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FIT Tariffs for Commercial Solar Plants Expected to Further Drop in Japan

2019/11/11 19:32
Kenji Kaneko, Nikkei BP Intelligence Group, CleanTech Labo
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Japan's Ministry of Economy, Trade and Industry (METI) announced its plan on the conditions for calculating purchasing prices for solar and wind electricity for fiscal 2020 at a meeting of the Calculation Committee for Procurement Price, Etc Nov 5, 2019.

The committee is for discussing purchasing prices based on the feed-in tariff (FIT) policy.

Based on discussions at experts' meetings, etc, commercial solar power plants with a grid capacity of 10kW or higher are scheduled to be separated into three segments and operated based on the FIT policy. First, low-voltage commercial solar power plants with a grid capacity less than 50kW will be shifted to sale of surplus electricity by setting "requirements for locally using self-consumption-type plants."

Second, a predetermined FIT tariff will be applied to high-voltage plants with a capacity of 50kW or higher, which were excluded from the bidding system (applied to plants with a grid capacity of 500kW or higher in fiscal 2019). Third, purchasing prices for high-voltage and extra-high-voltage plants, which are the targets of the bidding system, will be decided through bidding.

In the past discussions, it was decided to expand the application of the bidding system in fiscal 2020. In METI's plan announced Nov 5, 2019, the validity of expansion from "500kW or higher" in fiscal 2019 to "100kW or higher" was showed, and a schedule to decide the expansion based on the results of the fifth bidding (to be disclosed Dec 17, 2019) was announced. As a result, the bidding system will be considered based on the standard of "100kW or higher."

On the other hand, less-than-50kW low-voltage commercial solar power plants that meet the requirements for local use will sell surplus electricity (less-than-50kW plants that do not meet the requirements for local use will be excluded from the FIT-based purchasing). Also, if the target of the bidding system becomes "100kW or higher," electricity generated at 50-100kW high-voltage plants will continue to be purchased at a predetermined FIT-based tariff.