Promotion Policies for Sustainable Energy Technologies: Case Studies in Japan

Abstract

Sustainable energy technologies continue to be in the nascent stage for the most part. These characteristics should be considered when drafting promotion policies for such technologies. Using a socioeconomic model, this chapter simulates the effects of specific promotion policies for two particular sustainable energy technologies in Japan. An estimated input coefficient is used in the socioeconomic model analyzing thermal recovery from biomass, as actual market data are not available. The flows of energy and waste are also considered in the model. Restrictions on total greenhouse gas (GHG) emissions and subsidies for the thermal recovery industry funded by the emission tax were revealed to be effective toward promoting the industry. If actual market data, including those on pricing and products, are available for a certain time period (as they are for the residential photovoltaic market), a more detailed analysis is possible. In such cases, the socioeconomic and environmental simulation model may be combined with the growth model, which focuses on the cycle of cost decline created by the learning effect and environmental evaluation by consumers. The results of these simulations reveal the effectiveness of specific promotion policies, namely, a combination of GHG emission tax and subsidy, for sustainable energy industries.