To PV or not to PV? Prospects for residential solar PV system and self-consumption of excess power in Japan

Panel: 5. Smart and sustainable communities

Authors:
Shinichi Kishida, Jyukankyo Research Institute, Japan
Ruo Lin Yaw, Jyukankyo Research Institute, Japan
Mai Yata, Jyukankyo Research Institute, Japan
Takahiro Tsurusaki, Jyukankyo Research Institute, Japan
Hidetoshi Nakagami, Jyukankyo Research Institute, Japan

Abstract

It is crucial for policymakers and relevant service providers to motivate prosumers to continue adopting solar PV without relying on subsidized Feed-in Tariff (FIT) schemes. This is especially true in Japan, where utilities will no longer be obliged to purchase surplus power from residential PV installations when the ten-year buyback period begins to end from November 2019. One possible solution is self-consumption of excess power, which will help prosumers to reduce energy bills and to shift peak demand besides energy efficiency. Batteries, heat pump water heaters and electric vehicles are some of the technologies expected to promote self-consumption. In this paper, we evaluated feasible solutions in order to understand the future prospects of self-consumption in Japan. We examined the implications of three aspects of future self-consumption: policy trends, business decisions, and prosumer's awareness and intentions.

The policy trends are crucial, so we summarized recent government discussions and decisions about self-consumption after the end of the FIT scheme, and the implementation status of policies that promote self-consumption technologies. As for batteries, Japanese government identified that the high installation cost is one of the main barriers of the dissemination of batteries, and pointed out the importance of financial incentive for the customers. Therefore, regarding the implementation status of policies, a subsidy program has been established and currently in operation. Households which are eligible for this subsidy are the ones which meet the ZEH (net Zero Emission House) requirements, in addition to having installed efficient energy management system for equipment such as batteries. In 2018, a total of 336 subsidy applications have been made by ZEH compliant households which installed energy management systems.

In terms of businesses, we conducted qualitative research on relevant services presently offered by utilities and service providers. For batteries and heat pump water heaters, artificial intelligence (AI) is applied to effectively utilize surplus power of PV. The AI learns about the operation history of these equipment as well as electricity consumption pattern in the household, and by combining external information such as the weather forecast, it automatically decides the optimal operation plan for the next day. As for services currently provided by utilities, we identified pilot projects by mainly electric power companies which are related to power aggregation or Peer to Peer power trading.

Lastly, to understand views of prosumers, we conducted a questionnaire survey on 1,500 households with PV regarding their awareness of the future decreasing purchase price of surplus power, their plans after the FIT ends, and their perspectives on the adoption of self-consumption technologies. Survey results showed that should the purchase price of surplus power fall below 15 JPY/kWh (12 cents EUR/kWh) following the end of mandatory buyback period, more than 50% of the respondents wish to self-consume the surplus power of PV rather than selling to utilities. Furthermore, 24% of the respondents said that they may consider shifting the usage of specific home appliances from nighttime to daytime in order to effectively utilize surplus electricity. Also, 50% of the respondents are interested in batteries, indicating that there is a promising market for self-consumption related technologies.

However, 70% of the respondents prefer batteries with payback period of less than 10 years. On the other hand, 39% of the respondents think that reducing installation cost is the key to dissemination of self-consumption technologies, while 23% of the respondents wish to first obtain basic/necessary knowledge on self-consumption technologies. Regarding knowledge acquisition, about 25% of the respondents wish to obtain information from manufacturers, contractors, housing manufacturers and electric power companies.

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