
The logistics real estate developer and investor Prologis signed a 20-year 5.8MW virtual PPA with Sumitomo Life, the two companies announced on December 4, 2024. Supply of non-fossil certificates (NFCs) through the PPA is expected to start in December 2025.
The NFCs will be generated at two rooftop power plants to be developed at Prologis facilities. All certificates generated at the 1.2MW power plant to be developed at Prologis Park Okayama will be supplied alongside 4.6MW worth of certificates generated at the 5.7MW power plant to be developed at Prologis Park Morioka. The remaining 1.1MW will be self-consumed at the Morioka facility.
Power generated at the power plants will be aggregated and sold in the wholesale power market by Digital Grid, which will also be in charge of supporting the PPA’s settlement and the transfer of NFCs from Prologis to Sumitomo Life.
The two power plants that will be part of the PPA will be operated under the feed-in-premium (FIP) scheme, which pays a variable premium based on the wholesale market price and a balancing subsidy to eligible projects.
Since October 2023 until the end of the current fiscal year, the FIP price for rooftop solar projects 10kWh and larger has been fixed at 12 yen per kWh. While it will be lowered to 11.5 yen in FY2025, that is still considerably higher than the sub-10 yen/kWh offered for ground-mounted projects that are 50kW and larger. In both cases, the FIP contract duration is 20 years.
According to the Japan Energy Hub PPA database, this is the third PPA overall and the first virtual PPA disclosed by Sumitomo Life. Prologis has also previously announced multiple other PPAs.