Setouchi, a city in the western prefecture of Okayama, will be home to a solar power plant with a generating capacity of 230,000 KW, making it the largest facility of its kind in Japan and one of the biggest in world, the Nikkei business newspaper reported.
U.S.-based industrial giant General Electric Co. plans to take a majority stake in the plant's operator, opening the way for it to enter Japan's growing photovoltaic energy industry, Nikkei said.
The power plant, which will supply electricity to about 80,000 households and is expected to begin operating in 2018, will be bigger than the 111,000 KW facility that Japan's Softbank plans to bring online on the island of Hokkaido in 2015.
Eurus, a company formed by Toyota Tsusho and Tokyo Electric Power, plans to build a solar power plant with a capacity similar to the Hokkaido facility.
GE's entry into Japan's solar power industry will allow the conglomerate to boost sales of transmission equipment designed to improve energy efficiciency, an industry currently dominated by domestic manufacturers.
The power plant in Setouchi is expected to cost around 80 billion yen ($777 million), with GE paying for between 12 percent and 25 percent of the cost.
GE currently operates eight solar power plants in the United States and Europe that produce a total of some 900,000 KW.
Solar power and other renewable energy sources supply only about 1 percent of Japan's electricity, but the industry has been growing in the wake of the 2011 accident at the Fukushima nuclear power plant.
The Japanese government is crafting a new energy strategy that envisions generating between 20 percent and 30 percent of the country's electricity from renewable sources. EFE