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Solar power rises to 10 GW in Japan

The solar photovoltaic sector is rising high in the Land of the Rising Sun.

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Japan is now one of only five countries that have achieved 10 gigawatts of cumulative solar photovoltaic capacity, according to new research from NPD Solarbuzz.

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Germany was the first country to reach this mark, followed by Italy, China and the U.S. Like Japan, both the U.S. and China reached the 10 GW-milestone fairly recent – within the past few months.

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The increase in Japan’s solar capacity can be traced back to efforts from the Japanese government to increase the country’s renewable energy sector in the wake of nuclear falling out of favor after the Fukushima disaster in 2011.

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Solar PV deployment in Japan slowed in the mid-2000’s, partially due to a ten-year energy plan approved in March 2002 that favored the expansion of nuclear generation. The plan called for the expansion of nuclear capacity by 30 percent by 2011.

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With the government’s focus now shifting towards renewables, a new law approving feed-in tariffs for renewable energy was passed in June 2012. According to this, solar energy priced at 42 yen ($0.53) per kilowatt-hour, a rate that is more favorable then even Germany (see related story).

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Solarbuzz believes that this generous FIT has been instrumental in the rapid growth seen in Japan’s PV market.

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Specifically, the PV market in Japan broke the 10 GW barrier in August of this year. It reached 10.5 GW at the end of August.

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Rooftop solar PV installations have been the dominant segment in the Japanese PV market and remained so till the end of August 2013 with 89 percent of the market. The remaining 11 percent was spread across the ground-mount and off-grid segments.

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This growth in the solar sector, as well as in other renewable markets such as wind, is seen by many as continuing into the future. Japan’s renewable energy sector is seen as becoming one of the world’s most dominant in the coming months (see related story). However, this is by no means the first time that Japan’s solar industry has risen to the forefront of the global market.

Japan was actually an early leader in PV, becoming the first country to break through 1 GW of cumulative solar in 2004 and until 2005 it had the largest installed PV capacity of any country in the world.

The early leadership position of Japan was also credited to favorable conditions spurred by government programs supportive of solar. If 2012 saw a favorable solar FIT, 1994 saw a favorable subsidy program.

In 1994, the Ministry of Economy, Trade and industry launched a subsidy program for residential PV. This subsidy initially covered 50 percent of the cost of a PV system.

The early growth of the Japanese PV market also established Japanese manufacturing as the first dominant force in the PV industry. Manufacturers that benefited from the first phase of government initiatives included Sharp, Sanyo and Kyocera, all three who are now leaders in the domestic PV industry.

While the growth of the domestic PV market is seen as continuing into the future, there is some concern as to Japan’s capacity to support this demand.

Project developers have been experiencing shortages in module supply, with several domestic manufacturers already fully booked through the remainder of 2013 and 2014. Project developers have also been experiencing difficulty in acquiring suitable land and grid connections for their planned installations.

There are also some concerns over the sustainability of the Japanese FIT program as well as whether or not the existing grid can support the anticipated influx of renewable energy.

Despite these challenges however, Japan is currently forecast to be the second largest country for PV demand during 2013, with China set to become the global leader for this year according to Solarbuzz.

Solarbuzz believes that the growing markets of both China and Japan will establish the Asia Pacific region as the driving force for PV demand over the second half of 2013. – EcoSeed Staff



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