What Is The Environmental Values in The Energy Sector?

What is “Environmental Value” in the energy sector?

The term “Environmental Value” in the context of electricity generation refers to electricity produced through renewable energy sources that do not emit CO₂. This concept extends beyond mere energy production; it encompasses added value such as energy conservation and CO₂ emission control.

This word tend to be used mainly in Japan as “環境価値”. 

Background of the creation of environmental value

The background to the creation of environmental value is related to global warming.

Global warming is caused by increased emissions of “greenhouse gases” such as carbon dioxide and chlorofluorocarbon gases, and if global warming continues at this rate, problems such as rising sea levels due to melting of glaciers and the occurrence of abnormal weather will occur.

To curb this, global warming countermeasures need to be taken on a global scale, and green electricity is attracting a lot of attention.

However, even if you are actually using green electricity that is environmentally friendly, it is not obvious from the outside. Therefore, efforts are being made to visualize environmental values such as J-credits, Green Power Certificates, and non-fossil certificates.

By advocating these environmental values, businesses can appeal to stakeholders that they are “considerate to the global environment.”

Benefits of the Environmental Value System

Promotional Opportunities for Companies

One of the key merits is to show their commitment to environmental issues. Such initiatives often transcend the capabilities of in-house efforts, especially for small and medium-sized enterprises where financial constraints are a significant hurdle.

By purchasing environmental value in the form of certificates, companies are acknowledged for their environmental efforts. This approach not only validates their commitment but can also reduce the overall cost of implementing environmental solutions.

Easier Access to Funding for SMEs with Advanced Technologies

For small and medium-sized enterprises that possess cutting-edge technologies in solving environmental problems, these systems offer an efficient pathway to secure necessary funding. By adding environmental value to their innovations and selling these as certificates to energy providers, they can facilitate their financial stability.

However, the process of being recognized for environmental value by the government (Ministry of Economy, Trade, and Industry) can take up to four years, which might be a considerable disadvantage.

Challenges of the Environmental Value System

Complexity and Confusion Due to Multiple Systems

One of the cons is the confusion arising from the proliferation of various systems. Determining which system offers the most benefit can be challenging, particularly for businesses yet to decide on their specific environmental strategies.

For instance, a company needing to offset its greenhouse gas emissions may opt for “non-fossil value certificates,” while considerations of lowering electricity costs might lead them towards “green power certificates.” The lack of experts and informed individuals in this area adds to the complexity of making these decisions.

Induced Issues in Renewable Energy Implementation

Another demerit lies in the potential complications associated with the adoption of green power. Although the integration of green energy is recognized as a positive environmental step, it is also essential to thoroughly investigate various associated issues.

For example, the environmental impact of a solar power project that leads to extensive deforestation for installation purposes might not be viewed favorably. Similarly, when purchasing certificates, careful consideration of the methods and installation techniques of renewable energy sources like hydro or wind power is crucial. This consideration is vital in mitigating negative perceptions in case of any problems.

Yet, the environmental value systems, with their distinct merits and demerits, represent a complex yet essential aspect of our transition to a more sustainable and environmentally conscious society.