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Mitsubishi Goes Solar In Japan - The Rush Begins
The news that Mitsubishi Corporation (MSBHY.PK), one of Japan's huge trading houses, is likely to build the country's largest solar power plant is another sign that renewable energy in Japan could be set to become a significant stock market theme.
In May the Japanese government announced that it would no longer proceed with plans to boost the country's nuclear energy capacity.
At the time of the devastating earthquake, tsunami and nuclear meltdown in northern Japan nuclear power provided up to 30 per cent of the country's electricity needs. It had been expected that this ratio would rise to 50 per cent by 2030.
Instead, the government has proclaimed that by around 2021 Japan should be receiving 20 per cent of its power needs from renewable sources, more than double the current figure (which is mainly based on hydroelectric power).
The government has put the stress on solar energy, in which Japan is already a technological leader.
In fact, until 2004 Japan was the largest solar market in the world, though it has since been overtaken by Germany.
At the end of 2010 Japan had an installed solar capacity of 3,622 MW, placing it in third position globally, though well behind Germany, which had 17,193 MW.
Mitsubishi hopes to build its new plant in Kumamoto Prefecture, on the southern island of Kyushu. However, much depends on government plans to introduce a feed-in tariff.
Mitsubishi is already active in solar energy developments overseas. It operates plants in Europe in a partnership with Acciona SA of Spain, and it is involved in a project to build a major solar plant in Thailand.
Another company, Softbank Corporation (SFTBF.PK), which is mainly known for its internet and mobile communication businesses, has announced its desire to build up to 10 new large-scale solar plants in Japan. The first could be an eight-billion-yen (approx. $100 million), 20-MW plant in Hokkaido, in Japan's far north.
For investors interested in pursuing this theme, the three key stocks - all among the world's technological leaders, and all of them major producers of solar panels - are Sharp Corporation (SHCAY.PK), Kyocera Corporation (KYO.NYSE) and Panasonic Corporation (PC.NYSE), which has acquired solar pioneer Sanyo.
* Learn more on the attractions of Japanese renewable energy in the ebook Investing in Japanese Renewable Energy.
June 18th, 2011
Rayy Zar writes for Shaverama.