FIT Tariffs for Commercial Solar Plants Expected to Further Drop in Japan (page 2)

2019/11/11 19:32
Kenji Kaneko, Nikkei BP Intelligence Group, CleanTech Labo
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METI announced three plans Nov 5, 2019, on the expected values of "system cost per kilowatt" (which is used to calculate the purchasing price of solar electricity), which were made by using "top runner analysis." They are ¥135,000 (top 9%), ¥142,000 (top 13%) and ¥154,000 (top 17.5%). It said that one of the three plans will be selected based on the results of the fifth bidding.

The expected system cost used to calculate the purchasing price in fiscal 2019 (¥14/kWh) was ¥182,100. So, all of the three plans will lower expected system cost by several tens of thousands of yen. As a result, the purchasing price for high-voltage solar power plants that are excluded from the bidding system in fiscal 2020 is now more likely to become lower than ¥14/kWh.

Disposal fee fixed at 10,000 yen/kW

As for the price of surplus electricity generated at low-voltage commercial solar power plants that meet the requirements for local use, METI did not show its plan at the meeting Nov 5, 2019. It will be discussed in the next or later meeting of the Calculation Committee for Procurement Price, Etc together with the details of the requirements.

Moreover, in the meeting that took place Nov 5, 2019, committee members agreed to change the expected disposal cost of solar power generation (PV) facilities from "5% of capital cost" to "¥10,000/kW regardless of expected capital cost." This change was made by responding to an opinion that, if expected disposal cost is set at the ratio (5%), it decreases as expected capital cost is lowered but actual disposal cost is not lowered in accordance with capital cost.

Furthermore, METI proposed introducing a bidding system for onshore wind power plants in fiscal 2021 and employing a bidding system for all offshore wind power plants anchored to the seabed including plants that are excluded from the application of "Renewable Energy Marine Area Usage Law" in fiscal 2020, and the proposal was approved by committee members. As a result, it became clear that wind power plants will be shifted to the bidding system except for floating wind power plants.