As the Japanese government begins the process of reviewing and updating its basic energy plan, calls are growing for the country to expand the role of renewables like wind and solar power and make more progress toward a clean energy transition.
Underscoring those calls, the current policy is ranked as “insufficient” by the nonprofit Climate Action Tracker in terms of meeting emissions reductions necessary for the world to limit warming to 1.5 degrees Celsius.
“There is a need to provide further incentives for solar panels on roofs of factories, houses and warehouses, as well as to continue to expand commercial-scale solar,” says Mika Ohbayashi, director of the Tokyo-based Renewable Energy Institute (REI). “(Other) renewables, such as onshore and offshore wind, small and medium-sized hydropower, bioenergy and geothermal, also should be expanded.”
Japanese environmental and energy nonprofits, including REI, Kiko Network and Climate Integrate, argue that wind and solar, the cheapest and most plentiful renewable energy sources, should be prioritized over Japan’s current focus on hydrogen and liquefied natural gas, as well as unproven technologies such as co-firing ammonia with coal and carbon capture and storage (CCS).
But that is easier said than done due to China’s dominance of many of the components and technologies needed for the energy transition, including minerals and metals like lithium and cobalt, which are essential to batteries, solar panels and other key materials like silicon wafers and aluminum.
While monetarily cheap, they also enter supply chains carrying a dark, hidden cost — forced labor.
“Are these technologies, in social terms, actually cheap?” asks Seaver Wang, co-director of the climate and energy team at the U.S.-based Breakthrough Institute, which has compiled multiple reports highlighting the links between the solar supply chain and the forced labor of Uyghurs in China’s Xinjiang region. “We should not be supporting suppliers that do business in or that operate in Xinjiang.”
The challenge is that more ethical alternatives to China, such as building a domestic supply chain, would be costly and take years — time the planet simply doesn’t have if we are to avoid the worst effects of climate change. Even hitting the Paris agreement’s less ambitious 2 C goal would see a significant rise in heat waves, drought and sea-level rise, as well as other impacts.
Another option — work with partners in the U.S. and Europe to build an alternative to China — could allow for innovations in new technologies with huge potential, such as floating offshore wind. But that, too, would require a marked policy shift.
“Japan realizes that it's very dependent on China and that this is a geopolitical issue, but they don't do anything aggressive to stop it,” says Walter James, a Japan energy expert and principal consultant at Power Japan Consulting.
“Instead, Japan promotes their own industry to, hopefully in the future, displace and reduce dependence on China,” he adds, referring to the country’s plans for CCS and hydrogen, as well as emerging technologies like perovskite solar and floating offshore wind.
The road to solar and EV dominance
Export-driven China has used industrial policy, including subsidies and other incentives, to become a leader in many of the world’s key supply chains.
Production of solar panels, electric vehicles and batteries have all benefited from state support, while Chinese companies, including state-owned enterprises, have become the main importers of key minerals and metals, to the point where China now dominates raw material processing.
This has allowed China to produce solar panels and batteries at costs far below those of competitors — unfairly low, some argue. Japan and Europe, which used to be world leaders in solar, saw some companies either go bankrupt or move their manufacturing to China.
“Beijing's dominance of clean technology has profound implications for Japan's energy transition as well as its economic security policy,” said Daisuke Akimoto, an associate professor at Tokyo University of Information Sciences.
Climate groups like Ember, Transition Zero and the Center for Research on Clean Air are quick to praise China’s rapid expansion of solar, wind and EVs. Ember even put out a report arguing that China’s “excess” solar capacity can help countries like Japan shift away from fossil fuels. In fact, Japan’s expansion of solar since it halted all nuclear plants in the wake of the 2011 Great East Japan Earthquake and Fukushima meltdown has been mostly due to Chinese-made solar panels. A recent report from Ember found that, in the first half of 2023, Japan was the fifth largest destination for Chinese solar exports globally.
Wang believes that if clean energy technologies are going to be a critical part of future economic development, there’s a strong argument for maintaining domestic control of supply chains.
“If these are going to be revolutionary technologies that are going to rewrite the global energy system, why is it that you can only produce them in one country?” Wang says. “Why would countries like Japan willingly give up the chance to be a leader? It doesn't really make sense to me.”
Forced labor and human rights
Other factors that concern Wang and Akimoto are human rights and sustainability concerns linked to Chinese production of solar panels, batteries, EVs and other clean technologies.
While China’s highly sophisticated surveillance system and ability to monitor digital information flows make getting information from these camps challenging, Uyghurs who have left the Xinjiang region and open source intelligence reports paint a dark picture.
The U.S. and other countries have described China’s actions in Xinjiang as a genocidal campaign aimed at erasing an entire culture.
For the production of solar panels, the main concern is the region’s labor camps, which, at their peak, hosted an estimated 1.5 million Uyghurs and other minorities. They are “surrounded by razor-wire fences, iron gates, and security cameras, and are monitored by police or additional security,” according to researchers at Sheffield Hallam University in Britain. Factories are within the camps, and Uyghurs cannot leave voluntarily. There is also evidence that workers are unpaid.
One former camp detainee, Gulzira Auelhan, told journalists that she was regularly shocked with a stun gun, subjected to unknown injections and was forced to make gloves. She felt “like a slave.”
Xinjiang, the Chinese name for the regions that make up the Uyghur homeland, plays a crucial role in numerous solar and battery supply chains. The 2021 Sheffield Hallam report highlighted solar as an industry that is highly dependent on components and materials from Xinjiang. Data shows that Xinjiang is responsible for 40% of silicon production, 45% of solar-grade polysilicon and a large share of aluminum, wafers, cells and modules — all critical cleantech components and materials.
“Exposure to China's policies of repression in Xinjiang is considerable in these supply chains, and I think it makes a lot of people uncomfortable,” says Wang, noting that many environmentalists are hesitant to speak on this for fear of derailing the energy transition. “There's no way to actually tackle this issue unless we can talk about it, and take steps to not only exclude suppliers linked to Uyghur forced labor, but also diversify the supply chain.”
While Xinjiang’s abuses are the clearest example of ethical issues in Chinese supply chains, it’s part of an entire system.
Tibet — which, like Xinjiang, is the homeland for a people with their own distinct language, culture and history — is home to over 85% of China’s lithium, a critical component for the batteries that power, among many other things, EVs. The region is being mined by Chinese companies, with Tibetan villages being relocated, sometimes forcefully, to make way for mining. There are also widespread concerns about pollution and land degradation due to substandard environmental regulations.
There are also issues in countries like Indonesia and the Democratic Republic of the Congo, where Chinese companies that are processing nickel, cobalt or lithium have been linked to human rights and labor abuses at factories and mines.
Alternatives to China
Under Prime Minister Fumio Kishida, Japan’s focus has not been to directly compete with China on solar or batteries, but instead promote alternative supply chains that utilize other technologies — such as CCS, hydrogen, LNG, the co-firing of ammonia with coal, and biomass — though all have been criticized as either unproven or not effective in reducing emissions or both.
This has also been pushed abroad too, via Japan-led initiatives like the Asia Zero Emission Community (AZEC) and the Asia CCUS Network, backed by financing from Japanese government-linked institutions like the Japan Bank for International Cooperation and the Japan International Cooperation Agency.
“Japan is claiming that their infrastructure and engineering technical know-how with these technologies is superior, and they're trying to promote it throughout Asia,” James says.
The U.S. has taken a markedly different approach than Japan, using incentives, through the Inflation Reduction Act, to promote domestic manufacturing of solar panels and batteries, while increasing tariffs on Chinese solar panels and EVs. While some are broad restrictions, such as the tariffs announced earlier this year, some are linked directly to human rights concerns, like the Uyghur Forced Labor Prevention Act (UFLPA).
Europe followed with its own tariffs on Chinese EVs, and there might be more to come. European solar manufacturers are pushing for more American-style restrictions, arguing in a letter sent to legislators calling for stricter regulations and controls on Chinese solar imports that “forced labour products should have no place in the European market” and that “Europe’s clean energy transition must not be built on the backs of the Uyghur people and on the basis of crimes against humanity.”
An upcoming regulation, the European Union’s proposed Human Rights Due Diligence Requirements, would strengthen requirements that any products imported into the regional bloc be free of human rights and labor violations along its supply chains, and could impact imports from China.
“Goods tainted by the forced labor of the Uyghur people are increasingly losing market access. All companies, across all industries, must swiftly cut ties with the Region, where the government of China is carrying out crimes against humanity,” said Omer Kanat, executive director of the Uyghur Human Rights Project, in a statement.
Yet, so far, Japan is not emulating either the U.S. or EU tariffs, perhaps for reasons of self-preservation.
“When it comes to things like tariffs, Japan is more vulnerable to retaliation from China,” Wang says. “So, I think that Japanese policymakers have to be strategic in tailoring the recipe to their national situation.”
Japan currently has voluntary supply chain due diligence requirements, which Teppei Kasai, a program officer at Human Rights Watch’s Japan office, would like to see strengthened and made mandatory.
“Human rights are universal, and the Japanese government has a responsibility to ensure businesses do the best they can to prevent human rights abuses wherever they operate,” Kasai says.
In at least one space, though, the U.S. and Europe are looking to Japan as a model, and it's not for hydrogen or CCS: It’s rare earths, which are necessary not only for cutting-edge tech but, increasingly, clean technologies as well. After facing the economic impacts of Chinese export restrictions on rare earth minerals imposed over a diplomatic dispute, Japan has successfully reduced its reliance on China.
“I've seen a lot of exciting announcements recently on rare earth permanent magnet initiatives, which Japan and (South) Korea are fairly well positioned for because they responded in such a precautionary way to China's imposition of export quotas on rare earths in the early 2010,” Wang says.
There’s also an opportunity for Group of Seven countries to further expand partnerships and work together to counter Chinese dominance of important supply chains.
One area with significant potential is offshore wind. While China has become the largest builder of offshore wind, the country has yet to export this technology to a significant degree and does not yet dominate the supply chain. A recent agreement signed between the U.S. and Japan to promote floating offshore wind is one example of how the allies can counter Beijing. Japan is also pushing perovskite solar, a thin-film solar cell seen as a lighter, more flexible and mobile alternative to traditional silicon-based photovoltaics.
“Japan definitely has ambitions of being an export power of offshore wind components and turbines,” James says. “I think that, and promoting perovskite solar, is sort of a geopolitical strategy to try to reduce dependence on China.”
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