Japan sets feed-in tariffs for the 2020 Japanese Financial Year

Share on facebook
Share on twitter
Share on linkedin
Share on reddit
Share on email
The shift to rooftop markets has been long anticipated - pictured are Panasonic HIT modules specifically for tall buildings on show at PV Expo in Tokyo in 2017. Image: Andy Colthorpe / Solar Media.

Feed-in tariffs (FiTs) in Japan for solar PV systems have now been provisionally set by the national Ministry of Energy Trade and Industry (METI) for the next financial year, which begins in April.

The country has been preparing to graduate the market away from the premium-level incentives that started off at more than ¥40 per kWh (US$0.36) in 2013, when the programme was introduced to kick-start the market in the wake of the Great East Japan Earthquake of 2011 which resulted damage to Fukushima Daiichi nuclear power station.

The subsequent shuttering of nearly all of Japan’s nuclear generation facilities has left an advanced industrial economy without many natural resources of its own highly dependent on expensive imported fuel.

While this mainly means liquefied natural gas (LNG) – many tanker trucks carrying the fuel are seen on Japan’s roads – and latterly on a turn back to coal generation which is expected to include a dependence on coal imported from Australia.

However, while wind energy has been slow to take off and other options such as geothermal appear a non-starter (despite abundant resources, local pressure means it is unlikely this will ever be popular) solar PV generation in particular is now becoming competitive with grid electricity.

The biggest market dynamic shift within the solar industry is the move away from the much-vaunted ‘mega-solar’, grid-scale projects that created many-gigawatt pipelines of projects, both completed and commissioned, as well as a large number that have gone unbuilt.

In a meeting yesterday with PV Tech / Energy-Storage.news, Izumi Kaizuka, a manager at Tokyo-based solar PV industry analysis and research firm RTS PV revealed and discussed the new FiTs and Japan’s industry dynamics for solar – and increasingly energy storage – for a feature article to be published in the forthcoming quarterly edition of PV Tech Power (Volume 22).

Dawn of third-party ownership – ‘Zero Yen Installation’

Going forwards, Kaizuka said that the emphasis on rooftop solar generation, both at residential and commercial and industrial (C&I) level will continue. The analyst said that the primary driver of the rooftop market is self-consumption, because of the reduced level of FIT while demand for renewable power is increasing for many companies. Many providers in the solar industry have now entered third-party owner models, known in the US as “no money down” deals, or in Japan as “Zero Yen Installation” business models.

Large-scale solar has quietened down as land suitable for ground-mounted development is now at a real scarcity, while developers and owners of that aforementioned unbuilt mega-solar pipeline have a deadline of March this year to make good on their feed-in tariff awarded projects, Kaizuka said.

Japan’s feed-in tariffs (FiTs) for the 2020 Japanese Financial Year (JFY2020)

System size Feed-in tariff rate (¥ per kilowatt-hour)
Systems below 10kW 21
Systems between 10kW and 50kW 13
Systems between 50kW and 250kW 12
Systems >250kW N/A (competitive tender process held to determine prices)

There is still to be a public hearing held next week, but it is understood that it is very unlikely for any alterations to occur as a result of that process.

Meanwhile, domestic FiTs actually began in 2009, for a 10-year contracted period. More than 500,000 of these residential tariffs have now expired, meaning that homeowners are targeting self-consumption of power with batteries, or looking to broker power purchase agreement (PPA) contracts with the many new retailers that have sprung up to serve Japan’s deregulated, or unbundled, electricity market.

It has long been planned that this next financial year will be the last in which FiTs are offered, meaning that Japan is seeking new ways to support the deployment of solar PV, with the government targeting more than 130GW by 2030.

Subscribe to and read the next issue of PV Tech Power, out towards the end of February in time for PV Expo in Tokyo, to learn more.

Read Next

October 21, 2021
Distributed generation is the future of solar PV in China, with 48GW expected to be deployed next year in the country, according to Frank Haugwitz, director of Europe Asia Clean Energy Advisory Company
October 21, 2021
A round-up of the latest news from the US solar market, featuring project financing from Cypress Creek and DE Shaw, SolarEdge project launches and solar loan securitisations from Sunnova and Mosaic.
October 13, 2021
EDF Renewables has targeted Vietnam’s solar market by investing in rooftop PV installer SkyX Solar, a subsidiary of investment management firm VinaCapital.
PV Tech Premium
October 8, 2021
SunPower’s move to double down on its residential business forms part of a strategy that will see the company aim to lower supply chain costs, expand its geographical footprint and add to its product portfolio.
October 5, 2021
US solar installer SunPower is exploring alternatives for its commercial and industrial solutions (CIS) unit as it increases its residential footprint through the acquisition of Blue Raven Solar.
October 1, 2021
JA Solar is planning to develop new building-integrated photovoltaics (BIPV) products through a collaboration with Chinese waterproof materials manufacturer Oriental Yuhong.

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
November 10, 2021
8am (PST) | 5pm (CET)
Solar Media Events
December 1, 2021