What is a renewable energy aggregation service
that supports the sale of non-FIT electricity?
As a measure to achieve carbon neutrality, the government aims to make renewable energy the main source of Japan’s power. With the launch of the FIP (Feed-in Premium) scheme as part of these efforts, non-FIT initiatives have been attracting attention. On the other hand, non-FIT power producers are required to submit generation plans for up to the previous day, to bear adjustment costs (imbalance costs) based on discrepancies between generation plans and actual results, and to find purchasers for the electricity they generate, which represent major inconveniences. Therefore, as a renewable energy aggregation service, we will support power generation companies in their deployment of renewable energy by drawing on our expertise in power generation forecasting and market transactions cultivated in the European market, where our business partner Next Kraftwerke of Germany is a leader, as well as our own network of players.
What is non-FIT electricity?
Non-FIT electricity refers to electricity derived from renewable energy sources that have not been certified as FIT by the government, or for which the certification period has expired. More than 10 years have passed since the launch of the FIT scheme, and the government is now steering away from FIT, which focused on increasing renewable energy sources, to subsidizing FIP and off-site PPA, which aim to operate independently as main power sources. As such, the use of non-FIT electricity is expected to become more widespread in the future.
Unlike FIT electricity, for which the government guarantees the feed-in tariff for 20 years, non-FIT electricity requires power producers to stabilize and improve earnings on their own.
Differences between FIT and non-FIT
There are two main differences between FIT and non-FIT:
| Difference | FIT | Non-FIT |
|---|---|---|
| Electricity and non-fossil value purchasers |
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| Responsibility for balancing |
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| Difference | FIT | Non-FIT |
|---|---|---|
| Electricity and non-fossil value purchasers |
|
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| Responsibility for balancing |
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- Under the balancing system, the power producer must submit the power generation and sales plan for the previous day to the OCCTO (Organization for Cross-regional Coordination of Transmission Operators) and match it with the actual results for the following day. If there is a discrepancy between planned and actual values, the cost of compensation (imbalance cost) must be reimbursed by the power producer afterwards.
Benefits of non-FIT
Non-FIT has the following advantages.
1. Potential to sell electricity at a higher price than with FIT
With FIT, revenue from electricity sales is at a fixed unit price, whereas with FIP, revenue may improve when market prices rise. In addition, bilateral contracts may provide higher revenues than the FIT price.
2. Power producers can sell non-fossil certificates themselves
Under FIT, non-fossil certificates are owned by the Transmission & Distribution System Operator and cannot be sold directly to retail electricity providers or consumers, but non-FIT non-fossil certificates can be sold directly by the power generation companies. Retail electricity providers that have obligations to meet under the Act on Sophisticated Methods of Energy Supply Structures and consumers with RE100 achievement targets have a strong need to purchase non-FIT non-fossil certificates on a long-term, stable basis, which can potentially lead to increased revenues.
3. Subsidies are available (for new construction)
The government provides subsidies for new installation of power sources under off-site PPAs (Consumer-Driven PV Generation Installation Promotion Program) to promote the independent introduction and expansion of renewable energy. This provides a subsidy of 1/2 (or 2/3 in the case of municipal partnerships) will be provided for the solar power generation equipment to be installed.
4. Potential to increase revenues through subsequent installation of storage batteries
Under FIT, if storage batteries are installed after the FIT has been certified, a change in FIT certification is required and the FIT price is revised to the latest price, whereas under the FIP scheme, this requirement is relaxed. The FIP scheme also allows for using storage batteries to shift the time of day when electricity is sold, thereby increasing premiums as well as revenues from the sale of electricity in the market. Subsidies may also be available for storage batteries installed alongside renewable energy.
What is Toshiba’s renewable energy aggregation service?
As an aggregator, Toshiba ESS will bundle together power plants belonging to various power producers and operate them as a power generation balancing group.
Specifically, we will perform the necessary operations for “balancing” and assume the “imbalance risk.”
In addition, we will trade electricity and non-fossil certificates on the market and assist in matching with individual purchasers.
Features of the services provided by Toshiba ESS
Imbalance risk optimization
AI technology to optimize risk
Revenue maximization
Selection of the most appropriate revenue generation method
Flexible contract lengths
Consideration of needs
Available in every region
Support provided through Toshiba ESS’ nationwide network
Compliance with the latest schemes and subsidies
Service proposals that take into account the latest trends
Process up to the start of Toshiba’s renewable energy aggregation service
The process leading up to starting the service is as follows. Please note that this may differ depending on the service used.
Problem-solving case study
The following are examples of companies that have solved problems with Toshiba's renewable energy aggregation services.
Case studies
Below are some examples of companies that have employed Toshiba’s renewable energy aggregation services.
- Kokusai Kogyo Co., Ltd. and its logo are trademarks or registered trademarks of Kokusai Kogyo Co., Ltd.
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- SMFL MIRAI Partners Company, Limited and its logo are trademarks or registered trademarks of SMFL MIRAI Partners Company, Limited.
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