Japan to add 8 GW of solar PV this year

Japan will add a total of 8 GW to its solar PV installations this year, with just over 5.1 GW coming online in the second half of the year driven by government initiatives, according to a new report.

Analysts at research firm GlobalData said this solar growth follows a period of slow deployment for Japanese PV projects, which forced the country’s energy ministry to review the previous system of feed-in tariffs (FiTs) and led to the implementation of a revised strategy.

GlobalData’s project manager for alternative energy, Ankit Mathur, said: “Previously, companies encountered delays in acquiring approvals from government authorities for constructing PV projects on agricultural land, aggravated by developers waiting for further cost reductions in components.

“As a consequence, some developers neither finalized sites nor agreed a contract for purchasing equipment for PV power plant construction.”

The ministry moved to annul the FiT for projects that had failed to secure land and equipment by the end of March this year and to rescind any projects that had fulfilled only one of these requirements by the end of August.

It also introduced a clause stating that any projects approved during 2014 must have a finalized site and equipment contract within 180 days.

Mathur said that these steps “have created an immediate opportunity for module suppliers, although the installed cost of PV systems in Japan is generally higher than in other matured markets. From 1 April 2014, sales tax rose by 3 per cent, making the total tax levy on solar PV systems around 8 per cent.”

Mathur added that the Japanese PV market “is gradually moving from residential to non-residential areas, attracting experienced global developers to set up large-scale PV systems in the country. However, Japan’s mountainous terrain and lack of connectivity between regional grids will continue to be obstacles to growth.”

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