Published on February 22nd, 2016 | by Joshua S Hill2
Japan Solar Installations To Peak In 2016 At 13.2–14.3 GW, BNEF Projects
February 22nd, 2016 by Joshua S Hill
Japan’s solar installations are expected to peak this year somewhere between 13.2 GW and 14.3 GW, according to Bloomberg New Energy Finance.
Estimates by Bloomberg New Energy Finance (BNEF) show that the country’s solar market “has been growing steadily” as a result of Japan’s incentive program for clean energy that was introduced back in July of 2012. Subsequently, Japan installed 7.1 GW of solar in 2013, 10.3 GW in 2014, and as much as 12.3 GW in 2015.
However, BNEF estimated that 2016 would set a new high, with the annual installation figures this year reaching as high as 14.3 GW, but then will drop in 2017.
In fact, BNEF is predicting that 2017’s solar installations will sit somewhere between 9.8 GW and 12.4 GW.
“Because there have been challenges in grid connection, land acquisition, and securing financing for projects that could be subject to unlimited curtailment, the annual installed capacity will gradually decrease in 2017 and beyond,” BNEF wrote in the report released Thursday.
Unless something changes dramatically in the next month, Japan will likely cut its tariff for solar power producers beginning April 1 to 26 yen (or 23 US cents) per kilowatt-hour, 3.7% lower than its current rate of 27 yen, “amid falling capex costs for utility-scale projects,” wrote BNEF. Japan’s government has assigned a ministry task force to review the clean energy tariffs for the next fiscal year, though experts believe rates for wind, biomass, geothermal, and small hydro are all expected to remain unchanged.
Already, companies with business in Japan are beginning to modify their plans according to the expected decrease in solar demand. Panasonic announced last week that it would be suspending production at one of its solar PV cell production facilities for approximately half of 2016 due to lower demand.
Predictions for solar installations for some time have been reflecting expected demand decreases. Mercom Capital Group announced back in December that the United States is set to overtake Japan as the second-largest solar market behind China in 2016, with Japan only expected to install 9 GW (which, as you can see, is a lot lower than BNEF’s estimate).