GE unit plans to invest in Japanese solar plant

Fri Mar 28, 2014 5:33pm EDT

General Electric Co. acknowledged on Thursday that a cut in its top-tier credit rating was possible, but its chief financial officer said there was no ''time bomb'' hidden in its hefty finance arm. REUTERS/Brian Snyder

General Electric Co. acknowledged on Thursday that a cut in its top-tier credit rating was possible, but its chief financial officer said there was no ''time bomb'' hidden in its hefty finance arm.

Credit: Reuters/Brian Snyder

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(Reuters) - GE Energy Financial Services, the General Electric Co (GE.N) arm that funds energy infrastructure projects, said on Friday it was planning to invest in a solar power project in Setouchi, Japan.

The Nikkei had reported earlier that GE would contribute about 10-20 billion yen to the project and take a majority stake in the plant's operating company set up by Tokyo-based Kuni Umi Asset Management.

The 230,000-kilowatt plant, which will mark GE's entry into the Japanese solar market, would be the country's biggest plant with twice the output of the biggest domestic solar projects now in the works, the Japanese business daily reported.

Solar companies are benefiting from power subsidies in Japan, which is banking on solar power to help meet the shortfall in supply after the Fukushima disaster in 2011 shattered public confidence in nuclear energy.

The plant, which will start operating in 2018 in Setouchi in Okayama Prefecture, is expected to cost around 80 billion yen ($776 million), the daily reported.

While a spokesman from GE Energy Financial Services confirmed the equity investment, he declined to provide details, saying the company was "still discussing details within the project team."

"Because documents about this project have been publicly disclosed by the Setouchi municipal assembly, we can confirm that if certain conditions are met, GE plans to invest in the solar power project," GE Energy Financial Services spokesman Andy Katell told Reuters.

Katell said GE Energy Financial Services holds equity investments in six solar power projects in the United States and Europe, totaling more than 800,000 kilowatts.

(Reporting by Ankit Ajmera and Sayantani Ghosh in Bangalore; Editing by Maju Samuel)

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