enough demand from PHEV development and later from BEVs,
to take the risk of confronting the Chinese competition in its home market.
As pointed out above, such localization seems to be only the start for much
broader local integration. The Japanese automobile industry has already proven
that it can integrate in key markets (the US, Thailand, Indonesia) not only with
sales but also with production. So far, however, the localization was based on
global platforms with rather centralized management and development structures.
To adapt to a more service-based business model with a growing range of service
partners and local government relations abroad will become an increasingly more
difficult challenge.

5 Japan’s path into the mobile future


Individualization and localization will be key elements of coming mobility solu-
tions. From this perspective, it shouldn’t be too surprising that most countries are
taking different pathways towards e-mobility solutions. In the US, digital plat-
form providers and software developers are in the lead for new autonomy and
MaaS-oriented solutions based on private cars. In China, large e-commerce pro-
viders and local governments are shaping mobility designs even more from the
digital side. They are experimenting with MaaS, CASE and BEV solutions along
with building massive public transport systems. In Germany, large and innovative
automobile suppliers are playing a key-role in CASE development by developing
the interfaces between new digital platforms and the entire supply chain, includ-
ing production processes and cars (“Industry 4.0”). OEMs, at the same time, try
The Future of the Japanese Automotive Industry 153

to build a role in the hybrid environment of affluent cities with limited public
transport options by combining increasingly autonomous cars with individualized
MaaS solutions.
Japan’s automobile industry, on the other hand, seems to remain convinced
that cost and energy efficiency will be the key to effective mobility solutions in
the future, too. More significant changes in e-mobility are expected to take more
time because they will be based on new city designs and a growing range of com-
munity-oriented services, which require close collaboration with public transport
provider and city governments. One of the biggest challenges for the industry
during the transformation becomes the implementation of intermediate solutions,
such as MaaS systems based on current modes of transport (private cars, public
trains), which involves many new players but offers only little value added for the
automobile industry. The industry therefore focuses on developing car-centric
smart city concepts with infrastructures for hydrogen networks, for example. It
tries to integrate BEVs into household energy eco-systems and “mobile markets”
in suburbs and villages. Within its home-market the automobile industry already
seems to be well on the way into such a future, in international markets, however,
it faces increasing headwinds.

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Market and Technology Trends for the Automotive
Future in Germany

Weert Canzler

Keywords: Germany, automotive industry, climate change, innovation

Abstract
The automotive industry plays an enormous economic role in Germany. After
decades of success, it is facing today major challenges. These are first of all on-
going driveline innovations and the transformation of the industry’s business
model. The most important technical drivers are the electrification of the driveline
and the digitalisation of transport processes. But changes in attitudes and behav-
iour of car drivers and owners are ongoing via “personal digitalisation” with
smartphones. Access to new mobility services is dramatically improving. Future
transport in Germany will gain additional momentum from the convergence of
the electricity and transport sectors through transport electrification based on re-
newable energies.


Weert Canzler | Wissenschaftszentrum Berlin | weert.canzler@wzb.eu

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_11
156 Weert Canzler

Innovation forced by climate change


The automobile industry is one of the key industries in Germany, and a large pro-
portion of exports and millions of jobs depend on it. At the same time, the
transport sector is one of the largest emitters of greenhouse gases and consumers
of raw materials in Germany and worldwide. There is no doubt that emissions in
this sector will have to fall dramatically in the coming decades. If countries are to
meet their internationally agreed climate protection targets, a decarbonisation of
transport is unavoidable. However, our starting point is not an easy one: green-
house gas emissions from the transport sector – more than 80% of which consists
of motorised individual and freight transport – have been stagnating for years,
while reductions have been achieved in all other sectors (cf. Fig. 1). The main
reasons for this relate to the upgrading of vehicle engines, a shift from the small
and middle class segments to fuel-guzzling SUVs and a stagnating share of re-
newable energies in fuels. While the share of renewable energy in the electricity
sector and, following at some distance, in the heating sector has risen in recent
years, it remains just slightly above 5% in the transport sector (see Fig. 2). The
pressure on vehicle manufacturers to make progress towards decarbonisation is
therefore increasing greatly.

Fig. 1: Greenhouse gas emissions by sector


Market and Technology Trends for the Automotive Future in Germany 157

Fig. 2: Share of renewables in the electricity, heat and transport sectors

Development of renewable energy shares 2012–2017


Source: AGEE-Stat (icons by Freepik/flaticon.com and Sabathius/
openclipart.org)

Holding on to a dead-end technology


More than 90% of transport is based on oil and it will therefore be particularly
affected by the transformation to a post-fossil economy. According to the targets
set by the European Union, greenhouse gas emissions from transport must be re-
duced by at least 60% by 2050 at the latest compared to 1990 levels. By 2020, the
goal is to reduce transport-related CO2 emissions by 20% compared to 2008 levels
(EU Commission 2011).
Yet despite a number of announcements by automakers promising to bring
more electric vehicles onto the market, the industry has continued to work pri-
marily on optimising conventional driveline technologies. For years, the focus has
been on reducing fuel consumption and minimising pollutant emissions. How-
ever, any successes due to improved drive units and more lightweight construc-
tion have been largely offset by the increases in horsepower, by the use of more
and heavier additional features, and by the greater number of sport utility vehicles
(SUVs). In addition, actual fuel consumption figures sometimes diverge greatly
from the results of official, certified tests (ICCT 2019). Finally, the Dieselgate
scandal has shown that additional efficiency gains in combustion engine technol-
ogy can only be achieved at considerable expense: combustion engine technology
is fundamentally at a disadvantage compared to electric mobility. The combustion
158 Weert Canzler

engine has an overall efficiency of 20% at best while direct electrical energy con-
version utilises 70% of its primary (and potentially renewable) energy and even
the fuel cell achieves an overall efficiency of 26% (Canzler, Knie 2015: 21). For
climate protection reasons alone, combustion engine technology has no future; it
is a dead-end technology.
In order to decarbonise transport, we must push ahead with its electrification.
For efficiency reasons alone, a transformation of the driveline is needed as part of
a comprehensive transport transformation. Since substituting fossil fuels with bi-
ogenic fuels on a large scale is neither possible nor desirable due to competition
for agricultural land, renewable electricity providers will have to supply the en-
ergy required for transport. What is not yet clear, however, is which technologies
will be used, to what extent they will be used and in which segments. It is expected
that battery-electric vehicles and vehicles fuelled based on power-to-liquid and
power-to-gas processes will complement each other. For short distances, electric-
ity offers the greatest advantages as an energy source, while for longer distances,
and also in trucks and long-distance buses, energy sources with a significantly
higher energy density than batteries will make more sense. Instead of assuming
competition between various post-fossil-fuel drivelines, it is much more likely
that different technical concepts will cover very different application scenarios.
This also applies to how they will be integrated into the renewable energy system.
As storage devices, they have different roles: while battery storage devices are
useful for achieving a short-term balance in the power grid and can, through con-
trolled charging, also counteract short-term power overproduction – such as the
PV lunchtime peak – P-2-X processes also allow storage for days and weeks. Me-
thane and hydrogen, for example, are storage media that are flexible in terms of
time. However, the energy input of P-2-X processes is several times higher when
directly using electricity. Synthetic fuels require the highest energy input and are
therefore the most expensive variant (Agora Verkehrswende et al. 2018).
In addition to a transformation of the driveline, a transport transformation
will require more efficiency in transport services. The backbone of any efficient
transport system is “community transport”: in addition to consolidating public
transport services in many cities, especially by improving suburban and regional
rail connections, we will also need new trams and faster buses with their own
lanes and priority traffic lights, new sharing services such as car sharing and pub-
lic bike services. Successfully integrating local public transport and additional car
and bicycle rental services can meet city dwellers’ mobility needs to a large ex-
tent, so that they can cover the “last mile” without owning a car. In addition, there
are ride-sharing platforms that make it easy and inexpensive to take passengers
with you in rental vehicles and/or private vehicles. In addition to global players
such as Uber, Blabacar and Gett, a number of ambitious start-ups, such as
door2door or CleverShuttle in Germany, are currently competing. Ultimately, an
Market and Technology Trends for the Automotive Future in Germany 159

integrated intermodal transport service can achieve network effects that cannot be
achieved with the previous timetable- and station-bound public transport system.
In the medium and long term, autonomous vehicles can also offer further ad-
vantages for both public transport and additional sharing services (see
OECD/International Transport Forum 2015). Autonomous minibuses, for exam-
ple, can make public transport more flexible at off-peak times or in sparsely pop-
ulated urban areas because they can make “transport on demand” attractive. Car
sharing could become even more attractive if the rented autonomous vehicles
could pick up the customer and autonomously take him/her to the destination – or
at least look for a parking space on their own after an active journey. Whether a
combination of classic public transport and new platform-based sharing services
will succeed depends not least on the conditions that are put in place. What these
should look like is currently disputed (see e.g.: ITF 2016).

Changes in attitudes and behavior

The gradual decline in significance of the automobile


Sustainable transport in the future means more than just changing driveline tech-
nology; it also implies the car will lose its dominant role and different means of
transport will be linked and used efficiently. People’s mobility needs can be met
with considerably fewer cars. But is a retreat from the long-established model of
the private car in sight in Germany, a country that experienced early motorisation?
Some initial changes in attitudes towards cars can be observed, especially among
young people. The latest environmental awareness study conducted by the Fed-
eral Environment Agency shows that a large majority of over 80% of the Germans
surveyed would generally consider it a “contribution to good life” if there were
fewer cars in cities (BMUB 2016: 65).
There have also been changes in car availability and the driving licence rate
in recent years. In all early industrialised countries, the proportion of under-26-
year-olds with a driving license is declining significantly (ifmo 2013). With re-
gard to car availability, which is another indicator for a greater or lesser affinity
for cars, we see a gap between the generations: while the “young old” are growing
old with their cars and car availability is increasing among this group, it is de-
creasing among younger people; see Fig. 3.
160 Weert Canzler

Fig. 3: Car availability by age group:

Source: http://www.ifd-allensbach.de/filead-
min/AWA/AWA_Praesentationen/2016/AWA_2016_Sommer_Auto.pdf
The car is also facing pressure as a status symbol and as an instrument of
conspicuous consumption. High-end mobile phones and computers are just as
good as or better than cars as a way of showing social distinction.

Sharing services are growing


“Personal digitalisation” via the smartphone is dramatically improving access to
new mobility services. This is illustrated by free-floating car sharing: people can
locate these vehicles, reserve them at short notice and then use them at will. At
the end of the journey, users can park the car wherever they want in a defined
area. The various existing ride-sharing services only became possible once
smartphones became widely available.
It is true that car sharing is only a niche and that private cars are still the
norm. However, the growth rates of recent years are impressive (see Fig. 4); at
present further growth in free-floating car sharing is being slowed down above all
Market and Technology Trends for the Automotive Future in Germany 161

by the prohibitive charges levied by many local authorities for parking on public
roads.

Fig. 4: Licensed drivers and vehicles in car sharing in Germany from 1997–
2018

Source: BCS: https://carsharing.de/carsharing-deutschland-weiter-auf-


wachstumskurs
The example of car sharing not only shows the opportunities offered by dig-
ital access to transportation services, it also indicates a revolution in transport
choices in general. It gives the motto “use, don’t own” an IT basis, so to speak.
Simple and reliable access is more important for car sharers than a vehicle’s tech-
nical performance data or brand. The brands were, and still are, very important,
especially for German car manufacturers; they linked their identity – Vorsprung
durch Technik (Advantage through technology) or Aus Freude am Fahren (For
the joy of driving) to technical features and characteristics that were actually or
supposedly special. As a rule, customers secured their use by obtaining exclusive
access, i.e. by purchasing or leasing. The example of free-floating car sharing
shows that a change is taking place at the level of perception and decision-making
– similar to what has long been the case with digital booking platforms for hotels
or apartments. For the users of flexible car sharing systems, it is important to be
able to get a vehicle here and now. Decisions are made in fractions of a second.
The offer to get access to a vehicle at any time and almost anywhere in the city is
also changing people’s views and above all their needs structures. The immediate
desire to drive and its immediate facilitation are the priority (Canzler, Knie 2016).
162 Weert Canzler

The smartphone as a digital key


Digitisation, in particular the spread of the smartphone, is accelerating the trend
towards mobility services. These are still niche services and are mainly being used
by highly educated customers from the pioneer segment. In some cities, however,
sharing services are already achieving significant market shares. As a result, both
the competitive order and the value chain in the transport market are shifting.
Automobile brands are fading, cars are becoming commodities, and decisions are
being made about their use in a digital marketplace. An industry as rich in tradi-
tion as the automotive industry has come to be dominated overnight by small app
developers because its nerve centre is shifting. The effects of digital marketplaces
are subtle and creeping: people’s desires and needs, indeed their consumer behav-
iour as a whole is being changed by the use of smartphones, without the individual
always being aware of this. Digital access means all decision-relevant information
on all transport options can now be obtained quickly and conveniently via the
smartphone. The smartphone has thus become the digital key to the intermodal
mobility world.
The spread of the mobile internet is also changing the experience of travel
and transport itself. The era of authentic experiences is being dissolved by the
digital, because, increasingly, the capacity to overcome space is being used to be
online. Journeys in local and long-distance public transport are good opportunities
to obtain information and communicate with friends and relatives across the
world. Except for time spent on holidays and adventure trips, the transport expe-
rience is becoming a very individual form of infotainment. 

A vision of autonomous driving


In addition to personal digitalisation, digital automation processes are becoming
increasingly relevant in transport. High-performance sensors and ultra-fast infor-
mation processing are supporting successive driving and control processes in the
vehicle. Research projects on autonomous driving have attracted considerable at-
tention across the world, and not just in the United States, where digital and plat-
form companies such as Google and Uber have sent test vehicles onto the roads.
German automakers have also significantly increased their R&D spending on au-
tonomous driving in recent years. At the end of 2018, they even decided to initiate
joint research projects and harmonise the technical interfaces of their vehicles.
However, all current pilot tests are still well below level 5, the actual autonomous
driving level. The technical requirements for this have not been fulfilled, not only
in Germany, but also worldwide. The reasons why manufacturers are struggling
with this level 5 are not solely technical. “Level 5” represents a difficult-to-re-
solve contradiction for traditional carmakers and their self-image, namely, to
Market and Technology Trends for the Automotive Future in Germany 163

manufacture vehicles for self-driving. The mindsets in the industry have been
shaped by the “automobile as device”, a device that should offer the driver the
fastest, most comfortable and safest possible driving experience. Their notions of
autonomous driving are also trapped in this path dependency. The digital capabil-
ities that would enable automated driving are being used as assistance systems,
and more and more support services are being integrated into vehicles. Drivers
regard automatic parking as useful, and passengers welcome the many digital aids
to protect passengers and improve driving comfort. However, autonomous, i.e.
self-driving cars, which no longer allow the driver to intervene, are viewed am-
bivalently by the manufacturers. There are certainly advocates of networking, but
they emphasise the capacity to communicate with other vehicles, so-called
car2car communication. This seeks to increase traffic flow and road safety. The
aim is also to technically monitor the potential shortcomings of human drivers
and to be able to correct them in exceptional cases. But this is always supposed
to be an exception. The step from the “joy of driving” to the “joy of being driven”
is a big one.
The enormous possibilities of automated driving for linking means of
transport and intermodal services have also attracted limited attention (Berton-
cello, Wee 2015; OECD/International Transport Forum 2015). In an intermodal
setting, for example, autonomously driving minibuses could be used as feeder
vehicles for fast rail connections, where scheduled standard buses would never be
worthwhile. Or car sharing vehicles could drive to the user with just a few clicks
and look for a parking space on their own afterwards.

Prospects

Outlook: digital and post-fossil


For years, in all major cities in Europe and North America – and increasingly also
in other regions of the world – rising vehicle volumes have been accompanied by
growing distain (Dennis, Urry 2009). Particular criticism has been directed to-
wards their enormous consumption of space, but also towards the noise pollution,
exhaust fumes and emissions of climate-damaging greenhouse gases they cause.
With the increasing number of vehicles, the driving experience itself is also being
restricted. Drivers are switching to other means of transport or at least starting to
think about alternatives. Bicycles have become particularly popular, followed by
rail transport. The once tender plants of intermodality and multimodality have
now grown considerably in the big cities. In Berlin and Hamburg, but also in
London, Paris, Zurich and Copenhagen, for example, the number of people who
use several transport services is already greater than the number of people who
always use only one means of transport (Rode et al. 2014; Gehl 2010).
164 Weert Canzler

If we consider the problems of cities, where an increasing number of vehicles


are taking up limited space, and noise and pollutant emissions are increasing, it is
clear that a vehicle-oriented innovation approach alone can hardly offer a solu-
tion. The number of vehicles is also a major problem for many cities. This is
particularly true of the world’s megacities, where the space for motorisation along
American or European lines simply does not exist.
Merely introducing new, clean drivelines will not achieve the urgently
needed progress in environmental and transport policy. As long as a private car is
not used for an average of more than 23 hours a day, an electric car is a stationary
vehicle that takes up space as well. What is needed are strategies to improve ve-
hicle utilisation, to increase networking with other means of transport and to
strengthen non-motorised transport. This is precisely why almost all growing cit-
ies are relying on both strong public transport and the promotion of bicycle
transport. It is not just London, Paris and New York that have invested massively
in public-bike systems and made it increasingly difficult for private cars by im-
plementing entry restrictions and tolls; many Chinese megacities have done so
too.
The possibly serious consequences of digitisation in transport must be seen
against this transport and urban development policy background. Its disruptive
character is already evident in the examples of free-floating car sharing, digital
platforms and autonomous driving. Future transport will gain additional momen-
tum from the foreseeable convergence of the electricity and transport sectors
through transport electrification based on renewable energies (for more detail,
see: Canzler, Knie 2015; Ecofys 2014; IEA 2014; Transport & Environment
2014). Because solar and wind energies fluctuate, they need buffering and storage
capacities as their share of electricity production increases. E-cars can position
themselves as attractive partners for renewables. Battery-powered e-vehicles can
be used as part of smart grids to take up electricity when it is abundant and feed
it back in when it is scarce (Canzler, Knie 2013). Electric vehicles powered by
fuel cells can use “green hydrogen”, which is generated from excess renewable
electricity. “Bi-directional charging”, “vehicle-to-grid” and “power-to-x” are the
buzzwords here. Post-fossil mobility on the basis of "near-zero marginal costs" in
operation (Rifkin 2014) requires a high proportion of renewable energy genera-
tion plants that are digitally networked with various consumers in smart grids.
Technically, many promising solutions are emerging in this convergence
movement, and these will become lucrative economically if the costs of generat-
ing renewable energy and of batteries and electrolysis continue to fall (see Fig. 5
for the development of costs for Li-ion batteries). This is expected to materialise
in the coming years; economies of scale will lead to considerable cost reductions
(cf. for PV: Fraunhofer ISE 2015; for more on the batteries, see: Nykvist, Nilsson
2015).
Market and Technology Trends for the Automotive Future in Germany 165

Fig. 5: Comparison of learning curves for PV modules and lithium-ion bat-


teries

Keine Energiewende ohne Verkehrswende

Weert Canzler, WZB

Particularly in some Asian countries, such as Japan (Automotive News 2014;


D‘Arcier, Lecler 2014) and China (Wang, Kimble 2013), intensive work is being
done on this. The crucial question is how networked e-cars will be used. It is
neither realistic nor desirable to simply replace the privately used universal com-
bustion engine car with an electric car. E-vehicles, i.e. not just e-cars, but also
scooters, pedelecs and new device formats, will become elements of intermodal
services. Sharing models will play a central role in this, and the first experiences
with these have been positive (Ruhrort et al. 2014). However, these models will
only emerge from the niches when the necessary conditions for them are created.
We need a transformation of transport, but it will not fall from the sky. It can only
succeed if the existing privileges of the private car – ranging from free parking in
public spaces to company cars to tax deductible travel allowances – are curtailed
and, conversely, if specific benefits accrue to those who use shared cars.
166 Weert Canzler

Moving the transformation forward


The example of the "National Platform for Electric Mobility" (NPE) set up by the
German federal government in May 2010, which has attracted a great deal of in-
ternational attention and has been copied several times, shows how difficult it is
to initiate a transformation of transport. Technology programmes are no longer
sufficient to bring more electric vehicles onto the road; real benefits must be
granted to buyers and users of these vehicles. The NPE has proposed a number of
financial, regulatory and environmental measures, such as special depreciation
for fleet vehicles and preferential usage options for e-vehicles in the public do-
main (NPE 2014).
Yet, at present, all parties seem to be trapped in a lock-in situation, and their
need to secure their strategic interests allows little scope for change. After all,
changes always initially take place at the expense of what already exists, and the
possible advantages will remain too abstract for an effective policy approach. The
automotive industry is currently earning its money by selling combustion-engine
vehicles. E-traction is being developed and marketed in small quantities, and car-
sharing concepts are being tested to prepare for a change that these companies
find difficult to initiate themselves. State policy, on the other hand, is finding it
difficult to restrict the functional scope of established drivelines, because this en-
tails interfering with the existing freedoms.
There is a lack of “agents of reconstruction” and of a correspondingly mod-
erated process. In this situation, the initiative of an “independent third party” is
needed to force the paradigm shift. Such a third party could help to build up an
independent knowledge base and, as a neutral broker, move the currently dead-
locked transition towards a climate-friendly transport future. Any new initiative
must attempt to activate the existing reform potential as part of a broad consensus.
Behind this lies the assessment that we must grasp the technical and economic
opportunities offered by e-mobility in good time. This is not least an industrial
policy imperative.
In concrete terms, it means proactively driving electrification and organising
support for it in the various sectors, in politics and in civil society. The recently
launched "Agora Verkehrswende" (Agora Transport Transformation) aims to ac-
complish this task (see: www.agora-verkehrswende.de; Agora Verkehrswende
2017). Agora may form part of a broad transport transformation initiative that
addresses both the future conditions necessary for a networked post-fossil mobil-
ity and new innovation spaces. Intelligent fleet promotion is included in this, as
is the testing of storage services for the renewable electricity industry. For this to
work, we need organised experimental spaces in which, at some distance from the
Market and Technology Trends for the Automotive Future in Germany 167

strategic safeguarding of interests, parties can negotiate on technical usage con-


cepts, political framework conditions and a new transport culture under control-
lable conditions, with the objective of reducing emissions.
At the same time, such experimental spaces must also be able to activate the
promise of a tipping point and be linked to attractive global models.

Summary
Although the transport sector goes beyond just cars, the automotive industry plays
an enormous economic role in Germany. After decades of success, it is facing
major upheavals, both in terms of driveline innovations and the transformation of
its current business model. The most important technical drivers are the electrifi-
cation of the driveline and the digitalisation of transport processes. Global climate
protection policy also requires a decarbonisation of the transport sector in the me-
dium to long term. Across the world, emission limits will be further tightened,
and it will no longer be possible to remain within these limits while still using
combustion engine vehicles. Local authorities are increasingly setting ambitious
climate protection targets in their local climate protection plans, and these partic-
ularly affect transport. In all growing cities, there is a lack of space for even more
cars. At the same time, global digital companies are forcing their way into
transport markets with new business models. Finally, changes can also be ob-
served in attitudes and behaviour, especially among younger generations of city
dwellers. They point to a progressive decline in the importance of owning your
own car and an increase in pragmatic intermodality and multimodality. A trans-
formation of transportation from private cars based on internal combustion en-
gines to intermodal transport services with post-fossil-fuel vehicles is on the
agenda. The car industry is just beginning – still timidly and trapped in path de-
pendencies – to adjust to this. But it will not be able to free itself from its path
dependency on its own. This will not only require a framework that creates in-
vestment security, but also a moderated process of collective change and potential
spaces for innovations.

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Rare Earth Strategies of Japan and EU/Germany

Lutz Mez

Abstract
Today many high-tech technologies – including those in the automotive, renewa-
bles and defense sectors – depend on rare earths. The unique properties of rare
earths increase efficiency and performance, they are key for a green energy future.
Comparing the rare earth strategies of Japan and Germany/EU shows that leading
industrialized countries have chosen different strategies.
Japan’s "Rare Earth Recycling Act" came into force in August 2012 and a
nationwide system for recycling rare earth metals has been build-up. This urban
mining strategy has led to the recycling of rare earth in a large scale. The EU is
trying to establish access to raw material markets worldwide. "Fair conditions" in
raw materials trading for resource-rich countries – especially in Africa – shall rely
on EU competition policy and WTO dispute settlement procedures. But the EU
strategy was criticized to be neo-colonial and missing resource efficiency as tar-
get.


Lutz Mez | Freie Universität Berlin, Germany | lutz.mez@fu-berlin.de

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_12
172 Lutz Mez

Introduction
The demand for raw materials is increasing worldwide. The "Great Geopolitical
Game" has begun, particularly for strategically important raw materials. The EU,
Japan and the US want to secure access to rare earths and to a number of important
metals such as tantalum or cobalt. Rare earth elements (REE)17 are vital to modern
technologies and belong to the critical elements. REE are crucial to a wide range
of modern technologies e.g. uses in magnets, batteries, glass, and alloys; for the
manufacturing of high-tech civilian products such as computers, screens and
smartphones or in the renewable energy technology industry in wind turbines, but
they are also needed for the production of modern weapons.
The global north, with its industrialized consumer societies, cannot do with-
out these modern means of production and destruction in the future. As a result,
raw materials must continue to be mined, which is not only associated with risks
to the environment. Current global primary REE production is about 130,000 met-
ric tons per year. Only 1% of the REE are recycled from end-products (Jowitt et
al. 2018). However, global demand for REE has steadily increased. If a global
search for sources of raw materials is used in the tradition of classical geopolitics,
there is a danger that every small reserve of raw materials on the globe will be
dismantled and used up when a market is there. This can only be described as a
non-sustainable geostrategy.
In particular REE, which are of great importance for modern weapons sys-
tems and for the green industry, are currently experiencing non-sustainability.
This is because the extraction of these valuable raw materials, which are neces-
sary for the production of renewable energy technology, not only releases large
quantities of pollutants and radioactive material. The main issue of REE mine
production is the so-called balance problem, because the vast majority of REE
production is dominated by lanthanum (La) and cerium (Ce) but the majority of
demand is for neodymium (Nd) or dysprosium (Dy). In addition, energy is con-
sumed to a very high degree and renewable energies risk losing their advantage
to be the alternative to the fossil-nuclear energy system for reasons of climate and
environmental protection.
The majority of REE consumption is by mature markets: for catalysts, glass-
making, lighting and metallurgy 59% and for magnets, ceramics and batteries
41% (Goonan 2011).

17
The International Union of Applied and Pure Chemistry (IUPAC) defines the REE as the 15
lanthanide elements plus scandium (Sr) and yttrium (Y). Cf. IUPAC: Nomenclature of inor-
ganic chemistry – IUPAC recommendation 2005. Cambridge, UK: IUPAC 2005
Rare Earth Strategies of Japan and EU/Germany 173

In order to gain independence from various suppliers of fossil fuels, new


dependencies of raw material suppliers have arisen as a result of the use of renew-
able energy technology. This will ultimately make renewables an energy source
among many who are merely diversifying the energy mixes. From a market econ-
omy point of view, their production and use can today compete with traditional
energy sources that are established on the market. This has been – although it has
hardly been discussed – often only possible at the expense of the environment.
Since the development of REE such as dysprosium, terbium, europium, yt-
trium and neodymium, which are central to "green energy production", is capital
and time-consuming, producers have tried to compete at the expense of the envi-
ronment. If it is not possible to make the process sustainable in the future, the use
of renewable energy will continue to endanger the environment as demand in-
creases and production volumes are reduced.
There are different approaches to determining non-sustainability. These in-
clude the ecological backpack or MIPS (material input per service unit), the eco-
logical footprint and the water footprint. The ecological backpack quantifies the
amount of material determined and the substances and products that are moved
within the process chain. The ecological footprint calculates individual sustaina-
bility deficits. MIPS is a fundamental measure of estimating environmental im-
pact by a product. The footprint of water consumption quantifies the total amount
of water needed to produce the goods and services used by the population of a
country. This approach also includes quantities of water consumed outside this
country for goods produced for that country. However, a comprehensive assess-
ment model for non-sustainability, which takes into account all the aspects men-
tioned here, has yet to be developed.
E-Waste is one of the fastest growing waste streams and threatens to grow
into a global problem of unmanageable proportions. An effective form of man-
agement of resource recycling and environmental improvement is the extraction
and purification of precious metals taken from the waste streams – this process is
called urban mining (cf. Zeng, Mathews, Li 2018).
In order for the world to be able to use renewable energies in the long term,
stable and high prices for rare earths are demanded, also in order to be able to
finance environmental regulations. And indeed, the environmental burden must
be reduced as quickly as possible, especially in China. Until now, poor environ-
mental standards have been the reason why mining there is unrivalled cheap. In
addition, higher prices can be used by workers who mine the raw materials, as
well as the people who live near the mining areas. China has taken up this argu-
ment before the WTO and justified its high-price policy and the introduction of
export quotas by saying that it wants to reduce environmental pollution and that
it needed to finance environmental regulations. However, that was not considered
credible.
174 Lutz Mez

Only a system that does not cause "sustainable difficulties" can be described
as a sustainable energy supply system. Analogous to respect for human rights, no
raw materials should be purchased in the future by countries where environmental
standards are not guaranteed. What is needed, then, is not only the governments
of the respective supplier countries, but also of the countries whose industry wants
to buy rare earth metals.
A sustainable energy system also focuses primarily on energy efficiency and
resource efficiency – and also in the use of rare earths. A promising strategy to
alleviate supply risks is value recovery from end-of-life products. In this context
the Urban Mining strategy of Japan – the recycling and reuse of the relevant raw
materials – has a pioneering role.

Japan's Raw Material Initiative – Urban Mining & Recycling of Rare Earth
Elements on a Big Style
Japan is the world's third-largest economy, but a low-resource-poor country. That
is why Japan has always pursued an active policy designed to secure reliable im-
ports of raw materials. While there are sizable deposits of industrial minerals,
Japan has a notable share of the world's production of non-iron metals for only a
few products. For non-energy raw materials, Japan is a 0.2% share of the weak
production of raw materials (Hilpert 2013: 105). Consequently, mining, including
coal production, accounts for less than 0.1% of gross domestic product. Japanese
mineral and metal processing, on the other hand, is an extremely relevant eco-
nomic factor. After China and the US, Japan is the third largest consumer of in-
dustrial metals.
For rare earths and tungsten, Japan is particularly dependent on China as a
supplier country. When China temporarily suspended Japan's supply of rare earths
in an undeclared embargo in the summer of 2010, the issue gained reliable sup-
plies of raw materials not only for the Government but also a high priority for the
public (Aston 2010). Since then, the issue has been a top priority in Japanese
foreign policy.
The already high pressure to problem increased even more as a result of the
earthquake disaster and the tsunami in March 2011. The earthquake destroyed
many refinery production facilities (Nishikawa 2011) and the reconstruction of
the destroyed areas, the demand for raw materials increased dramatically. The
Japanese electronics and automotive industries hit the disaster particularly hard
because metal processing was partially completely destroyed, and capacity re-
newal took more than a year. The automotive industry suppliers, whose factories
in the northeastern region were particularly hard hit. Due to a lack of parts and
power outages, the world's largest car company, Toyota, has had to temporarily
close plants or curb production at home and abroad.
Rare Earth Strategies of Japan and EU/Germany 175

The 2017 TEPCO Special Business Plan estimates the economic costs of the
nuclear disaster at the NPP Fukushima-Daiichi for compensation payments,
cleanup, interim storage and decommissioning to 215 bn. Euro (Kanamori &
Kåberger 2019).
For the design and coordination of Japanese raw materials policy, METI,
with its foreign trade department, the Economic Cooperation Department and the
Industrial Department, is responsible for the iron and steel referees, and non-iron
metals lead the way. The Agency for Energy and Natural Resources (ANRE) is
administratively responsible.
The Ministry of Foreign Affairs, the Ministry of the Environment and the
Ministry of Education and Science are also concerned with raw materials policy.
The State Department is responsible for raw materials diplomacy. "Despite the
large number of ministries, self-governing bodies, companies and associations in-
volved in Japan's raw materials policy, it is possible to speak of an orderly, coher-
ent, transparent system" (Hilpert 2013: 108).
In May 2009, METI, together with the Ministry of Health and the Ministry
of Education, Culture, Sport and Science and Technology, published a White Pa-
per outlining the role of rare metals and rare earths for manufacturing industries
(METI et al. 2009). In July 2009, the METI stated in a strategy paper that 18
elements of the rare earth group and 30 other metals were considered critical
(Hilpert 2013: 106).
A recycling law has been in force in Japan since 2001. The recycling rate for
durable economic goods already reached 84% in 2008. Since 2008, the METI has
published or initiated four raw materials policies to secure Japan's supply of min-
erals and metals. The "Resource Security Directive" aims to increase Japanese
companies' involvement in key resource projects (METI 2008). In order to im-
prove the supply of raw materials and rare metals, Japanese companies are to se-
cure exploration and development rights abroad or to secure long-term Consign
supply contracts.
The "Strategy for the Safety of the Supply of Rare Metals" was published on
28 July 2009 (Hilpert 2013, p. 108 f.). To increase security of supply, a four-pillar
strategy was outlined and the development of a raw materials-specific infrastruc-
ture proposed: (1) government support for resource investments abroad, (2) recy-
cling of rare metals in Japan, (3) development and use of alternative materials as
well as (4) storage of strategic metals.
In December 2011, METI announced "Priority measures to secure the supply
of natural raw materials and fuels" (METI 2011). With this policy document, the
Japanese government is responding to the earthquake disaster of March of the
year. An updated adjustment of energy and raw materials policy to the conse-
quences of the disaster is the "Cabinet strategy for securing resources" of 24 June
2012. The paper adopted by the Prime Minister and the Cabinet modifies and
176 Lutz Mez

fleshes out the March 2008 directive. Japan wants to focus more on resource-rich
countries, invest in local raw material processing, offer investment packages, ac-
quire grants and use multi-state and bilateral structures such as the WTO (Hilpert
2013: 109).
Recycling as a source of raw materials plays a prominent role in Japanese
raw materials policy. The National Institute of Materials Science (NIMS) pub-
lished a study in 2008 in which the metal reserves in Japan were estimated to be
comparable to the occurrence of the leading producer countries (NIMS 2012).
The Ministry of the Environment has then carried out model tests for the recycling
of small electrical devices in a number of regions, which have been successful.
On the basis of the "Rare Earth Recycling Act," which came into force in
August 2012, Japan has begun to build a nationwide system for recycling rare
earth metals. Harmonization of the social system for collecting resources from
end of life products and real separation techniques are essential to develop urban
mining. The concept “Artificial deposit” is useful for recycling minor rare metals.
New processes to dismantle and detach parts from end of life products were de-
veloped. To realize urban mining, it is necessary to re-understand the role of the
old infrastructure in iron and steel and non-ferrous industries (Nakamura &
Halada 2015).
Electronic waste is also known as “e-waste” or WEEE (Waste Electrical and
Electronic Equipment). E-waste conversion is widely described as urban mining.
Recycled metals and plastics extracted from e-waste – urban mining – are con-
trasted against “virgin” materials, where ore is mined from the earth’s crust or
plastic produced without incorporating recycled materials.
Today Japan recycles most of the nearly one million tons of WEEE appli-
ances. The business of high-tech “green” recycling is sometimes referred to as
“shredder economy”. But the vast infrastructure of machines, transport logistics,
and human labor that breaks down e-waste goes far beyond mere crushing or
“shredding” (Kirby 2018). The mechanized demanufacturing project of WEEE is
replicated throughout Japan. It is an opportunity to recover resources and to de-
velop technological capital that can be used for both profit and regional influence
(Ibid.).
The potential of urban mining in Japan was estimated in 2009). The potential
includes the amount of in-use stock and dissipated stock and estimates the accu-
mulation by considering the balance between import and export after World War
II. The accumulation of gold and silver is 6,800 tons and 60,000 tons respectively.
They are greater than the reserves of South Africa for gold and Poland for silver
(Halada et al. 2009).
After having found a tremendous potential of deep-sea mud as a source of
REE and yttrium in the western North Pacific Ocean near Minamitorishima Island
in 2013 – the resource amount was estimated to be 1.2 Mt of rare earth oxides,
Rare Earth Strategies of Japan and EU/Germany 177

which account for 62, 47, 32, an 56 years of annual global demand for Y, Eu, Tb,
and Dy, respectively – this new Japanese resource could be exploited in the near
future (Takaya et al. 2018).

The EU Raw Materials Initiative


Germany as a member state of the European Union has no own strategy for sus-
tainable rare earth supply. Critical raw materials were imported, mainly from
China. Since 2013 Germany has the R&D-Program "Raw materials of strategic
economic importance for high-tech made in Germany". The objective of the pro-
gram is, to promote and further expand research and development along the value
chain of non-energy mineral raw materials. The time frame for this will be five to
ten years, the financial volume will be up to 200 Mio EUR. The program directs
at universities, non-university research institutes and companies of the commer-
cial economy. It will promote the applied research till the demonstration scale as
well as linking it with the fundamental research. Education and further education
to resource technologies will be deployed as accompanying measure (BMBF
2013).
The EU has many raw material resources and EU Member States produce a
wide range of mineral resources, but the EU is heavily dependent on imports for
strategically important raw materials and high-tech metals. "For antimony, cobalt,
molybdenum, niobium, platinum, rare earths, tantalum, titanium and vanadium,
the import-to-consumption ratio is 100 percent" (Mildner and Howald 2013: 69).
However, the EU's critical dependence on these raw materials has only been
addressed since 2005 and a transition to more resource-efficient economies and
sustainable development has been proposed. In May 2007, the Council adopted a
coherent political approach with regard to raw materials supplies” (European
Council 2007: 6) and in November 2008, the European Commission presented
the EU's Raw Materials Initiative. The Commission's communication to the Eu-
ropean Parliament and the Council is about securing Europe's supply of the goods
necessary for growth and employment (European Commission 2008).
Then an ad hoc working group was set up by the Commission to identify
those raw materials that could become critical to the European economy. Of 41
non-energy minerals and metals studied, 14 were classified as critical because the
demand could more than triple by 2030, but these are only promoted in a few
countries. Supply bottlenecks are imminent in antimony, beryllium, cobalt,
fluorite, gallium, graphite, indium, magnesium, niobium, platinum group metals,
tantalum, tungsten and rare earths (European Commission 2010: 5 f.).
Criticism of the EU's raw materials strategy came from MEP Reinhard
Bütikofer: "The most important project is missing [...] A concentrated effort to
178 Lutz Mez

achieve resource efficiency, i.e. to make more economical use of natural re-
sources“ (Bojanowski 2010).
In order to secure the supply of these critical raw materials, the EU Commis-
sion presented a new raw material strategy "Tackling the Challenges in Commod-
ity Markets and on Raw Materials" in February 2011, building on the 2008 Raw
Materials Initiative and has three pillars: (1) fair and sustainable supply of raw
materials from global markets, (2) fostering sustainable supply of raw materials
within the EU, and (3) boosting resource efficiency and promoting “secondary
raw materials” through recycling (European Commission 2011a: 14 ff.).
The new strategy forms part of the overarching Europe 2020 strategy. Secur-
ing the supply of raw materials remains the task of the economy. The EU sees its
role as creating the framework for access to raw material markets worldwide.
With resource-rich countries – especially in Africa –, a modified development
policy aims to establish transparency in raw materials trading and improve the
trade and investment climate. In order to achieve "fair conditions" in raw materi-
als trading, the Commission relies on EU competition policy and WTO dispute
settlement procedures. An improvement in the raw material market is to be
achieved through the increased networking of state geological services.
Attac and medico International denominated the EU's Raw Materials Initia-
tive a call for "unrestricted access to raw materials" and criticized the massive
pressure on exporting countries (Medico International 2011). The EU uses trade
and investment agreements "to secure access to raw materials at low cost and to
benefit businesses" (ibid.). This means that the EU is partly responsible for unac-
ceptable working conditions and human rights violations in the countries con-
cerned. The methods of degradation practiced would affect the environment, dam-
age the health of the local population and poison soil. In order to strengthen the
competitiveness of European industry, the South would not only be overexploita-
tion, but would actually exacerbate the predicament in the countries concerned.
The EU's raw materials initiative is not consistent in terms of development policy,
he said.
At the end of 2010, the European Parliament commissioned Reinhard Bütik-
ofer to report on European raw materials strategy. The report (European Parlia-
ment 2011) was adopted by a large majority in December 2011. He presents the
Commission's three-pillar strategy "from head to feet" (Bütikofer 2013: 6). First
and foremost, the EU should pursue an innovation strategy. By making more ef-
ficient and better use of resources, it is possible to reduce both the need for im-
ports and protect the environment and strengthen Europe's competitiveness. The
key points of the innovation strategy are therefore recycling, resource efficiency,
reuse, substitution and research and development.
Rare Earth Strategies of Japan and EU/Germany 179

In September 2011, the Commission presented the "Roadmap to a Resource


Efficient Europe". While it proposes measures to increase resource efficiency and
promote recycling, it remains very general. It states, among other things:
„The Commission will […] focus Union research funding (EU
Horizon 2020) on key resource efficiency objectives, supporting
innovative solutions for: sustainable energy, transport and con-
struction; management of natural resources; preservation of ecosys-
tem services and biodiversity; resource efficient agriculture and the
wider bio-economy; environmentally friendly material extraction;
recycling, re-use, substitution of environmental impacting or rare
materials, smarter design, green chemistry and lower impact, bio-
degradable plastics” (European Commission 2011b: 10).
There is no mention of the instruments and institutions required for this strat-
egy. These include, for example, resource efficiency advisory services, a top run-
ner program, and public procurement alignment for resource-efficient products,
and the promotion of research and development. In addition, the Eco-Design Di-
rective, which sets standards for energy consumption, could be extended to in-
clude the use of raw materials.
In a study on rare earths, the Eco-Institute (2011) proposed, among other things,
the establishment of an European competence network for rare earths. It should
bring together universities, research institutes, companies and other experts, share
research results and develop a research agenda. Reinhard Bütikofer seized on this
idea and suggested a network of competencies European Rare Earths Competency
Network (ERECON) in the EU budget. ERECON was established in 2013 with
three working groups and a secretariat in Brussels. The topics of the working
groups were:
 Opportunities and road blocks for primary supply of rare earths in Europe;
 European rare earths resource efficiency and recycling;
 European end-user industries and rare earths supply trends and challenges.
Bringing together experts from industry, science and policy-making,
ERECON has looked for ways to improve the supply of rare earth metals to EU
countries.
The final conference took place in October 2014 in Italy. The key findings
of the network are documented in a report “Strengthening the European Rare
Earths Supply-Chain. Challenges and policy options” (ERECON 2015).
The experts spelled out options for developing a diversified and sustainable
REE supply-chain for Europe and formulated policy recommendations. Among
the options the substitution of REEs is mentioned, the development of new
sources of heavy rare earths outside of China and greater recycling from waste
180 Lutz Mez

streams, recycling in form of commercially viable, large-scale REE recycling,


European REE mining, particularly in Sweden and Greenland and the develop-
ment of a business model for downstream processing. The six policy recommen-
dations stretch from maintaining and strengthening the European REE skills and
knowledge base, to the creation of an European Critical Materials Observatory.
Further recommended are technology support through funding industry-led pilot
plants for HREE processing, levelling the playing fields for European HREE ex-
ploration, making waste management REE-friendly through eco-design, incentive
schemes for collecting priority waste products, and streamlining policy and waste
regulation and boosting supply security through enhanced cooperation among Eu-
ropean end-users and other stakeholders (ibid.).
A Commission expert group – the Raw Materials Supply Group – with rep-
resentatives from EU member states, European Economic Area countries, EU
candidate countries, and organizations representing industry, research and civil
society advises the Commission and oversees the implementation of the RMI. The
commission also regularly publishes a list of critical raw material (cf. European
Commission 2014).
When the United Nations adopted the Sustainable Development Goals in
September 2015, the EU committed itself to these goals and pledged to apply the
principles of sustainable development to all EU policies and initiatives. In No-
vember 2016 a report on mining and the SDGs was published. The Commission
will help to implement the SDGs in non-energy extractive industries.
The European Innovation Partnership (EIP) on Raw Materials is the main
EU initiative implementing the RMI stakeholder platform that brings together EU
countries, companies, researchers, and NGOs to promote innovation in the raw
materials sector. The EIP developed its Strategic Implementation Plan (SIP) with
95 actions. The SIP sets out the objectives, targets and actions to be reached or
implemented by 2020 (European Commission 2013).
The objectives are (1) ensuring the sustainable supply of raw materials to the
European economy, (2) reducing the import dependency by improving supply
conditions, diversifying raw materials sourcing and improving resource effi-
ciency (incl. recycling), and finding alternative raw materials, and (3) putting Eu-
rope in the forefront in the raw materials sector and mitigating related negative
environmental, social and health impacts.
The targets of the SIP are (1) up to 10 innovative pilot actions, (2) substitutes
for at least 3 applications of scarce raw materials, (3) framework conditions for
primary raw materials, (4) framework conditions for enhanced efficiency in ma-
terial use and in waste prevention, (5) a European raw materials knowledge base
with information, flows and dynamic modelling system for primary and second-
Rare Earth Strategies of Japan and EU/Germany 181

ary raw materials, (6) network of research, education and training centres on sus-
tainable raw materials management, and (7) a pro-active international co-opera-
tion strategy of the EU.

Summary
Today many high-tech technologies – including those in the automotive, renewa-
bles and defense sectors – depend on rare earths. The unique properties of rare
earths increase efficiency and performance, they are key for a green energy future.
Comparing the rare earth strategies of Japan and Germany/EU shows that leading
industrialized countries have chosen different strategies.
The EU has a critical dependency on REE. The problem was not realized
before 2005. Two years later, in 2007 a “coherent political approach with regard
to raw materials supplies” was discussed and in 2008 the EU Commission pre-
sented the Raw Materials Initiative. Of 41 analyzed minerals and metals 14 were
regarded as critical. The RMI was criticized to be neo-colonial and missing re-
source efficiency as target. The 2011 adopted updated raw materials strategy has
three pillars: fair supply from the world market, promotion of sustainable supply
and improved resource efficiency. A strategy for the development of a European
rare earths recycling scheme was suggested by researchers and ERECON – the
European Rare Earths Competency Network – has focused on opportunities for
primary supply in Europe and closing the loop through resource efficiency and
recycling.
Japan is a resource-poor country with a weak production of raw materials
and has always pursued an active raw materials policy. Further Japan has a high
dependence for REE and tungsten and is particularly dependent on China as sup-
plier. However, a recycling law has been in force in Japan since 2001 and was
implemented effectively. The METI initiated four raw materials policies to secure
Japan’s supply of minerals and metals in 2008. When China temporarily sus-
pended Japan’s supply of rare earths in an undeclared embargo in 2010, the issue
gained top priority in Japanese foreign policy. The problem pressure increased
even more after the earthquake and tsunami in March 2011.
The “Rare Earth Recycling Act” came into force in August 2012 and today
Japan has a nationwide system for recycling rare earth metals. Electronic waste
conversion is widely described as “urban mining” and in Japan nearly one million
tons of e-waste is recycled. The Japanese strategy is in comparison to the EU
approach the more sustainable way to go.
182 Lutz Mez

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Findings of the Research Project

Helmut Weidner, Lutz Mez, Lila Okamura

Industrial countries like Japan and Germany have pledged to integrate more sys-
tematically ecological considerations in their overall policies and to develop low-
carbon oriented climate policies. But obviously there exist a rather large gap be-
tween the official goals and reality.
In this edition the authors sketched the main differences between Japan and
Germany and investigated which factors could explain them. The overall goal was
to find out what kind of political, economic, historical, cultural, institutional and
technological factors have played a role with respect to (ecological) moderniza-
tion capacity and capability, policy learning and policy change.
The empirical focus was on four policy areas:
- energy policy and renewable energy promotion;
- nuclear energy (incl. decommissioning of power plants and nuclear waste
disposal);
- automotive industry/transport;
- rare earth (as an important resource for technological innovation in the three
other areas).
Japan and Germany belong to the group of industrialized countries who
started quite early with establishing a comprehensive environmental policy. How-
ever, over time their development paths became quite different, especially in the
areas of climate change, nuclear energy and renewables.
Whereas Germany became a forerunner in these areas, Japan's climate and
energy policy has stalled.
The automobile industries of the two countries, however, followed different
strategies for the future model split and public transport, making Japan a forerun-
ner in the development of alternative (exhaust reducing and fuel saving) engines.
And in the area of rare earth policy Japan has developed and implemented
“urban mining” as advanced recovery and recycling technology, while Germany
(and the EU) tend to exploit existing resources globally in a rather neo-colonial
approach.
The analysis of the chosen policy areas was guided inter alia by the theory
and analytical approaches of "path dependency", "ecological modernization", "ca-
pacity building" and "critical environmental policy analysis".

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4_13
186 Helmut Weidner, Lutz Mez, Lila Okamura

Energy Policy
After 2nd World War the core energy policy of the Federal Republic of Germany
could be equated with coal policy. The policy of these early years was followed
in the second phase by a half-hearted attempt to counteract the crowding-out strat-
egies of the oil multinationals. In the third phase, petroleum was accepted as a
"cheap" energy source and in 1973 nuclear power was accorded top priority in the
nation's first coordinated overall energy policy. "Out of oil" and energy conserva-
tion were the bywords of the fourth policy phase, from 1974 to 1982. In response
to the massive suffering of German forests from air pollution ("acid rain"), envi-
ronmental protection figured ever more prominently in the formulation of energy
policy from 1983 onward.
This ushered in the fifth and latest phase, which is characterized by climate
protection, the forced expansion of renewable energies, the statutory phase-out of
nuclear power, and intensified energy conservation efforts. Furthermore, the
grand coalition government (Conservatives-CDU and Social Democrats-SPD) in
2018 set up a commission tasked with managing the definite phase-out of coal-
fired power production in Germany. The commission agreed on a final report that
proposes to end coal-fired power production by 2038 or earlier. The government
has not yet made a binding decision on this (Spring 2019).
Japan's exceptional postwar economic performance was accompanied by a
steep rise in energy demand and drastic changes of the structure of energy sources
for thermal power generation. Until the 1950s, Japan was nearly self-sufficient in
energy, relying primarily on domestic coal and hydropower as it has almost no
own oil or natural gas resources. The output of domestic coal rose continuously
after WW II, reaching a peak in 1961. Due to the high cost of domestic coal pro-
duction, stricter environmental regulations, increasing protests against polluting
coal power plants and ash disposal, and the availability of relatively cheap oil coal
lost its prominent role as energy source.
In about 15 years after the WW II Japan changed from primary reliance on
domestic coal (and hydropower) to imported oil. For instance, primary energy
consumption in Japan during the period from 1960 to 1971 increased by 3.4 times.
The total capacity of electric power generation increased from 23,657 MW in
1960 to 68,262 MW in 1970. This represents an increase of about 300 percent in
a single decade. This process of rapid change of the energy structure was some-
times called the "energy revolution".
The period of stable and cheap oil supplies was suddenly finished by the first
oil price crisis (oil shokku) of 1973-74 leading to a dramatic turn of Japan's energy
policy which was exacerbated by the second oil price crisis of 1979. Since the
two oil crises, energy security through reducing the dependency on Middle East-
Findings of the Research Project 187

ern oil became the centerpiece of Japanese energy policy: The Japanese govern-
ment not only started an intensive "resource/oil diplomacy" (shigen gaiko) trying
to diverse the energy supply sources and to secure energy supplies but also pro-
moted energy efficiency measures, nuclear power production and also the use of
alternative energy sources. In particular it was MITI that urged industry and the
power companies to increase the use of (mostly imported) coal. They followed
this "recommendation" only reluctantly as they preferred supposedly cheaper nu-
clear energy and, especially TEPCO (Tokyo Electric Power Company) Liquified
Natural Gas (LNG). Finally, the utilities and MITI jointly founded the Japan Coal
Development Company in 1979.
The governmental policy made up by a mixture of pressure and support soon
showed positive effects. For instance, energy efficiency (the ratio of energy use
to economic growth) declined continuously and stronger than in most other in-
dustrial countries. The improvement in energy efficiency was at its most pro-
nounced between 1979 and 1986, when the ratio of energy consumption to GNP
fell by one fifth. The various policies to reduce energy demand included inter alia
financial incentives for energy-efficient investment, strong increase of R&D
measures, specific laws and regulations (like the Law Concerning the Rationali-
zation of Energy Conservation 1979), and the so-called Moonlight (1978) and
Sunshine Projects (1974) to promote energy conservation or the development of
alternative energy resources.
Particularly noteworthy are measures that led to a partly very strong increase
in the prices of various energy sources, like the increase of the gasoline tax by
about 25 percent, and of the aviation fuel tax by 100 percent. Electricity prices
were staggered progressively in three stages according to the principle: the higher
the consumption, the higher the price per unit of electricity. Altogether, Japanese
prices for electricity became the highest in the group of industrial countries, and
"Japan has achieved one of the most remarkable successes among IEA countries
in improving energy efficiency" (IEA 1991:9; cf. Mez 1995: 141).
Natural gas has played a very important role in Japan's diversification away
from oil since the 1970s oil price crises and has been an important fuel source in
compensating for lost nuclear power in the aftermath of the Fukushima disaster.
However, the costs are rising as Japan's higher natural gas and LNG demand for
power generation has led to a strong rise of LNG prices.
From a political perspective the governmental policy after the oil price crisis
has led to greater national and international involvement of the government in the
energy markets, and to a closer cooperation and relationship of governmental bod-
ies (especially MITI), and the energy producing companies as well as the highly
energy dependent industries.
However, since the disruption of electricity supply caused by the Fukushima
disaster, rapid steps have been made to liberalize the Japanese electricity market
188 Helmut Weidner, Lutz Mez, Lila Okamura

and to create greater flexibility and more options for consumers to choose their
providers.

Renewable Energy Policy


Germany began to promote the use of renewable energies as early as the 1970s
when faced with the oil price crisis. However, renewable energy promotion
started in a stronger and more systematic way in the 1990s: A recommendation of
the an Enquete Commission appointed by the German Bundestag (Parliament)
had called for implementation of serious measures in the areas of rational energy
use and the development of renewable energies. This provided a strong stimulus
for the following activities of the government to promote the establishment of
renewable energy in the domestic and commercial spheres.
The first German photovoltaic (PV) subsidy scheme started with the "1,000
Solar Roofs Initiative" (1991–1995). It was followed by the "100,000 Solar Roofs
Initiative" (1999–2003) leading to a rapid increase in the installation of PV sys-
tems. The Renewable Energy Sources Act (EEG) was then enacted in 2000 to
promote renewable sources. The most influential instrument, however, was the
"Feed-in Tariff" (FIT) scheme of 2000, amended several times in the following
years. Mainly due to the rapid increase of the costs of the system the government
fundamentally reformed the Renewable Energy Sources Act which entered into
force in August 2014.
In the aftermath of the Fukushima disaster the government decided to phase
out nuclear energy and to push towards the so-called Energiewende (energy trans-
formation) especially by increasing the share of renewables in all energy-related
areas. This strengthened the policy focus on renewables.
In all, the development of renewable energy became a real success story with
most of the success being due to government regulation and intervention: The
share of renewable energies in electricity consumption rose between 2000 and
2018 from 6.3 percent to 37.8 percent, while the share of final energy consump-
tion rose from 6.2 percent (2004) to 16.6 percent (2018). Renewable energies
contribute in many areas to the avoidance of greenhouse gases. Most emissions
are saved in the sector of power generation - but they also contribute to climate
protection in the heating and transport sectors. In 2018 around 184 million tons
of carbon dioxide equivalents were avoided by renewables. According to the (very
challenging) target of the government renewable energies should account for 30
percent of final energy consumption by 2030 and 60 percent by 2050, and their
share in electricity consumption should be 80 percent in 2050 in order to contrib-
ute decisively to the achievement of the mid- and long-term targets of the German
climate policy.
Findings of the Research Project 189

This is a challenging target, and there are quite a few experts who express
great doubts that the goals can actually be achieved. But it is fair to say that re-
newable energies have become the most important lever for energy system trans-
formation, also because the government has obviously recognized that they will
play a key role in the ecological modernization of the German economy and so-
ciety:
"The energy transition is Germany’s avenue into a secure, environmentally friendly,
and economically successful future. We have decided to fundamentally alter Ger-
many’s energy supply: away from nuclear energy and towards renewable energy. And
we are aiming to use energy more and more efficiently in future. (...)
At the same time, we want the energy transition because it offers a unique opportunity
for business in Germany. It is to become a key driver of modernisation for tomorrow’s
industrial society, opening up new fields of business, stimulating innovation and cre-
ating growth and jobs." (BMWi 2015:3).
In Japan it was after the oil price crisis that renewable energy got more con-
sideration in the governments new energy strategy focusing on diversification of
its energy supply and sources.
Following the recommendation of the Council for Science and Technology
the so-called Sunshine project was implemented in 1974 by MITI; the "Moonlight
Project" was added in 1978 to complement the Sunshine project. A New Energy
Development Organization (NEDO), was founded in 1980 under the authority of
the MITI; one of its tasks is to manage the Sunshine and Moonlight projects. In
the same year, the Petroleum Substitute Energy Promotion and Development Law
was enacted, and the Sunshine Project was strengthened. This technology promo-
tion programme puts the focus on solar, geothermal, and hydrogen energy as well
as on coal conservation. For a short period became a world leader in solar elec-
tricity production. But in the following years renewable energy got rather low
priority in the government's energy strategy.
In the 1990s various measures by the central and local governments contrib-
uted to the increase of particularly solar photovoltaic (PV). The major effect came
from public subsidies, and accordingly when the subsidies for the domestic sector
were finished in 2005 the development in this sector stagnated. But in 2009 when
subsidies were reintroduced the market began to flourish again. Very similar to
Germany, the Feed-in Tariff (FiT) introduced in November 2009 began to play
the most decisive role in the then starting strong growth of PVs, and in the end of
2011, Japan became number three in PV capacity in a worldwide comparison.
With a large number of volcanoes and favourable geological conditions, Ja-
pan has one of the highest potentials for geo -thermal power generation in the
world. Geo-thermal power generation has been developed with governmental pro-
motion until the 1990s but was then almost stopped in favour of nuclear power.
190 Helmut Weidner, Lutz Mez, Lila Okamura

After the Fukushima nuclear disaster in March 2011 the government de-
clared the increase of renewables as a political priority. Accordingly, the existing
FiT-system was reformed and extended in 2012 to include, for instance, the pro-
motion of renewable energies other than solar energy. In addition, the feed-in tar-
iffs were increased very sharply, so that they were the highest in a global compar-
ison (in some cases they were twice as high as the already relatively high German
tariffs).
Since July 2012, the capacity of renewable energy facilities in operation has
grown at an average annual rate of 29 percent. Currently, solar energy accounts
for the largest share of renewable energy, while wind power, biomass and geo-
thermal energy only play a minor role. However, due to its high costs and other
problems the FiT-system was revised in May 2016, including the introduction of
a tendering system for large-scale solar energy projects. The first auctions were
held for solar PV in October 2017 and September 2018.
Finally, there still is much to be done to make the power grid fit for a prob-
lem-free feed-in of electricity from renewables. Yet, the government's 5th Basic
Energy Plan still has the target of making renewable energy a principal source of
power supply, reaffirming that that renewable energy will account for 22 to 24
percent of the nation’s total electricity generation in 2030.
The target for renewables includes around 9 percent for (already existing)
hydropower plants. Accordingly, photovoltaics are to be expanded to 7 percent,
wind power plants to 1.7 percent and biomass energy to up to 4.6 percent. Overall,
the government plan therefore provides for only a relatively small increase in re-
newables. The plan also states that the target of nuclear power's contribution to
the national electricity generation in 2030 will remain 20 to 22 percent. Accord-
ingly, nuclear power will continue to remain an important base-load power source.
The target for thermal power in the energy mix is 56 percent. Some experts have
strong doubts that the officially agreed target on CO2 - a reduction by 26 percent
related to the base year 2013 by 2030 – could be achieved by the government’s
energy plan, mainly because that would need a quick restart of a large number of
nuclear reactors.
In fiscal year 2017, coal-fired plants accounted for 30.4 percent of the power
supply. The energy-saving law requires each power company to raise the average
conversion efficiency of its thermal power plants to at least 44.3 percent by 2030.
Thus, the Basic Energy Plan stipulates that inefficient coal-fired thermal plants
will have to be phased out.
In 1998, Japan initiated a unique policy: The Top Runner Approach, to im-
prove energy efficiency of end-use products by focusing on the most efficient
products on the market (appliances like TV, air conditioners, equipment, and au-
tomobiles). The program aims at promoting the development of the world’s best
Findings of the Research Project 191

energy-efficient products to save energy and to reduce GHG emissions. This pol-
icy instrument became the blueprint for similar policies in other countries.

Nuclear Policy
Nuclear policy was initially quite central to German industrial policy and then to
national energy policy, and later also to German environmental policy. Nuclear
and related energy policy decisions were made and coordinated for the most part
at the national level as part of the coalition party politics and its need for reason-
able consensus both within the party structure but also regarding accommodations
with Germany’s sectoral corporatist interest group structure. Environmental con-
cerns are since the 1970s deeply embedded in German society and politics The
Chernobyl nuclear accident galvanized these environmental concerns in a very
energy-focused way and finally paved the way to a nuclear phase-out agreement
shortly after the Fukushima disaster in March 2011.
Nuclear power stations were operating in West Germany since 1961 and in
East Germany since 1966. In the aftermath of the first oil price crisis 1973/74
West Germany gave priority to nuclear power – and nearly all oil-fired power
stations were closed. East Germany started operation of its first reactor in 1966
and added four blocks in the 1970s and one in 1989. The expansion of this tech-
nology occurred for West Germany in the wake of the first oil price crisis. How-
ever, far reaching nuclear expansion plans were given up already in the 1980s.
For East Germany the main driving force were energy policy agreements with the
Soviet Union. After the unification of Germany in 1990 all nuclear power plants
(NPPs) in East Germany were shut down. In West Germany the "nuclear exit"
was put on the political agenda by a very strong anti-nuclear movement and on
the federal level it was promoted by the then opposition parties, the Social Dem-
ocrats and Greens.
The phase-out of nuclear power in Germany has been one of the priorities of
the red-green Government which took office in October 1998. Despite continuous
and broad-based public criticism, up until 1998 federal nuclear policies had sided
with the pro-nuclear alliance and supported the industry through a number of tax
and regulatory privileges. Thus, the phase-out decision marked a fundamental re-
vision of past nuclear policy-making system. After one-and-a-half years of inten-
sive negotiations between industry and government, in the course of which a num-
ber of controversies had to be solved, agreement was reached with the utility com-
panies on the gradual phasing-out of nuclear energy use in Germany on June 14,
2000 whereby three reactors were permanently shut down.
Nuclear exit has been on the German policy agenda since over three decades.
After the Chernobyl accident in 1986 a majority of the public and also a consid-
erable number of relevant politicians and stakeholders opposed nuclear power and
192 Helmut Weidner, Lutz Mez, Lila Okamura

strived for renewable energy alternatives. At the same time climate change policy
gained high attention of German policy makers and ambitious targets for the re-
duction of Greenhouse gas emissions were approved. In 2000 a phase out agree-
ment was reached between the Federal Government and the operators of nuclear
power plants. Since 2002 the purpose of the Atomic Energy Act has stopped to be
the promotion of nuclear power but to phase out the use of nuclear energy for the
commercial generation of electricity in Germany.
After the federal elections in 2009 the conservative-liberal government
(CDU and FDP) targeted and implemented a slow-down of the termination of
nuclear power plants. This provoked strong anti-nuclear reactions in a large part
of society. As a response to the nuclear disaster in Fukushima in March 2011, a
nuclear moratorium was announced by the government and in summer 2011 the
German government and the parliament (Bundestag) adopted decisions on the
gradual phase-out of nuclear power and on accelerating the energy transformation
towards renewables. Eight nuclear reactors lost their operation license on August
6, 2011 and the remaining nine must be stepwise shut down until 2022.
According to the government's program three key elements to replace the
electricity produced by nuclear reactors will be implemented: expansion of re-
newable energy use with a corresponding infrastructure, a significant improve-
ment of energy efficiency efforts - and for a transition period also new and more
efficient gas-fired plants will be used. But the ongoing Energiewende (energy
transformation) of the German energy system demands much more than the sub-
stitution of energy sources and changing the way of using energy. A fundamental
reform of social, economic, technological and cultural policy in Germany has to
be realized, too.
Japan's nuclear power policy is particularly characterized by the fact that
the government (usually MITI/METI) published very optimistic plans for the ex-
pansion of nuclear power from the outset, but these could not be fulfilled in all
cases; in fact, real developments often lagged far behind the planned figures. And
so many experts now doubt that the current plans for the future use of nuclear
energy (cf. the 5th Basic Energy Plan of 2018) can be realized in the years up to
2030 or 2050.
Since 1954, when Japan began a nuclear research program the country has
been on a path to reduce its dependence on foreign energy sources through the
development of nuclear power. The first nuclear power plant was commissioned
in 1960, based on US-technology; uranium was obtained from Canada, France,
South Africa and Australia. The first experimental reactor (JPDR) went into op-
eration in 1963, followed in 1966 by the first commercial reactor unit at the Tōkai
nuclear power plant. The reactor was shut down already in 1976.
Findings of the Research Project 193

In the aftermath of the oil price crises, the expansion of nuclear energy was
strongly promoted by the government. The expansion of nuclear energy was re-
garded as the best way to reduce dependence on foreign energy resources and at
the same time to reduce the environmental impact of the use of fossil fuels; it was
also seen as a viable source for decarbonization. Furthermore, it was planned to
reduce in the long-term dependence on uranium imports and at the same time to
reduce nuclear waste disposal problems by establishing an independent nation
nuclear "fuel cycle". Later, the idea of developing the technological capacities for
a new promising export good was added as a further incentive.
Already in the 1980s Japan developed to a leading country in nuclear-gener-
ating capacity. The relatively rapid expansion of nuclear energy has also been
encouraged by the creation of a multi-layered system to promote the acceptance
of this technology, in particular for prefectures and municipalities in the planned
siting-locations. Since 1974 the government has enacted laws to promote the de-
velopment of electric power resources under which taxes have been imposed on
the consumers of electricity (cf. Matsuoka 1989). This money ("cooperation
money") is used to pay compensation to and to raise the welfare standards of those
local people who have accepted the construction of power plants in their areas:
this includes the provision of public facilities and infrastructure such as schools,
community centers, libraries, gymnasiums, roads and swimming pools. Since
1981, households within a defined radius of the nuclear power plant have received
a legally regulated annual sum of money. As a rule, electric companies also pay
huge amounts of money for their impacts on farmland and fishing areas.
But where there is strong and persistent local resistance, the so-called riot
police was also used to break the resistance. Thus, the history of the expansion of
nuclear energy is at the same time a history of diverse social and political con-
flicts, often violent and increasing over time. Various accidents and relative fre-
quent scandals of the atomic industry increased the "nuclear allergy" (kaku are-
rugi) of the majority of the public, stimulated rising opposition at local grounds
and further slowed the realization of the government's programs. Examples are,
inter alia, as follows: Accidents at the Monju FBR in 1995, the reprocessing plant
at Tokai-mura in 1997 and 1999; radiation overexposure of workers in Tsuruga
1981; two workers died from overexposure in a reprocessing plant in Tokai-mura
in September 1999. In August 2002, it was discovered that TEPCO had made false
reporting of the results of routine inspections of its nuclear plants. In 2004, five
workers lost their lives in an outbreak of heated steam from a burst pipe in a re-
actor operated by Kansai Electric. An investigation revealed that this section of
pipe had been removed from the safety checklists and was therefore never in-
spected. Opposition raised also after the "Three Mile Island Accident" in the USA
in March 1979, and the Chernobyl disaster in Ukraine (then belonging to the for-
mer Soviet Union) in April 1986. But in contrast to Germany where the nuclear
194 Helmut Weidner, Lutz Mez, Lila Okamura

energy policy was slowed down after the Chernobyl disaster (e.g. by reducing
public R&D financing of this technology; also no new nuclear power plant was
connected to the grid in the aftermath), Japan built new reactors and increased the
financial support for nuclear power technology and energy production.
The reactor disaster at Fukushima in March 2011 - triggered by an earth-
quake of magnitude 9 with a following tsunami and nuclear meltdown at the Fu-
kushima Dai-ichi power plant - gave many opponents of nuclear energy hope that
this disaster could mean an "end" for nuclear energy in Japan or that the structures
of the so-called nuclear complex (called "nuclear village" in Japan) could be fun-
damentally changed. Many were convinced that at least the importance of nuclear
energy in the national energy mix would be greatly reduced. And indeed, for a
short time after the catastrophe, it looked as if nuclear energy would become a
technology with no future in Japan:
One consequence of the disaster was a gradual shutdown of all nuclear power
plants. Japan became for the short period of two months free of nuclear energy
production, then the first reactor was started again in July 2012. In September
2013, all reactors were stopped again, and in this case for a period of about 2
years. This has, however, led to a significant rise in fossil fuels use, increased fuel
imports and rising carbon dioxide emissions. These unfavourable developments
were also used to justify the now again positive assessment of nuclear energy as
a solution to energy and environmental problems: The new government (a coali-
tion of LDP and Komeito) elected in 2012 and headed by Prime Minister Abe
successfully promoted a renaissance of nuclear power which resulted in the re-
versal of the nuclear power phase-out until 2040 decided by the previous govern-
ment and in the restart of nuclear reactors in 2014 -- thus in a surprisingly short
time after the Fukushima catastrophe and despite the majority of the population
still rejected the expansion of nuclear power. Japan's government decided to main-
tain nuclear power as a major pillar in the country's energy strategy. Only the
targets were reduced: The pre-Fukushima plan (3rd Basic Energy Plan 2010) to
rise nuclear energy to 50 percent of total electricity supply would have required
building 15 nuclear plants additionally. The new plan, in contrast, includes a state-
ment that the government will aim to make renewable energy Japan’s main source
of power by 2050 by a policy of proactively promoting the introduction and ex-
pansion of renewables. The 2030 targets, however, have been left unchanged, with
the energy mix set at 20 to 22 percent for nuclear power, 22 to 24 percent for
renewable energy, and 56 percent for thermal power. This government's renewed
strong focus on nuclear energy is highly controversial in Japan as in other coun-
tries. By contrast, the International Energy Agency in its recent analysis of Japan's
energy policy, recommended that Japan should revert to the use of nuclear energy
if it were to reduce its emissions of greenhouse gases by 2030, as internationally
agreed. If nuclear energy were to fail to reach its 20-22 percent target by 2030, it
Findings of the Research Project 195

would be "extremely expensive" to close the gap with renewable energy. Japan
would then in all probability have to use more gas and coal and it would then
hardly be possible to achieve the greenhouse gas targets with national means. Ja-
pan has made an international commitment to reduce greenhouse gas emissions
by 26 percent by 2030 compared to 2013. Again, the government wants to achieve
this goal with an energy mix, in which nuclear energy plays a strong role with a
share of about 20 to 22 percent. Nevertheless, Japan has once again drastically
reduced its previous nuclear ambitions. Before the catastrophe at the Fukushima
Daiichi nuclear power plant, the country was still aiming for a nuclear share of 50
percent of the electricity supply in a long-term perspective.
The government's strong commitment to nuclear energy and its assessment
of the strength of possible resistance to it can also be seen from some of its deci-
sions on politically and socially sensitive constellations. For instance, the operat-
ing Japan Atomic Power Company (JAPC) received a last-minute extension for
another 20 years at the beginning of November 2018 for Tokai 2, a nuclear power
plant located in the prefecture of Ibaraki, which reached its legally stipulated max-
imum operating life of 40 years just at the end of this month. Otherwise, the re-
actor would have had to be shut down for ever. The approval of a lifetime exten-
sion would not have been possible after the expiry of the deadline. Tokai 2, just
like the damaged Fukushima Daiichi nuclear power plant, is a boiling water reac-
tor located only about 120 km north of Tokyo. Furthermore, the 30 km periphery
of this plant with 960,000 inhabitants is the most densely populated 30 km pe-
riphery of a nuclear power plant in the country. The city of Tokai is also called
the birthplace of the nuclear energy of Japan since the first commercial nuclear
power plant in Japan was here connected to the grid. Despite this sensitive con-
flict-prone initial situation, there were few protests against nuclear energy, as a
relatively large number of inhabitants are employed in this sector and its second-
ary sectors, or their income depends on it in a relevant way.
Finally, it should be emphasised that in Japan the problems of storage and
final disposal of nuclear waste are still far from being solved. Japan's only nuclear
waste disposal facility, Rokkasho, in Aomori Prefecture in northern Japan, has
existed since 1993 and is reaching its capacity limits. The very complex, long-
term, discursive-participative site-searching and decision-making process in Ger-
many for nuclear waste disposal is more demanding from a democratic-theoreti-
cal point of view than the Japanese strategy, but in Germany too there has been
so far no breakthrough towards an effective and consensusable development path.
With regard to nuclear energy development and policy in both countries,
however, the assessment that nuclear energy no longer plays a relevant role in
Germany as an obstacle to the ecological modernisation of the energy sector via
primarily the expansion of renewable energies seems justified: Japan has not used
the Fukushima disaster politically to drastically reduce the use of nuclear energy
196 Helmut Weidner, Lutz Mez, Lila Okamura

in the future or to decide on a binding phase-out program, as is the case in Ger-


many. The explanation for this may also be that the political-economic "nuclear
complex" (the "nuclear village") in Japan has been weakened in the aftermath of
the Fukushima catastrophe, but still has a great influence on the shaping of energy
policy. The main stakeholders in this “nuclear village” are TEPCO and the other
regional utilities. They cooperate closely in long-established formal and informal
networks with high-ranking bureaucrats in the Ministry of Economy, Trade and
Industry and related organizations and agencies, as well as with leading members
of management and labor in large enterprises related to realm of electricity pro-
duction and supply. Very similar to the former German situation the "village" is
also inhabited by members of the media, academia and other institutions with an
interest in nuclear energy (cf. Mez in this book).
In contrast to Germany, the opponents of nuclear power in Japan have not
succeeded in undermining the "nuclear village" through long-term, diverse and in
part sophisticated strategic political activities, in order to then finally use the ca-
tastrophe of March 2011 as an "opportunity window" for the realization of a final
phase-out of nuclear energy.

Automobility Policy
Although the transport sector goes beyond just cars, the automotive industry plays
an enormous economic role in Germany and Japan. After decades of success,
Germany is facing major upheavals, both in terms of driveline innovations and
the transformation of its current business model (for the following cf. Canzler in
this book). The most important technical drivers for the automotive industry are
the electrification of the driveline and the digitalisation of transport processes.
Global climate protection also requires a decarbonisation of the transport sector
in the medium to long term.
Across the world, emission limits obviously will be further tightened, and it
will no longer be possible to remain within these new limits while still using com-
bustion engine vehicles. Germany’s local authorities are increasingly setting am-
bitious climate protection targets in their local climate protection plans, and these
particularly affect transport. In addition, there is an increasing number of court
decisions that result in certain areas (mostly within cities) being closed to cars
with current emission standards.
In all growing cities, there is a lack of space for even more cars. At the same
time, global digital companies are forcing their way into transport markets with
new business models. Finally, changes can also be observed in attitudes and be-
haviour, especially among younger generations of city dwellers. These changes
point to a progressive decline in the importance of owning your own car and an
increase in pragmatic inter-modality and multimodality.
Findings of the Research Project 197

A transformation of transportation from private cars based on internal com-


bustion engines to intermodal transport services with post-fossil-fuel vehicles is
on the agenda in both countries. However, the German car industry is just begin-
ning – still timidly and trapped in path dependencies – to adjust to this. But it will
not be able to free itself from its path dependency on its own. This will not only
require a framework that creates investment security, but also a moderated process
of collective change and potential spaces for innovations.
Historically, Japan's automotive industry is a laggard compared to other ma-
jor industrialized countries, especially the USA and Germany. In 1950, for exam-
ple, Japan produced a total of only 31 thousand four-wheeled vehicles. At present,
the Japanese automotive industry is one of the largest and most innovative in the
world. The very dynamic way to this position is characterized by an initially ex-
tremely strong and diverse support of the sector by the Japanese government, of-
fering various and often internationally controversial incentives (such as tariff-
barriers set up as protection against foreign competitors, special tax benefits for
the domestic producers, as well as enormous investments in roads and related
infrastructure).
The extremely strong expansion of automobility triggered by this led to a
sharp increase in a wide range of environmental impacts as early as the early
1970s, in particular due to vibrations, noise and air pollution such as photochem-
ical smog, which frequently occurred in urban agglomerations (cf. Shibata
1989:99-119, in Tsuru & Weidner). The government reacted only hesitantly and
half-heartedly to this and to the increasing pressure of public protests, especially
in large cities, in order not to weaken the expansion of this sector, which had been
declared a key industry. This ignorant policy only changed as a result of increas-
ing popular protest, a coordinated initiative by seven major cities to push the cen-
tral government to enforce stricter limits, and the setting of stricter limits for car
exhaust emissions in the US.
As early as the early 1970s, when the first information about the plans of the
US government and the US Environmental Protection Agency to set stricter emis-
sion limits became known, the Japanese government and car manufacturers re-
acted relatively quickly with increased R&D measures to reduce emissions, as the
USA was a major export market for Japanese vehicles. When in 1971 the so-called
Muski Act came into force in the USA, the Japanese government decided to adopt
the exhaust emission standards laid down here as a guideline for its own regula-
tions, which were to be implemented by the Japanese car manufacturers in 1975
and 1976. The standards for carbon monoxide and hydro-carbon foreseen for
1975 were adopted relatively quickly, but the standards for nitrogen oxides were
subject to numerous attempts by the automotive industry to weaken or delay them.
As the government did not act decisively enough, seven major cities (includ-
ing Tokyo, Nagoya, Osaka and Kawasaki) founded an initiative in 1974 to enforce
198 Helmut Weidner, Lutz Mez, Lila Okamura

strict environmental standards in the transport sector. This initiative was ulti-
mately largely successful, also through the public mobilizing information policy,
although the opponents tried to use the oil price crisis of 1973 to their advantage
by making the regulations (which led to exhaust catalytic converters) responsible
for increased fuel consumption and an intensification of the incipient economic
recession. One of the most important arguments of the industry and its supporters,
however, was that in the USA itself the implementation of emission standards had
been postponed due to the economic problems caused by the oil price crisis.
The fact that the stricter emission standards could then be enforced was also
due to the fact that the two largest car manufacturers, Toyota and Nissan, surpris-
ingly announced the production of "clean models" for 1976, which they them-
selves had previously described as technically unfeasible and had now achieved
a good sales argument in the shadow of the oil price crisis by reducing fuel con-
sumption.
As a result, remarkably efficient and economical engines came onto the Jap-
anese market from about 1975 onwards. This was the time when, because the oil
embargo had raised fuel prices, American and European customers began to look
for smaller and more economical cars. Thus, Japanese car exports afterwards in-
creased greatly, and Japan remained on the track of an overall successful automo-
tive policy that relies heavily on energy and environmental innovations. Japan,
for instance, also became the forerunner in the development and implementation
of hybrid and e-cars. Additional, Toyota and Honda already offer a car with fuel
cell aggregate. Whereas in Germany comparable technical change proceeded so-
to-say only glacially, the Japanese automobile manufacturers set the stake in new
engine techniques. Nevertheless, Japan continues to experience considerable en-
vironmental pollution due to the strong increase in traffic, and traffic congestion
is almost endemic in large cities.

Rare Earth Policy


Today many high-tech technologies – including those in the automotive, renewa-
bles and defense sectors – depend on rare earths. The unique properties of rare
earths increase efficiency and performance, they are key for a green energy future.
Comparing the rare earth strategies of Japan and Germany/EU shows that they
have chosen quite different strategies.
The EU has a critical dependency on REE. The problem was not realized
before 2005. Two years later, in 2007 a “coherent political approach with regard
to raw materials supplies” was discussed and in 2008 the EU Commission pre-
sented the Raw Materials Initiative. Of 41 analyzed minerals and metals 14 were
regarded as critical. The RMI was criticized to be neo-colonial and missing re-
source efficiency as target. The 2011 adopted updated raw materials strategy has
Findings of the Research Project 199

three pillars: fair supply from the world market, promotion of sustainable supply
and improved resource efficiency. A strategy for the development of a European
rare earths recycling scheme was suggested by researchers and ERECON – the
European Rare Earths Competency Network – has focused on opportunities for
primary supply in Europe and closing the loop through resource efficiency and
recycling.
In Germany the German Mineral Resources Agency (DERA) is the national
information and consultancy platform for mineral raw materials. DERA was es-
tablished in 2010 by decree of the Federal Ministry of Economic Affairs and En-
ergy (BMWi) and is part of the German Geological Survey (Federal Institute for
Geosciences and Natural Resources, BGR). Hence, DERA builds on many years
of expertise and a wide scientific and technical infrastructure. DERA helps com-
panies and politicians to become aware of potential price and supply risks along
the supply chain. In addition, the agency also supports measures undertaken by
the Federal Government and companies in securing mineral raw materials on
global markets.
Since 2012 the Federal Research Ministry BMBF is financing research pro-
jects via the R&D program for economic strategic raw materials. In 2018 at the
annual Raw Material Congress in Berlin, researchers reported several new
sources for critical raw materials and REE. This was found in sea sand or mine
dumps, and in rivers. And in the settling pond of a former ore mine the researchers
discovered Indium, Gallium and Cobalt plus REE. In the past decades, raw mate-
rials and REE were imported, because they were not regarded as economic inter-
esting.
German companies like Ceritech AG - a subsidiary of Deutsche Rohstoff AG
– are exploring, developing, producing, and refining rare earth deposits. Ceritech
was formerly known as Seltenerden Storkwitz AG. The company was founded in
2011 and is based in Chemnitz. In 2012 the company announced that about 20,100
tons REE with a value of up to €8 bn were located in Storkwitz – the first and
unique deposit in Central Europe. But because of the drifting down of prices of
REE the mining project was cancelled in 2015. The company is now working on
the production of rare earth metals without establishing a mine and its full infra-
structure and costs. Ceritech has developed an unconventional method to extract
REE from gypsum – a byproduct of fertilizer production.
Despite these measures the German rare earth policy as such is both weaker
and less strategically oriented than the Japanese policy.
Japan is a resource-poor country with a weak production of raw materials
and has always pursued an active raw materials policy. Further Japan has a high
dependence for REE and tungsten and is particularly dependent on China as sup-
plier. However, a recycling law has been in force in Japan since 2001 and was
implemented effectively. The METI initiated four raw materials policies to secure
200 Helmut Weidner, Lutz Mez, Lila Okamura

Japan’s supply of minerals and metals in 2008. When China temporarily sus-
pended Japan’s supply of rare earths in an undeclared embargo in 2010, the issue
gained top priority in Japanese foreign policy. The problem pressure increased
even more after the earthquake and tsunami in March 2011.
The “Rare Earth Recycling Act” came into force in August 2012 and today
Japan has a nationwide system for recycling rare earth metals. Electronic waste
conversion is widely described as “urban mining” and in Japan nearly one million
tons of e-waste is recycled. The Japanese strategy is in comparison to the EU
approach the more sustainable way to go.

Comparing Japan and Germany


What status of ecological modernization have the two countries achieved in the
selected policy areas? The previous detailed analysis and the resulting overview
in the following two tables show that neither country has a clear leading position
in the policy areas relevant for sustainable climate policy. While Japan leads in
the policy areas of "Automobility" and "Rare Earth", Germany has made further
progress in ecological modernization in the areas of "Energy/Renewable Ener-
gies" and "Nuclear Energy". Japan is striving to profit from its know-how made
through its nuclear energy policy for export purposes as well; while Germany
could benefit from foreign demand for its experience in decommissioning and
dismantling nuclear power plants.
But even in the policy areas in which the countries are leading , only the
status of "medium innovation" has been achieved so far. Only Germany is already
on its way to "structural innovation" in the field of nuclear policy through its
phase-out policy, which is most likely no longer reversible. Structural innovation
will be achieved when the goals of socially and ecologically compatible disman-
tling and conversion of existing nuclear power plants and final disposal of nuclear
waste have also been achieved. Provided that Germany continues to push ahead
with the expansion of renewable energies in line with current government targets
and also finishes the phase-out of coal-fired power plants already initiated, struc-
tural innovation can also be achieved in the area of conventional energy genera-
tion and renewable energies. This would be a good step forward on the road to a
sustainable climate protection policy via a continuous step-by-step policy of eco-
logical modernization. Japan, on the other hand, has still a long way to go to
achieve ecological modernization through structural innovations in these areas.
Although Japan is better positioned than Germany in the areas of automobility
and rare earth, its strategy to date has not focused on structural innovations.
Findings of the Research Project 201

Table 1: Results for the 4 policy areas

Table 2: Detailed Results for the 4 Policy Areas


202 Helmut Weidner, Lutz Mez, Lila Okamura

Capacity-Building for structural Ecological Modernization still needed

As the analysis of the various policy areas has shown, the existing capacities for
environmental management and policy have only been sufficient to initiate eco-
logical modernization at the level of moderate innovation in some areas. It has
been shown that in principle both countries have a large arsenal of capacities
which are necessary to end even strong path dependencies. This applies above all
to technological and economic-financial capacities, which are about similarly
large in both countries. This also applies by and large to institutional capacities,
although here there are relevant differences in the political-institutional sphere
that lead to different opportunities for the proponents of ecological modernization
to exert influence. The chances of influence are generally higher in Germany due
to several legal and other regulations as well as membership of the European Un-
ion (EU).
Germany has a more substantial federal politico-administrative system com-
pared to the relatively high centralistic system of Japan, providing the German
decentral levels with more power and resources to "go their own ways" in the
policy areas focused in this study (e.g. in promoting renewable energy). The
highly differentiated political election system in Germany together with the EU-
elections also provides more chances for political "newcomers" than Japanese po-
litical "start-ups" or small political parties enjoy. The Green Party, for example,
generally received a larger share of the vote in political elections at the European
level than at the national level, enabling it to influence German environmental
policy through European policy-making. The financial support of non-profit or-
ganizations and political parties (e.g. legal regulations for party financing) is
stronger in Germany which also benefits organizations and parties that oppose the
established power system. Generally, the politicization of formally listed non-
profit organizations is easier in Germany, even if they explicitly act for the change
of existing political-economic conditions.
Probably the public media landscape is also more diverse and less dependent
on political and economic power constellations than in Japan. The founding of a
nationally distributed daily newspaper (Tageszeitung: TAZ) in September 1978
with a strong left-liberal and ecological orientation contributed considerably to
improving communication and networking between the environmental and anti-
nuclear groups, which until then had operated mostly decentral. This also in-
creased their political clout.
All in all, apart from a few differences in the political and institutional
spheres, both countries have similarly high financial, economic and technological
capacities, providing potentially a multitude of choices with respect to a transfor-
mation towards ecological modernization. However, the largest differences exist
Findings of the Research Project 203

regarding the cognitive-strategic capacity and capabilities of the actor groups that
push for a fundamental change in the non-sustainable paths of development.
We defined "cognitive-strategic capacity" (cf. Introduction) as the capability
of environmental actors, actor groups or movements to correctly analyze the (in
a broad sense) environmental political arena with respect to overall support of
targeted new policies or measures; to assess the power of veto groups, opponents
and their related supporters; to relate this information to own power resources in
order to assess realistically the chances for changing the current path and to de-
velop and realize a political strategy and tactics to achieve (in a medium- to long-
term perspective) their goals. This includes the capability of using (or even creat-
ing) "opportunity windows" and enhancing needed capacities.
The analysis of the four policy areas selected for this study has shown that
the genuinely political capacity element "cognitive-strategic capacity" (or the
strategic "will & skill") is more pronounced among the German proponents of
ecological modernisation, also and especially because the German environmental
movement has always made strong efforts to expand this type of capacity. This
enabled these actors - despite temporary setbacks - to penetrate highly isolated
political-economic-technical systems of action in the long term and change their
rules of action as well as paradigms.
This strategy, also known as the "march through the institutions", ran parallel
to the establishment of own institutions (as for example so-called independent
scientific research, analysis and consulting organisations such as the Öko-Institut
in Freiburg) in order to be on an equal footing with the established institutions in
scientific or technical issues. This also includes the founding of a nationwide
"Green Party", which - also after many ups and downs - is now one of the large
established parties involved in government in important federal states (or as in
Baden-Württemberg the government coalition leads) or occasionally at the fed-
eral level. In addition to this institutionalization of the environmental and anti-
nuclear movement, there has also been a constant development, promotion and
networking of support groups in the social sector, in particular in the educational
and cultural system. This made it easier, for example, to organise and carry out
protest actions and also large mass demonstrations, which took place, for exam-
ple, shortly after the Fukushima catastrophe. Finally, one should also mention the
not uncommon cooperation with ecologically open-minded business firms, trade
unions and, of course, with the rapidly growing "green business sector".
In Japan, in contrast, there is no well-organized and forceful national net-
work with a clear and mutually supported political target, embracing environmen-
tal (and anti-nuclear) proponents from different spheres; there is also no signifi-
cant penetration of the institutions of the politico-administrative system by envi-
ronmental actors, and there is also no special political party with clout represent-
ing forcefully "green interests" within the government(s).
204 Helmut Weidner, Lutz Mez, Lila Okamura

By comparing the two countries, we can learn that it is important to give high
attention to cognitive-strategic capacity building and that a high degree of "will
& skill" of environmental policy proponents is a crucial parameter for the ecolog-
ical modernization of heavily path-dependent policy areas.
Further we learn from comparison that also well-organized pressure from
public (governmental) institutions can lead to important changes in powerful busi-
ness sectors, as in the Japanese automotive industry in the 1970s through the con-
certed action of seven major cities, which led to the enforcement of strict exhaust
emission standards, the technical implementation of which had previously been
vigorously denied. This successful environmental policy intervention in the still
relatively "young" Japanese car industry could have contributed to the fact that
this industrial sector reacted quite flexibly and innovatively to further ecological
and energy policy challenges in the period that followed.
In the policy area "Rare Earth" it is obviously an intelligent strategy of the
political-administrative system at various levels which, in conjunction with finan-
cial and organisational incentives, contributes to the development of an efficient
and more sustainable recycling sector in Japan. In this sector, Germany's cogni-
tive-strategic capacities are poorly developed, partly because environmental ac-
tors have paid little attention to this sector so far. The strong political impetus in
Japan to promote innovations in the rare earth sector, however, is not present in
the field of renewable energies, since these are still in the shadow of the path
bound general energy policy, where proponents of ecological modernization still
have very little influence.
Although progress towards ecological modernisation is also evident in Jap-
anese policy areas in which the strategic-cognitive capability of environmental
actors played and plays only a minor role, there has been only moderate innova-
tion in these areas, and no movement towards structural change has yet been dis-
cernible.

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Mez, L. (1995) Klimaschutzpolitik als CO2-Minderungspolitik. In: Jänicke, Bolle, Carius, (Eds.), Glo-
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Contributors

Weert Canzler holds a Diplom in political science from the Freie Universität
Berlin and a doctorate in sociology from the Technical University of Berlin. He
completed his habilitation with teaching authorisation for "Social Science
Mobility Research" at the Technical University of Dresden. Since 1993, he has
been a researcher at the Social Science Center Berlin (WZB) and since 2013 the
spokesperson of the "Leibniz-Forschungsverbund Energiewende".

Martin Jänicke is Professor for Comparative Politics and between 1986 and
2007 he has been Director of Environmental Policy Research Centre (FFU)
of the Freie Universität Berlin. Prof. Jänicke has over 40 years’ experience as
scientific author and senior policy advisor. Between 1999 and 2008 Jänicke
served as a member and Vice President (2000-2004) of the government Expert
Council on the Environment (SRU). Since 2013 he is also Senior Fellow at the
Institute for Advanced Sustainability Studies (IASS).

Lutz Mez is a senior adjunct professor (Privatdozent) at the Depart-ment of


Political and Social Sciences, Freie Universität Berlin. In April 1986 he co-
funded the Environmental Policy Research Centre (FFU) and served as its
executive director until April 2010. His major research area is comparative
environmental and energy policy, with particular reference to nuclear and
electricity policy.

Lila Okamura is an associate professor at the Department of German Studies and a


Member of the Institute of Human and Environmental Symbiosis Research at
Dokkyo University in Japan. She holds a master’s degree in political science
from Gakushuin University in Tokyo and a doctoral degree from the Freie
Universität Berlin. Her teaching and research areas are comparative
environmental policy, energy and climate policy, waste management and
nuclear policy.

© Springer Fachmedien Wiesbaden GmbH, part of Springer Nature 2020


L. Mez et al. (eds.), The Ecological Modernization Capacity of Japan and
Germany, Energiepolitik und Klimaschutz. Energy Policy and Climate
Protection, https://doi.org/10.1007/978-3-658-27405-4
208 Contributors

Martin Schulz is senior research fellow at the Fujitsu Research Institute (FRI), a
leading industry think tank in Japan. His research areas include digital
transformation, corporate strategy and economic policy. Before 2000, he was a
visiting researcher at a number of universities in Europe and Japan, and
assistant professor Freie Universität Berlin.

Helmut Weidner is a political scientist and an adjunct professor (Privatdozent)


at Freie Universität Berlin. In the period 1978-2013 he was research fellow at the
Social Science Center Berlin (WZB). Weidner’s research fields are comparative
environmental policy and analysis, global climate and alternative conflict
resolution (mediation). More recently he dealt with issues of equity, global
justice and redistribu-tional problems in climate change policy.