Taking advantage of financial incentives for solar power generation, Japanese trading houses are stepping up investments in photovoltaic projects in Spain and elsewhere in Europe.
By investing in the fast-growing field in Europe, they hope to see the solar power business become a main source of long-term earnings, according to officials.
In late July, Mitsui & Co. acquired all the stock of photovoltaic power project companies in Catalonia, Spain, with a current capacity of 100 kilowatts peak (kWp).
The acquisition was made through IPM Eagle LLP, an investment firm based in Britain in which Mitsui has a 30-percent stake.
Upon completion of additional facilities, the total capacity will soon be 1,460 kWp, enough to supply electricity to 380 households.
Sumitomo Corp. also announced in May it had launched a solar power project on Spain's Canary Islands with a projected output of 9,000 kWp.
The total cost is estimated at 8.5 billion yen and power generation will start later this year.
Meanwhile, Itochu Corp. acquired a 10-percent stake in Scatec Solar AS of Norway, which develops solar power generation facilities, for 1.3 billion yen in May.
It will build major solar parks in Germany, the Czech Republic and elsewhere with target sales set at 130,000 kilowatts per year by 2010.
Amid surging prices of crude oil and other resources, the fund--tentatively named Innovation Sozo Kiko--will invest mainly in solar power generation, wind power generation, fuel cells, and other new energy technologies and natural resources.
The government is aiming to prevent excessive outflows of national wealth to countries rich in natural resources, and to build a mid- and long-term base for future economic growth.
The government hopes these new policies will transform the economy into one that functions on drastically reduced resource consumption.
Initially, the government saw the fund as an entity to buy up dormant patents owned by companies and universities, aiming to use them to produce high-value-added goods across a wide range of industries.
But the government shifted to a policy that concentrates on certain specific purposes due to a recent surge in prices of various natural resources.
Among its practical investment targets, the government is considering a project to collect and pool technologies from major manufacturers, emerging companies, universities and other research institutes that can lead to the production of innovative fuel cell technologies.
In the solar power-generation field, the fund would help companies select and concentrate on promising business projects.