7 items to check the price of a solar power plant and the remaining FIT period

Table of Contents

• The price of a solar power plant changes depending on the remaining FIT period

• Item 1: Confirm the start point and end date of the remaining FIT period

• Item 2: Link the selling price and the remaining period to actual generation performance

• Item 3: Confirm equipment degradation and repair risks during the remaining period

• Item 4: Assess fixed costs and operation and maintenance costs over the entire remaining period

• Item 5: Verify the alignment between the land contract and the remaining FIT period

• Item 6: Reflect output curtailment and shutdown history in revenue projections

• Item 7: Also confirm the operational policy after the FIT ends

• Common mistakes that occur when pricing is judged based only on the remaining FIT period

• Summary: Evaluate the remaining FIT period together with on-site evidence

The Price of a Solar Power Plant Is Perceived Differently Depending on the Remaining FIT Period

When considering the purchase or acquisition of a solar power plant, one thing you should always check alongside the price is the remaining FIT period. The remaining FIT period is an important condition that indicates how much time is left during which electricity can be sold at a fixed price. A solar power plant is a business asset that generates revenue by selling the electricity it produces, and the duration for which the electricity sale conditions continue has a major impact on price assessment.

However, it is not as simple as a long remaining FIT period being necessarily good or a short one necessarily bad. A power plant with a long remaining period has many future opportunities to sell electricity remaining, but during that time equipment degradation, power conditioner replacement, cable repairs, grass cutting, drainage management, insurance, inspections, and repairs may occur. Conversely, a power plant with a short remaining period has a limited time to generate revenue, so if major repairs or additional burdens arise, there is less opportunity to recover costs.

For practitioners searching "solar power plant price", what matters is not treating the remaining FIT period as a standalone number, but confirming whether the plant can truly generate power, sell it, and be operated and maintained stably throughout that period. Even if the feed‑in tariff is attractive, revenue won’t grow if generation declines. And even if the remaining term appears sufficient, long‑term operational risks remain if there are concerns about land contracts, connection agreements, or equipment condition.

For used solar power plants, past operational history strongly affects the price. It is necessary to check whether generation performance has been stable, whether there have been few shutdowns, whether inspection reports and repair histories are in order, whether the land contract aligns with the remaining FIT period, and whether on-site drainage or vegetation management present any problems. Even if the remaining term appears to exist on paper, if equipment deterioration or the management burden is significant on site, the actual value will be affected.

This article organizes seven items for practitioners to check the price and remaining FIT period of solar power plants. Rather than specific prices or unit costs, it focuses on verification points usable for pre-purchase, comparison, internal approvals, price negotiation, and management handover.

Item 1: Confirm the starting point and end date of the remaining FIT period

First, you should confirm the commencement point and the end date of the remaining FIT period. Even if the project documents state the remaining period, you cannot assess the reasonableness of the price if the basis for that period is unclear. You need to verify, using contract documents or materials that indicate the start of operations, when the period begins and how long the current power sale conditions will continue.

For used solar power plants, a certain period has already elapsed since the start of operations. Therefore, rather than accepting the remaining term stated by the seller or broker at face value, we cross-check the operation start date, the power purchase agreement, certification-related documents, the grid connection agreement, and the start date of generation records. If dates or names differ between documents, we confirm which document is being used as the basis for calculating the remaining term.

It is important to note that the time the facility was completed, the time electricity sales began, and the time contractual terms take effect can be conflated in practical documents. If you judge only by the number of years listed in the project summary, you may misinterpret the actual remaining period. Misjudging the remaining term directly affects annual revenue, payback/recovery forecasts, loan repayments, and maintenance/repair decisions.

Also, it is necessary to confirm the procedures for transfer of title and succession. Check whether the procedures required to assume the power-sale terms after purchase are organized, whether the division of responsibilities between the seller and the buyer is clear, and whether the necessary documents are in order. Even if the remaining term appears to be sufficient, deficiencies in the succession procedures can leave uncertainties in post-purchase operations.

In lower-priced projects, the low price may stem from ambiguity about the remaining FIT period. In higher-priced projects, part of the value may be that the basis for the remaining period is clear and that contracts and documentation are consistent. First, accurately determining the remaining period is the starting point for price assessment.

Item 2: Link the feed-in tariff and remaining term to power generation performance

After checking the remaining FIT period, next link the feed-in tariff rate with the actual generation performance. Even if the feed-in tariff is favorable and there is still time remaining on the contract, revenue will not increase if actual generation is low. To determine the price of a solar power plant, you need to check the tariff, the remaining period, and the generation together.

When looking at power generation records, it is important not to judge based solely on the annual total. Even if the annual totals appear stable, a month-by-month view may show that generation drops only during particular seasons. If weeds grow in summer and cast shadows on the lower parts of panels, if surrounding trees or the terrain cast longer shadows in winter, if generation is affected by fallen leaves or snowfall, or if equipment shutdowns or inspection stoppages occur, these month-by-month trends reveal site-specific issues.

We also review multi-year trends. Even if a single year’s performance looks good, that year may have benefited from unusually favorable weather conditions. By checking whether output is stable across multiple years, declines year by year, or suddenly drops from a certain point in time, you can identify signs of equipment degradation or inadequate maintenance. To assess whether the same level of power generation can be maintained during the remaining FIT period, it is necessary to examine past performance carefully.

If you estimate annual revenue by looking only at the feed-in tariff and the remaining contract term, you are likely to overlook variations in power generation. For example, if projected generation is calculated based on historically strong years, future revenue may look optimistic. Conversely, if there was a temporary equipment malfunction in the past that has since been repaired, future generation may improve. What matters is whether you can explain the basis for the generation estimate.

In lower-priced projects, the track record of power generation may be weak relative to the feed-in tariff rate and the remaining term. In higher-priced projects, the price may be justified not only by the feed-in conditions but also by the stability of the generation performance. When evaluating the remaining FIT period, it is essential to confirm how stably the system can generate power during that period.

Item 3: Confirm equipment deterioration and repair risks during the remaining period

When evaluating the remaining FIT period, equipment deterioration and repair risks that may occur during that period must not be overlooked. Power plants with a long remaining period still have many revenue opportunities, but equipment may deteriorate during that time and require repairs or replacement. For power plants with a short remaining period, a major repair can have a much heavier impact on their financial performance.

The equipment to be checked is not limited to the solar panels. You need to inspect the entire solar power plant, including power conditioners, cables, connection equipment, mounting structures, foundations, monitoring devices, fences, drainage facilities, and communication equipment. Even if it is currently generating power without problems, during the remaining period you may need to replace power conditioners, repair cables, repair mounting structures or foundations, or update monitoring devices.

Inspection reports and repair histories are important documents for reading future risks. They let you verify which equipment had problems in the past and when and how they were addressed. The fact that a failure occurred is not necessarily a problem in itself. If the cause was identified, repairs were carried out appropriately, and measures to prevent recurrence remain in place, it becomes easier to assess the state of maintenance. On the other hand, if identified issues remain unaddressed or the repair details are unclear, they need to be anticipated as a burden during the remaining term.

When deciding on repairs during the remaining term, consider how much time is left to recoup the repair costs. If the remaining term is long, repairs to maintain power generation are often worthwhile. If the remaining term is short, you need to carefully assess how far to go with repairs and how much improvement in power generation can be expected. For low-priced projects, the low price may reflect that repairs will be needed in the near future.

Equipment degradation is also checked during on-site inspections. We look for cracked or dirty panels, the installation environment of the power conditioner, cable damage, corrosion of the mounting structures, scour around foundations, clogged drainage channels, and damaged fences. Even if documentation appears to show few problems, degradation may be found on site. The value of the remaining FIT period depends on whether the equipment can operate stably throughout that period.

Item 4: View fixed costs and maintenance/management expenses over the entire remaining period

When evaluating the remaining FIT period, you need to consider not only electricity sales revenue but also fixed costs and operation and maintenance costs over the entire remaining term. A power plant is not a one-time purchase; as long as you own it, inspections, monitoring, mowing, cleaning, insurance, land management, tax and administrative procedures, and emergency responses will continue to occur. It is important to confirm how much profit remains over the remaining term after deducting these costs.

Fixed costs include land-related expenses, insurance, communications, power generation monitoring, tax and accounting processing, contract management, administrative procedures, and so on. Maintenance and management costs include regular inspections, checks of electrical equipment, grass cutting, cleaning, drainage channel management, repairs to fences and gates, management of surrounding trees, on-site response to abnormalities, and so on. These are costs that are likely to occur in years of both high and low power generation.

Just because past maintenance costs were low doesn't necessarily mean the power plant is easy to manage. It may be that costs were low because necessary inspections, grass cutting, and drainage management were not carried out adequately. If you switch to an appropriate management system after purchase, costs may increase more than expected. When reviewing past costs, check the work performed, frequency, reports, and the on-site condition together.

The longer the remaining period, the more fixed costs and operation and maintenance costs accumulate. Even if the annual burden appears small, over the entire remaining period it can have a significant impact. Even with a short remaining period, projects with heavy fixed costs can leave little net income. It's important to look not only at the electricity selling price and generation volume, but also at the actual revenue after operation and maintenance.

For lower-priced projects, fixed costs and maintenance costs may not be sufficiently accounted for. For higher-priced projects, a well-established management system and a clear outlook on costs may be included as part of their value. When assessing the remaining FIT period, you should consider not only the remaining electricity sales revenue but also deduct the management costs that will be required during that period.

Item 5: Verify consistency between land contracts and the remaining FIT period

When checking the remaining FIT period, always also check for consistency with the land contract. Solar power plants are businesses that are operated on land for long periods. Even if the power sales terms remain, if the period during which the land can be used stably is insufficient, concerns about continuing the business remain. It is especially important for power plants on leased land to confirm that the land-use contract period aligns with the remaining FIT period.

The first thing to check is whether the land is owned or leased. Even for owned land, verify the boundaries, road access, drainage, scope of management, and relations with neighboring properties. For leased land, check the contract period, renewal terms, termination conditions, rent revision, obligations to restore the land to its original condition, and the relationship with the landowner. Check whether land-use rights are sufficiently secured for the remaining FIT period.

If the term of the land contract is shorter than the remaining FIT period, it is necessary to confirm whether it can be renewed, whether the renewal conditions are clear, and whether agreement with the landowner can be easily obtained. If there is uncertainty about contract renewal, even if the remaining period appears sufficient on paper, the actual operational risk increases. In low-priced projects, concerns over the land contract may be the reason behind the low price.

Boundaries and the scope of use are also important. Confirm whether the contractual scope, the scope shown on drawings, the area enclosed by fences, and the area actually being managed all match. If boundaries are unclear, issues can arise with mowing, drainage management, fence repairs, and dealing with neighbors. To operate stably during the remaining FIT period, the assumptions regarding land use need to be clarified.

Also check road access and entry routes. We assess whether service vehicles can enter not only for routine inspections but also for equipment replacement, disaster recovery, mowing, and drainage cleaning. If rights of way are unclear or access routes are difficult to use in wet weather, the management burden during the remaining period may increase. Consistency between the land contract and the remaining FIT period is a criterion for judging not only revenue but also operational continuity.

Item 6: Incorporate output curtailment and downtime history into revenue forecasts

Even if there is still remaining FIT period, if the amount of electricity that can actually be sold is restricted or equipment shutdowns occur, revenues will fall below expectations. Therefore, it is important to reflect output curtailment and shutdown history in revenue forecasts. Judging based only on the electricity sale price and the remaining period can lead to overestimating actual annual revenue.

Regarding output control, we check to what extent it has occurred in the past and whether it is reflected in generation performance and electricity sales revenue. If there is a decline in monthly generation, we examine not only weather, equipment outages, and shading from vegetation, but also whether output control has had an effect. Revenue calculations that do not account for the impact of such control can appear better than reality.

We also review the equipment downtime history. We verify which equipment stopped, when and to what extent, what the cause was, and how long it took to be restored. In particular, faults in power conditioners, monitoring devices, connection equipment, and cables have a direct impact on power generation. If there are unexplained shutdowns or repeated occurrences of the same fault, they should be treated as a revenue risk for the remaining term.

Power generation monitoring and emergency response arrangements are also important. Even if an anomaly is detected, if it is unclear who will verify it and who will arrange on-site response, downtime may be prolonged. For plants located far away or with poor road access, on-site inspection and restoration can take time. Longer downtime will affect electricity sales revenue during the remaining FIT period.

For low-priced projects, output control and a history of stoppages may be the reason for the low price. For high-priced projects, fewer stoppages and well-established monitoring and recovery systems may justify the price. When looking at the remaining FIT period, it is important not only to check whether the period remains, but also to confirm how stably electricity can be sold during that period.

Item 7: Confirm the operational policy through to after FIT completion

Finally, what I want to confirm is the operational policy after the FIT ends. The remaining FIT period is a major factor in price decisions, but a plant’s value does not necessarily disappear completely at the time the FIT expires. How it is handled after expiration will vary depending on equipment condition, land contracts, interconnection agreements, management structure, and future plans for power utilization. However, it is also risky to overestimate the post-expiration value.

First, verify whether the assumption that the equipment will continue to be used after the FIT period ends is realistic. Inspect the condition of the solar panels, power conditioners, cables, connection equipment, mounting racks, foundations, and monitoring devices to determine whether they can be operated safely after the FIT ends. If major repairs or replacements will be required during the remaining period, this will also affect the post-FIT operational policy.

Land contracts are also important. Confirm whether the site will continue to be used as a power plant after the FIT ends, whether removal or restoration to the original condition will be required, and what the contract with the landowner stipulates. In the case of leased land, if the conditions regarding land use and removal after termination are ambiguous, future liabilities can become difficult to foresee. You should also confirm the scope of restoration and who will be responsible.

We will also review the connection contract and the approach to selling electricity. We will clarify what kind of operation is anticipated after the FIT ends, how the generated power will be handled, whether the connection equipment will be maintained, and whether equipment upgrades will be necessary. Even if the details are undecided at this stage, it is important to consider how realistic the post‑end options are.

When assessing price, you should focus on revenues during the remaining FIT period, but you cannot ignore decommissioning costs, management fees, land contracts, and the condition of the equipment after the FIT ends. For projects with a short remaining term, the post-termination handling has a large effect on the price. Even for projects with a long remaining term, if the post-termination policy remains unclear, concerns about long-term management planning will remain.

Checking the operational policy after the FIT period broadens the perspective for purchase decisions. When judging whether a price is reasonable, it is important to consider not only short-term revenue from electricity sales but also how long and in what way the power plant will be maintained.

Common mistakes that occur when judging price based solely on the remaining FIT period

If you judge the price of a solar power plant based only on the remaining FIT period, several mistakes are likely to occur. The most common is concluding that a project is good simply because the remaining period is long. Even if the remaining period is long, the actual value decreases if generation performance has declined, equipment degradation has progressed, fixed costs are high, or there are concerns about the land contract.

Conversely, it is premature to immediately rule out a project just because the remaining term is short. If the power generation track record is stable, the equipment condition is good, and fixed costs and land conditions are well defined, it can be easier to make a decision even for a short remaining term. However, for projects with a short remaining term, the impact of major repairs or replacements can be substantial, so repair risks must be examined especially carefully.

Judging solely by the electricity sale price is risky. Even if the price is good, revenues will not increase if generation is low. If there are frequent output curtailments or equipment shutdowns during the remaining period, electricity sales income will be lower than expected. It is important to look at the sale price, remaining period, generation performance, and shutdown history together.

Overlooking fixed costs and maintenance expenses can also lead to failure. If you don’t deduct grass cutting, inspections, monitoring, insurance, land-related costs, administrative procedures, and repair costs, you won’t know the actual remaining profit. You need to check how much fixed costs will accumulate over the entire remaining period.

You should avoid judging based on documents alone. Even if the remaining term can be confirmed in the contract paperwork, there may be on-site issues such as equipment deterioration, poor drainage, shading, vegetation, boundary issues, or road access problems. The value of the remaining FIT period only matters if the site is in a condition that allows it to continue generating power.

Summary: Determine the remaining FIT period together with on-site evidence

To check the price of a solar power plant and the remaining FIT period, it is important to confirm seven items: the starting point and end date of the remaining period, the feed-in tariff unit price and historical generation performance, equipment degradation and repair risks, fixed costs and operation and maintenance costs, consistency with the land contract, records of output curtailment and shutdowns, and the operational policy after FIT expiry. The remaining FIT period is an important condition, but it alone cannot determine whether the price is reasonable.

There may be reasons why a low-priced power plant is cheap. A short remaining term, declining power generation, impending equipment repairs, uncertainty in land contracts, heavy fixed costs, or discrepancies between the documents and the actual site may underlie the price.

There are also reasons why a high-priced power plant is expensive. If it has remaining term, stable generation performance, and well-maintained equipment and favorable land conditions, it can be a project that is easier to consider from a long-term perspective.

What is important for operational staff is to organize the remaining FIT period as a substantiated basis that can be used for internal explanations. They need to link the power sales contract, certification-related documents, generation performance records, inspection reports, repair history, land contracts, connection agreements, and on-site inspection results so they can explain whether stable operation can be maintained throughout the remaining period.

During on-site surveys, it is effective to record, together with location information, the checkpoints likely to affect revenue during the remaining FIT period. If panels, power conditioners, cable routes, drainage channels, trees causing shading, the extent of vegetation growth, fence damage, areas near boundaries, and potential repair locations are recorded accurately, it becomes easier to organize the basis for future costs and reductions in power generation.

If you want to accurately link a solar power plant’s remaining FIT period to its on-site conditions, using LRTK (an iPhone-mounted GNSS high-precision positioning device) is also effective. If you can record the locations of equipment within the plant, drainage channels, causes of shading, extent of vegetation, candidate repair locations, and points of caution near boundaries together with high-precision positional information, you can reconcile discrepancies between drawings and the actual site and make it easier to share operational risks during the remaining FIT period among stakeholders. When determining the price of a solar power plant and its remaining FIT period, it is important to build up not only the desk-based remaining period but also the evidence for power generation capacity and the management burden that can be confirmed on site.