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TEPCO Applies New Method to Solve Problem of Stagnant Solar Projects

Payment of contribution in aid of construction or cancellation of contract

2019/03/27 13:46
Kenji Kaneko, Nikkei BP Intelligence Group, CleanTech Labo
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Japan's Ministry of Economy, Trade and Industry (METI) announced the results of TEPCO Power Grid Inc's efforts to secure an available capacity of a power grid at a meeting of the Grid Working Group (WG) of the New and Renewable Energy Subcommittee March 18, 2019.

This time, METI announced that TEPCO Power Grid has implemented a scheme of canceling grid connection contracts with power companies having power plants that have not started operation for a long period of time and have not paid contribution in aid of construction and that 84% of such plants (359) canceled the contracts or withdrew for fiscal 2012.

METI plans to increase available capacity by promoting the application of this "canceling scheme" to the service areas of general power producers other than TEPCO Power Grid and freeing capacities occupied by stagnant projects.

With the canceling scheme of TEPCO Power Grid, the company first reissued bills and newly asked the 359 commercial low-voltage plants (total capacity: about 10,000kW) that have applied for grid connection in fiscal 2012 but have not yet paid the contribution in aid of construction to pay the contribution. At that time, it enclosed a "letter for canceling application" and asked them to send back the letter if they do not have a will to connect to a power grid.

As a result, 58 of the 359 plants paid the contribution, and 301 canceled their contracts or withdrew. So, it became clear that about 80% of them will not connect to the grid, creating a new available capacity.

As for power plants that have not paid the contribution in aid of construction, TEPCO Power Grid has (1) 22,010 (about 830,000kW) commercial low-voltage plants that applied for grid connection in fiscal 2013-2016, (2) 414 (about 320,000kW) high-voltage plants that applied for grid connection in fiscal 2012-2016 and (3) six (780,000kW) extra-high-voltage plants that applied for grid connection in fiscal 2012-2016. And the company plans to move forward with the canceling procedure by using similar schemes.