Monthly Report

Yano forecasts Japan’s new solar capacity to reach 6GW and shift heavily toward PPAs in FY2030

September 3, 2024
Solar in Japan
PPAs are growing in popularity in Japan.

Yano Research Institute expects the newly installed solar capacity in Japan to reach just over 6GW in FY2030, the company revealed in the latest edition of its forecast. The market research firm expects the currently prevailing power plants monetized by the feed-in-tariff (FIT) and feed-in-premium (FIP) subsidies to give way to non-subsidized power plants used for self-consumption or monetized through PPAs.

According to Yano Research Institute’s projections, new non-residential on-site PPA capacity in FY2023 (April 1, 2023, to March 31, 2024) reached 870MW and off-site PPA capacity reached 445MW, accounting for 17.3% and 8.8% of the total, respectively.

The company’s forecast expects the shift toward power plants not subsidized by FIT or FIP to continue and PPAs to account for over 60% of the new installed solar capacity in FY2030. It expects the new installed solar capacity monetized by off-site PPAs to overtake the capacity installed for on-site PPAs for the first time in FY2026 due to the larger average size of off-site contracts.

While the majority of newly installed solar power plants for self-consumption right now is subsidized using the FIT (and to a smaller extent FIP) scheme, that is expected to gradually shrink due to the decreasing level of the subsidies.

On-site PPAs started gaining popularity in Japan in FY2020 and off-site PPAs followed in FY2022. To date, approximately 400 deals have been disclosed with many more undisclosed ones expected to have been made. Details of the disclosed deals can be found in the Japan Energy Hub PPA database.

If you found the above helpful, join our free weekly newsletter to get a summary of the latest news from the Japanese power market straight in your inbox.

…or create a FREE Japan Energy Hub account to not only receive the newsletter but also access to selected parts of our data modules.

In other news...

Monthly Report - The Japanese Power Industry Executive

Submit the form below to receive a sample issue of The Japan Power Industry Executive.