For centuries, the Japanese have enjoyed relaxing in abundant hot springs, or “onsen,” which are heated by the volcanic and tectonic activity that makes East Asia prone to major earthquakes.

Similar geothermal resources along the Pacific Rim’s “ring of fire” have attracted billions of dollars in foreign investment to Indonesia and the Philippines as those countries develop hundreds of megawatts of power plants that generate electricity with natural steam.

Japanese companies play key roles in the worldwide geothermal boom, yet development is conspicuously absent within Japan due to cultural reverence for hot springs, a lack of incentives and the historical reliance on nuclear power and fossil fuels for electricity. Since the 9.0-magnitude earthquake and tsunami on March 11 crippled the Fukushima Dai-ichi nuclear reactors, causing radiation leaks and blackouts, there have been renewed calls to develop Japan’s abundant geothermal fields.

“With regard to geothermal, this is absolutely an untapped resource that could benefit Japan and all of the Asian region,” said Julia Nesheiwat, a Council on Foreign Relations fellow studying energy policy for U.S. Department of State.

Eight of the country’s 18 geothermal power plants are located in the devastated Tohoku region. Four plants near hardest-hit Sendai tripped during the tsunami but continued operating after the crippled nuclear reactors leaked radiation, according to media reports.

Ranked Third for Geothermal Potential

Japan ranks eighth in the world for installed geothermal capacity with about 540 MW already producing power and third for untapped potential, according to the 2010 Geothermal Congress at Bali, Indonesia. Estimates are related to pre-tertiary basement units less than 3 kM deep with temperatures of 150 C, or 302 F. The United States, Philippines and Indonesia rank first through third for installed capacity with 3,086 MW, 1,904 MW and 1,197 MW, respectively.

Most high-temperature fluid resources are located in the northeast’s Tohoku and southwest’s Kyushu, home to the Kuju volcano. Japan sits above a subduction zone, so the archipelago possesses many geothermal fields with low-enthalpy. These regions have potential for development with organic rankine cycle (ORC) systems and fluid temperatures of 100 C, or 212 F.

“If there is a major natural disaster, the main damage (to geothermal plants) will be to the pipelines carrying hot water,” said D. Chandrasekharam, an earth sciences professor at the Indian Institute of Technology Bombay. “That’s much easier to control than radiation.”

In 2004, Nevada’s Ormat Technologies Inc. supplied the country with its most recent geothermal project, which is also its first ORC binary system at the Hacchobaru Power Station in Kyushu. The 2.2-MW unit enabled the existing power plant to generate additional electricity from water that exits steam turbines before re-injection underground.

In a sign that the country is warming to geothermal, Ormat last year signed an agreement with JFE Engineering to build and operate new power plants with support from Japan’s Itochu Power Corp. The companies have not moved any projects forward in Japan, but they are developing multiple megawatts in Indonesia with other Japanese companies, including Kyushu Electric Power Co.

The reluctance of Japan’s utility companies to pursue alternative energy without incentives has been exacerbated by the cultural traditions surrounding the country’s 28,000 hot springs, many experts said.

“The Japanese look at these hot springs as almost holy, so there is great concern for how the water is used,” said Lucien Bronicki, Ormat’s chairman and chief technology officer.

Open spaces in densely populated Japan are a premium, so the preservation of the beloved hot springs has become one of the many obstacles to geothermal expansion, according to Takashi Kamei, a nuclear scientist who specializes in sustainability at Kyoto’s Ritsumeikan University.

“Most of our geothermal resources exist at places for sight-seeing,” he said. “We love to enjoy onsen.”

A 55 MW geothermal power plant has generated electricity at Kyushu’s Hacchobaru Geothermal Station since 1977, while a second 55 MW plant came online in 1990. The systems are located near Beppu, which has the most mineral springs in the world. As a major tourist destination with steamy pools surrounded by scenic mountains, the region is a bit like Yellowstone National Park with spa resorts.

Shigeto Yamada, an engineer and spokesman with the Geothermal Research Society of Japan, thinks Japan can realistically develop 1.5 GW to 2.4 GW of the estimated 23.4 GW of potential by 2050. An aggressive feed-in tariff (FIT) will be crucial to the pace of that expansion, he said.

“To support the future geothermal development, Japan’s government is discussing a FIT as one of the incentives, and Japanese geothermal industries are lobbying to continue the govermental grants and support,” Yamada said. “Of course, any investments from overseas are always welcome.”

Between 30 MW and 60 MW may already be in development in northern Japan. J-Power, Mitsubishi Materials Corp. and Mitsubishi Gas Chemical Co. last year announced the creation of joint venture Electric Power Development Co. to develop a geothermal power plant Akita Prefecture.

Japan’s 540 MW of installed geothermal equals less than 1% of the country’s 46 GW of nuclear power capacity. In Japan’s Renewable Portfolio Standard (RPS), the Ministry of Economy, Trade and Industry (METI) called for adding 600 MW of geothermal energy over 10 years. After plans for nuclear power plants ramped up, METI in 2009 backed off its goals for geothermal energy. There was never a feed-in tariff associated the RPS, so geothermal projects have stalled.

“METI does not want to increase geothermal at present,” said Sachio Ehara, a geothermal researcher at Kyushu University. “If METI changes the idea, 600 MW will be feasible, although we must accelerate the speed of development.”

He estimates that Japan has known resources to begin constructing one 60-MW power plant every year for the next decade.

“It’s not easy to complete 10 power plants in 10 years,” he said.

A typical geothermal plant takes five to 10 years to develop, so Japan will have to turn to wind and solar for immediate renewable energy sources, Bronicki added. The Climate Change Policy Division of Japan’s Ministry of Environment estimates that Japan possesses 1,900 GW of potential wind energy, according Climate Connect.

None of the country’s wind farms were damaged by the tsunami or earthquake, although some power lines were damaged. Many wind turbines near the hardest-hit coastlines continue generating electricity today.

Energy expert Paul Gipe suggests that Japan could offset the energy lost from crippled reactors by increasing European-style feed-in tariffs to rapidly develop renewable energy. Convincing Japan’s energy establishment to change its ways won’t be easy without major incentives, Japanese sources said.

Power Company Reluctance

Japan’s electricity is distributed through 10 utility companies that own their own power plants and grids, which are not always compatible across regions. There have not been major incentives to embrace utility-scale renewable energy, so the power companies have not gone out of their way to expand clean energy, Kamei said.

“Major energy people, including the nuclear industry and electricity utilities, do not want to adopt large scale renewable energy,” Kamei said.

That may be a moot point since Prime Minister Naoto Kan said Tuesday that Japan will have to scrap its old energy policy to boost renewable energy while becoming less reliant on nuclear power. The policy initially called for increasing nuclear capacity from 30% of all power to 50% by 2030.

“Even before the natural disasters, Japan strongly recognized the need for energy diversification,” said Nesheiwat, of the Council on Foreign Relations. “The ongoing Fukishima situation, however, will inevitably force Japan to sharpen the need for alternative energy and, yet, increase hydrocarbons.”

Geothermal’s ability to provide energy 24/7 with up to 95% efficiency is another reason the government might eventually push for developing more wells in the near future, Chandrasekharam added. Japan faces more power shortages since Chubu Electric Power Co. announced it would shut down reactors at the Hamaoka Nuclear Power Plant. Critics said the Hamaoka plant — located 100 yards from the ocean above a fault — has a high probability of damage from an 8.0-magnitude tremor since the Tokai area experiences large earthquakes every 100 years.

Japan, the world’s leading importer of liquefied natural gas (LNG), will ultimately have to use more fossil fuels to offset the loss of nuclear energy. But there’s indication that some in the fossil fuels industry are warming to renewable energy.

Geothermal Expertise

Japanese utilities and steam turbine manufacturers play major roles in worldwide geothermal projects. Mitsubishi Heavy Industries Ltd. announced in June that it would build five 45-MW geothermal power plants for Iceland’s Reykjavik Energy.

The Japan International Cooperation Agency is lending 27 billion yen, or $325 million, to Indonesia to build a geothermal power plant in Sumatra. Itochu and Kyushu Electric Power Co. are investors or developers throughout Indonesia. The irony of all that expertise and money traveling overseas is not lost on Japan’s geothermal engineers.

“I think the Japanese government should determine a reasonable feed-in-tariff price first, then we should improve the national park and onsen problems as fast as possible,” said Kyushu University’s Ehara. “We have a large amount of potential … if we can overcome those problems.”