It has been announced that the Renewable Energy Special Measures Act will go into effect in July 2012. From its introduction, electric power companies in Japan will be obliged to purchase electricity from renewable energy sources.

According to KK Gas Review, the Renewable Energy Act will result in higher electricity bills for industries that consume large amounts of electricity. This will include companies such as steel and chemical companies, as well as industrial gas companies who rely on energy intensive devices, for example, air separation units.

However, earlier this year the Japan Industrial and Medical Gases Association (JIMGA) gathered to discuss possible amendments to the Act that would be less punitive on large industry. Masahiro Toyoda, Chairman for JIMGA explained the concept at a press conference, “Using the German system as a reference, a facility for reducing the burden should be worked into the measure… Rather than a uniform burden corresponding to the amount used, we should look into a surcharge method linked to the cost of power charges which differ according to usage volume and time.”

He added, “Furthermore, corresponding to the ratio of power charges in accordance with sales, an upper limit should be set and the amount exceeding a certain ratio should be exempt.”

Thanks to JIMGA’s appeal the Ministry of Economy, Trade and Industry has approved an amendment. As hoped, the revision will offer Japanese companies the opportunity to alter their usage bill according to their consumption patterns. For example, a company operating electricity heavy devices throughout the night will pay less than a peer firm who operates the same machinery during peak hours. In addition, companies that qualify as high electricity consumers would benefit from capped charges.