Softbank Corp, Japan's third-largest mobile phone operator, will help build about a dozen large solar power plants across the country and is willing to commit hundreds of millions of dollars in investment to boost a lagging renewable energy sector.
The company's billionaire president, Masayoshi Son, has become a prominent advocate of alternative energy during a two month nuclear crisis in quake-hit northeast Japan, but insisted his new project would not lessen Softbank's focus on telecommunications.
With engineers still battling to gain control of four nuclear reactors damaged by the March 11 quake and tsunami, Prime Minister Naoto Kan has pledged to make renewables a pillar of Japanese energy policy while reconsidering a target to generate more than half of the country's electricity from nuclear plants by 2030.
"I think this is a historic day for the expansion of renewable energy in Japan," Son told reporters at a packed news conference on Wednesday and said he was cooperating with governors from 19 prefectures to push forward the plan.
The Nikkei business daily reported on Wednesday that Son had proposed the construction of about ten 20-megawatt facilities, costing about 8 billion yen ($100 million) each.
The paper said Softbank would fund about 10 percent of the cost of the solar power plants, with local governments paying 100 million yen for each facility, while bank loans would cover the rest. Son did not confirm these details.
Softbank remains heavily indebted after buying Vodafone's Japan operations in 2006.
MODEL PROJECTS
"Our main business is telecommunications and there will be no change to that. But I think we can invest a few percent of our more than 3 trillion yen ($36.6 billion) sales revenue on renewable energy, as a way of contributing to society," Son said.
He said Softbank would initially contribute to model projects and later review its contributions, using project finance and carefully avoiding any losses.
Son, the charismatic entrepreneur who built Yahoo Japan into the country's biggest broadband provider and was an early investor in China's e-commerce giant Alibaba.com Ltd, could be a catalyst for solar power and other renewables, analysts said.
"When calculating the cost of solar power, you have to think
— what cost safety? The cost of nuclear power has turned out to be a lie, while fuel costs are likely to continue to rise," said Nomura Securities analyst Tetsuya Wadaki.
"When Son speaks, people pay attention. I think he can create momentum for green business."
Solar energy policies have been on-again, off-again in Japan, where pioneers such as Sharp Corp and Kyocera Corp have lost their lead to overseas rivals that enjoyed heftier subsidies.
The cost of solar panel installation in Japan is double that in Germany. Son's megasolar plan may also not be feasible while Japan's power grid remains fragmented, hampering the transfer of solar power generated in western Japan to Japan's main power guzzler, Tokyo, experts said.
Softbank, also the distributor of Apple Inc's iPad and iPhone in Japan may use solar panels produced by Sharp Corp in the project, the Nikkei said.
Shares in Softbank closed down 1.3 percent at 2,966 yen, underperforming a 0.6 percent fall in the Nikkei index.
