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Japanese solar will overtake Germany and the US in 2013

Japan's decision to turn its back on nuclear and offer the world's most generous PV FIT scheme is set to see the country overtake Italy, Germany and the U.S. this year to become the world's second biggest solar market in 2013.

Japan will become the world's second biggest solar market in 2013, according to IMS Research.

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The PV Market in Japan report, by IHS-owned IMS Research, predicts more than a gigawatt of new photovoltaic installations will be added by the end of the month, and more than 5 GW over the remaining three quarters of 2013.

This is down largely to a FIT rate of JPY42/kWh (US$0.44/kWh), described as "perhaps overly generous" by Ash Sharma, senior director of solar research at IHS.

Even with the FIT rate expected to come down around 10% after April 1, the solar policy is expected to drive photovoltaic installations to new heights with Japanese manufacturers the main beneficiaries.

"Japanese customers want to buy Japanese modules," added Sharma, who pointed out the tough requirements for inverters in the country made it difficult for foreign companies to break in to that segment and are causing a bottleneck in inverter supply.

Up to 25% of the new installations this year will be of 2 MW or more in size, according to the IMS Research report whose authors predict such larger scale developments will drop off next year because of a shortage of suitable development sites in the country.

The report's authors say the generous solar policy in Japan is a lifeline for domestic manufacturers whose residential systems are currently around twice as expensive as their German equivalents.