Domestic demand to solar PV products in Japan dropped in the second quarter of fiscal year 2015 (2015 July to September), leading to domestic PV shipment decrease. JPEA reported an annual PV module shipment decline in the quarter, and the PV cell shipment decrease sequentially was also large. It is projected for Japan to face demand decline in the future, so some Japanese PV companies have started seeking opportunities for global PV plant projects.
The installations of large-scale PV projects in Japan declined sequentially in 2Q15, which was mainly due to the feed-in tariff reduction policy that cuts the rates year by year since 2012, said JPEA. During the second quarter, Japan’s domestic PV module shipment declined sequentially to 1,979MW, representng a 23% reduction from 2Q14. The domestic PV cell shipment also declined 26% from 2Q14 down to 1,777MW – the decline not only indicated the third sequential reduction, but also the largest reduction rate Q-o-Q in the past 32 quarters.
1,410MW – or 79% -- of PV cell shipments from the 1,777MW volume were for non-residential, large-scale PV power plants. The demand to large-scale projects decreased 24% compared to 2Q14. Furthermore, 40% of the total domestic PV cell shipments were supplied by overseas companies, higher than the 33% ratio in 1Q15 and was the highest in history.
Most PV companies saw financial decline in 2Q15 compared to the prior quarter or to the same quarter in 2014. The situation was blamed on weakened demand from large-scale and utility-scale projects. It was unable for installations for residential PV segment to offset the large-scale/commercial installation decrease, neither.
Lower domestic demand in Japan triggers global strategies
EnergyTrend projects 2015 and 2016 to be Japan’s peak demand years, and the demand will go down because of factors such as saturated market, overloading power grids and FiT reductions. Small-scale residential or commercial PV systems will dominate Japan’s PV market in the future, while orders for large-scale PV plants will be eliminated.
To remain competitive through the market transformation, first-tier Japanese PV companies such as Kyocera, Sharp, Panasonic and Mitsubishi Electric have started developing overseas markets. According to JPEA, the overseas PV cell shipments from Japanese vendors increased 12% annually to 202MW.