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Japan Revs Up Biofuel Drive
[Analysis] The nation is increasingly concerned about high oil prices and global warming
Hisane Masaki (hmasaki)     Print Article 
Published 2007-12-14 09:46 (KST)   
Fueled by concerns over skyrocketing oil prices and accelerating global warming, resource-poor Japan is revving up its drive to promote biofuels.

Earlier this year, the world셲 second-largest economy and third-largest oil consumer started to sell bio-gasoline at a limited number of gas stations on a trial basis.

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In a bid to add fuel to its drive to promote a wide use of bio-gasoline in automobiles, the government is expected to introduce a preferential tax system in the next fiscal year starting in April 2008. The government is also expected to make imports of a key gasoline additive made from biomass ethanol tariff-free starting in fiscal 2008.

Still, the nation셲 biofuel drive faces a bumpy road ahead, largely because of two different types of bio-gasoline being sold on a trial basis as well as because of the higher production cost of the bio-gasoline than that of crude-derived fuels.

It remains to be seen whether the nation will be able to reach the government-set goal of saving 500,000 kiloliters (kl) of crude oil -- 3.145 million barrels of oil -- per annum through the use of biofuels by 2010.

Meanwhile, with the nation currently having to rely on imports for almost all of its bioethanol, the government is seeking to boost domestic annual production of the gasoline substitute to 6 million kl by 2030.

A joint council of government agencies, universities and 16 major firms, including Nippon Oil Corp. and Toyota Motor Corp., the nation셲 largest oil distributor and automaker respectively, has been inaugurated recently to develop innovative technologies for mass-producing low-cost bioethanol.

The Japanese government-orchestrated drive to promote bio-gasoline is part of efforts to ensure the resource-strapped nation's energy security in the medium and long terms, amid stubbornly high prices and increasingly tough global competition for oil.

The recent spike in oil prices is one of the biggest potential threats to the Japanese economy. Japan imports almost all of its oil, nearly 90 percent of which comes from the volatile Middle East. In 2006, Japan imported 4.2 million barrels of oil per day.

The nation셲 retail gasoline prices soared to their highest-ever levels last week, with regular gasoline fetching an average of 154.9 yen, according to the Oil Information Center. Crude oil hit a new record of $99.29 a barrel last month.

The New National Energy Strategy, which was compiled last year by the Ministry of Economy, Trade and Industry (METI), set a goal of reducing the nation's reliance on oil for transport to 80 percent from the current 100 percent by 2030.

Japan is also feeling the heat over the Kyoto Protocol on curbing global warming. Under the treaty, Japan must reduce its annual emissions of carbon dioxide (CO2) and several other greenhouse gases (GHGs) by 6 percent to 1.18 billion tonnes CO2 equivalent on average between 2008 and 2012 from the 1990 levels.

According to preliminary figures released recently by the Environment Ministry, Japan셲 GHG emissions totaled 1.341 billion tonnes CO2 equivalent in fiscal 2006, down 1.3 percent from the fiscal 2005 levels but up 6.4 percent from the fiscal 1990 levels, far short of the 6 percent reduction target.

Under the Kyoto Protocol, biofuels made from plants are not regarded as sources of GHG emissions since the amount of CO2 emitted during their use matches that absorbed by plants.

In April 2005, two months after the protocol took effect, the Japanese government compiled a comprehensive program to reach its Kyoto goal, which includes a target of saving 500,000 kiloliters (kl) of crude oil per annum through the use of biofuels by 2010.

Hisane Masaki is a Tokyo-based journalist, commentator and scholar on international politics and economy. This is the first part of a rewritten and updated version of an article that originally appeared on Asia Times. Two more parts will come later.

©2007 OhmyNews
Other articles by reporter Hisane Masaki

  Linked Story - Two Lanes: Japan's Biofuel Drive...

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