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social sciences
Article
Feed-in Tariff Pricing and Social Burden in Japan:
Evaluating International Learning through a Policy
Transfer Approach
Yugo Tanaka 1, *ID , Andrew Chapman 2ID , Shigeki Sakurai 1and Tetsuo Tezuka 3
1Graduate School of Advanced Integrated Studies in human survivability, Kyoto University,
1 Nakaadachi-cho, Yoshida, Sakyo-ku, Kyoto 606-8306, Japan; sakurai.shigeki.2c@kyoto-u.ac.jp
2International Institute for Carbon-Neutral Energy Research, Kyushu University, 744 Motooka, Nishi-ku,
Fukuoka 819-0395, Japan; chapman@i2cner.kyushu-u.ac.jp
3
Graduate School of Energy Science, Kyoto University, Yoshida-honmachi, Sakyo-ku, Kyoto 606-8501, Japan;
tezuka@energy.kyoto-u.ac.jp
*Correspondence: tanaka.yugo.77x@st.kyoto-u.ac.jp
Received: 25 August 2017; Accepted: 17 October 2017; Published: 20 October 2017
Abstract:
Feed-in tariff (FiT) policy approaches for renewable energy (RE) deployment are employed
in many nations around the world. Although FiTs are considered effective in boosting RE deployment,
the issue of increasing energy bills and social burden is an often-reported negative impact of their
use. The FiT has been employed in Japan since 2012, following after many developed countries, and,
as was experienced in other nations, led to a social burden imparted on society significantly higher
than initial government estimates. Although policy decision making does not necessarily reflect
international policy experience, it is still prudent to ask how international policy experiences of social
burden increase were considered within the Japanese approach. In this research, we analyzed the
transfer process by adapting a conventional model to develop more objective observations than was
previously possible, by setting a benchmark for evaluation based on prior international experiences.
We identified two streams of policy transfer, each led by different actors; the government and
representatives of the National Diet of Japan (Diet). Both actors were exposed to the same experiences,
however the interpretation, application to policy development and priority settings employed were
vastly different. Although the framework can only assess policy learning processes, we have found
that the government undertook a reasonable and rational process toward learning, while, on the
other hand, the modified bill developed by the Diet members did not thoroughly derive learnings
in the same way, due to cognitive and political reasons, and specifically, the issue of limiting social
burden was not addressed.
Keywords: energy policy; feed-in tariff; policy transfer; social burden; international learning
1. Introduction
The feed in tariff (FiT) policy for renewable energy (RE) was introduced in Japan in 2012. Since the
introduction of the FiT, the overall share of RE-based generation within the Japanese grid has increased
(Agency for Natural Resources and Energy 2015), as well as the burden imparted on society by the FiT.
The burden of the FiT in Japan is passed on to households in terms of a “Renewable Energy Power
Promotion Surcharge”—calculated according to yearly RE purchasing quotas for energy suppliers,
which are then added to consumer’s monthly bills. The unit price of this surcharge is set every
fiscal year, according to the overall amount of RE required to be sourced by providers, according to
government regulations (Tokyo Electric Power Company 2017).
The total societal burden anticipated by the government was stated as a maximum of 0.5 yen
additional cost per kilowatt hour (kWh) for electricity by the year 2020 (The House of Representatives
Soc. Sci. 2017,6, 127; doi:10.3390/socsci6040127 www.mdpi.com/journal/socsci

Soc. Sci. 2017,6, 127 2 of 16
2011d). However, in reality, this burden had already reached 2.25 yen per kWh by May of 2016 (Agency
for Natural Resources and Energy 2016). Taking into account only the current registered applications
for new installations of RE, it is expected that under the current policy settings, this burden will be
further increased by 2020. The burden which is imparted as a result of the FiT policy above and beyond
initial government estimates will be borne by society in the form of increased electricity bills.
Considering the experience of other nations, the FiT policy mechanism was first conceptualized
by the German Renewable Energy Promotion Organization in the 1980s (Lauber 2006) and by the
year 2000 begun to be implemented, first in Germany, then in France and then throughout the world.
Following the broad implementation of the FiT, over time, several issues were identified and in many
cases around the world adjustments to policy mechanisms were deemed necessary to alleviate these
issues. It is, therefore, prudent to consider what Japan learned from the experience of countries who
implemented the FiT before them; that is, what was learned from their experiences, upon which
evidence base were Japanese policies built, and why did Japan implement a policy which led to the
same increase in social burden as the nations investigated.
The policy-making process has been described as resembling “primeval soup”, with action
occurring fitfully as problems become matched with policy ideas considered to be in the political
interests of a working majority of the partisans with influence over a policy domain (Kingdon 1984;
Lindblom and Woodhouse 1993). Therefore, it shouldn’t be assumed that policy decisions are built
strictly upon an evidence base or policy learnings. However, identifying a gap between what was
actually learned in the process and what could potentially be learned, and to what extent lessons are
reflected in the implemented approach is quite important as a basis for policy decision improvement.
This research adapts Rose’s lesson-drawing model (detailed in Chapter 2) such that it can be
used as a qualitative evaluation framework of international policy learnings, identifying what lessons
have been drawn around a specific issue within policy approaches, using other nations’ experience
as a benchmark. With this framework, we attempt to answer the following questions from a “policy
transfer process” point of view; (1) Why did Japan experience the same increase in social burden as
other FiT nations? (2) Did Japan learn from the negative outcomes experiences in other nations?
2. Analytical Framework
The first stage of the analysis in this study deals with international policy experience, providing
an objective and reliable basis for its evaluation. The second stage of analysis investigates the policy
transfer process and provides insight on how international policy learnings were derived in our focus
nation. Specifically, we analyze the policy transfer process of the introduction of the Japanese FiT,
with a focus on lessons around the social burden issue (social burden in this research refers specifically
to the increase in electricity bills for households). We analyze the experiences which could influence
the introduction of the FiT in Japan, by examining the cases of leading nations throughout the world
(explained in Section 2.1). Following this initial analysis, we then analyze the policy transfer process
by augmenting the model presented by Rose (Rose 2005, explained in Section 2.2). We conduct these
analyses based on information extracted from reliable documents, as defined in Section 2.3.
Policy transfer is defined as the process in which knowledge about policies, administrative
arrangements, institutions and ideas in one political setting (past or present) is used in the
development of policies, administrative arrangements, institutions and ideas in another political
setting (
Dolowitz and Marsh 2000
). Although policy transfer has been studied informally by political
science researchers, the integrated concept was first delivered by Dolowitz & Marsh in 2000. Most of
their work has focused on providing precise descriptions and explanations of illustrative cases. In this
context, there has not been much effort to provide policymakers with practical tools to reflect, evaluate,
and improve their policy learning activities.
The originality of this framework is its attempt to detail two elements as a basis for evaluation;
international experience and lesson drawing. Although the concept of lesson drawing in policy
transfer is based on the model proposed by Rose, our approach augments his framework to assess

Soc. Sci. 2017,6, 127 3 of 16
the characteristics of a single policy learning, by using his framework as a normative guideline and
identifying the relevant policy experiences in an international context. The result of the assessment of
international experience, gathered at the time of policy learning is expected to serve as a benchmark
for identifying the specific characteristics of the investigated policy learning. By setting a benchmark,
the assessment of the process of lesson drawing will allow us to evaluate the learning process in
a more rigorous way. The framework will serve as an analytical framework for academic policy
transfer research, in many policy settings not limited only to the FiT. At the same time, the augmented
framework has implications for use as a practical tool in policy development.
2.1. International Experiences Assessment
At the time of Japan’s implementation of the FiT, nine nations (Germany, France, Italy, USA, UK,
Australia, China, Korea and Japan) dominated the international solar PV industry, together accounting
for 91% of global PV module production and in excess of 87% of cumulative deployed capacity at the
end of 2011 (Table 1,IEA PVPS 2012).
Table 1. Module Production, Cumulative Capacity and Market Share Totals for end 2011.
Country Module Production (MWp, %) Cumulative Capacity (MWp, %)
Germany 2500 MWp 8% 28,420 MWp 39.1%
France - - 2831 MWp 4.5%
Italy - - 12,803 MWp 20.2%
USA 1100 MWp 4% 3966 MWp 6%
UK - - 976 MWp 1.5%
Australia - - 1408 MWp 2.2%
China 20,000 MWp 67% 3000 MWp 4.7%
Korea 1000 MWp 3% 812 MWp 1.3%
Japan 2700 MWp 9% 4914 MWp 7.7%
TOTAL 27,300 MWp 91% 59,130 MWp 87.2%
Additionally, as Figure 1shows, most of the RE increase driven by the FiT in Japan was due to
solar PV deployment (International Renewable Energy Agency 2017); the focus of this study.
Soc. Sci. 2017, 6, 127 3 of 15
cases. In this context, there has not been much effort to provide policymakers with practical tools to
reflect, evaluate, and improve their policy learning activities.
The originality of this framework is its attempt to detail two elements as a basis for evaluation;
international experience and lesson drawing. Although the concept of lesson drawing in policy
transfer is based on the model proposed by Rose, our approach augments his framework to assess
the characteristics of a single policy learning, by using his framework as a normative guideline and
identifying the relevant policy experiences in an international context. The result of the assessment
of international experience, gathered at the time of policy learning is expected to serve as a
benchmark for identifying the specific characteristics of the investigated policy learning. By setting a
benchmark, the assessment of the process of lesson drawing will allow us to evaluate the learning
process in a more rigorous way. The framework will serve as an analytical framework for academic
policy transfer research, in many policy settings not limited only to the FiT. At the same time, the
augmented framework has implications for use as a practical tool in policy development.
2.1. International Experiences Assessment
At the time of Japan’s implementation of the FiT, nine nations (Germany, France, Italy, USA,
UK, Australia, China, Korea and Japan) dominated the international solar PV industry, together
accounting for 91% of global PV module production and in excess of 87% of cumulative deployed
capacity at the end of 2011 (Table 1, IEA PVPS 2012).
Table 1. Module Production, Cumulative Capacity and Market Share Totals for end 2011.
Country Module Production (MWp, %) Cumulative Capacity (MWp, %)
Germany 2500 MWp 8% 28,420 MWp 39.1%
France - - 2831 MWp 4.5%
Italy - - 12,803 MWp 20.2%
USA 1100 MWp 4% 3966 MWp 6%
UK - - 976 MWp 1.5%
Australia - - 1408 MWp 2.2%
China 20,000 MWp 67% 3000 MWp 4.7%
Korea 1000 MWp 3% 812 MWp 1.3%
Japan 2700 MWp 9% 4914 MWp 7.7%
TOTAL 27,300 MWp 91% 59
,
130 MWp 87.2%
Additionally, as Figure 1 shows, most of the RE increase driven by the FiT in Japan was due to
solar PV deployment (International Renewable Energy Agency 2017); the focus of this study.
Figure 1. Cumulative Installed Capacity of Renewable Energy in Japan 2000–2016.
Figure 1. Cumulative Installed Capacity of Renewable Energy in Japan 2000–2016.
In order to provide context for the analysis of the policy transfer process, these major PV deploying
and manufacturing nation’s policy implementation lessons will be assessed. A “lesson” is described

Soc. Sci. 2017,6, 127 4 of 16
as any learning which can improve the conceptual management of the policy cycle, incorporating:
unexpected outcomes experienced after implementing the FiT, suggested causes of the problem,
and the subsequent action taken by the government to rectify any issues. Experiences specifically
related to social burden are extracted and applied to the analysis.
2.2. Policy Transfer Assessment
There have been many case studies exploring the characteristics of transfers, and the relationship
of policy transfer to the success or failure of policy implementation. An approach labeled
“lesson-drawing” focuses on the voluntary act of transfer by rational actors working in specific
political contexts, and a model of policy transfer processes has been proposed based on the empirical
evidence from lesson-drawing studies. We analyze the Japanese FiT case using the model (Rose 2005;
summarized in Table 2), to identify the characteristics of the policy transfer process, and to identify
any significant relationships between processes and policy outcomes. Although the lesson drawing
model has been criticized for its implicit assumption that the drawing process is both rational and
voluntary (Bulmer et al. 2007), for this study, where we assume that policy makers and law makers
should rationally learn from available lessons to improve policy making outcomes, it is utilized as a
normative guide for evaluation. The summary at Table 2omits the first two steps of Rose’s model,
proposed as a practical guide for policy makers, originally composed of ten steps. Of these ten steps,
the first two steps outline a preliminary phase, confirming definitions and conditions of lesson-drawing,
while the remaining eight steps explain the step-by-step actions policy makers should undertake in
lesson-drawing. Since we adapt this model as a normative standard to assess practical policy learning
activities, we omit the preliminary steps in this study.
Table 2. Lesson-drawing Model for Policy Transfer Assessment (Rose 2005).
Step Instruction
-Understand the key concepts: what a
program is, and what a lesson is and is not
It should be first identified whether or not definitions for key
concepts are complete: for example, a program is very different
from a vague rhetorical invocation of policy goals.
- Catch the attention of policymakers
It is when dissatisfaction rises and there is a pressure to do
something that policymakers become interested in learning from
abroad.
1Scan alternatives and decide where to
look for lessons
Where you look should rationally follow from what you want
to learn.
2 Learn by going abroad Get an accurate understanding of how a program really works on
the ground.
3
Abstract from what you observe a
generalized model of how a foreign
program works
Remove the specifics of national context and create a
cause-and-effect model which can be used to develop a program for
application at home.
4Turn the model into a lesson fitting your
own national context
A lesson is created by re-contextualizing the generic model, in forms
such as adaptation, synthesis, etc.
5Decide whether the lesson should
be adopted
The veto of a lesson on the grounds of political unacceptability
would sometimes be an obstacle.
6 Decide whether the lesson can be applied Resources and contexts can be barriers to applying a lesson.
7Simplify the means and ends of a lesson
to increase its chances of success
The application of lessons is more likely to succeed when; there is a
clearly defined objective, there is a single goal, the program has a
simple design, etc.
8
Evaluate a lesson’s outcomes objectively,
and, following adoption, as it evolves
over time
Foreign evidence puts bounds on speculation for new programs,
and policymakers must make adaptations dependent on feedback
once a lesson is implemented.

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2.3. Review of Pertinent Literature
In this study, we also use a literature review approach to collect evidence from publicly available
documents to assess and compare the outcomes experienced in FiT deploying nations, as well
as assessing the resultant policy transfer process in Japan. To maintain a high level of reliability,
government documents such as minutes from parliament or documents which rely on these sources
are assessed, either directly from government records or from international institutes. In the case of
academic publications, only those which are published in English or Japanese following a peer review
process are utilized. Some of the analyses for policy transfer assessment are based on statements from
representatives of the National Diet of Japan (Japan’s bicameral legislature, composed of the House of
Representatives and the House of Councilors), posted on their official websites, newspaper articles,
and an open-ended interview to a government executive who oversaw the FiT development process
1
.
3. Results and Discussion
This chapter describes the results of the literature review, and provides a discussion of the key
facts derived from the analysis.
3.1. International FiT Policy Experience
By the time Japan introduced their FiT policy in 2012, many countries around the world had
already implemented a similar policy approach. It is, therefore, reasonable to expect that a significant
amount of evidence could have been assessed regarding both the policy making and operational
aspects of the FiT. Considering this abundance of available evidence, it is also reasonable to assume
that the design of a similar policy would rely upon this evidence base in order to develop the best
possible policy. To understand whether or not learning from other nations’ experience was applied in
the Japanese case, the issues and experience gained with regard to social burden impacts resultant from
policy implementation is analyzed for 9 leading solar nations including Japan (detailed in Table 1).
A discussion of blocs of nations according to their FiT policy approach and implementation timeline is
detailed below.
3.1.1. Germany, France, South Korea and Italy
These four early adopter nations implemented their FiT policies between the year 2000 and 2005.
In all cases the deployment of PV exceeded projections, leading to an increased societal burden (in the
form of increased electricity bills). As a result, between 2009 and 2012, FiT policies were revised or
terminated in each of the early adopter nations.
In the case of Germany, in the year 2000 the German Renewable Energy Sources Act (EEG) was
enacted, and a FiT introduced. Prior to the EEG, programs existed to stimulate PV deployment
and R&D, however they did not have a significant impact. The German PV industry recognized
the risk of losing to international competition, particularly from America and Japan which had
introduced comprehensive market support schemes. This recognition, and the 1998 change of
government to the Social Democratic Party and Green Party coalition led to the introduction of
the FiT (Hoppmann et al. 2014).
Under the EEG, generators who were considered “necessary and economically feasible” were
able to connect to the electricity grid and generate electricity, to be purchased by grid operators at the
rate of 51 Euro cents per kilowatt hour (kWh) for a contracted period of 20 years (purchase prices were
reduced at an annual set rate in order to incentivize generation cost reduction). In order to preclude an
1
The government executive we interviewed oversaw the FiT policy decision, and therefore had access to all relevant
knowledge and official reports.

Soc. Sci. 2017,6, 127 6 of 16
unlimited increase in financial burden, a 350 MWp deployment cap was set (the cap was increased to
1000 MWp in 2002, and abolished in 2004; Hoppmann et al. 2014).
Between 2004 and 2008, PV was rapidly deployed throughout Germany, leading to a recognition
of the financial burden issue in parliamentary debates. By 2008, the financial burden due of the FiT
had grown to 2 billion Euro, a 6-fold increase from 2004. In addition, due to rapid deployment of
PV, panel costs reduced much faster than FiT payments leading to windfall profits for PV generators.
In response to this issue, from 2009, the previous years’ PV installation total was taken into account to
automatically adjust the FiT rate. This was known as “dynamic degression”, or the “flexible ceiling”
approach (Hoppmann et al. 2014).
In the case of France, as part of the Modernization of the Electricity Public Service Bill of 2000,
a FiT for PV generation was introduced in 2002, in response to the European Union (EU) directive of
2001 (1001/77/EC) with similar attributes to the German approach. As the initial FiT rate was much
lower than Germany’s (15 Euro cents/kWh) little impact was made upon the electricity mix.
In 2006, then Prime Minister de Villepin stated his intent to double the FiT. Mainland France
increased the FiT to 30 Euro cents/kWh, and overseas territories’ 40 Euro cents/kWh. This change
in policy setting was conducted suddenly at the top levels of government and the decision-making
process was not clear. In addition, the installation limit was removed and the FiT structure modified so
as to increase with inflation, rather than decreasing with reduced panel costs. As a result, applications
to the scheme flooded in, leading to a massive administrative burden for grid operators and local
administrators. New applications to the scheme were temporarily halted in 2010 and in order to
redress the balance between solar deployment and rising electricity prices, a dynamic degression
approach similar to Germany was introduced (Cointe 2014).
For South Korea, the Act for Alternative Energy Increased Uptake and Use was introduced in
2002 including a support mechanism for the price difference between alternative and conventional
energy generation sources. This mechanism placed an obligation on conventional electricity generators
to purchase RE at a value between the system marginal price of renewable and conventional energy
sources, decided by the market. The additional cost of RE was not added to consumer electricity
bills but was covered by general government revenue, differentiating it from other FiT schemes.
The rapid increase in PV deployment, and reduction of PV equipment prices led to a massive increase
in PV company growth, increasing PV based generation levels, and associated financial assistance.
As a result, in 2008 the initial support scheme was abolished in preference for a Renewable Portfolio
Standard (RPS) approach, to be implemented from 2012 (Cho and Lee 2014).
In Italy, a Government directive was issued in 2005 (DM28/07/2005) leading to the First Conto
Energia policy including a FiT for solar-based generation. The FiT settings for this initial attempt were
not sufficiently attractive to engender significant deployment of PV. In 2007, as part of the Second Conto
Energia policy, the FiT payment was calculated according to the actual costs required for deploying PV
and in the period of 2007 to 2011, the cost of PV systems declined significantly with no subsequent
reduction in the FiT. A rapid increase in the amount of PV deployed resulted, along with a significant
increase in overall FiT costs. The 2011 Third Conto Energia policy reduced FiT levels to rectify this
issue. (Dio et al. 2015).
3.1.2. USA, Australia, UK and China
In the period 2006 to 2011, the USA, Australia, UK, China and Japan also implemented FiT policies,
and to differing degrees experienced similar issues as the early adopter nations.
In Australia, the FiT was implemented at the state level and in each case rapid deployment was
experienced leading to significant increases in consumer electricity bills. As a result, in the period of
2008–2010 the FiT was discontinued or significantly reduced, only 2 to 3 years after its introduction
(Chapman et al. 2016).
In the UK, the Energy Act of 2008 paved the way for the introduction of a FiT in 2010. A larger
than expected deployment of RE ensued, meeting 2020 deployment goals by 2015 (Department of

Soc. Sci. 2017,6, 127 7 of 16
Energy & Climate Change 2015). As a result, the climate change control measures budget is expected
to be exceeded by 20% in the 2020–2021 period (Office for Budget Responsibility 2015).
In the USA, there is no single national approach to RE deployment, however 37 states and
the District of Columbia have their own RPS requirements or goals in place. (IEA/IRENA 2017).
In addition to the RPS, six states (California, Hawaii, Maine, Oregon, Vermont and Washington) have
FiTs or similar programs in place. As interest in FiTs grows in the USA, some utilities have introduced
voluntary FiTs (National Renewable Energy Laboratory NREL).
Although China is a mass producer of solar modules, its domestic demand has not been as high
as the rest of the world. To support domestic level solar installations, the National Development and
Reform Commission (NDRC) announced a nationwide feed in tariff in 2011, ranging from 15.5–17.9 US
cents per kWh depending on the installation timeframe (Energy Trend 2012). Similar to other FiT
operating nations, China also reduced their FiT, with 2017 FiT rates reduced by between 28 to 52% for
distributed PV depending on the region of deployment. These reductions were lower than initially
expected (from draft proposals to the NDRC) in order to attempt to preserve a reasonable return on
investment timeframe for households installing PV (Clean Technica 2016).
3.1.3. Summary
There have been many learnings to deal with social burden resultant from the FiT, as well as
attempts for the improvement of FiT-based policies and reduction of social burden by many national
governments. These learnings are summarized in Table 3including the year of FiT introduction and
subsequent amendment. These implicate that although high incentives ensure RE deployment, it is
extremely difficult to set an appropriate incentive price, based on accurate estimation of RE deployment
and social burden, therefore some nations have decided to employ automatic price adjusting system.
Table 3. FiT experience and outcomes in major PV deploying and manufacturing nations.
Country Year2Experienced Issues Caused
by Increased Social Burden
Suggested Facts which Might
have Caused the Issues
Government Reaction
to the Issue Amended
Germany 2000
Industry global
competition began to
suffer from increasing
manufacturing cost
Electricity price for
industry had risen due to
the FiT surcharge
Industry privilege:
industries facing global
competition were
excluded from the
surcharge
payment obligation
2003
High electricity price
began to get attention
in political debate
Rapid deployment of RE
was observed and
remuneration
seemed excessive
PV system price declined
sharply due to increasing
competition from
Chinese companies
Dynamic degression:
procurement prices were
to be adjusted based on
the amount of
RE installed
2009
France 2000
The level of
social burden
became uncontrollable
A higher than expected
number of projects
applied to the scheme
Remuneration decided
under Prime Ministerial
leadership was attractive
to investors
Dynamic degression:
procurement prices were
to be adjusted based on
the amount of
RE installed
2010
Korea 2002
Government faced
difficulty in
maintaining the FiT
scheme for RE through
the public budget
FiT supported by
public budget
RE steadily deployed due
to FiT
Abolished: FiT was
replaced by RPS 32012

Soc. Sci. 2017,6, 127 8 of 16
Table 3. Cont.
Country Year2Experienced Issues Caused
by Increased Social Burden
Suggested Facts which Might
have Caused the Issues
Government Reaction
to the Issue Amended
Italy 2005
Government faced the
need to limit
any further
surcharge increase
Tariff reduction was not
timely, however system
prices had
declined sharply
Large deployment of
RE observed
Lower remuneration &
static degression:
procurement prices were
significantly reduced
with a further reduction
schedule employed
2010
Australia
(State)
2008~2010
Electricity prices for
industry and
households
increased significantly
Increasing burden gap
between solar and
non-solar households
Solar electricity fed into
the grid increased rapidly
Abolished or reduced
remuneration: some
states discontinue the
scheme and others
significantly reduced
tariff levels
2011~2012
USA 2006~ - - - -
UK 2010
Policy cost for
supporting RE
exceeded projections
and was likely to
overspend LCF limits
RE deployment
exceeded expectations
Dynamic degression:
tariff rate to be adjusted
when installation caps
were met in each period
2015
China 2011 - - - -
Japan 2011
Surcharge level
had risen
beyond projections
Unexpectedly large
amount of solar projects
applied to the scheme
Tender (≥10
kWp)/announcement of
future tariff (<10 kWp):
larger PV projects were
selected through tender,
smaller projects through
procurement processes,
with tariffs set
in advance.
2016
Note: Contents drawn from literature review references.
3.2. FiT Policy Transfer in Japan
The result of an analysis on introduction process of FiT in Japan is presented in this section.
The background of FiT introduction is overviewed to provide a context for the analysis, firstly
describing in Section 3.2.1 that there was an irregular modification onto the government draft in
legislative procedure, and in the process, there were two streams of lesson-drawing conducted by
different actors (Diet and government members). Then the analysis on the impact of the modification
follows in Section 3.2.2. Finally, two forms of lesson-drawing are respectively examined by using the
model described in Section 2.2 in order to discuss how they are reflected in the Japanese FiT.
3.2.1. Policy Process of the Japanese FiT
Energy policy in Japan had mainly focused on economic efficiency in producing electricity under
the long and dominant regime of the Liberal Democratic Party (LDP) before the FiT was introduced.
A Renewable Portfolio Standard (RPS) system had been employed to ensure high flexibility for the
selection of power sources along with the use of cost-reducing incentive programs to promote the
deployment of RE (Ito 2015). The Democratic Party (DP) took power in the 2009 election, and in their
election campaign promised to consider the FiT approach to stimulate RE deployment as a part of their
manifesto (The Democratic Party of Japan 2009).
3The objective of abolishment was due to budget and other issues.
2The year of legislation.

Soc. Sci. 2017,6, 127 9 of 16
The new government organized an expert committee to examine the FiT approach. Based on this
examination, the original FiT draft bill was authorized within the government (Cabinet Office 2011).
The expert committee visited Germany, Italy, England and Spain and interviewed policy makers to
learn from their experiences in the early stages of policy development (Ministry of Economy, Trade
and Industry 2010a). Following internal debate, it was concluded that finding the balance between
incentives and social burden would be of primary importance (Ministry of Economy, Trade and
Industry 2010c). Therefore, various options for designing incentives, as well as the future burden
estimate for each approach were assessed, including public engagement (Ministry of Economy, Trade
and Industry 2010b). Finally, the option which forecasted a future burden of 0.5 yen per kWh was
employed in the government draft (Ministry of Economy, Trade and Industry 2011).
However, the proposed draft was significantly modified through the legislative process in the
Diet (The House of Representatives 2011a). The modified FiT approach was proposed by the LDP,
and agreed to by the governing DP (Nishimura 2011b). In this modification, the Committee on
Economy, Trade and Industry, who was in charge of this bill, visited Germany, Spain and France
and interviewed policy makers to learn from their experiences (Nishimura 2011a;The House of
Representatives 2011b).
Thus, it can be understood that FiT was introduced to Japan with regard to other nations’
experience, and there were multiple chances for learning from abroad, by both the expert committee for
policy making and the lawmakers’ committee. In the next section, we conduct a comparison between
the original bill which was firstly submitted by the government and the modified bill which was
proposed and agreed by lawmakers, in order to identify how this modification changed policy priorities.
Then we can discuss afterwards the nature of the policy transfer of the FiT; what policymakers and
lawmakers learned from abroad, how they were implemented into each draft as lessons, and why Japan
failed to avoid experiencing the same increase of social burden as other nations did by introducing FiT.
3.2.2. Comparison between Original and Revised Bill
The parliamentary amendment introduced an alternative methodology to the one agreed upon
through expert committee feedback and public engagement. The final characteristics of the negotiated
FiT bill are significantly different and in some cases in opposition to what was initially debated within
the DP, as shown in Table 4.
Table 4. Concepts Revised in the Legislative Procedure and Consequential Impacts.
Before After Potential Impact
(Government Draft) (Passed Bill)
The FiT level for PV should be set
carefully and the amount of RE
deployed should be taken into
consideration to enable flexible tariff
adjustment over time by the Ministry
of Economy, Trade and Industry.
RE business’ profitability should be
prioritized for 3 years following
enforcement of the FiT legislation, and
the FiT level should be set by a
Calculating Committee, independent
of the Ministry.
•Remuneration is more likely to
be ensured for generators
•Social burden is likely to
be higher.
•Timely tariff adjustment is less
likely to be possible.
All types of RE, except solar PV
should be rewarded with a uniform
tariff in order to stimulate
market competition.
Generation sources other than PV
should also be rewarded for
generation according to their cost
of generation.
•Various RE sources are more
likely to be deployed.
•Social burden is likely to
be higher.
Burden is to be shared equally by
everyone based on their level of
electricity consumption.
Large corporations which consume a
large amount of electricity should
receive exemptions or reductions on
the burden associated with the FiT.
•Industry is less likely to incur
a burden.
•Surcharge collected from others
is likely to increase.

Soc. Sci. 2017,6, 127 10 of 16
We can understand that one of the reasons which triggered an increase in social burden was this
significant change in policy structure. As explained bellow, the finally agreed bill didn’t estimate
future burden level nor consider any effective system to control it within a permissible range.
Firstly, the revised bill apparently allows RE business to receive more remuneration than the
original bill, which increases probability for higher social burden and more deployment of RE.
When the revised bill was proposed, the Minister of Economy, Trade and Industry expressed
his concern about the possibility of an increase in social burden level over time, however a
detailed examination and estimation of the potential burden level was not conducted at this stage
(The House of Councilors 2011).
Secondly, the revised bill is less likely to control the burden imparted on society according to
the situation. Although at the inception of the FiT where a future estimate of burden was considered
difficult, it is reasonable to assume that ongoing modification of the FiT could have kept the experienced
level of social burden under control over time. This could have been achieved through an evaluation
of burden levels over time, and the adjustment of FiT parameters, prudent to the situation. In the
original government draft formulated through expert debate, input from experts tried to ensure burden
controllability by allowing the Minister of Economy, Trade and Industry to directly manage timely
adjustment of tariff levels. The level of future burden and renewable deployment estimates were
agreed through public engagement, and the price settings were thought of as key to achieve the balance
between RE deployment and other policy targets. However, the law enacted did not have a specific RE
deployment target of ideal for the future social burden level, nor did it contain a feedback mechanism
to control uncertainties.
On one hand, in order to evaluate the future social burden due to the FiT, there is a need to establish
standards as to the level of burden that society is willing to accept. For example, the establishment of
policy goals with regard to the level of RE to be deployed and the relationship between deployment
rates and societal burden are necessary. In the case of Japan, following the wholesale revision of
the initial FiT policy proposal, a deployment target was not set, nor was it discussed at any public
negotiation of policy parameters. Based on events of the time, the authors assume that the timing of
a parallel review of the Japanese energy policy approach was one of the reasons for this oversight.
In order to set a target for the deployment of RE as a portion of the electricity generation mix for
Japan, a future estimate of nuclear generation levels was required. However, as a result of the March
2011 Fukushima reactor accident, the consideration of nuclear generation levels was not palatable for
government and was not brought to debate in the parliament. Because of this indecision, only vague
targets were set, and priority was given to the implementation of the FiT policy.
On the other hand, in order to adjust the FiT parameters, prudent to the situation, there is a need
to establish a feedback mechanism. In the original FiT draft, it was assumed that according to policy
system outputs (increased deployment, increasing costs etc.), a feedback mechanism was in place so
as to adjust policy system inputs (purchase obligations, procurement pricing etc.) which affect FiT
settings, as summarized in Figure 2. However, since the setting of the FiT price in the enacted law was
calculated and entered into legislation based on the cost of RE generation for the producer including a
provision for “appropriate remuneration” (such that the generation of RE was a profitable enterprise),
it did not allow input factors to be decided based on outputs, which loosened the feedback control,
reducing the likelihood of burden level control. On the other hand, the enacted law increased the
attractiveness immediate investment in RE deployment.
Actually, experts who were responsible to calculate the procurement prices based on the enacted
law have considered feedback factors and their input on procurement price for discussion. However,
as no officially legislated deployment target of RE, FiT price or payment period adjustment mechanism
were defined, a response in the form of modified legislation was the agreed approach by experts,
should deployment exceed expectations (Calculation Committee for Procurement Price, etc. 2012).

Soc. Sci. 2017,6, 127 11 of 16
Soc. Sci. 2017, 6, 127 10 of 15
enacted did not have a specific RE deployment target of ideal for the future social burden level, nor
did it contain a feedback mechanism to control uncertainties.
On one hand, in order to evaluate the future social burden due to the FiT, there is a need to
establish standards as to the level of burden that society is willing to accept. For example, the
establishment of policy goals with regard to the level of RE to be deployed and the relationship
between deployment rates and societal burden are necessary. In the case of Japan, following the
wholesale revision of the initial FiT policy proposal, a deployment target was not set, nor was it
discussed at any public negotiation of policy parameters. Based on events of the time, the authors
assume that the timing of a parallel review of the Japanese energy policy approach was one of the
reasons for this oversight. In order to set a target for the deployment of RE as a portion of the
electricity generation mix for Japan, a future estimate of nuclear generation levels was required.
However, as a result of the March 2011 Fukushima reactor accident, the consideration of nuclear
generation levels was not palatable for government and was not brought to debate in the parliament.
Because of this indecision, only vague targets were set, and priority was given to the implementation
of the FiT policy.
On the other hand, in order to adjust the FiT parameters, prudent to the situation, there is a
need to establish a feedback mechanism. In the original FiT draft, it was assumed that according to
policy system outputs (increased deployment, increasing costs etc.), a feedback mechanism was in
place so as to adjust policy system inputs (purchase obligations, procurement pricing etc.) which
affect FiT settings, as summarized in Figure 2. However, since the setting of the FiT price in the
enacted law was calculated and entered into legislation based on the cost of RE generation for the
producer including a provision for “appropriate remuneration” (such that the generation of RE was
a profitable enterprise), it did not allow input factors to be decided based on outputs, which
loosened the feedback control, reducing the likelihood of burden level control. On the other hand,
the enacted law increased the attractiveness immediate investment in RE deployment.
Figure 2. Conceptual Feedback Control for the FiT.
Actually, experts who were responsible to calculate the procurement prices based on the
enacted law have considered feedback factors and their input on procurement price for discussion.
However, as no officially legislated deployment target of RE, FiT price or payment period
adjustment mechanism were defined, a response in the form of modified legislation was the agreed
approach by experts, should deployment exceed expectations (Calculation Committee for
Procurement Price, etc. 2012).
3.2.3. Policy Transfer Process of the Japanese FiT
This study has described so far that the government original draft was significantly modified
through the legislative procedure, into a bill based on different concepts of social burden. In
addition, both of the original draft and the revised one were formulated more or less referring to
other nations’ experiences. In this section, two streams of lesson-drawing are respectively examined.
Through an analysis of the essence of the learnings, we can begin to derive a clear picture of how
these were reflected in the development of the Japanese FiT policy.
Input Output
Policy support for RE projects Expansion of the amount of RE
instalation
Procurement pric e (finance) Increase of surcharge
Purchase obligat ion (regulation) Remuneration for generators
Grid connecting obligation (regulation) Negative impact on grid st abilit y
Others Others
Feedback
Feed-in
Tariff
Figure 2. Conceptual Feedback Control for the FiT.
3.2.3. Policy Transfer Process of the Japanese FiT
This study has described so far that the government original draft was significantly modified
through the legislative procedure, into a bill based on different concepts of social burden. In addition,
both of the original draft and the revised one were formulated more or less referring to other nations’
experiences. In this section, two streams of lesson-drawing are respectively examined. Through an
analysis of the essence of the learnings, we can begin to derive a clear picture of how these were
reflected in the development of the Japanese FiT policy.
Using the model first described in Table 2, the essence of the actual learnings derived by the expert
committee members who visited European nations on two occasions in 2010 (4~10 and 17~23 January)
are analyzed as described in Table 5. Building on this analysis, the subsequent visit to Europe by
Diet members representing the Committee on Economy, Trade and Industry (16~20 July 2011), and its
relation to the modification of the proposed law is also discussed below.
Table 5. An Assessment of the Policy Transfer by the Government.
Step Policy Transfer in the Original Draft
(Conducted by an Expert Committee)
1
Scan alternatives and decide where to look
for lessons Germany, Spain, Italy and England
2 Learn by going abroad
Hearings by government officials, power system operators, industrial
associations and private companies; On-the-spot studies at a solar park
and wind farm
3
Abstract from what you observe a
generalized model of how a foreign
program works
Settings of the procurement price affect renewable energy deployment,
and a significant increase in deployment poses social burden increase
risks and limitations of the acceptable amount of electricity exported to
the grid due to its capacity restrictions
4Turn the model into a lesson fitting your
own national context
Consideration for well-balanced design incorporating renewable energy
deployment, social burden, and power grid stabilization is necessary
5Decide whether the lesson should be
adopted
Through stakeholder hearings and public debate, it was decided to
adopt the lesson
6 Decide whether the lesson can be applied Through quantitative simulation, it was decided to adopt the lesson
7
Simplify the means and ends of a lesson to
increase its chances of success
•Timely adjustment of the tariff by the Minister of Economy, Trade
and Industry
•Cost-reduction through market competition
8Evaluate a lesson’s outcome prospectively
and, if it is adopted, as it evolves over time
Renewable energy deployment and social burden estimates were
quantitatively presented, and the procurement price was to be adjusted
according to feedback
Note: Contents drawn from literature review references.

Soc. Sci. 2017,6, 127 12 of 16
Based on the results of the analysis, we can understand that the expert committee learned from
other nations’ experience and attempted to develop a balanced policy that would both increase the
amount of RE deployed, while limiting the social burden on households. As demonstrated in the
international FiT experience assessment in the previous section, each of the FiT implementing nations
experienced a rapid deployment and social burden increase, leading to a revision of their policies.
The initial government proposal built on learnings from these experiences, eventuating in a rational
system design process.
In contrast, the Diet member investigative committee derived vastly different conclusions,
while they were exposed to the same experiences as the expert committee. Although the learnings
and how they were considered in order to develop the alternative bill have not been made clear, so,
based on available documentation surrounding the policy proposal development, the analysis result
can be summarized as Table 6.
Table 6. An Assessment of the Policy Transfer by the Diet.
Step Policy Transfer in the Revised Draft
(Conducted by Lawmakers)
1
Scan alternatives and decide where to look
for lessons France, Spain and Germany
2 Learn by going abroad
Hearing from government officials, ambassadors of Japan, industrial
associations and private companies; On-the-spot study at a solar park
and a wind farm
3
Abstract from what you observe a
generalized model of how a foreign
program works
Settings of procurement price affect renewable energy deployment, and
significant increase poses social burden increase
4Turn the model into a lesson fitting your
own national context
Consideration for well-balanced design incorporating renewable energy
deployment and social burden is necessary
5Decide whether the lesson should
be adopted -
6 Decide whether the lesson can be applied -
7
Simplify the means and ends of a lesson to
increase its chances of success
•Evidence-based tariff setting by independent expert committee
•Cost-based procurement to ensure appropriate remuneration
8Evaluate a lesson’s outcome prospectively
and, if it is adopted, as it evolves over time
Renewable energy deployment and social burden estimate was not
presented, and feedback control was less available
Note: Contents drawn from literature review references.
The result shows that both the government and the Diet were exposed to the similar policy
experience as is described in the former assessment (Section 3.2), however, that there is a logical gap
between the lesson learned and the means finally taken in the transfer process of the Diet. The nature
of the transfer process and its reflection on the policy can be understood by analyzing the background
of this gap.
Firstly, there is a high probability that the interpretation of lessons in the Committee on Economy,
Trade and Industry’s investigation was different from the government’s expert committee, while
learning almost the same lessons. In support of this assertion, a Diet member of the opposition
LDP, upon his return from the investigative excursion said “If the tariff for purchasing RE is set too
high, the impact on consumer electricity bills becomes large, while at the same time industry makes
disproportionately large profits. However, if the tariff is set too low, investment in RE is stifled”
(Nishimura 2011d). Further, he said “if the overall burden on the citizens is not made clear, the debate
(on Japan’s FiT) cannot be undertaken” (Nishimura 2011d). However, the same member made the
following comment about the government’s initial bill proposal, “the Ministry of Economy, Trade
and Industry has the sole say on FiT settings, reducing the possibility for fairness and transparency”,
indicating that this decision would be better if removed from the Ministry of Economy, Trade and

Soc. Sci. 2017,6, 127 13 of 16
Industry’s purview. He suggested that the bill required modification and that an institution under the
purview of the Diet would be a better choice for FiT price setting (Nishimura 2011d).
Secondly, since reliable information about future burden level was not shared, intentionally
or unintentionally, as a basis for the policy decision, there was no discussion about controlling it.
With regard to the social burden increase following the Diet member’s modification, the Committee
on Economy, Trade and Industry did not undertake an estimate on this quantum. The mechanism to
control increases in social burden were described by the committee thus: “As we and our chairperson
have considered other nations approaches, we believe that the modified bill contains the appropriate
measures” (The House of Representatives 2011c). This issue was not discussed further. Also, according
to a newspaper article, the pre-revision Ministry of Economy, Trade and Industry burden estimate of
0.5 yen per kWh by 2020, or approximately 150 yen per household per month was referred to as the
prospective future burden under the revised policy (Asahi-Shinbun 2011).
Thirdly, in finalizing of the Diet members’ revised bill, there is a high probability that some
negotiation of the bill according to individual member’s interests took place. The Diet member who
tabled the bill described the finalization process as a time of vigorous debate between regional members
who were anti-nuclear, those seeking a rapid increase in renewable energy deployment, and, others
who were proponents of an increase in the use of nuclear power (Nishimura 2011c). In addition,
a Ministry executive stated that at the time, Diet members were unwilling to entertain discussions
about social burden levels, or even about the electrical grid (Yoshino 2016).
From the above, we can understand that although the diet members lesson learning process
went as far as listening to the experience of foreign nations, their implementation of these learnings
differed from that of the previous committee of experts. Additionally, at the point of bill finalization,
the horse-trading between Diet member factions precluded a complete application of the learnings
to the final bill. In the final Diet deliberations, it was stated (without evidence) that the revised
bill incorporated overseas learnings, suggesting that policy decisions were taken without a full
understanding of all of the stated important issues, including a control mechanism for social burden,
instead prioritizing the increased deployment of RE. In other words, at least in public, there was no
justification given for the fact that the modified draft was actually not based on international policy
experience, and future social burden was likely to increase.
Although we still need more evidence, the apparent lack in deliberation on the social burden
issue of the FiT seems to have been rooted in the political situation following the Great East Japan
Earthquake, where lawmakers rushed to reach agreement for the legislation with little consideration
of long term impacts on society. Since this literature focuses on the process of international policy
learning, other analytical approaches for policy decision processes should be undertaken to understand
the decision making background more comprehensively than addressed here.
4. Conclusions
This research augmented the lesson-drawing framework, in applying to the Japanese FiT case
as an example, in order to assess both the policy transfer process as originally intended by Rose,
and in addition deliver a detailed identification of lessons learned internationally, and their specific
impact upon policy development and its outcomes in the target nation. The framework can be used to
qualitatively evaluate learning processes about a specific issue entailed in a policy approach, using
other nations’ experiences, including corrective policy actions as a benchmark in order to deliver policy
which is evidence based and cognizant of international experience.
Based on the investigation of the FiT policy development and implementation process, explored
through the policy transfer framework, we attempted to answer the questions; (1) Why did Japan
experience the same increase in social burden as other FiT nations?; and (2) Did Japan learn from the
negative outcomes experiences in these nations?
In response to the first question, Japan experienced a similar increase in social burden as the
other nations because the FiT approach taken was unlikely to be able to maintain the level of burden

Soc. Sci. 2017,6, 127 14 of 16
at the initially agreed level, and lacked both a specific RE deployment target and timely feedback
mechanisms for the control of social burden level.
With regard to the second question, Japan learned lessons from other nations’ experience through
officially dispatched fact-finding delegations. Both the government and the Diet led delegations found
that in many nations’ FiTs tend to cause unexpected increases in both RE deployment levels and
social burden in order to support the scheme. They learned that the approach taken in Japan should
consider the balance between incentives and social burden. Although the original government draft
was designed to realize this concept, it was not accepted in the Diet and an alternative FiT approach
was employed.
This research identified that although the government undertook a reasonable and rational
process toward learning, the modified bill developed by the Diet members did not thoroughly
derive learnings in the same way. This research has also identified the possibility that political
compromises and the need to hide policy decisions led to the misuse of policy learning in achieving
policy implementation goals.
The methodology employed in this study entails limitations which should be considered. Since the
evidence base depends on a literature survey, which may be less effective in analyzing policy processes,
most of which are closed processes. Therefore, further analysis on the politics behind the decision for
Japanese FiT policy modification, for example by interviewing policy makers, could complement our
research. Also, the evaluation framework developed in this research could be improved through its
application to other cases, particularly FiT policy development processes of other nations and other
energy policy issues. This body of work is a future goal of this framework development research.
Acknowledgments:
The authors would like to thank the anonymous reviewers for their valuable comments and
suggestions to improve the quality of the paper.
Author Contributions:
All authors designed the research. Yugo Tanaka and Andrew Chapman conducted data
collection, analyses and drafting the manuscript. Shigeki Sakurai and Tetsuo Tezuka helped to analyze the data
and approved the manuscript.
Conflicts of Interest: The authors declare no conflict of interest.
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2017 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access
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