Japan's Solar Auctions: Winning Prices Fell to One-Fifth in Nine Years — What the 38 Zero-Yen Bids in Round 24 Reveal

Round 24: 79 MW offered, 143.6 MW bid, 57 projects awarded

On 20 June 2025, the Organization for Cross-regional Coordination of Transmission Operators (OCCTO) published the results of Japan's 24th solar auction (FY2025, first round). The auction covered FIP-eligible solar plants of 250 kW and above, with 79 MW offered and a ceiling price of 8.90 JPY/kWh.

Bids totalled 73 projects and 143,618 kW — roughly 1.8 times the offered capacity. Fifty-seven projects won a total of 79,000 kW, filling the round exactly. The capacity-weighted average winning price was 4.06 JPY/kWh, with a low of 0.00 JPY and a high of 7.79 JPY.

What stands out is that 38 projects — 66.7% of all winners — bid at zero yen, accounting for 28,650 kW, or 36.3% of the awarded capacity. Two-thirds of the projects, and more than a third of the megawatts, were awarded at zero premium.

A market split neatly in two

Breaking down the winning prices: 38 projects at 0.00 JPY, one at 4.99 JPY, eight at 5.00–5.99 JPY, five at 6.00–6.99 JPY and five at 7.00–7.79 JPY. Almost nothing was awarded between zero and five yen, leaving a clear gap in the middle of the distribution.

The 38 zero-yen awards went to just four companies: Chiiki Denryoku K.K. (24 projects), Mitsubachi 101 LLC (10), Bison Energy K.K. (3) and GPSS Agri B LLC (1). At the other end, the projects that won at five yen or more were mostly large single sites or regionally developed projects: Mirai Soden Kabuhari Hino LLC (19,500 kW at 5.70 JPY), Machiokoshi Energy K.K. (9,999 kW at 7.77 JPY) and Tomakomai TJD Solar LLC (2,636 kW at 7.79 JPY).

Capacity is highly concentrated as well — the top three winners together hold 59.6% of the awarded megawatts. Project numbers skew small, but the capacity goes to a handful of large sites and the zero-yen bidders.

Nine years of winning prices, from 21 yen to 4.06 yen

Reading the published results from Round 1 through Round 29 shows a long, unambiguous decline.

Round 1 (November 2017) set a ceiling of 21.00 JPY/kWh and awarded only nine projects totalling 141 MW. Round 2 (September 2018) was more extreme: not a single bid came in under the 15.50 JPY ceiling, and the auction closed with no winners at all. At that price, developers simply could not make the numbers work.

From Round 4 (September 2019) onward, winning prices tracked the ceiling downward — 9.99 JPY in Round 11 (March 2022) and 8.55 JPY in Round 18 (November 2023). Up to that point, each round moved by roughly 0.3 to 1 yen.

Round 19 (March 2024) was the turning point. Zero-yen bids appeared for the first time and the weighted average fell from 8.55 to 5.11 JPY in a single round. Zero-yen awards recurred in Rounds 24, 25, 27 and 28, with the Round 24 figure of 4.06 JPY the lowest in nine years.

Prices have since recovered somewhat: 4.61 JPY in Round 27 (March 2026), 6.74 JPY in Round 28 (June 2026) and 8.89 JPY in Round 29 (August 2026). Round 29 awarded only eight projects and 38 MW against 115 MW offered — an award rate of 33%. With fewer zero-yen bidders in the room, the capacity no longer fills. The ceiling price was also raised to 9.60 JPY from Round 28, the first upward adjustment since the auction system began in 2017.

Why a zero-yen bid can still work

Under the FIP scheme, bidding zero does not mean generating for free. It means giving up the premium paid out of the levy, while the electricity itself is still sold at market price. Zero-yen bidders also remain eligible for balancing-cost support and relief on generation-side charges. For a developer, it is a trade: surrender the premium in exchange for policy advantages, and take the capacity.

That structure matters because it links revenue directly to market prices and to the plant's own output. With no premium, every kilowatt-hour you fail to generate is revenue you never see.

A 100% award rate is not a sign of a healthy market

Round 23 (March 2025) awarded five projects and 93,000 kW, filling the offered capacity exactly. Round 27 (March 2026) filled 79 MW with eleven projects. An award rate of 100% looks healthy on paper, but in both cases a few large projects absorbed the entire round. Developers of 300–500 kW sites were effectively shut out.

The Round 24 breakdown shows the same pattern in miniature: projects between 300 and 999 kW numbered 37, yet accounted for only 26% of the awarded capacity. Small projects dominate the project count; large projects take the megawatts.

What this means for plant owners

Auction results set the premium for newly certified FIP projects. They do not change the tariff of a plant already selling under FIT, so a lower auction price does not reduce the revenue of an operating plant.

What it does affect is how new projects are underwritten — and through that, the valuation of existing plants, their resale prices and the way operators think about maintenance. Where there is no premium, output is the entire revenue base. Two identical plants can differ by several percent a year in revenue depending on whether soiling, shading and inverter downtime are left unaddressed.

A case from our own diagnostics illustrates the scale. At a plant in Ishinomaki, the achievement rate against NEDO's expected output fell to 64%, 57% and 65% in April, May and June 2025 respectively, while the same site ran in the 90% range through autumn and winter. The seasonal contrast points away from weather and towards soiling and vegetation shading. A decline of that kind is easy to miss without continuous monitoring, and by the time it is noticed, it has often cost a full year of output.

Auction prices look like a story about new development. For existing plants, the more important discipline is measuring output correctly and finding the cause of a decline early.

Sources

Figures in this article come from OCCTO's published results for each auction round and from materials published by the Ministry of Economy, Trade and Industry on the auction system. AI Power Advisor maintains a compiled table of winning prices, offered capacity and awarded project counts from Round 1 through Round 29, and can provide details on individual rounds on request.