Japan on track to hit 90 GW of PV capacity by end 2023

Japan reached a cumulative installed PV capacity of 78.4 GW at the end of 2021, according to the National Survey Report of PV Power Applications in Japan – 2021, which was recently published by the International Energy Agency Photovoltaic Power Systems Programme‘s (IEA-PVPS) Task 1.

Last year, the country deployed 6,545.2 MW of new solar capacity. About 2,992 MW of the total came from centralized installations, 3,551 MW from distributed-generation solar arrays, and 2.2 MW from off-grid systems.

Izumi Kaizuka, the director of RTS Corp., said the Japanese market could reach a cumulative capacity of up to 90 GW by the end of 2023.

“We expect between 5 GW and 6 GW of new PV capacity both in 2022 and 2023,” Kaizuka told pv magazine, noting that the market share between centralized and distributed projects might not change substantially.

Large-scale will solar account for between 2.5 GW and 3 GW of all newly installed capacity this year.

“It will be mostly for projects under the expired feed-in tariff scheme for utility scale installations,” Kaizuka explained. “Only a small portion will come from auctions and the PPA market.”

Rooftop PV will account for the rest of this year's installations – especially commercial and industrial systems.

“Rising energy prices are currently pushing businesses to install solar installations under the feed-in tariff scheme,” said Kaizuka.

The feed-in tariffs for PV systems up to 10 kW will decrease from JPY 17 ($0.13)/kWh in 2022 to JPY 16/kWh this year, but only for surplus power. The tariffs for installations ranging in size from 10 kW to 50 kW will drop from JPY 11/kWh to JPY 10/kWh. The owners of such installations will be allowed to inject all electricity into the grid.

The tariff for PV systems ranging in size from 50 kW to 200 kW will decline from JPY 10/kWh to JPY 9.5/kWh. All systems larger than 200 kW will have to compete in auctions.

“The feed-in tariff scheme for rooftop PV will be in place until the end of next year and we don't know already what may come afterward,” said Kaizuka.

The IEA-PVPS said that PV system prices continued to drop in 2021. The price of residential PV systems up to 10 kW in size, for example, fell from JPY 231/W in 2020 to JPY 220/W in 2021. Prices for commercial installations ranging in size declined from JPY 187/W to JPY 178/W. The average price of ground-mounted PV plants over 1 MW, meanwhile, decreased from JPY 128/W to JPY 122/W.

Kaizuka acknowledged that Japan is dealing with limited land availability and high land costs. These issues are obstacles for the deployment of large-scale solar facilities.

“We may already have reached our tipping point,” she said, in reference to the availability of land for solar. “But I am confident that some support may come from local governments and prefectures, which may decide to allocate public land for this purpose. Currently, there is intense activity to define the zoning processes for either conventional ground mounted projects or agrivoltaic plants.”

Agrivoltaics could potentially become a new market driver for the Japanese energy market in the years to come. According to the IEA-PVPS, the combined capacity of all agrivoltaic systems deployed in the country reached 300 MW at the end of December.