October 1, 2014 / 1:57 AM / 3 years ago

Japan to slap more restrictions on solar power -paper

TOKYO, Oct 1 (Reuters) - Japan will make more changes to a scheme introduced after the Fukushima crisis to encourage investment in renewable energy by tightening rules on guaranteed payments for larger solar projects, the Yomiuri newspaper reported.

Under current rules solar projects lock in prices when they receive approval for guaranteed tariffs from the government. But from next year, project operators will only be able to lock in prices when they start generating power, the paper reported, without citing sources.

The move is significant as the government has cut the so-called feed-in-tariffs every business year since the scheme was introduced in July 2012 and projects have faced delays in starting up.

The feed-in-tarriff scheme requires utilities to buy electricity generated from renewable sources such as wind, solar or geothermal, at a guaranteed rate for a set period. The initial rates were among the highest in the world.

That prompted a rush of applications, with the government approving 71 gigawatts of renewable capacity under the scheme as of April 30. More than 68 gigawatts of that is for solar-power projects, industry ministry data shows.

But only 9.8 gigawatts of government-approved renewable capacity, or 14 percent, had been connected by the end of April, according to the same figures, as developers face a slew of hurdles in brining projects online.

By pushing back the timing of when solar projects over 1 megawatt can take advantage of the tariffs, the government hopes to limit the amount that is paid out, the Yomiuri said.

Industry ministry officials responsible for renewable energy were not immediately available for comment.

After setting solar prices at 40 yen per kilowatt-hour for projects with a capacity of 10 kilowatts or more in the first year of the programme, the government cut the rate to 36 yen in the year through this March, then to 32 yen from April.

Japan's regional monopolies are also cutting access to solar projects.

Shikoku Electric Power Co and Tohoku Electric Power Co each said on Tuesday that they would restrict connections to their grids, joining a growing list of regional monopolies that have limited access for alternative energy. (Reporting by James Topham; Editing by Aaron Sheldrick and Joseph Radford)

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