Year 2022 or the year of action has started, following 2021 when the momentum toward decarbonization accelerated. Significantly influenced by COP26, in 2021, major countries across the globe including both advanced and developing countries were aligned with each other and moved forward to promote policy measures for creating a decarbonized society. As shown in Table 1, highlighted activities over PV power generation both in Japan and abroad made a large step forward to expand introduction of PV power generation in 2021.

The global PV market has grown to 156 GW (preliminary figure) in 2021 from 139 GW in 2020, driven by the recovery of the Indian PV market, and the cumulative installed capacity reached the 900 GW level. PV applications have further diversified with the growth of AgriPV, floating PV (FPV) and building integrated PV (BIPV), in addition to conventional applications such as MW-scale PV power plants and rooftop PV systems. While the majority of PV cells and modules are supplied by Chinese manufacturers, investments for the enhancement of production capacity were active across the entire PV supply chain from silicon feedstock to PV modules, driven by the growing demand globally. However, due to the cost increases of raw materials, components and transportation, the prices of PV products started increasing, switched from the decreasing trend.

In 2021 in Japan, following the national target of ”reducing GHG emissions by 46% by 2030,” the “Plan for Global Warming Countermeasures” and the “Sixth Strategic Energy Plan” were formulated, and Japan’s energy sources were selected. With the significant increase of the renewable energy ratio in 2030 to 36 – 36%, renewable energy has become the core of Japan’s energy policy and Japan’s attitude toward creating a decarbonized society was presented to the world. A significant achievement is that, with the Sixth Strategic Energy Plan, expansion of renewable energy introduction of Japan hereafter will be promoted by regulatory reform and collaboration among concerned ministries and agencies  the collaboration, rather than the sole responsibility of METI. As for PV in particular, against the aggressive target PV installed capacity of 117.6 GW in FY 2030 (55.8 GW already installed), METI, MoE (partly in partnership with MAFF) and MLIT will be responsible for the introduction of 31.8 GW, 24.2 GW and 5.8 GW, respectively, or 61.8 GW in total. These ministries have already reflected in their FY 2021 supplementary budget and FY 2022 budget the amount of budget to expand introduction of PV power generation.

Going forward, METI will work to create an environment that will smoothly promote and accelerate the expansion of the introduction of renewable energy through the Act on Promotion of Renewable Energy, the Electricity Business Act, the Energy Conservation Act, and other measures. With a focus on prioritizing and maximizing the introduction of renewable energy, MoE will start introducing renewable energy to public facilities based on the revised Law Concerning the Promotion of the Measures to Cope with Global Warming and the Local Decarbonization Roadmap, and supporting municipalities in the introduction of renewable energy. MoE will also strengthen support to private companies in the introduction of PV systems for self-consumption. Based  on the “MLIT’s Environmental Action Plan”, MLIT will promote ZEH and ZEB, and expand the introduction of PV power generation using infrastructure spaces such as public rental housing, government facilities, roads, airports, ports, parks, sewage, etc. Based on the Agriculture, Mountain and Fishing Village Renewable Energy Act and Green Food System Strategy, MAFF will promote the introduction of AgriPV and review regulations on the conversion of farmland to expand PV introduction. The Cabinet Office’s “Task Force for Renewable Energy” will advance regulatory reforms to expand PV introduction by comprehensively inspecting regulations on renewable energy across relevant ministries and agencies.

Meanwhile, in the PV industry, in response to the movement toward creating a decarbonized society around the world, new movements that could not occur in the 2010s have started. Various initiatives began with large-scale investment in the renewable energy business by conventional energy industries, utilization of PV by real estate and major construction companies, non-firm connection by electric companies, inter-industry collaboration to strengthen the renewable energy business, acceleration of investment and financing for renewable energy by the financial industry, sale and purchase of PV power plants and overseas business expansion. Under such circumstances, the Japanese PV manufacturers were unable to keep up with global price competition and were forced to withdraw from domestic production. It is necessary to consider the stable supply of PV cells and modules for over 50 GW PV introduction in Japan in the future.

In the PV market, approval of new projects did not spread, and the expansion of PV introduction slowed due to the reasons such as a rise in PV module prices, stagnation in inverter shipments due to a shortage of semiconductors, and a price surge of mounting structures and components. The annual installed capacity in 2021 is expected to be only 6.5 GWDC (estimate), and it will be the first negative growth since 2018. However, as a new business model, PV introduction with the PPA scheme, which does not require funds, began to spread mainly onsite, and corporate PPA, which adopted this method offsite, has also started. It is assumed that the PPA scheme will become a new driving force in the 2020s in place of the Feed-in Tariff (FIT) program.

2021 was the year to set the national energy target for 2030, and 2022 will be an important start year to realize this target. Based on the collaboration with relevant ministries and agencies, The PV industry must leverage PPA, subsidies, regulatory reform and user industries to create new deployment capabilities to achieve its 2030 goals. Let us build a new era of reliable PV power generation, which will be introduced with electric power consumers who are actively promoting the switch to renewable power, and trigger further introduction.

Table 1  Ten most important news related to PV power generation in 2021

©RTS Corporation

Note: Abbreviations of ministries

METI: Ministry of Economy, Trade and Industry               MoE: Ministry of the Environment

MAFF: Ministry of Agriculture, Forestry and Fisheries       MLIT: Ministry of Land, Infrastructure, Transport and Tourism