New publication “Forecasting PV Installed Capacity in Japan 2025 to 2040”

2026.05.13

New Publications

The Seventh Strategic Energy Plan was approved by the Cabinet in February 2025, and the expansion of PV power generation is entering a new phase towards 2040. While maintaining the conventional S+3E principle (Safety, Energy Security, Economic Efficiency and Environment), the Plan states that securing decarbonized power sources is also important for strengthening industrial competitiveness in response to the potential increase in electricity demand due to the progress of DX (digital transformation) and GX (green transformation). Under the policy of maximizing the introduction of renewable energy as the main power source, the projected proportion of PV power in the energy mix has been significantly increased from the previous 14 – 16% to 23 – 29%, which corresponds to the generation capacity of 203 – 280 GWAC, showing PV’s position as the top power source in Japan in FY 2040. Since the cumulative installed capacity by FY 2024 is estimated to be around 77 GWAC, achieving the 2040 target will require an average of 8 – 13 GWAC annual installed capacity over the next 16 years. Given that the current annual installed capacity is below 5 GWAC, it is necessary to accelerate deployment with the combined efforts of both the public and private sectors.

On the other hand, there have been cases of PV power plants that lack consideration for ensuring harmony with the natural environment and local communities. As a countermeasure, the Package of Measures for MW-scale PV Projects was decided upon by the Ministerial Council at the end of 2025. While taking strict action against inappropriate projects, the policy is to continue supporting and promoting further deployment of desirable PV projects (ground-mounted, building-mounted, Agro PV, etc.) that comply with relevant laws and regulations balancing various public interests, such as ensuring the safety of land development and electrical facilities, protecting living and natural environments, and that ensures harmony with the local community.

Japan is said to have the world‘s highest PV installed capacity per unit of land area, and further expansion requires promoting new deployment strategies. In this report, how to promote the introduction of PV in various fields, including residences, private buildings, public buildings and infrastructure facilities, ground-mounted PV systems in harmony with local communities, farmland utilization (Agro PV) and floating PV (FPV) has been examined, in consideration of the following: dissemination environment and market conditions, technological advancements and the areas in which PV can be introduced and utilized. Amidst changing social environment, PV power generation needs to become a reliable energy source and transform itself into a self-sufficient power source to serve as a future main power source. Moving away from the previous expansion of introduction through the FIT/FIP programs and towards a desirable form of integration into the electricity market, the PV installed capacity to be introduced by 2040 was forecasted by application (introduction field) and capacity range, based on the Seventh Strategic Energy Plan, taking into account various factors, such as introduction schemes, business models, technological innovations, the shift to green electricity from the side of electricity consumers and the improvement of social acceptance.

PV Installed Capacity Japan 2025-2040 Source: RTS Corporation