Following Japan’s tragic tsunami’s and the Fukushima nuclear disasters last year, the country quickly decided to double down on the amount of renewables in the country, particularly solar. One of the biggest moves the country had made since then was creating a generous feed-in tariff (FiT), which will help grow the commercial and utility-scale projects in a country with an already large residential market supported locally and nationally. Taken together this could result in a market as large as 13 gigawatts of new installations annually by 2016, according to a new GTM Research report: “The Japan PV Market, 2012-2016: A New Era of Solar or the Beginning of a Boom-Bust Cycle?”

The report looked at three scenarios across all solar market segments—residential, commercial and utility—a baseline, low, and the roughly 13 gigawatt high scenario. Even the baseline scenario is high at about 8.5 gigawatts annually. The low scenario is closer to 5 gigawatts.

“The residential market has been really big. The new feed-in tariff doesn’t affect that very much,” said report author and GTM Research Solar Analyst Scott Burger during a recent podcast about the report. “I think the market is going to grow significantly over the next few years. We’re projecting that it will reach roughly almost 2 gigawatts in 2013, which would be by far the largest residential market in the world,” he said.

The new feed-in tariff makes commercial and the utility-scale systems more attractive, according to Burger. “The feed-in levels are very high,” Burger said. “They’re roughly 3 times that of Germany or Italy. It’s getting a lot of attention right now at an international level.” He anticipated that the area that is already seeing and will see a lot of growth in Japan’s commercial market, systems larger than 10 kilowatts. Utility systems will also grow but may be limited by the high cost of real estate in Japan. But Burger cautioned that the Japanese government must be cautious about allowing too much solar in too quickly, resulting in a boom and bust cycle like those that have happened in countries like Italy and Germany.

More information on the report is available here: The Japan PV Market, 2012-2016: A New Era of Solar or the Beginning of a Boom-Bust Cycle?