Renewable Alert Letter 35: Possible Relief Measures for Wind Projects with Output Increases

Energy & Infrastructure Alert | March.01.2018

日本語: 風力発電設備の出力増加時における救済措置の可能性

In regard to the revision of FIT price for wind projects with output increases as discussed in our Alert Letter dated February 21, 2018, certain relief measures from METI may now be in sight.

1. Projects participating in the power source interconnection project offering process

In our Alert Letter dated February 21, 2018, we noted how, in principle, wind facilities will be subject to revision of FIT price if output is increased, and how this will have a significant impact on projects that have obtained deemed approval but are unable to submit business plans especially as to the projects that have elected to participate in the power source interconnection project offering (dengen setsuzoku anken boshu) process using an output that exceeds the output for which approval was originally obtained.

On February 26, 2018, METI issued another call for public comments regarding transitional measures related to this issue.
  • In regard to an application for amendment approval (henkou nintei) under Article 10.1 of the FIT Act that is submitted on or after the deemed date of approval under Article 9.3 of the FIT Act (excluding such for solar facilities as well as wind facilities under 20kW) and that satisfies all of the conditions below, the FIT price will not be revised upon approval with respect to any project that had obtained approval under the old FIT Act and for which the invalidation of such approval has been deferred pursuant to Article 6.1 of the Supplementary Provisions to the Amended FIT Act due to current participation in the power source interconnection project offering (dengen setsuzoku anken boshu) process:
    • The date on which approval was deemed to be obtained under Article 9.3 of the FIT Act pursuant to Article 6.3 of the Supplementary Provisions to the Amended FIT Act is on or after Thursday, March 1, 2018;
    • The application relates to an increase in output, and such increase amounts to less than 10kW or less than 20% of output for the facility (excluding increase that involve change in facility category, etc.);
    • The application has been submitted within 1 month from the day following the date of deemed approval; and
    • Written proof of an interconnection agreement with an electric utility (regarding the first agreement on interconnection after conclusion of the power source interconnection project offering process) has been submitted with the application.

This new call for public comments appears to be in response to initial comments that were submitted by various concerned parties, including many clients and relevant partiesthat have consulted Orrick as we continue to engage in discussions with METI. We recommend that comments in support of the transitional measure above be submitted before the deadline of March 8, 2018.

2. Projects without interconnection agreement documents

In response to strong requests from a number of operators, the call for public comments issued on February 26, 2018, also addresses transitional measures for increase in output in the case of wind facilities that have not obtained interconnection agreements reflecting the output increase.

  • In regard to an application for amendment approval (henkou nintei) under Article 10.1 of the FIT Act (excluding those for solar facilities as well as wind facilities under 20kW) that satisfies all of the conditions below, the FIT price will not be revised upon approval even when such approval is issued on or after April 1, 2018:
    • The application relates to an increase in output, and such increase amounts to less than 10kW or less than 20% of output for the facility (excluding an increase that involves a change in facility category, etc.);
    • The application has been submitted no later than Friday, March 30, 2018; and
    • Written proof of an interconnection agreement with an electric utility (reflecting the output increase) has been submitted no later than Friday, November 30, 2018.

Again, we recommend that comments in support of the transitional measure above be submitted before the deadline of March 8, 2018.

Please click here for details regarding the call for public comments.