Mark Manger (below) responded to me off-list asking about the lack of geothermal power in Japan, and he thought it might be a good idea to post the response directly to the list.

Why does one of the world’s most volcanic locations only have 16 operating geothermal plants with a total installed capacity of barely 530 MW and generating less than 0.3% of Japan’s total kilowatt-hours sold?
Geothermal seems to be a thought-provoking challenge to the conventional wisdom about who controls whom in the political economy of electric power in Japan because the conclusions are so counter-intuitive.

Before nuclear power became increasingly attractive to Japanese actors in the wake of the 1973 oil shock, there was the promotion of geothermal power plants. The first commercially operated geothermal plant was built in Italy in 1904, followed by New Zealand in 1958, and the United States in 1960. When geothermal power was floated in Japan as a commercial source in the early 1960s, MITI, LDP politicians, Japanese power companies, and local host communities all welcomed the technology.

It was considered relatively attractive by Japanese electric power companies, because it was a base-load power source that could operate 24-hours a day; it was easily “dispatchable” by power companies unlike intermittent sources today like solar and wind, so there was no threat to the grid; and obviously it was in abundant supply in Japan. The story is even more interesting today because it is a "renewable power source" that is relatively clean in terms of CO2-eq/kWh emissions (much better than solar and wind), has a high utilization rate (85%+), has a fairly long life cycle, and has a much lower marginal generation cost per kWh than solar or wind assuming similar costs of capital and depreciation schedules.
So what happened?

Odake was Kyushu EPCO’s first geothermal plant in Oita Prefecture. After about 10 years of “eminent domain”
siting problems and construction issues, it started operations in 1967 with an installed capacity of 12.5 MW (a small test case). According to interviews with Kyushu EPCO, everything was fine in the beginning.
Then, a local hotspring (onsen) owner started to publicly criticize Odake, Kyushu EPCO, and the government claiming that they were destroying his business.

Geothermal plants have to be built close to the source or the high-temperature steam is lost in the pipes the farther it is transported. Odake engineers had to drill approximately 300~500 feet into the earth right above the exact site in order to hit the appropriate heat pockets. The neighboring hotspring’s depth was about 100 feet. The surrounding geothermal sources were swallowed up by Odake and left the neighboring hotspring inoperable. What followed next was a successful local media campaign by hotspring interests groups against Odake, Kyushu EPCO, and the government arguing that geothermal plants would destroy Japan’s traditional way of life and local communities. Protests ensued.

MITI worked with the Japanese EPCOs to site better locations over long leadtimes (about 10 years per site) in the 1970s and 1980s, but ultimately what destroyed geothermal’s chances vis-à-vis other sources was not a “nuclear village” stifling geothermal's growth or “big oil” crushing the little guy; it was the logistics of geothermal itself. The installed capacity tends to be in the 20 MW to 50 MW range. The average conventional thermal plant using fossil fuels tends to be in the 500 MW to 1,000 MW range. In order to replace just one conventional plant with geothermal sources, a power company would have needed to build 20 geothermal plants in surrounding locations to match the output of just one conventional or nuclear power plant.

After the hotspring owners lobbied successfully with media help against geothermal power plants in the 1960s, it became difficult to site geothermal plants in Kyushu and Tohoku (areas with the largest magmatic heat sources). Today, some people advocate drilling in the national parks to avoid this issue, but they also are opposed by various environmental interests who are very concerned about how drilling and exploration will effect the eco-system.

I appeared on a program for the BBC World News discussing the political economy of geothermal power last year. One Japanese institute's analyst appearing with me had estimated geothermal could produce approximately 10% of Japan’s total electric power needs – mostly in the Tohoku EPCO and Kyushu EPCO service regions -- if it were not for the objections of hotspring owners and environmental lobbyists.

Paul J. Scalise, Ph.D.
JSPS Research Fellow
Institute of Social Science
The University of Tokyo