SOLAR TODAY - May 2011

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After;Fukushima: What the Japan Disasters Mean for PV

By Seth Masia

Following the March 11 earthquake and tsnunami, 11 nuclear-powered generating stations on the island of Honshu shut down, leaving 2. 5 million homes without power. Japan lost about 10 gigawatts (GW) of capacity, roughly 7 percent of the nation’s electric power. Some of that capacity will be restored, but the 4.7-GW Fukushima Dai-ichi plant, which suffered partial meltdowns in three of its reactors and a spent-fuel storage pond, is out for good.

Much has been made in the business press of the worldwide slowdown in manufacturing of consumer goods due to the temporary inability of Japanese plants to make or ship components. But the hole in the Japanese power grid also has implications for global energy markets.

as Japan rebuilds its infrastructure, the country will show strong demand for all forms of distributed power, from mobile generators to PV arrays.

seth masia (smasia@ solartoday.org) is deputy editor at SOLAR TODAY.

Natural gas prices rose about 2. 5 percent during the weekend following the initial disaster, to a two-year high. The reason is straightforward: The quick way for Japan to fill the nuclear gap is to burn more natural gas. The country imports nearly all its gas from South Korea and from Russia’s Sakhalin Island facilities. Gas futures didn’t follow along with the rise, and a week later, as traders recalled that the winter heating season is winding down, prices had come back down to about $4 per million Btu. But Dow Jones predicted that by 2020, flattening of the nuclear power industry will lead utilities worldwide to demand at least an extra 100 billion cubic meters ( 3. 5 trillion cubic feet) of gas. Rising gas prices affect utility costs worldwide, and make Russia stronger in dealings with its western neighbors. Japan may also need to import more coal, mainly from Australia.

The disasters in Japan may slow the steady decline
in photovoltaic (PV) prices. Since January, the financial
press has been forecasting a serious worldwide oversup-
ply of PV modules beginning late in 2011, when the rate
of installations, forecast at 22 GW worldwide this year,
fails to soak up China’s purported capacity to make as
much as 35 G W of new modules annually. For a variety
of reasons related to factory consolidation and Chinese
industrial policy, the 35-GW capacity figure may be
exaggerated. The PV oversupply forecast now needs to
be reevaluated.