TOKYO -- Showa Shell Sekiyu will invest around 30 billion yen ($288.68 million) to construct 10 megasolar power plants across Japan by 2015.
Wholly owned unit Solar Frontier, which specializes in solar energy, will break ground on a 30,000kW megasolar facility this year on a property adjacent to Nagasaki Airport. In addition to supplying panels, Solar Frontier will handle solar farm construction, operations and maintenance.
Solar Frontier has a business tie-up with Germany's Belectric, which has built a number of megasolar plants worldwide offering more than 1 million kilowatts of power, and Japanese plant engineering firm Chiyoda. It will tap both firms' know-how in such areas as shortening construction timelines, to lower project costs.
Power capacity developed by Solar Frontier, including existing facilities, will jump sixfold to 100,000kW -- bringing it on a par with other domestic solar panel giants such as Sharp. The capacity is equivalent to enough power for 30,000 households.
Solar Frontier makes CIS (copper-indium-selenium) solar panels instead of the crystalline silicon type that is the global mainstay among manufacturers. CIS panels offer a lower energy conversion rate than those made of crystalline silicon, but are less susceptible to weather and low-light conditions and thus provide stable energy volume.
In 2013, Solar Frontier's solar cell shipments were equivalent to some 900,000kW on a volume basis, giving it a roughly 10% share of the Japanese market -- the largest after Sharp and Kyocera.
But the domestic market has seen an influx of foreign solar cell makers since the July 2012 rollout of Japan's feed-in tariff program, which requires utilities to purchase power from renewable energy sources at a fixed rate. In just one year, prices of solar energy systems have fallen by 10% or so, making it difficult to profit from panel sales alone.
Solar power prices under the feed-in program will also be lowered from April to encourage an expansion in wind power and other forms of renewable energy. Anticipating a decline in orders, Solar Frontier hopes to offset that by focusing on comprehensive services that include construction, maintenance and operation of solar farms.