The
Energy Conservation Law has been the primary policy instrument to propel energy
efficiency investment since the oil crisis in the 1970s. The law was first
enacted in 1979 and amended in 1998, 2002, 2005, 2008, and 2013 to expand the
target and enhance the requirement and enforcement mechanism, and as a result Japan
achieved top-tier energy efficiency in the world. The law not only targets
specific machines and devices such as truck and refrigerator but also requires
businesses to draft and implement an energy conservation plan for their
factories, buildings, and fleet. For example, proprietors recording the total
energy use of 1,500 L in toe per year must draft and implement a long-term plan
to improve the efficiency by 1% or more annually, and the latest amendment in
2013 encourages “peak cut” – curbing electricity demand during peak hours
through measures such as demand shift, cogeneration, and storage battery
installation.
For individual machines and devices, the law
establishes the “Top Runner Program,” which sets energy efficiency standards
based on the performance of the best available technologies (“top runners”) for
each item. The program began in 1999 with standards for 11 items, and expanded
the coverage over time to 27 items. The focus of the program has been on automobile
and office and home appliance, but the latest amendment in 2013 added building
material as an auxiliary item to save energy used in other devices. The impact
of the program has been eminent; for instance, the energy use of standard air
conditioner decreased by 43.3% between 1995 and 2012, and the average fuel
efficiency of passenger car rose by 58.5% between 1993 and 2012.
Table: Target Items in the Top Runner Program
To take advantage
of the program, a new labeling system was also created to enable consumers to
understand and compare the energy performances of various products. The label
includes (1) a colored symbol showing whether or not the product meets the
standards, (2) achievement rate relative to the standard, (3) energy efficiency,
mostly represented as expected annual electricity bill, and (4) standard fiscal
year. It is now a popular decision-making indicator for many consumers, and its
importance continues to grow with the rise in electricity rates.
Figure: Sample Label
The regulatory approaches under the Energy
Conservation Law has made unique success in Japan in the past 35 years due largely to the
cooperative relationship between businesses and regulators, and the law gained
popularity among the general public as a plain and transparent regulation.
Nonetheless, the uniform reduction mandate on commercial energy use is said to
be unfair as the difficulty in achieving the target depends on the baseline
energy use. At the same time, the Top Runner Program now covers roughly half of
the energy use in residential and commercial sector, but misses some
energy-intensive appliances and devices such as washer/dryer and commercial
refrigerator/freezer. Furthermore, the program also sets separate standards for
each size-based subcategory, and it could possibly be discouraging downsizing of
several items such as passenger car and television. These instances suggest
that the 35-year-old law has made important contributions to energy
conservation in Japan but still has space for improvement.
Figure: Energy Use per Nominal GDP in 2010
(Source: Energy Data and Modeling Center)
References:
Nordqvist, Joakim (2006). Evaluation of Japan's TopRunner Programme.
Agency for Natural Resources and Energy (2010). TopRunner Program.
