Sun no longer shines on Japan’s solar boom as subsidies wane via The Japan Times

JUL 14, 2016
Japan’s solar boom is beginning to falter.

Until recently, the resource-poor nation has been one of the leading markets for photovoltaic (PV) units, helping to prop up an industry hurt by falling prices for the technology and policy changes. But four years after the introduction of generous incentives to promote clean energy in the wake of the March 2011 Fukushima nuclear disaster, data show the boom is losing steam.

The slowdown — after several years of rapid growth — threatens to undermine the government’s push to find a clean alternative to nuclear power and dims what has been a bright spot for the global photovoltaic industry.

“As the declining volume of PV module shipments shows, the market is shrinking,” said Takehiro Kawahara, an analyst for Bloomberg New Energy Finance.

Repeated tariff cuts and difficulty securing land and grid connections are among some of the reasons that have led to a drop in new applications to develop solar, Kawahara said.

For Japanese panel makers such as Sharp Corp. and Kyocera Corp., “the shrinking domestic market forces them to lower costs to remain in competition with international players or consider exiting the segment,” he said.

Solar power-related bankruptcies are increasing, according to Teikoku Databank Ltd. The number of companies that went bust rose to 36 in 2015, from 17 in 2013 and 21 in 2014. Bankruptcies continue to accelerate, with 17 seen in just the first five months of 2016, Teikoku said.

[…]
Solar has grabbed the lion’s share of what is known as feed-in tariffs — above-market rates awarded to producers of clean energy. With available land for solar in short supply and some utilities saying they cannot accept more intermittent solar power, that is a worry for some. Also, only about a third of the solar projects awarded the preferred rates have actually begun producing power.

The bulk of the clean energy capacity approved by the government under the FIT program since 2012 has been in solar, raising concern that the tariffs do not seem to have stimulated much in the way of other clean energy sources.

“Feed-in tariffs have proved there’s potential for 80 gigawatts of solar in Japan,” said Masaaki Kameda, secretary-general at the Japan Photovoltaic Energy Association, the country’s solar lobby. “But to bring online this potential, various policies need to be applied continuously,” he said.

The government has tightened rules for projects that have been delayed and plans to introduce an auction system for large-scale solar next year.

“Now that we know that solar power generation systems can certainly supply energy, it is important to find out how we can make the most of the generated power,” Kameda said.

Prime Minister Shinzo Abe has tried to play it both ways — saying he’s a supporter of clean energy, while also backing a continued role for nuclear and a big role for coal. Despite clouds over the nuclear industry and repeated failed attempts to get reactors back online, Japan’s latest policy pronouncements see nuclear accounting for as much as 22 percent of Japan’s power mix by 2030. Similarly, the government sees a bright future for coal at 26 percent.

Japan’s solar market is expected to shift to rooftops. Between 2016 and 2040, Japan will add 94 gigawatts of new solar, including 65 gigawatts of rooftop PV, BNEF said in a report last month.

If Japan wants to achieve a much higher penetration of renewables, “an independent system operator would be necessary to ensure the grid connection approval process is neutral,” said Kawahara.

Read more.

This entry was posted in *English and tagged , , , , , . Bookmark the permalink.

Leave a Reply