The lowest successful bid was roughly 28% lower than the feed-in tariff (FIT) rate of JPY 24 (around US$0.214) that the government offered throughout the last fiscal year, The Nikkei reported this week, without citing sources. It said the highest successful bid in the country’s first reverse auction for solar came in at JPY 21/kWh.
Given that METI has yet to issue a press release, Prashant Khorana, an analyst at MAKE Consulting, told pv magazine he is approaching the news with a degree of caution. However, he said the pricing reported by The Nikkei is broadly in line with the research firm’s expectations for the levelized cost of energy (LCOE) in Japan’s solar auctions.
“The economics make sense, but the volume is a little lower than what we had expected,” Khorana said. “We’ll have to downgrade our forecast a little bit if this is true — it’s a little less momentum than we’d expected in the market.”
The Japanese units of Canadian Solar, Hanwha Q Cells and X-Elio were among the companies that won the rights to build PV projects above 2 MW in size, The Nikkei claimed. It said that 500 MW of solar capacity was potentially up for grabs in the latest bidding round, with just 140 MW awarded to developers.
METi plans to hold two bidding rounds per year from fiscal 2018. The government approved plans to move forward with solar auctions in early 2016, as part of efforts to phase out the FIT scheme it launched in July 2012 at an initial rate of JPY 40/kWh.