1. Skip to content
  2. Skip to main menu
  3. Skip to more DW sites

Digging for energy

Julian Ryall, Tokyo
February 7, 2014

Three years after the 2011 earthquake and tsunami, Japan's nuclear plants remain mothballed. But as Tokyo struggles to cover the costs of imported oil and petroleum, companies have set their sights on geothermal energy.

The Matsukawa geothermal power plant, Japan's first geothermal plant built in 1966, is seen at Hachimantai city in Iwate prefecture, northern Japan on August 4, 2011.
Image: Yoshikazu Tsuno/AFP/Getty Images

The announcement in January that Japan suffered a record trade deficit in 2013 caused consternation in Tokyo, with analysts pointing to the need to import fossil fuels as the biggest single factor in the nation's economic slump.

The annual deficit spiked to 11.47 trillion yen (112.07 billion US dollars), up 65.3 percent on the previous year, due in large part to the demand from industry and households for crude oil and liquefied natural gas, all of which have to be imported.

The government of Prime Minister Shinzo Abe says it is committed to restarting nuclear reactors idled since the March 2011 earthquake and tsunami and weaning the country off energy imports. But with the disaster at the Fukushima Dai-Ichi nuclear plant still fresh in local residents' memories, there is little likelihood of the nation's 50 reactors being switched back on in the near future.

Adversity into opportunity

Face with this situation, Japanese companies have discovered that times of adversity can also present a window of opportunity. And with the public unwilling to countenance a return to nuclear power - at least for now - a number of firms want to tap into an underdeveloped, virtually limitless and environmentally friendly energy source that literally lies beneath Japan's feet.

Japan's Prime Minister Shinzo Abe speaks during a lower house special committee on a state secrets act at the parliament in Tokyo November 26, 2013.
PM Shinzo Abe is committed to restarting nuclear reactors in JapanImage: Reuters

Chuo Electric Power Co. has announced that its new geothermal plant in Kumamoto Prefecture will start generating power in April, becoming the first new geothermal facility in 15 years.

A second project, developed by Orix Corp, and Toshiba Corp., is scheduled to go online in early 2015. The two companies see the plant in Gifu Prefecture, central Japan, as a test site for further facilities in Hokkaido, Tohoku - the region devastated by the March 2011 earthquake and tsunami - and on Japan's southernmost main island of Kyushu.

Another 10-company consortium, headed by Idemitsu Kosan Co. and Inpex Corp., has similarly announced plans to develop Japan's largest geothermal plant, in the Bandai-Asahi National Park in the Fukushima Prefecture. With an anticipated output capacity of 270,000 kilowatts, the developers are hoping to have the plant operational in the early years of the next decade.

Oil, gas exploration firms

"Inpex are getting involved as they are an oil and gas exploration company and obviously have experience and know-how in the area of drilling, so a project like this is perfect for them," Tom O'Sullivan, an independent energy consultant and founder of Tokyo-based Mathyos Japan, told DW.

Projects to harness Japan's geothermal resources lag behind the solar sector, he agreed, "but the potential is enormous in a country that sits atop the 'Ring of Fire'" - the meeting point of tectonic plates around the Pacific Rim that is infamous for seismic activity, volcanoes and naturally heated water rising from deep within the earth's crust.

"All of Japan is colored in red on the University of Tokyo's seismological map," O'Sullivan said. "The potential is just remarkable." An estimated 70 gigawatts of geothermal energy lie directly below Japan, sufficient to supply more than one third of the nation's power needs, O'Sullivan said.

Fumaroles geothermal active Area of Onsen Akan National Park in Hokkaido, Japan
Japanese companies want to tap into the underdeveloped energy source which lie under the country's feetImage: imago/imagebroker

But there are also hurdles. In the same way as people in other countries are protesting the exploitation of shale gas deposits, many in Japan are resisting the deep boring that is required to access geothermal energy. Even the operators of the nation's famous "onsen" hot spring resorts are concerned that the power industry will deprive them of the resource they rely on.

High development costs

Development costs are also high, critics point out, with a 20 megawatt geothermal plant requiring an initial 7 million US dollars to assess and then a further investment of between $20 million and $40 million to complete the drilling.

The typical seven years from discovery to commercial operation of a geothermal plant is another concern for potential investors. A solar farm, for example, can be returning an income in as little as 12 months, O'Sullivan points out.

Japan's first geothermal plant (article picture) opened on the island of Hachijojima in 1999 and, to date, geothermal projects here have been relatively small-scale affairs, in part to ensure the support of local residents.

Since the Fukushima disaster, however, the national government has introduced a feed-in tariff system to encourage investment in the geothermal sector and a further 20 sites across the country are presently being assessed for the suitability for projects.

Rival energy sources

But Yoko Ito, a senior researcher at the Institute of Energy Economics Japan, believes that more attention is still being focused on other potential sources of renewable energy.

"The feed-in tariffs were introduced in July 2012 as the government believed they would help to increase the amount of geothermal energy being supplied, but the total amount that has been added so far is disappointing," she said.

The 17 plants currently in operation provide a modest 520 megawatts, although this puts Japan in eighth place in the world in terms of geothermal electricity, according to the Geothermal Energy Association.

"Many of Japan's projects are quite small, for a limited local area and not suitable for commercial operations," Ito said.

Supporters of alternatives to Japan's reliance on nuclear energy or polluting fossil fuels hope that small-scale geothermal projects will eventually encourage investors to sink their money into larger schemes that may make the most of the nation's underground opportunity.