The End of the “Ground-Mounted” Era: The Day Japan’s Solar Bubble Bursts in 2027

On December 15, 2025, a major policy shift that will likely be etched into the history of Japan’s energy policy was decided at the Liberal Democratic Party (LDP) headquarters in Nagatacho, Tokyo. At a joint meeting of the LDP’s Economy, Trade and Industry Division and Environment Division, a proposal was approved to effectively abolish support schemes for large-scale solar power plants (so-called “mega solar”) starting in fiscal year 2027.

Specifically, the proposal takes an extremely strict stance by excluding not only mega solar projects with an output of 1,000 kW or more, but also ground-mounted commercial solar power systems of 10 kW or more, from eligibility for the Feed-in Premium (FIP) scheme, which provides subsidies on top of market electricity prices.

This marks a complete shift in phase for Japan’s solar power industry, which expanded explosively after the 2011 Great East Japan Earthquake under the tailwinds of the Feed-in Tariff (FIT) system. At the opening of the meeting, Policy Research Council Chair Takayuki Kobayashi’s remark—“Has support for mega solar already fulfilled its role?”—resonated as more than a cost argument; it sounded like a declaration of farewell to policies that prioritized sheer expansion in scale.

The business model of “profitably covering vacant land with panels,” which had persisted for nearly 15 years, will lose its public backing and come to a definitive end in 2027. This decision represents a historic turning point that will force Japan’s renewable energy market to transition from a phase of uncontrolled expansion to a more mature—or selective—phase premised on coexistence with local communities.

When “Green Energy” Becomes Pollution: The Reality Seen in Kushiro Wetlands and Kamogawa

Why has solar power, once hailed as a “light of hope,” come to face such strong political headwinds? The answer lies in the growing severity of environmental destruction across the country and the resulting friction with local residents. Ironically, renewable energy—supposedly “environmentally friendly”—has begun to be recognized as a form of “pollution” threatening Japan’s beautiful satoyama landscapes and ecosystems.

A particularly symbolic case was the development around the Kushiro Wetlands in Hokkaido. This precious wetland, designated under the Ramsar Convention and also a national park, saw as many as 27 mega solar facilities operating in its vicinity by 2025, prompting critics to deride the area as a “sea of mega solar.” Moreover, construction sites promoted by an Osaka-based operator were found to be habitats for the Hokkaido salamander and nesting sites for white-tailed eagles—both designated as national natural monuments—triggering nationwide criticism over sloppy environmental assessments and heavy-handed development practices.

The opposition movement grew into a social phenomenon, with the mayor of Kushiro declaring a “No More Mega Solar” stance and prominent figures voicing alarm on social media.

Similar issues emerged in Kamogawa City, Chiba Prefecture, where panels installed on deforested slopes caused landslides and muddy runoff during heavy rains, threatening the lives of downstream residents. Hillsides blanketed in black panels created an eerie landscape, criticized as “scenic destruction,” damaging tourism resources and deeply dividing local communities.

The decision to abolish support can thus be seen as the government’s unavoidable response to these desperate cries from local regions suffering from “renewable energy pollution.” The LDP proposal also includes plans to significantly lower the current 40,000 kW threshold for mandatory environmental impact assessments and to strengthen oversight.

The Logic of Politics and Economics: Why the LDP Declared “Its Role Is Over”

Environmental concerns were not the sole force behind this decision. Economic rationality and growing concerns over “economic security” also became powerful drivers of policy change. From an economic perspective, solar power generation costs have fallen sufficiently, leading to the judgment that subsidies funded by public burden (the renewable energy surcharge) are no longer necessary.

While the FIP scheme adds a premium to market prices, many projects are already approaching grid parity—cost levels at which investments can be recovered without support—making it increasingly difficult to justify further public burden.

Equally important are the political dynamics. Conservative members within the LDP, including Sanae Takaichi, have long expressed concern over Japan’s dependence on Chinese-made solar panels for its energy infrastructure. Chinese companies currently dominate the global solar panel market, and criticism has persisted that a portion of Japanese electricity bills ultimately flows overseas.

As Takaichi stated during the September party leadership race—vowing to “clean up subsidy systems that pave wetlands like Kushiro with panels”—the proposal is also part of a broader “economic security” strategy aimed at curbing disorderly land development by foreign capital and restoring energy autonomy. It is also reported that the introduction of mega solar regulations was explicitly included in coalition agreements between the LDP and the Japan Innovation Party, underscoring that this shift had strong elements of a politically predetermined course.

A Bet on the Next Generation: How Perovskite Cells and Rooftops May Save Japan’s Future

With mega solar effectively abandoned, how will Japan aim to achieve carbon neutrality by 2050? The government’s next strategy is a shift from quantity (mega solar) to quality—next-generation technologies that do not depend on vast tracts of land. The proposal clearly states that future support will focus on rooftop installations and on perovskite solar cells, a technology developed in Japan.

In a mountainous country with limited flat land, forest development has reached its limits. Attention is therefore turning to factory rooftops and building facades. Currently, only a few percent of large factory rooftops in Japan are equipped with solar panels, yet they hold enormous untapped potential equivalent to several nuclear power plants.

The key to unlocking this market is lightweight, flexible perovskite solar cells. Companies such as Sekisui Chemical have conducted one of the world’s largest demonstration experiments at the 2025 Osaka–Kansai Expo and are aiming for mass production by 2027.

The year 2027 thus marks a true “generational shift,” where the abolition of mega solar support intersects with the start of mass production of perovskite cells. The Japanese government is seeking to end the era of indiscriminate development driven by China-dependent silicon panels and instead build a truly sustainable energy nation through domestically developed perovskite technology and community-friendly rooftop solar generation.

Whether this high-stakes gamble succeeds will depend on the speed of technological development and the ability to adapt to a newly evolving market environment.