Solar Panels

Japanese Solar Project to Power California as the State Aims for 100% Clean Grid

Japan

In June, Idemitsu Renewables, a subsidiary of Japanese company Idemitsu Kosan, completed financing for a 50MW solar project in California. Under a power purchase agreement (PPA) with Silicon Valley Power, the project will provide power to Santa Clara City. In 2018 solar accounted for 29% of Santa Clara’s green power standard mix. In 2019, solar projects contributed to 14.2% of California’s in-state generation.

In February, Japan and the United States signed an MoC with the intention of strengthening energy and infrastructure and market building in both countries. The MoC cites an enhancement in liquefied natural gas (LNG) and other commodity markets, as well as bilateral infrastructure investment. This agreement promises exchange between the two countries and extends on the goals of the Asia Enhancing Development, Growth Through Energy (Asia EDGE) initiative. While natural gas has lower carbon emissions than other fossil fuels like coal and oil, it will be necessary moving forward to emphasize the importance of infrastructure investment for renewables as states start to commit to sourcing all energy from climate-friendly sources.

One such state is California, home to the planned 50MW solar project, which set a goal of 100% clean energy by 2045. Between 2014 and 2018 natural gas dominated California’s energy mix. But, as seen below, the use of natural gas has seen a steady decline. Large and small hydropower systems have also been on the decline. Hydropower as a renewable source has come under criticism for its viability and for a state like California which has experienced intense droughts in recent years, it might be a less optimal solution. Meanwhile, with current investments, solar seems to be continuing to increase. Wind has followed a very similar path providing 11.46% of California’s power in 2018.

Investment in solar energy is likely to continue to increase as the costs to implement solar (as well as wind) have dropped dramatically since 2010 and show no signs of increasing. While renewable energy has its own hurdles to jump in regards to the minerals mined to create solar panels and wind turbines, international investment and cooperation will be necessary to attain the goal of making our grids 100% clean.

Japanese greenfield capital investment in California’s electricity grid between 2003 and 2020 consisted of $793.3 million for one coal, oil, and gas project and $435.8 million for three renewable projects. Japan has good reason to invest more in renewables, especially in a state that is eager to create a 100% clean grid. While some political positions have pivoted significantly towards creating more renewable, clean energy domestically; cooperation and collaboration on an international scale will be necessary to attain 100% clean grids.

Marc Jaffee is a Research Intern at the East-West Center in Washington. He is a first-year graduate student at the George Washington University studying Security Policy.