Mitsui & Co. and Tokio Marine Asset Management Co. plan to construct 20 ‘megasolar’ plants in Japan financed by infrastructure funds they will launch.
The facilities will be built in two phases and offer a total generation capacity of 60 MW. They are all scheduled to be in operation by the end of fiscal 2013. As part of the first phase, Hokkaido, Yamanashi and Yamaguchi prefectures will get two plants each, while Mie, Wakayama, Tokushima and Kumamoto prefectures will each host one plant, for a total of 10. Each site will offer a capacity of between 1.5 and 5.3 MW, for a combined total around 28 MW. All are scheduled to be in operation by next June.
Total investment is expected to reach 9 billion yen, met by an infrastructure fund Tokio Marine Asset will launch later this month. Investment will be solicited from corporate pension programmes, life insurers and others. The fund will acquire all of the solar facilities, targeting an annual investment yield of around 5%. Plant operation and maintenance will be outsourced to a Mitsui-affiliated firm under a 20-year agreement.
For the second phase, the two companies are considering launching as early as the end of fiscal 2012 a separate infrastructure fund totaling around 10 billion yen to build 10 additional megasolar plants in Japan. They have nearly completed their search for sites and will soon launch negotiations with landowners in earnest. The 10 plants are scheduled to come online by the end of fiscal 2013 and are expected to generate more than 30 MW.
The 20 plants will procure parts domestically, including solar panels from Kyocera Corp. (6971) and others. Panels account for 30% of facility and system expenses. Domestic panels cost more than overseas products, but Mitsui and Tokio Marine Asset expect to offset this through bulk orders for installation and through standardised construction.