Panasonic Ramps Up Japanese Solar Manufacturing to Meet Domestic Rooftop Demand

Panasonic Corp, a Japanese electronics company, announced that it will expand its domestic solar cell and module production to meet the rooftop solar demand in Japan. The company will invest a total of 9.5 billion yen (US$78 million) in a cell production plant in Shimane Prefecture and a module plant in Shiga Prefecture.

The company’s current HIT production capacity is 900 MW per year, of which 300 MW is produced in Malaysia and 600 MW in Japan. The new investment will boost the domestic production capacity 150 MW to total 750 MW by March 2016, making its total annual production capacity more than 1 GW.

Panasonic HIT module production plant in Shiga Prefecture. Credit: Panasonic Corp.

Panasonic’s solar cells, known as HIT, are hetero-junction cells composed of monocrystalline and amorphous silicon. Panasonic reached a conversion efficiency of 25.6 percent last year at the research level, and 22.5 percent at the mass production level.  Since high-efficiency cells enable more power per square foot than conventional solar cells, they provide a greater advantage to the majority of Japanese homes and offices, which have very limited roof-space.

The company will allocate the boosted domestic production capacity solely to the domestic market, specifically residential and rooftop systems below 500 kW while allocating modules produced in Malaysia to overseas markets.

Furthermore, as the domestic production ramps up, the company will phase out outsourced modules. The company has outsourced multicrystalline solar modules under an original equipment manufacturer (OEM) contract from Europe in order to meet demand for a large quantity of relatively inexpensive modules used for Mega Solar projects. In the fiscal year 2014, ending in March 2015, the outsourced solar modules represented approximately 18 percent of the company’s entire solar module sales, but the increased domestic production capacity will eventually replace all the outsourced modules.

Japan launched a generous feed-in tariff (FIT) program in July 2012 to stimulate the domestic renewable energy market. As of this January, the nation approved over 71 GW worth of solar photovoltaic (PV) capacity, of which 16.2 GW has been installed. The FIT has largely stimulated the deployment of large-scale PV systems, known as Mega Solar.

However, as the tariff rates come down and large land areas become unavailable, the domestic solar demand is expected to shift from investment-return focused, large-scaled systems to self-consumption focused, rooftop systems. The company also predicts that demand for zero net energy (ZNE) homes and buildings will expand with the federal and local governments’ new initiatives in energy efficiency.

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