Japan confirms 11 percent FIT reduction

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Japan’s booming solar market will see another FIT reduction. As of next month, the FIT rate will be digressed by 11%. Solar arrays larger than 10 kW will now receive JPY24 per kilowatt hour ($0.21/kWh), a reduction on the current JPY27 ($0.24/kWh

The FIT digression was widely expected, although it is below the 16% reduction mooted earlier in the month. The 11% reduction is in line with advice METI received from industry experts.

A massive 14.3 GW of solar is expected to be installed in 2016, according to a Bloomberg New Energy Finance forecast. This level of annual installation exceeds the 12.3 GW of solar added in 2015 and, if achieved, will represent a new record of solar deployment for the country.

While Japanese solar deployment is clearly taking place at breakneck speed, and the government has been seeking to limit the costs incurred through large levels of solar being added the country’s grid, its wider energy challenges show few signs of abating. The nuclear industry and many within the government would like to see many of the country’s idled nuclear reactors switched back on, public opposition and safety concerns have hamstrung the sector’s recovery.