Visit to Plant

19.5MW Solar Plant Arranges Panels on Slopes

Steel molds improve foundation accuracy, shorten construction time

2014/03/08 22:26
Shinichi Kato, Nikkei BP CleanTech Institute
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The mega (large-scale) solar power plant with a total output of 19.5MW, which is being constructed by the Daiwa House Group on about 300,000m2 of land of the former Kaijima Coal Mine in Miyawaka City, Fukuoka Prefecture, is nearing full-fledged operation (Fig. 1). This mega-solar project consists of three large-scale solar power plants. The 1.5MW and 1.9MW output solar power plants started operation in October 2013 whereas the remaining 16.0MW mega-solar power plant is slated to start generating power in April 2014.

"The land, which once contributed to Japan's energy through coal, is now in the position to again make a contribution to the energy supply as a solar power plant." Ahead of the construction, Yoshiteru Adachi, New Energy Project Leader at the New Energy Department, Daiwa Energy Co Ltd, heard such opinions from the landowners of the former Kaijima Coal Mine, where the power plant was built. "It felt sobering knowing they rented us the land with those thoughts," Adachi recalled.

Toyota Motor Corp's Kyushu Plant is located nearby. Given this location, an industrial park was established with the aim of attracting plants from the automobile-related industry. The mega-solar power plant is situated in a corner of this industrial park. Time passed without finding a company to build a plant in the park as was expected at the beginning, until the Daiwa House Group came to construct the mega-solar power plant prior to the implementation of the feed-in-tariff (FIT) program for reusable energy.

Reasons why lease style was adopted

For this mega-solar power plant, Daiwa House Industry Co Ltd's subsidiary, Daiwa Energy, runs the power generation business and sells the power to Kyushu Electric Power Co Inc. The mega-solar power plant was constructed by Daiwa House Industry. As has thus far been described, the project appears to have been completed within the Daiwa House Group, but this is not so.

It is Mitsubishi UFJ Lease & Finance Co Ltd that purchased the mega-solar power plant from Daiwa House Industry and rents it to Daiwa Energy. And it is also Mitsubishi UFJ Lease & Finance that rents the land from the landowners.

There were various reasons why such a business structure was adopted. First, it was aimed at clarifying the roles of Daiwa Energy's power generation business and Daiwa House Industry's mega-solar power plant construction business. It was also difficult for Daiwa Energy alone to procure the roughly ¥6.5 billion (approx US$62.9 million) needed for construction of the mega-solar power plant. Mitsubishi UFJ Lease & Finance, however, can serve as a financing function.

For a 20MW-class mega-solar power plant like this, a special purpose company (SPC) is generally established to structure a loan as project finance. In the case of this mega-solar power plant, however, the cost to establish, manage and run an SPC would exceed the cost of leasing the property. As Mitsubishi UFJ Lease & Finance also manages the contract, salary transfer, etc, the benefit of complementing each other with a company that is skilled in risk management and maintenance operation is significant."

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