Solar cell makers are expected to increase sales in Japan as the government struggles to reduce atmospheric pollution.
Despite efforts to clean up industry and transport in the home of the Kyoto Protocol, environmental officials predicted last week that the country will exceed its original target for greenhouse gas emissions by more than 170 million tonnes by 2010.
This would mean the country missing its obligations under the Kyoto Protocol by 20 to 34 million tonnes, the government admitted.
As a core signatory to the Kyoto Protocol, Japan is committed to steady reductions in its output of greenhouse gases.
As part of its plan to meet these targets, the government is encouraging the adoption of non-polluting renewable energy sources such as solar and wind power.
The government originally planned to seek annual reductions of 2.6 million tonnes of carbon dioxide output by using solar cells.
However, in view of the disappointing results so far, analysts from Nomura Securities' Financial & Economic Research Center in Tokyo now believe that the authorities are likely to call for a greater pollution reduction from solar energy.
Compared to traditional methods of generating electricity, one square metre of solar cells will provide a reduction in greenhouse gas emissions of approximately four tonnes over an average 20-year lifespan.
The government's original pollution reduction target of 2.6 million tonnes of carbon dioxide would require at least 13 square kilometres of new solar cells nationwide, costing at least $763m.
However, crystalline silicon, a key material used in the most common solar cells, is in short supply. This shortage is increasing demand for thin-film solar cells, which do not rely on crystalline silicon, but are four times more expensive.
"If other countries take major steps to reduce greenhouse gas emissions by using solar cells, we think it would encourage the construction of thin-film production facilities as it is easy to expand them," said Nomura analyst Tetsuya Wadaki.
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