PV Expo: Canadian Solar CEO’s hopes for Japan power market deregulation

Deregulation of the Japanese electricity market, expected to begin next year, could “breathe new life into PV”, according to Shawn Qu, chief executive and chairman of Canadian Solar.

One of the key topics of discussion at the PV Expo in Tokyo this week is that of clearing the way to give consumers a much greater choice in their electricity provider. This process has been pencilled in by the government to begin next year.

Currently, electricity transmission and sales is in the hands of Japan's 10 regional utility companies. The regional monopolies that have developed around this arrangement are considered to be exerting upward pressure on bill payers and as of several years ago, the government has made a commitment - on paper- to get the process underway in earnest from 2016.

Bearing in mind an important caveat that many here at the PV Expo have voiced, namely that it is still unclear how this process will be executed and how long it will ultimately take to complete, nonetheless, great expectations have been raised by this promise of energy freedom for households.

As part of an in-depth interview, PV Tech asked Shawn Qu what he thought the consequences of energy liberalisation, as it has been called, might be and what lessons might be learned in other parts of the world if the liberalisation process is successful.

“We don't know yet, right?” Qu said, laughing.

“We're in the process of deregulating but I wish and I hope deregulation can breathe new life into PV. For PV, you should always ask the question of what about once you've put PV modules on every rooftop? What else can you do? What other services, how can you further enhance the customer experience?

"A deregulated market will offer you new opportunities – especially when you have this access, this entry to home energy systems. That entry point will allow you to provide more services, to drive more value. Exactly what value? We don't know yet. Let's wait and see."

Qu said that, for example, the increased connectivity between the various parts of a smart energy management system would generate tremendous amounts of data on energy usage and demand. "Obviously you can accumulate a lot of data, so how to use the data to drive the value and to provide other services, that's something to be explored,” he said.

One service Qu could have in mind is to allow homeowners themselves to become energy providers, in a new and more efficient way than, for example, feed-in tariffs (FiTs) have done in the past in various global markets where PV system owners are paid a premium for what they feed in to the grid.

Some companies exhibiting at the show in Tokyo are already actively marketing their newest energy systems, particularly for the Japanese residential market, with this in mind. Panasonic, for instance, was displaying a home energy system that not only combines PV with energy storage but has as an integral part of its energy management software a feature that “intelligently” allows the system owner not only to purchase electricity at the lowest available price, but also to sell PV-generated electricity back to the grid at the highest.

While companies that have already staked a claim to this approach have taken something of a gamble on timescale by moving early, it appears many share Qu's enthusiasm and hopeful expectation.