Market Overview

CO2-free electricity options in this research indicate those electricity options that electric power retailers supply zero-CO2 emitting energy or net-zero energy to customers by utilizing renewable energy or non-fossil certificate.

The domestic market size of CO2-free electricity options for FY2021, based on annual number of subscribers, is estimated to be 150,000. Adoption of CO2-free electricity options has been preceded by major companies that press ahead with carbon neutrality, such as foreign-affiliated companies and those domestic companies that approve of international initiatives for climate change (e.g. RE100). Since FY2021, the use of 100% renewable energy has begun included in the requirements for receiving the EV subsidy, which encouraged new subscriptions of CO2-free electricity options.

At companies embarking on the Scope 3 measures (the measures to prevent greenhouse gas emissions by suppliers and clients for common business activities), there are moves to require business associates to reduce or eliminate carbon-emitting energies in use. This brought about adoptions of CO2-free electricity options by SMEs, regardless of business size and business type, as a response to such requests by their business associates on supply chains.

Noteworthy Topics

CO2-Free Electricity Options for General Household

Because the use of 100% renewable energy has become included in the requirements for EV subsidy payments, and because more companies have newly entered and started offering electricity options with economic advantage granted, represented by point rewarding, the market of CO2-free electricity options has gradually been formed for general households.

Those companies newly entered in developing CO2-free electricity options for general households have a characteristic of positioning the energy business as a new growth market that can cope with social changes that assume carbon neutrality.

If more electric power retailers hammering out business strategies in anticipation of those changes in society, and if more ample CO2-free electricity options for households with “extra environmental values” added, such as economic benefits, the market size of CO2-free electricity options may be boosted.

Future Outlook

The domestic market size of CO2-free electricity options for FY2022, based on annual number of subscribers, is estimated to be 450,000. Generation of more CO2-free electricity options not only for corporations and households but also for the public spaces in condominium buildings and for construction sites is likely to contribute in attracting diverse customers. In addition, municipalities declaring to be the zero-carbon cities are increasing, which is expected to expand demand for CO2-free electricity options at public facilities. As the policies are developed at major new electric power providers, the market size is projected to expand, if the governmental policies (in legislation and use of subsidies) do not change considerably even after FY2023.

Still, the estimated market size may take a downturn, if skyrocketing prices of raw materials do not stop within FY2022, or electric power retailers curtail the investments in securing renewable energy　and non-fossil certificates, or if exploring of new customers is limited due to supply capacity, etc.

Research Outline