GlobalData’s latest report, ‘Japan Power Market Size, Trends, Regulations, Competitive Landscape, and Forecast, 2022 - 2035’, reveals that the expansion of renewable power capacity faces specific challenges.
Attaurrahman Ojindaram Saibasan, Power Analyst at GlobalData, explained: “Historically, the proliferation of renewable power projects has been hindered by the difficulty of getting such projects connected to the grid. Since the grid is in the hands of various local utilities, connection charges are high. This is compounded by the fact that the rules for setting up renewable projects are cumbersome, and it takes three of four years to clear all regulatory hurdles. Very few developers have sufficient funds or patience to see their projects through this process.”
Consequently, the government has decided to reduce the waiting period for the approval of renewable power projects to less than two years, GlobalData reports. In addition, the establishment of a centrally operated grid may finally allow renewable projects to be set up faster, encouraging the sector to grow into a significant part of Japan’s power network. The implementation of an approval process for renewable projects through auctions will hopefully change the system and increase the speed at which projects are commissioned.
Saibasan concluded: “Another challenge that the country faces about the renewable sector’s expansion is a lack of space. Japan’s quest to replace thermal power with renewables will not be possible, mainly because it will need to cover virtually all its free land with solar panels to fully power the country.
“Offshore wind is an option, and the country is also experimenting with floating solar power. These resources were expensive, but are now more economical with improvements in technology. Again, Japan’s efforts to implement a public tendering system to approve new renewable power projects will be able to take advantage of the falling prices of newer technologies.”