Japan’s increase of imported wood pellets to increase

Japan has been dramatically increasing its wood pellet imports for its feed-in-tariff (FIT) program, with wood pellet imports expected to reach an estimated 4.25 million bone-dry tons this year, according to a report filed with the USDA Foreign Agricultural Service’s Global Agricultural Information Network in August.

The report explains that Japan expanded its FIT scheme to include a wider range of renewables following the Fukushima Dai’ichi nuclear power plant accident in 2011, which was caused by an earthquake and tsunami. Prior to that accident, the FIT scheme applied to only solar power. An expanded FIT scheme was adopted by Japan in 2012 that covers most sources of renewable energy, including biomass, wind, geothermal and small-scale hydro in addition to solar. Under the FIT scheme, power utilities companies charge customers a fixed price, or tariff, for power from eligible renewable power generators, this is a for predetermined period after the power plants start operation.

According to the report, the FIT program maintained a set price regardless of the wholesale electricity price. Beginning in fiscal year (FY) 2022, Japan introduced a feed-in premium (FIP) program for renewable power sources under which the Ministry of Economy, Trade and Industry (METI) sets a fixed premium that is added for the average price of wholesale electricity over the previous 12 months.

Wood pellets used under the FIT scheme are subject sustainability requirements. Beginning earlier this year, METI has also required biomass power generators to calculate lifecycle greenhouse gas (GHG) emissions. In addition, METI has published default GHG emissions values associated with biomass feedstock eligible for the FIT/FIP programs for power generation and has indicated it plans to require power plants to provide information to verify their GHG emissions calculations.

Chart displaying growth of wood pellet imports to Japan