The non-operating solar projects: Examining the impact of the feed-in tariff amendment in Japan

The non-operating solar power projects indicate a large gap between the operating and approved solar capacity in Japan. The country amended the feed-in tariff (FIT) law in 2017 to address this issue. This empirical study investigates the impact of the amended FIT policy on non-operating solar projects using municipality-level panel data from 2014 to 2019. We find that the amended policy improved the relationship between the approved capacity and operating capacity of solar power projects. The impacts are heterogeneous across different sizes of solar power projects: they are more substantial in large-and mega-scale solar power projects than in small-scale ones. To explore the determinants of non-operation, we also apply a cross-sectional analysis to identify municipal characteristics related to non-operating capacity. The results indicate that non-operating projects are located in municipalities with higher construction costs. These findings shed light on how the revisions of existing policies could effectively support renewable energy and provide lessons for other countries or regions on designing a better energy policy.

Automated summary

This study investigates the impact of the amended FIT policy on non-operating solar projects in Japan, finding that the policy improved the relationship between approved and operating capacity, with varying impacts across different sizes of solar projects. Municipalities with higher construction costs were identified as having non-operating projects. These findings provide insights on supporting renewable energy through policy revisions and offer lessons for designing effective energy policies in other countries or regions.