Canadian Solar Starts Building Two Solar Plants In Japan
Zacks Investment Research | Nov 28, 2017 08:58PM ET
Canadian Solar Inc. (NASDAQ:CSIQ) has started constructing two Japanese solar power projects — Shizuoka Project with a capacity of 10.77 megawatt-peaks (MWp) and Miyagi Project with a capacity of 2.1 MWp.
About the Projects
The Shizuoka Project will utilize 32,640 high-efficiency MaxPower modules of Canadian Solar. Once the plant comes online in fourth-quarter 2018, it is expected to produce roughly 12,971 megawatt-hours (MWh) of clean and reliable solar electricity, annually. To purchase the solar electricity, Tokyo Electric Power Co., Inc has inked a 20-year feed-in-tariff contract at the rate of 32 cents per kilowatt-hours (kWh) with Canadian Solar.
Powered by 6,650 of the company’s high-efficiency MaxPower modules, the Miyagi Project will generate around 2,400 MWh of clean and reliable solar electricity, annually. The power production will take place once Canadian Solar starts commercial operations in the third quarter of 2018. The solar energy generated from the plant will be sold to Tohoku Electric Power Co., Inc.; which has inked a 20-year feed-in-tariff contract at the rate of 32 cents per kWh with the company.
Canadian Solar’s Solar Projects in Japan
Japanese government has been trying to increase electricity generation from the renewable sources. In fact, following the introduction of feed-in tariffs (FIT) in July 2012, solar photovoltaic (PV) has scaled up fast in Japan. As a result, this nation has recently emerged as a profitable market for high quality solar solution provider like Canadian Solar.
In August 2017, Canadian Solar declared that its 27.3 MWp solar photovoltaic (PV) power plant in Tottori Prefecture, Japan, has initiated commercial operations. Also, the company successfully activated four solar power plants in the country with combined capacity of 52.5 MWp of green energy in July.
According to Dr. Shawn Qu, chairman and chief executive officer of Canadian Solar, the company's portfolio of under-construction or operating assets is well-diversified across 18 prefectures throughout Japan. Surely these developments including the latest initiation of the solar plants’ construction will aid the company in capturing more solar market shares in Japan.
Canadian Solar’s International Solar Projects
Recently, Canadian Solar secured three solar power projects during Mexico’s third Long-term Auction for renewables held on November 15. Totaling 367 megawatt-peaks (MWp), these power projects will be developed and build in the Mexican cities of Aguascalientes, Hermosillo and Obregón.
In October, the company announced that its wholly-owned subsidiary has entered into a joint venture (JV) with a few subsidiaries of Menora Mivtachim Holdings Ltd. — one of Israel's five largest insurance and finance groups. The JV aims to invest in the development, financing, construction and ownership of solar power projects in Israel.
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Again in the same month, it entered into binding contracts to sell interests in three solar farms to Foresight Solar Fund Limited (FSFL) in Queensland, Australia. These farms have an aggregate capacity of 117 megawatt-peaks (MWp).
In June, Canadian Solar declared the divestment of 80% stake in Pirapora II solar energy project to EDF (PA:EDF) EN do Brasil, which is the Brazilian subsidiary of renewable energy market leader — EDF Energies Nouvelles — with commercial operations expected to begin in 2018.
Increasing Focus on Solar Energy
Alternative energy sources have been the primary target of utility service providers owing to rising concerns related to the consumption of fossil fuel and the subsequent carbon emission. To make most of the situation, each day more utilities are shifting their focus to generation of alternative energy.
With President Trump walking out of Paris agreement in a bid to boost the coal industry, temporarily the focus has shifted to large Asian markets like China, Japan and India where solar market seems to grow rapidly.
Per a report from GTM Research, the global solar market will hit 85 GW in 2017 nearly doubling the installed capacity of 2014. To capture larger share of this expanding market, solar companies like Canadian Solar have already started enhancing their overseas base and the latest JV is one such instance.
Price Movement
Canadian Solar has outperformed the Zacks Investment Research
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