(Bloomberg) -- In many respects, Takeshi Magami’s farm is like any other in Japan, growing everything from potatoes to ginger and eggplants. But one major difference sets it apart from its neighbors: the 2,826 solar panels perched above the crops.
The panels, covering much of the one hectare (2.5 acres) of land in the tranquil countryside east of Tokyo, serve a dual purpose. They supply nearly all the power needed to run the farm, and are a source of extra income by selling surplus renewable energy to the grid.
For Magami that can mean 24 million yen ($187,000) of additional revenue a year, eight times more than the maximum 3 million yen generated from his produce. While he benefits from generous tariffs that have since been reduced, it's an indication of the added value available to farms in Japan and globally.
“Our goal is to electrify and automate all steps of farming” and create a model for what sustainable agriculture could look like, said the 38-year-old Magami, who has been operating the farm as part of his start-up Chiba Ecological Energy Inc.
All the machinery used on Magami’s farm, minus the tractor and a hand-pushed tiller, are electric, charged by panels set above a small shed. Rows of batteries for the tools are lined up on a shelf.
The farm is part of a global movement called solar sharing -- or agrivoltaics -- that involves the simultaneous use of farmland for producing crops and generating power. The movement is gaining adherents as the global push to replace fossil fuels is encouraging more innovative approaches to boosting capacity for renewable energy.
Solar sharing is emerging as a viable alternative in places like Japan with limited space and a heavy reliance on energy imports. It can help stretch home-grown energy production as countries increasingly seek to reduce their exposure to foreign supplies. Solar sharing is also useful in countries with harsh growing environments, protecting crops by absorbing sunlight and acting as a shield.
“We’ve seen many regions with climate change, and agrivoltaics could mitigate and make agriculture more resilient,” said Max Trommsdorff, head of the agrivoltaics group at the Fraunhofer Institute for Solar Energy Systems ISE in Germany. “Small countries in the sun belt with high population is where agrivoltaics are most urgent and promising.”
Japan, which is targeting to go carbon neutral by 2050, has limited capabilities for renewable energy because of its mountainous terrain. It is aiming for 36% to 38% of its energy mix to come from renewable sources in 2030, with solar accounting for 14% to 16%. While Japan’s solar installations have risen over the last decade, they supplied only 8.9% of the country’s power as of fiscal 2020, according to the Institute for Sustainable Energy Policies in Tokyo.
That means Japan will need more spots for panels. The government is looking toward rooftops, railway lines and airports, and the country’s wide stretches of agricultural land on the flat plains offer a promising alternative.
But while Magami has demonstrated the success of solar sharing, the practice hasn’t been widely adopted in Japan. Only 742 hectares were approved for agrivoltaic use between fiscal 2013 and 2019, according to data from the Ministry of Agriculture, Forestry and Fisheries, out of the country’s total agricultural land of 4.4 million hectares as of 2020.
Agrivoltaics is a tough sell for Japan’s elderly farming population. Many are without successors to take over the business, and they’re unwilling to make the heavy investment in solar panels that may take decades to pay off. It also can be a distraction from the business of growing crops.
“Some people are against it as it ruins aesthetics, or for getting in the way of farm work,” said Chiho Egashira, an official at Japan’s ministry of agriculture. It can be cumbersome for farm equipment to dodge poles that lift the panels off the ground.
While solar panels can be an alluring prospect for extra income, the ministry wants to ensure food security remains the priority. And so it has put in place rules to ensure production levels.
Magami says that despite the hurdles, it’s necessary for the country to embrace agrivoltaics to reach carbon neutrality by 2050. He calculates that using solar panels on roughly 5% of Japan’s arable farmland, or equivalent to 200,000 hectares, could generate 20% of the country’s power generation.
“Things like geothermal and hydropower take decades to start operating,” Magami said. “We’re no longer in an era where the best way is to find unused plots of land available and install it with panels. Those have all been filled.”
Other nations are making progress with solar sharing, especially in countries that face a similar lack of space. South Korea has targeted 10 gigawatt of agrivoltaics capacity by 2030 under its Renewable Energy 3020 plan. Taiwan is eyeing the scheme as it seeks available spaces for renewable installation, according to Magami. Italy plans to invest 1.1 billion euros ($1.2 billion) in agrivoltaics to create about 2 gigawatts of capacity.
Larger countries also have a significant presence. China, the world’s top solar panel producer, is home to the biggest agrivoltaic system: a project covering 20 million square meters of land in the desert in Ningxia. Of the 2.8 gigawatt agrivoltaic systems installed globally, China had roughly 1.9 gigawatt of capacity as of 2020, according to the Fraunhofer Institute.
Adoption in the US varies, with more progressive states in the Northeast launching projects with government funding, according to Mark Uchanski, an associate professor at Colorado State University who specializes in sustainable and organic agriculture. “People's appetites are increasing,” he said. Agrivoltaics “is a perfect storm for wanting food security, energy and working toward emission goals,” he said.
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