solar market in japan
DESCRIPTION
This is my presentation at the JETRO seminar in 10/2009, about Japan\'s solar marketTRANSCRIPT
The Sun Will Rise AgainOpportunities in Japan's Solar Sector
Chako Ando
Cando Advisors
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Agenda:
Solar market in Japan Political climate Major players Opportunities
Market entryAlliance
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Solar market in Japan
Why “Again”? Japan – ahead of world’s market
1994 – 2005: Technology development and government incentives in the Solar sector
1998 – 2004: Lead the world in cumulative installation
In 2004, Japanese solar panel manufacturers accounted for 50% of world’s share
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Why “again”?
Market slowed down since 2005 Why? The incentive
system expired
Japanese solar makers’ world share fell from 50% in 2004 to 25% in 2008
World Solar Panel Share 2007
Source: Agency for Natural Resources and Energy
Japan
ChinaGermany
US
Taiwan
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World market share 2009 (est.)
Source: iSuppli
0
2
4
6
8
10
12
14
2008
2009
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Japan’s solar industry Market size
Export
Domestic
Source: JPEA
1 million kW
238K kW
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Japan’s domestic solar market
Residential
Utility/Industrial
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Recovery of the market
Subsidy re-established in Jan 2009 Jan - March application was 22,500 cases - vs.
annual installation of 55,000 in 2008 Govt. budget for subsidy –
2008 - Y9 billion 2009 - Y47 billion ($500 mm)
(200,000 households)
2009 April-June domestic shipment grew 83% from same period 2008
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Political climate
Subsidy and tax breaks for residential installation
Local and regional subsidy Feed-in Tariff Law (July 2009) "School New Deal" New DPJ Government
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Political agenda
Target: July 2008 - 10x solar PV by 2020April 2009 - increased to 20x by 2020
Targets a 10 year payoff* New DPJ regime - to expand to other
renewable energies
* A recent report by Chuo Mitsui Trust says it may be shortened to 8 years after FiT purchase incentive
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Subsidy and market
Solar market in Japan is heavily affected by political subsidy
Substantial government subsidy in early 2000s
After 2005 expiration of subsidy program, the market contracted in 2006 and 2007
The new program would support about $2,000 per household, reducing the cost by 10%
Subsidy
# of installation
Source: Nikkei Trendy
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Local incentives
Example: Tokyo Targets to introduce 1 million kw of solar p
ower in the district by 2016 2 year program started in April 2009
Subsidy for 40,000 householdsApplies to rental property and corporate resid
ence (national program is only owned homes)
Source: Tokyo Metropolitan Center for Climate Change Actions
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"School New Deal"
Government aims to install solar panels on the rooftop of 12,000 public schools in 3 years50% supportMinimum of 4 million Yen budget per case
Source: MEXT
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Energy purchase (Feed-in Tariff) New energy purchase system (FiT syste
m) to start Nov 2009 Electric utility companies to purchase back
renewable energy from homes for Y49/watt
10 year program, reducing payback period
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Hatoyama’s new government
More ambitious plan of greenhouse gas reduction 25% reduction from
1990 level by 2020 Vs. 8% target by
previous regime
Major environmental “Manifest” of DPJ Cap-and-trade system “Global warming tax” FiT, smart grid technol
ogy Solar panel, auto, fuel
cell
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Leading Japanese Companies
Sharp Kyocera Sanyo Mitsubishi
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Sharp
Industry leader, former world leader untill 2006
Lagged behind Q Cells due to silicon shortage
Building capacity of thin film Sakai Plant to produce 1 m
m kW a year from 2010 – total production to double from 2008
Web Monitoring – from PV Japan
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Kyocera
Compact size, light modules
Solar ventilation system for the new model of Prius
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Trading companies
ItochuSolar installers, system integrators
67% acquisition of Ecosystem Japan (March 2009) 85% of Solar Net of U.S. (April 2009) Solar Depot of California Scatec Solar (Norway) Enolia Solar (Greece)
Source: Company website
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Market opportunity
Opportunities in Japanese marketPanels, modulesProduction equipmentVenture, co-developmentRelated services
Installation Testing
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Overseas companies in Japan
In April-June 2009, import grew 70x from previous year to 10% of Japanese market
Suntech Power (China) Applied Materials Opportunity for a Venture: Konarka Techn
ologies
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Suntech Power (China)
Dec 2008 - Alliance with West Holdings, Japanese home retrofitter, for panel installation
Started retail sales through 450 outlets of major home electric appliance retailer, Yamada Electric from August 2009
Targets 10% share of residential solar in Japan w/in a year Growth in Europe slows
Price on par with leading Japanese products, but warranty 25 years instead of 10
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Applied Materials
Global player of panel production “About 95 percent of our solar business is outside the
U.S.” All 14 solar panel factories it’s built around the w
orld in the last two years - none in the U.S. Thin film module production line “SunFab” five are in Germany, four are in China, one is in
Spain, one is in India, one is in Italy, one is in Taiwan and one is even in Abu Dhabi.
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Opportunity for a Venture
Konarka Technologies Joint development and venture with Toppa
n Forms of organic film PV for indoor use March 2009 - announced the 2010 release
of indoor light PV film, to be used in audio paper, one-time passwrd cards
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Alliance Cases
Example: Sharp and Enel JV in ItalyEnel: Electric utility in ItalyThin film panel production (1GW capacity)189 MW solar power generation facility
>100 billion yen investment ($1 bil.)
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Part and component
Source: Nikkei BP
Electrode: DuPont, Ferro
Backsheet Film: DuPont
Silicon: Hemrock (US)REC (Norway)
Backsheet: Isovolta (Austria)
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Resources
JPEA
Market size http://www.jpea.gr.jp/04doc01.html
2009 1Q http://www.jpea.gr.jp/pdf/pub_st.pdf
