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Buying Prices for Solar Electricity Might Be Changed Twice in FY2015

2015/01/19 14:45
Kenji Kaneko, Nikkei BP CleanTech Institute
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Japan's Ministry of Economy, Trade and Industry (METI) had a meeting of the Calculation Committee for Procurement Price Jan 15, 2015, for the first time in 2015.

As for the buying prices for renewable energy-derived electricity in 2015, METI decided to lower the buying price for electricity generated by non-residential (10kW or higher-capacity) solar power generation facilities and keep the prices for other kinds of renewable energy-derived electricity.

METI has a meeting of the Calculation Committee for Procurement Price every year during the period from January to March to discuss and decide buying prices for the feed-in tariff policy for the following year.

This time, for the calculation of purchasing prices for fiscal 2015, MEIT announced the estimates of (1) the costs for renewable energy-based power generation systems and operation and maintenance (O&M), (2) facility utilization rate, (3) ground-making expenses and (4) rents in addition to the way to deal with the "premium period" (a period during which favorable consideration is given to the profits of power producers), which will end at the end of June 2015.

In terms of estimates related to non-residential solar power generation systems, METI proposed to raise estimated system cost to ¥290,000/kW (275,000/kW in fiscal 2014), raise estimated facility utilization rate to 14% (13% in fiscal 2014), keep estimated ground-making expenses at ¥4,000/kW, keep estimated grid connection cost at ¥13,500/kW, lower estimated O&M cost to ¥6,000/kW/year (¥8,000/kW/year in fiscal2014) and keep estimated land rent at ¥150/m2/year.

According to the estimates, the raise in system cost will increase buying price while the lowered O&M cost and the increase in facility utilization rate will decrease buying price. Some pointed out that the increases in system cost and facility utilization rate were possibly caused by "overloading," which installs solar panels with a total rated capacity higher than that of PV inverters. Therefore, it will be researched until the next meeting.

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