Study to Evaluate the Cost-effectiveness of NEDO Projects

Analysis of NEDO Inside Products Survey

Sayaka Shishido, Masaru Yamashita,

Yoshiko Yurugi and Mitsuru Takeshita

Evaluation Department

Inside

New Energy and Industrial Technology Development Organization

Introduction to NEDO Inside Products　

　 NEDO inside products are defined as products that incorporate core technologies developed through NEDO project results.

　

N

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D

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Pioneer in market creation

Strengtheningglobal

competitiveness

Improving technology in a wide range of

sectors

●Taking the lead in the creation of new markets

●Achieving competitive advantages through world-leading technologies

●Addressing social issues through new technology development

●Supporting technological innovation across a wide range of industries through basic technology development

Addressing social issues

Government funding

R&D

Demonstration

projects

Management, evaluation and

selection by NEDO

Overview of NEDO Inside Product Research Purpose:　 Estimate economic effect and social benefits of NEDO projectsTarget:

*Most recent annual sales: More than $1.25 billion 　　*Sales between $250 million and $1.25 billion*Low sales, but significant social benefit

Summary of economic effect and social benefit:① Economic effect:

Project budget, most recent annual sales, accumulated sales over the past five years, sales forecast between FY2011–FY2020

② Social benefit: 　　　　　　CO2 reduction effect, ripple effects, employment growth, etc.

Sales calculations:1) Average cost of project (FY): 　 (total cost for a project implementation period) 　 (project period)

2) Most recent FY sales (FY2010): 　 (aggregate sales over the past five years for the target product) (five years)or (single year sales amounts for products with only single year sales estimates) 　　3)Total future sales forecast ：　　　 cumulative sales from FY2011–FY2020 based on FY2020 sales forecasts

Data basis:Questionnaire completed by companies(Tentatively NEDO’s contributing rate is 100%.)

Official data:① Economic organizations ② Public institutions, private research institutes ③ In cases of insufficient data, supplemental estimates were calculated using the data above

Waste power generationWind power Solar power

High-efficiency industrial furnaces

Thermal storage air-conditioning systems

Lithium-ion batteries for EVs and PHEVs

Sulfur-free light oil

Hybrid shovels

Residential fuel cells

Low-emission diesel cars

High-speed copy machines

Thermal insulationIndustrial heat pumps

Eco-friendly cement

Water treatment plants

CFC reduction technology

NEDO インサイド製品が、我が国の環境・エネルギー問題解決に貢献！

440 mega tons CO2/10 years(FY2011–FY2020)

Energy saving effect (crude oil equivalent)

35 billion gallons/10 years (FY2011–FY2020)

Residential heat pumps

Examples of Technological Innovations that Address Environmental and Energy Issues

Sales Performance and Forecasts for NEDO Inside Products Sales Performance and Forecasts for NEDO Inside Products

pioneer in market creation

Strengtheningglobal

competitiveness

Improvingtechnology

across a wide range of sectors

*$1=80yen

NEDO budget outlay Sales performance

Accumulated sales forecast (2011–2020 )

Project costs

Accumulated project costs

Most recent sales

Accumulated sales over the last five

years Unit: million $ Cost/year project period Cost/year

　 Photovoltaic power 73 2,169 19,808 58,053 311,691

　 Wind power 5 106 3,299 9,125 51,341

　 Gas turbines 　　 44 665 3,214 14,873 50,125

　 Residential HP hot-water supply systems

15 193 4,250 20,000 48,125

　 Residential fuel cell 61 1,100 150 375 14,546 Blu-ray 15 76 6,353 18,125 64,423

　 Water treatment 24 148 465 1,650 7,475

　 High-efficiency industrial furnaces

　 14 100 30 446 1,329

　 Low-emission diesel

cars 8 53 94 706 2,875

MEMS 16 313 476 1,526 8,349 Fine ceramics 6 154 131 131 13,125

Other - 2,131 11,528 49,455 252,004

　 Total - 7,208 49,798 174,465 825,408

Cost Effectiveness & Employment Growth Effect

・ Sales forecast (FY2011–FY2020): $825 billion Cost effectiveness:

　　○ NEDO’s budget for 50 products is about $7.2 billion.　　○ Corporate income tax is about $12.3 billion.＝ $825 billion X 3.66% (pretax profit rate*) X 40.69% (effective corporate income tax rate)　　　　　　　　　　　　　　* Based on the Ministry of Finance’s Business and Investment Survey of Incorporated Enterprises. 　

Employment effect: Employment growth between 107,000 and 177,000 per year

　　　○ $49 billion (FY2010 sales) X 13.38%* (ratio of personnel expenses to sales) ÷ $64,000 (average employee compensation) = 107,000 employees in FY2011

　　○ $825 billion (FY2011–FY2020 sales) X 13.38% (ratio of personnel expenses to sales) ÷ $64,000 (average employee compensation) = 1.77 million employees between FY2011-FY2020

* Ratio of personnel expenses to sales is based on the Ministry of Finance’s Business and Investment Survey of Incorporated Enterprises and average employee compensation is based on the National Tax Agency’s Pay for Private-sector Employees Survey.

CO2 reduction effect: 12 products contribute to the reduction of CO2 emissions

　　⇒　 CO2 reduction effect is 440 megatons (FY2012–FY2020)

Energy saving effect (crude oil equivalent) is 35 billion gallons /10 years (FY2011–FY2020)

8

Residential heat pump hot water supply system

FY1984–FY2007 $193 million

Overview:・ NEDO developed basic heat pump

technologies from 1984, like mechanisms for whole heat pump system not only CO2 use.

・ Private companies developed a residential-use heat pump. NEDO support to develop multi-purpose heat pumps, including high-efficiency, compact and cold climate heat pumps.

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Project

Current status

2020

Creation of markets through NEDO projects

Pioneer in Market Creation

Knowledge sharing

NEDO Project

Practical use of heat pump systems 　

Research on high-efficiency compressors and high-efficiency power recovery equipment

Research on air heat exchanger

Research on compact high-performance gas coolersCapital investment

Derivative effect

Building up basic knowledge was the starting point for developing energy-saving technologiesIdentifying new uses for heat pumps and development of multi-purpose practical applications, including compact and cold climate heat pumps.

・ The introduction of heat pumps has accelerated since FY2007 due to the increase of all-electric homes and price reductions・ The heat pumps are designed for residential use as well as industrial use.

Residential heat pump system

Forecast for heat pump market in Japan

Total CO₂ reductions are estimated to be 42 mega tons (FY2011–2020 )if total heat pump sales reach 10 million by FY2020.

Environmental effect

9

Die Bonding Film

・ Achievement of reduced thickness, and improved flexibility and adhesiveness simultaneously by controlling polymer structures at nano levels.

・ Contributed to size reductions and improved functionality of latest electronic devices such as smartphones, tablets, etc.

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Current status

2020

Environment:Energy-saving as SSD’s consume lower amounts of electricity than HDD’s.

Technology: Streamlined manufacturing processes （ multiple processes streamlined to one bonding film process only)

Contributed to enhancing Japan’s competitiveness in semiconductor materials field

Presence of Japanese companies:Sales: $127 million/year;greater than 50% market share;achieved de facto standardization

Strengthening Global Competitiveness

Effects

FY2001–FY2007: $75million

Example （ Stacked MCP ）

HS Series

Overview:

Technology development: Development of phase separation control and analysis technology for power inverters and LED light sealants.

Film properties:Ultra-thin film (10 μm) with strong bonding properties (peeling strength 1.0 kN/m between 60-90°angles)

Accelerating development of practical application through collaborative R&D of mechanisms between industry and academia.Basic technology makes possible synthesis of materials suitable for requisite properties

Products using die bonding film

engine

air bag

tiremirror navigation system

Micro Electro Mechanical Systems (MEMS)

FY1991–FY2012: $319 million

Japan is a global leader in micro machining technology as a result of R&D spanning over 20 years .

Overview:・ R&D on MEMS started in the late 1980’s. Japan launched a large-scale ten year national project in 1991 to build a technological base for MEMS.・ R&D has been accelerated recently to develop applications in multiple fields.

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NEDO projects

Current status

2020

0100200300400500600700800900

1000

2010年 2012年 2014年 2016年 2018年 2020年

Market growth

38 billion yen

99 billion yen

Cars Manufacturing

Achievement of high-performance, lightweight devices through micro machining technology

Improving Technology in a Wide Range of Areas

Accumulation of basic technologiesDevelopment of multi-purpose applications through crossover activities among different fields

Development of multi-purpose uses

What is MEMS?MEMS is a micro-mechatronics systems using semiconductor processing consisting of miniaturized sensors, actuators, electronic circuits integrated onto chips.

Electronic devices

11

High-efficiency Furnaces

FY1993-FY1999: $102 million

Overview:・ Achievement of more than 30%

energy saving, reductions in NOx and size

・ Adopted by steel and aluminum industrials; accounted for more than 1/3 of industrial furnace market in 2005

・ Project consortium composed of 13 companies from the same industry

・ Development of multi-purpose technologies using simulations and databases; heat recovery has nearly reached theoretical limits.

・ Field tests conducted at 167 locations contributing to market growth.

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NEDO projects

Currentstatus

2020

Development of eco-friendly industrial furnaces

フィールドテスト事業で導入加速

CO2reduction effect: 16 million t-CO2/10 years

NEDO supports the dissemination and promotion of eco-friendly industrial furnaces

Furnace cross-section

Environmental effect

Addressing Social Issues

1. Solar power Wind power

・ new energy 　 ・ 1981

1. Solar power Wind power

・ new energy 　 ・ 1981

2. Gas turbines

　・ high-efficiency　・ 1980

2. Gas turbines

　・ high-efficiency　・ 1980

4. Nano-ion products　

　・ healthy living, eco-friendly　 ・ 2001

4. Nano-ion products　

　・ healthy living, eco-friendly　 ・ 2001

5.Reduction of CFCs

・ address global warming ・ 1996

5.Reduction of CFCs

・ address global warming ・ 1996

7. High density devices (HDD)

・ new markets ・ 1995

7. High density devices (HDD)

・ new markets ・ 1995

8. Blue-ray

　・ new media

　・ 1998

8. Blue-ray

　・ new media

　・ 1998

9. Die bonding films

・streamlining

　・ 2001

9. Die bonding films

・streamlining

　・ 2001

10. Residential fuel cells

　

・ cogeneration ・ 1992

10. Residential fuel cells

　

・ cogeneration ・ 1992

11. Fine ceramics

　・ new materials　　・ 1981

11. Fine ceramics

　・ new materials　　・ 1981

14. Water supply (MBR,UASB)

global business　・ 1997

14. Water supply (MBR,UASB)

global business　・ 1997

13. EV batteries

・ load leveling　　・ 1992

13. EV batteries

・ load leveling　　・ 1992

NEDO Inside Product Stars!★ 　

6. Furnaces

　　・ energy saving　　・ 1993

6. Furnaces

　　・ energy saving　　・ 1993

3. Residential heat pump system

　　 　　 ・ heat pumps　　 ・ 1984

3. Residential heat pump system

　　 　　 ・ heat pumps　　 ・ 1984

Pioneer in market creation

Strengthening global

competitiveness

Improving technology

Addressing social issues

★★★

★★★

★★★

★★★

★★★

★★★★

★ ★

★★ ★★★

★★

12. MEMS

・ multi-purpose　・ 1991

12. MEMS

・ multi-purpose　・ 1991

★★★

Future outlook

Challenges・More than half of NEDO inside products are viewed as ”addressing social issues” and should not be evaluated in terms of economic profitability only.→　 In particular, as NEDO’s mission is to address energy and global environmental problem, we need to carefully consider in-depth evaluation methods for these products.・ As the number of materials and components in the supply chain increases, it become more difficult to calculate the value of each unit.

・ NEDO not only supports individual companies, but also aims to improve Japan’s technological strength, therefore we should conduct evaluations in terms of value-added to Japan’s technology base.

・We should implement evaluation methods based not only economical viability and energy efficiency but also include benchmarks such as reductions in environmental burdens (e.g., hazardous materials), and improvements in user-friendliness, quality of life, levels of happiness, etc.

・ Basic and infrastructure technology development is expected to become broader and we are striving to develop evaluation methods that are compatible with such change. Currently, we are examining interview methods related to combustion and polymer chemistry.

Thank you!

（以下、参考）

＜市場創出の先駆者＞製品名 分野

太陽光発電 環境・エネルギーブルーレイディスク関連 安全・安心・快適家庭用ヒートポンプ 環境・エネルギー風力発電 環境・エネルギー家庭用燃料電池 環境・エネルギー移動体用蓄電池 環境・エネルギー /産業競争力ロボット（清掃用、産業用等） 安全・安心・快適 /産業競争力ガスタービン 環境・エネルギーロボット（警備用等） 安全・安心・快適 /産業競争力＜国際競争力のブースター＞

製品名 分野ハードディスクドライブ 産業競争力電子材料フィルム 産業競争力エキシマレーザー半導体装置 産業競争力大型 CAT-CVD装置 産業競争力不揮発性の半導体メモリ 産業競争力積層 DRAM（ Dynamic Random

Access Memory）産業競争力

パワー半導体材料（ SiC,GaN等） 産業競争力宇宙用蓄電池 産業競争力液晶ディスプレイ用偏光フィルム 産業競争力電気二重層キャパシタ 産業競争力＜幅広い分野の底上げ＞

製品名 分野高機能・信頼性サーバ 安全・安心・快適樹脂部品用接着剤 産業競争力金属ガラス 安全・安心・快適光触媒 安全・安心・快適高性能セラミックス 産業競争力MEMS 産業競争力

16「 NEDO インサイド製品」　 50

製品リスト ＜社会的な課題解決への貢献＞製品名 分野

廃棄物発電 環境・エネルギー高性能工業炉 環境・エネルギーナノイー応用製品 安全・安心・快適4次元 X線 CT診断装置 安全・安心・快適排ガス後処理システム（尿素SCRシステム）

安全・安心・快適

低公害ハイブリッドディーゼル車

環境・エネルギー

バイオ研究用顕微鏡 安全・安心・快適高効率嫌気性生物処理 (UASB

等 )環境・エネルギー

活性汚泥法（ MBR）用膜ユニット

環境・エネルギー

エコセメント 環境・エネルギー電子材料用絶縁材料 安全・安心・快適液中燃焼法によるフロン破壊 環境・エネルギー産業用ヒートポンプ 環境・エネルギー真空断熱材 環境・エネルギー高速デジタル複写機 環境・エネルギーサルファーフリー軽油 環境・エネルギー冷熱蓄熱システム 環境・エネルギー省エネ型建機 環境・エネルギー短下肢装具 安全・安心・快適アスベスト代替ガスケット 安全・安心・快適半導体製造用クリーニングガス 安全・安心・快適肝炎等診断システム 安全・安心・快適糖鎖微量迅速解析システム 安全・安心・快適ノン VOC塗装システム 安全・安心・快適ホーム ITシステム 安全・安心・快適

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NEDO プロジ ェクト

凡例：

：今後 10年間固定軸

将来累積売上予測の計算方法