Grid Scale, Solar, Storage

Solar PV Manufacturer Solar Frontier Expanding Globally As Japanese Solar Market Softens

After three years of brisk sales in Japan driven by an aggressive Feed-in Tariff (FIT), Solar Frontier is looking to expand into the global market and still hopes to build a manufacturing plant in the U.S. according to the company president and CEO Atsuhiko Hirano who spoke with RenewableEnergyWorld.com during Intersolar North America.

The company purchased a 280-MW pipeline — consisting of about 10 mid-sized projects — from Gestamp earlier this year and plans to use it to “create a foundation” of projects in the U.S., which is one of its key markets.  In addition, Solar Frontier has a 100 MW pipeline of projects in the U.K. “So 2013 and 2014 was really all about Japan but now we are making it clear that we are going global,” he explained.

The company also plans to “disperse our production capacity” into the global market and has a very aggressive goal of deploying 3 GW of capacity into the market by 2020.

Hirano said Solar Frontier has dabbled in the emerging energy storage space as well, pairing NEC batteries with some residential systems in Japan and installing the same type of residential PV plus storage systems in Germany using a German battery manufacturer’s products. “But it’s not an exclusive arrangement that we have,” he said explaining that the company is keeping its eyes on the emerging space.

Challenging Market Conditions in Japan

“In Japan the demand was abut 9.3 GW and we only have 1.3 GW of capacity so we are limited by what we can supply,” Hirano explained.  Solar Frontier currently has about 10 percent market share in Japan, which is in line with thin-film’s share of the overall solar market worldwide.

Hirano said that the attractive FIT meant that PV system prices could be higher in Japan than elsewhere, which caused Chinese manufacturers to target the Japanese market and drive up competition. “Unlike the other countries, the Japanese government has been unwilling to impose [some type of] tariff or duty on Chinese products,” he said. “We have been faced with some price competition that is not based on production cost,” he added.  Hirano said he would like to see the Japanese government give some recognition to the fact that Solar Frontier is not just creating a carbon-free power source but it is also creating an industry in the country. “It may be difficult to have a local-content type of approach but we are saying that there should be more recognition.”

A Balanced Approach

Hirano would like to see a balanced approach with regard to developing a renewable energy industry, meaning that governments put some value on creating jobs and economic growth driven by the creation of renewable energy products in addition to valuing the clean energy that the products produce. For that same reason, the company is exploring a manufacturing facility in New York.  

Solar Frontier has completed feasibility studies with the state of New York that will help it decide whether or not to build a factory in Buffalo. Hirano explained that once the 150-MW factory it is currently building (its 4th) in Japan has been completed and verified, it will have a green light to move forward with the New York plan. The new factory uses technology that could reduce panel cost and increase manufacturing efficiencies.

The decision to build a plant in New York also depends on how much the company has been able to build up its project pipeline. “We don’t want to start creating a market as we build the factory,” he said. With the purchase of Gestamp, Solar Frontier also brought on the company’s project development employees, which are now actively looking for new projects in North America.  “So those are the two conditions that I myself am waiting for to be confident that we can go ahead,” he said.

To see a slideshow of Solar Frontier’s 1 GW factory in Japan, click here.