Sony has warned the Japanese government it may have to shift manufacturing out of the country unless rules on renewable energy are relaxed.
Kenichiro Yoshida, Sony’s chief executive officer told Taro Kono, Japan’s minister for administrative reform, that purchasing renewable energy in Japan is difficult. His comments were echoed by the chief executives of electronics firm Ricoh, cosmetics business Kao and fund manager Nissay Asset Management at a meeting with Kono.
Kono acknowledged that Japan was “lagging behind” other countries in the use of renewable energy. He announced last week the establishment of a government task force to examine regulations that are hampering the expansion of green energy.
Japan’s existing renewables plan calls for the use of renewables to increase from 17 per cent of electricity in the 2018 fiscal year to as much as 24 per cent by 2030, but that would still be below the 30 per cent already achieved by many European countries.
The focus on renewables comes in the wake of Prime Minister Yoshihide Suga’s recent pledge to make Japan carbon neutral by 2050. But the government has yet to outline specific steps to reduce the country’s reliance on fossil fuels, which increased sharply after the Fukushima nuclear disaster in 2011.
As suppliers try to meet the green energy demands of customers such as Apple, firms are installing solar panels and buying power from offshore wind farms in line with Apple’s target of having all of its products be carbon-neutral by 2030. In turn, this puts pressure on governments to accelerate green energy plans.
“What Apple and other companies are trying to do is contribute to meeting Paris climate targets by decarbonizing their own footprints and making it a precondition for their partners and suppliers to use renewable energy,” said Prakash Sharma, director for the energy transition practice at consultancy Wood Mackenzie Ltd. “It’s gaining momentum because more and more companies are moving in that direction.”
Sony has its own goal of making all of its facilities run on green energy by 2040. Sony’s European sites already run entirely on renewables, while its facilities in China are set to make that transition by the end of March 2021 and by 2030 for those in North America.
However, its factories in Japan face the biggest challenge. To compound matters, that is where Sony fabricates its industry-leading CMOS image sensors, which are used in Apple’s iPhones, among others. In value terms, Sony captured a 53.5 percent share of the global market for imaging sensors in 2019.
Producing the camera sensors requires intensive and highly stable electricity sources, making a full switch to renewables even more tricky. But shifting manufacturing abroad is also difficult due to concerns over the transfer of one of Sony’s most valued and competitive technologies.