'Renewable Energy Act' serves as breakthrough
The project site was originally a publicly owned joint farm registered as Category 1 farmland under the Agricultural Land Act. The farm was shut down 17 years ago as a result of integrating public farms in line with the decreasing number of livestock farmers, after which the site's effective use became a problem. Although inviting a mega-solar project was considered in the wake of the FIT scheme implementation, it was difficult to convert the land category in order to run a solar power business when it came to Category 1 farmland.
A breakthrough came with the "Act on Promoting Generation of Electricity from Renewable Energy Sources Harmonized with Sound Development of Agriculture, Forestry and Fisheries" formulated in November 2013. It was only after adopting this act's scheme did it become possible to utilize Category 1 farmland for a renewable energy project (Fig. 4).
Subsidy leveraged for storage battery adoption
It was to meet the technical requirement Hokuden announced in April 2015 that the Shiriuchi 20M Mega Solar Power Plant installed a storage battery system in parallel with the PV system. Hokuden required a "1% fluctuation per minute" that limits the range of fluctuations in grid output of a mega-solar plant combined with the battery's charge-discharge control to 1% or less per minute compared with the rated output of the PV inverters. This is aimed at smoothing short-period fluctuations to limit the impact of sharp fluctuations in output from PV power generation on the grid frequency (Fig. 5).
Taking into consideration the cost for a storage battery system at that time, however, even if the FIT-based unit price was 40 yen/kWh for the project, it was difficult to secure a return on investment generally required by enterprises while setting up a battery system to meet this requirement in parallel with a PV system.
Amid such circumstances, a subsidy project announced in March 2015 served as a tail wind. It was the "Subsidy as an Emergency Response to the Suspension of the Grid Connection of Renewable Energy-based Power Generation Facilities" (Project for Helping Renewable Energy-based Power Producers Introduce Power Storage Systems), for which the Ministry of Economy, Trade and Industry (METI) called for public proposals through the Sustainable open Innovation Initiative (SII).
The project in Shiriuchicho applied for this subsidy project and secured a subsidy, which resulted in a sharp rise in the return on investment.