European Solar Carnage continues as Solar Panel Companies fall like nine pins against the Chinese Onslaught
August 30, 2012New India Assurance Company
August 31, 2012Solar Energy – Japan
The Japanese Government announced a very lucrative subsidy scheme for solar energy in Japan following the Fukushima disaster. Note Japan gets only 2% of its energy requirements from green energy compared to around 20% for Germany. Though Japanese solar panels used to be the world leaders till 2007, lack of government support and competition from solar panel producers in China has made them also rans. Though the Japanese solar panel producers are not being able to take advantage of the generous subsidy, Japanese home builders are not going to lose the opportunity. Big home builders like Sekisui House and West Holdings have made billion dollar investment plans to get into solar energy. Note Softbank has already announced plans to build 10 MW solar parks all over the country.
West Holdings has organized a consortium of 12 investors including solar cell and solar panel producers. The company is going to build 250 installations with around 500 MW of capacity. Note home builders have a natural advantage as they can easily install solar panels in newly built housing projects. They also have easy access to solar installers and financing.
Bloomberg
Sekisui House Ltd. (1928), the Japanese house builder, plans to move into electricity generation by installing solar panels, it said in July.
West Holdings Corp. (1407), a Japanese home renovation company, said it plans to invest $1.3 billion to develop solar power plants The 250 plants with a combined capacity of about 500 megawatts will be set up over five years by Japan Mega Solar Power Co., formed by West Holdings in June, Toshihisa Nagashima, senior managing director, said by phone today. Japan Mega Solar has attracted 12 investors including Orix Corp. (8591), a Japanese finance and leasing company, Shanghai-based JA Solar Holdings Co. (JASO), the biggest maker of photovoltaic cells, and LS Industrial Systems Co. of South Korea, he said.
Softbank and Mitsubishi solar investment in Japan
Mitsubishi has mostly looked to overseas market for growth like Wind Energy in the USA .Mitsubishi is a part of the consortium which is looking to set up huge solar power plants in Thailand as well.But now with Japan reaffirming it commitment to renewable energy and on track to kill nuclear energy,Mitsubishi is turning its focus towards the domestic market.Mitsubishi is planning to set up a number of solar power plants in the country to take advantage of the Japan solar Feed in Tariffs which will be introduced soon.Note the Fukushima disaster which led to elevated nuclear radiation levels has changed the energy policy of the country and its powerful businesses. Softbank CEO has already decided to set up a number of power plant in the country using solar energy, now Mitsubishi too is following. Softbank has decided to set up 10 large power plants of 100 million each in partnership with local prefectures for which it will give the 10% equity funding.
However with the setting of a crazily high Feed in Tariff of 52c/KwH, solar demand is set to increase exponentially in Japan. Note Japan is already one of the biggest markets globally and has a large solar manufacturing industry. This is ideal grounds for a subsidy led solar boom like what happened in Spain in 2008 and Czech in 2010 with pernicious results. Japanese solar companies like Sharp, Solar Frontier, Mitsubishi will benefit the most. This is despite their much higher solar panel costs and prices compared to the global leaders like Trina. The reason is because of implicit barriers that Japan erects. Non-Japanese companies like First Solar, Sunpower have not been able to penetrate the Japanese market in a significant way because of these implicit hurdles. Note this is common to other markets and industries as well like LCD, computers, mobiles, rice etc.