Crisis-Driven Power Reform— FIT, Separation, and the Illusion of Change —

Japan’s power system reform is being pushed under the cover of crisis.
The expansion of renewable energy through the FIT scheme introduced by Naoto Kan and the separation of generation and transmission will raise electricity prices and destabilize supply.
Bureaucrats will label the failure a “social experiment” and move on without accountability.

2016-03-24
The following is a continuation of the previous section.
However, on December 7 of last year, the Ministry of Economy, Trade and Industry reconvened its “Expert Committee on Electricity System Reform,” and a strong policy direction emerged to promote the separation of power generation and transmission through the breakup of electric power companies.
Reform-minded bureaucrats at METI may be intending to push through this separation while the fervor for abandoning nuclear power has not yet cooled.
This is precisely what Milton Friedman meant when he said that “only a crisis produces real change.”
I must repeat that abandoning nuclear power and expanding renewable energy have nothing to do with each other.
They are connected only by image.
Indeed, implementing the separation of generation and transmission would even be a blow to renewable energy itself.
If renewable energy is expanded through the FIT scheme forcibly implemented by Naoto Kan, and if generation and transmission are separated, electricity prices will inevitably continue to rise, fiscal burdens will increase, and power supply will become increasingly unstable.
At that point, many citizens will likely think, as Germans have, “Electricity prices have risen for the sake of expanding renewable energy, which is a nuisance. That is why abandoning nuclear power was unrealistic from the start.”
And then the reform-minded bureaucrats at METI will stamp this “social experiment” as a failure and proceed to the next “structural reform” without taking responsibility to anyone.
How many times must we Japanese be deceived by so-called “reforms” before we learn?
Society grows worse with each round of “reform,” even as we are told it is improving.

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