Romain Zissler, Senior Researcher, Renewable Energy Institute
2 February 2026
in Japanese
In Japan, solar photovoltaic (PV) is sometimes unfairly criticized because it is perceived as a technology imported from China – a country with which diplomatic relations are strained. China’s dominance over the global solar PV supply chain is undeniably strong and undesirable. However, pragmatic energy policies should move beyond this simplistic view. Solar PV undoubtedly strengthens Japan’s energy security and economy. In 2024, Japanese manufacturers accounted for 34% of domestic shipments of solar PV modules (including their overseas production). In 2025, 78% of module imports came from China, but India’s emergence as one of the world’s new leaders in module manufacturing offers untapped diversification potential. Domestic production can be increased through the implementation of appropriate support mechanisms. Module recycling reduces the need for additional imports. Finally, solar PV is the most cost competitive electricity generation technology in Japan, and the majority of its economic value is extracted within the country.
According to the Japan Photovoltaic Energy Association (JPEA), in 2024, over one-third of the solar PV modules shipped to Japan were manufactured by Japanese companies [Figure 1].
Most of the production of Japanese companies took place abroad. The JPEA does not specify the countries involved, but additional data from BloombergNEF indicates that it is China.
Given that the factories located abroad are owned by Japanese companies, it cannot be claimed that Japan is excessively dependent on foreign companies to meet its domestic demand.
Figure 1: Domestic Shipments of Solar PV Modules – Japan, 2024
According to the Japanese Ministry of Finance (MoF), in value terms, imports of modules into Japan came essentially from China (78% in 2025) – including overseas production by Japanese companies – and Southeast Asia (i.e., the Philippines, Vietnam, Malaysia, Cambodia, Indonesia and Thailand) (20%) [Figure 2].
On the positive side, Japan can diversify its import portfolio, as India is the world’s second-largest supplier of modules on a manufacturing capacity basis, and Japanese imports of Indian modules have been negligible so far (0.001%).
The main export market for Indian modules is the United States. However, since the end of August 2025, Indian modules have been subject to import tariffs of 64% in the United States.1 This measure is forcing Indian manufacturers (e.g., Waaree Energies, Tata Power Solar Systems, Adani Enterprises…) to diversify their customer base. Increasing the trade of modules between India and Japan could be beneficial for both countries.
Figure 2: Country of Origin of Solar PV Module Imports – Japan, 2025
According to BloombergNEF, one of the challenges is that Japanese manufacturers now only produce cells and modules (i.e., they no longer produce polysilicon, ingots or wafers) [Figure 3]. Consequently, they currently have no control over events occurring upstream in the supply chain.
Figure 3: Solar PV Manufacturing Capacity of Japanese Companies by Segment – 2025
This situation is regrettable, but not irreversible. Japanese companies demonstrated their technological expertise in manufacturing polysilicon and wafers in Japan until 2022, when the last factories were still operating before closing due to fierce global economic competition.
If the Japanese government deemed these segments strategic, incentives (e.g., grants, tax credits…) could be offered to stimulate production by Japanese companies and/or encourage foreign companies to establish themselves in Japan.
For example, in the United States, thanks to a 25% investment tax credit, domestic production of ingots and wafers was revived in 2025.2 This incentive enabled the American company Corning to build a new ingot and wafer factory (manufacturing capacity of 2 GW/year each) in the state of Michigan.
Importing solar PV modules is a one-time transaction, unlike importing fossil fuels, which is necessarily recurring. Once installed, modules generate electricity until the end of their lifespan (i.e., up to 30 years). Conversely, without a continuous inflow of fuel, coal and gas-fired power plants cannot generate electricity. This is why even imported modules contribute to Japan’s energy security.
Furthermore, while it is possible to recycle solar PV modules, recycling fossil fuels is impossible.
When solar PV modules are imported, raw materials that are not necessarily produced locally are also indirectly imported. In Japan, the mining of copper and bauxite (the base of aluminum) ore is very limited. However, refined copper and aluminum – two valuable metals – are easily recovered during module recycling (e.g., from the cables, junction box and frame).3
According to the International Energy Agency-Photovoltaic Power Systems Program (IEA-PVPS), a collaborative R&D initiative, some Japanese companies can properly recycle modules. Hamada Corporation is a good example.
Hamada Corporation owns a solar PV recycling center in Kyoto, in the Kansai region. This facility can process 21.6 tons of module waste per day. Mechanical treatments are implemented (i.e., “hot knife” for unbroken modules and “hammering” for broken-glass modules) to recover materials such as glass, metals and polymers [Figure 4]. These recovered materials are used by glass manufacturers and refining companies.
Figure 4: Simplified Illustration of Hamada Corporation’s Solar PV Module Recycling Process
Closed-loop recycling of solar PV modules involves recovering all the materials from old modules and reintegrating them into the manufacture of new ones. The IEA assumes a recovery rate of 85% for all materials, which does not completely eliminate the need for virgin materials.4 The recovered materials must be purified before they can be reused.
Recycling solar PV modules generally remains technically complex and insufficiently profitable. This could represent an opportunity for Japan to aim for global leadership.
According to BloombergNEF, in Japan, in 2024, new solar PV outcompeted all other electricity generation technologies in terms of cost, including existing coal-fired power plants, even without carbon pricing [Figure 5].
In addition, new solar PV systems paired with batteries (four-hour duration) have proven to be competitive with existing combined-cycle gas turbines (CCGTs). This achievement is remarkable because it demonstrates that a reliable power supply based on a variable renewable energy is becoming a cost-effective reality.
Figure 5: Power Generation Cost of Selected Technologies – Japan, 2024
Thus, by expanding solar PV, with or without batteries, electricity generation from fossil fuels decreases. This results in lower electricity prices for consumers, as well as a reduction in fossil fuel imports and greenhouse gas emissions. This is a triple win for Japan: economic efficiency, energy security and environmental protection are now within reach.
Another piece of good news is that the deployment of solar PV primarily benefits the national economy. This is because in Japan, most of the economic value of solar PV is extracted by Japanese companies.
According to the International Renewable Energy Agency (IRENA), in Japan, solar PV modules accounted for only 13% of the total installation cost of utility-scale projects [Figure 6]. The combined share of grid connection, installation and soft costs – the three other major cost categories – was almost six times higher (76%).
Figure 6: Breakdown of Utility-Scale Solar PV Total Installation Cost – Japan, 2024
Grid connection costs include all medium-voltage cables and connectors, as well as transformers and substations. In the power grid technology sector, Japanese companies such as Mitsubishi Electric, Hitachi Energy, Fuji Electric and Toshiba Energy Systems & Solutions are major global players with a strong presence in their national market.
Installation costs include site preparation (access and internal roads, cable routing) and assembly of all necessary equipment (e.g., mounting structure, modules, inverters, grid connection components, monitoring and control systems). This work is typically carried out by domestic companies.
Soft costs are mainly divided between the margin of project developers (6% of the total installation cost) and permit fees (4%). In Japan, the leading developers of solar PV projects are Japanese companies such as Toyota Tsusho, ENEOS, ORIX, Tokyu Fudosan, Daiwa House and NTT.
Finally, inverters deserve a brief mention. They represent a minor part of the total installation cost (3%) but received considerable attention in the spring of 2025. Indeed, American experts discovered rogue communication devices in Chinese solar power inverters, raising concerns about energy security.5
It may be reassuring for the Japanese public to know that several Japanese companies market inverters domestically (e.g., Omron, Panasonic, Diamond & Zebra Electric, TMEIC, Nichicon and Yaskawa Electric).
According to RTS Corporation, Japanese companies accounted for 43% of domestic inverter shipments in 2024.6 The main foreign companies were the Chinese companies Huawei Technologies (34%) and Sungrow Power Supply (15%), and the German company SMA Solar Technology (6%).
Several solutions exist to address the problem of inverters manufactured by Chinese companies. First, thorough and systematic inspections of these inverters could be implemented. If rogue communication devices were also discovered in Japan, an import ban could be a decisive measure (see the example of Italy below). Simultaneously, production by Japanese companies and non-Chinese foreign companies established in Japan could be encouraged.
In the autumn of 2025, for diversification purposes, Italy held an auction for solar PV projects prohibiting the use of equipment (i.e., cells, modules and inverters) manufactured in China or by Chinese companies.7 The average price of the winning projects was €0.066/kWh. By comparison, in the summer of 2025, Italy held another auction without restrictions on the origin of the equipment. The average price of the winning projects was then €0.057/kWh. Therefore, the ban on Chinese products increased the price of solar PV by less than €0.01/kWh. This demonstrates that such a stringent measure has only a limited negative impact on the affordability of solar PV.
In conclusion, instead of fearing the Chinese industry, Japan should more actively promote solar PV and focus its efforts on implementing projects that meet societal expectations, particularly in terms of impact on host communities.
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