A Japanese government panel has recommended lifting the amount utilities must pay for electricity from offshore wind farms while cutting prices for power fed in from solar projects.
The recommendations come as Japan, which in the past has been substantially dependent on nuclear power, looks to diversify its use of renewable energy.
Reuters Newsagency reports Japan, hoping to boost alternative energy in the wake of the Fukushima nuclear disaster, introduced a feed-in tariff scheme in 2012.
Under that scheme utilities must buy all power generated from renewable sources such as wind, solar or geothermal.
However, wind projects accounted for only three per cent of development approvals under the program as of November, with solar making up 94 per cent.
The panel’s recommendation, which will need approval from Japan’s trade minister to take effect, should boost business for companies connected to the wind sector both domestically and overseas such as Hitachi and Mitsubishi Heavy Industries.
“As you look at Japan, and how we see the energy mix in Japan we see an opportunity, and that opportunity is in renewables,” Anne McEntee, head of renewable energy at GE , said at an industry conference last month.
At the same time GE announced it would begin selling a wind turbine made specifically for the country.
The offshore wind tariff for major projects should be lifted by nearly two-thirds to $0.39 a kilowatt-hour from the year that starts from April, while the solar tariff should be cut by 11 per cent to $0.34 a kilowatt-hour for corporate projects, the panel suggested in a report just issued.
While generous subsidies have sparked a rush of solar energy projects, the trade ministry is now considering revoking authorisation for some unbuilt installations.
Industry sources have said the promise of a quick profit encouraged speculative developers lacking the experience and expertise needed to deliver, and would cause many projects to fall through.
As of November, less than a quarter of the 26,226 megawatts of solar capacity approved since subsidies were introduced in July 2012 is selling power to the grid, according to data issued late last month by Japan’s Ministry of Economy, Trade and Industry (METI).
