Project Finance Laws And Regulations Japan 2025

1.1 What are the main trends/significant developments in the project finance market in your jurisdiction?

(1) Renewable energy projects and Renewable Energy Act

Since the introduction of the Feed-in-Tariff ("FIT") scheme in 2012, a large number of renewable power plants, mainly solar power plants, have been developed and operated in Japan. However, in order to reduce the economic costs in relation to the FIT scheme and to integrate renewable energy to electricity market same as the other energy sources, the procurement prices have been decreased, and the Feed-in-Premium ("FIP") scheme was introduced.

Under the previous FIT scheme, renewable energy generated by renewable energy projects was mandatorily purchased at fixed prices by creditworthy utility companies for 20 years; cashflow from these projects are foreseeable and suitable for project financing. However, under the FIP scheme, renewable energy plant operators need to sell renewable