Growth in Japan’s solar power sector is predicted to slow over the coming decade, according to a new analysis from the Fitch Group, but not before the industry adds 17 gigawatts (GW) worth of new solar capacity between the end of 2017 and the end of 2020.
US credit, macro, and industry solutions firm Fitch Solutions Macro Research, part of the Fitch Group, published a new Industry Trend Analysis for Japan’s solar sector this week, in which it forecast growth in Japan’s solar power sector to slow over the coming decade. The slowdown comes in the wake of the company’s transition to competitive auctions for utility-scale solar power capacity procurement in 2017. Another catalyst for this slowdown is the September announcement from the Japanese Government which sees the country’s feed-in tariffs (FiT) for solar installations reduced at the household- and company-levels by half by the mid-2020s.
This transition away from feed-in tariffs to competitive auctions, as well as FiT reductions, are intended to address the high costs of subsidizing the country’s solar power industry which has nevertheless resulted in explosive growth, with the Japanese solar sector growing from 13.6 GW at the end of 2013 to 48.6 GW by the end of 2017, making it one of the fastest growing solar sectors in the world.