There is no place like Japan for wind power makers. Thanks to a highly incentivized tariff system and abundant air currents, the country is fast becoming an industry mecca. Some might call it the new "kamikaze" - literally, Divine Wind.

For Portland, Oregon-based wind turbine maker Xzeres, the opportunity is indeed heavenly. Established in 2010, the firm quickly seized on the announcement of Japan's renewable energy policy in 2012 to set up shop in Tokyo. Since then, it has received approval from the Ministry of Economy, Trade and Industry (METI) to build on 150 sites across the country, and has another 500 applications in process.

"We're busy in other places such as North and South America and the UK, but Japan is far and away our best market," says Xzeres international business development manager Ross Taylor, whose company set up a sprawling booth at the 4th International Wind Energy Expo held in March in Odaiba. "Our goal is not just to sell into the market, but to nationalize the brand for the local market."

To do so the company is striving to set up a nationwide dealer/distributor network through which it can source investor funds to funnel into new projects. But the key to making the entire enterprise work is the government-set feed-in-tariff (FIT) rate, which currently sits at 55 yen per kilowatt hour for a 10 kW wind power generating system.

Start up costs for such a system are often higher than for comparable photovoltaic (PV) generating systems, but the corresponding FIT is almost double for wind. This allows the IRR (internal rate of return, or the payback of the initial investment capital) to average just five to eight years. Selecting an area with relatively high wind speeds can thus net a nice profit over the life of a 20-year METI contract. Other perks include a 17-year tax depreciation benefit.

Xzeres' machines also feature the ability to retract hydraulically in the event that extreme weather poses a risk to the survivability of the hardware. At the expo, the company announced a new kind of insurance policy which covers damages attributable to natural disasters, as well as loss of FIT revenue due to turbine down time.

As might be expected, obtaining government approval for installing turbines is by no means quick or easy, requiring a long list of checkoffs, including long-term structural durability, and resilience to earthquakes and lightning.

"Japan is very 'by the book' in that respect, and the government makes people jump through a lot of hoops in the approval process," says Mr. Taylor. This includes Class NK certification, which is analogous to a UL accreditation for home appliances.

In actual use, turbines can indeed be productive. Depending on typical wind speeds found in Japan of, say, six to seven meters per second, a 10 kW turbine could produce 28,000-38,000 kWh of electricity per year, enough to sustain five homes.

With Japan's government dead set on meeting a target of sourcing 30% of the nation's energy needs from renewable sources, the current incentive system for wind power is likely to remain in place, say many experts. Mr. Taylor reckons that the prime window of opportunity will remain open for another two years or so.

"Japan's 2011 (Fukushima) nuclear disaster brought the country to this point, and the country remains prone destructive climactic phenomena, so who knows what might happen with policy going forward?" he says. "In the end, it comes down to economics; the current IRR for photovoltaic is around 5% and people still see that as attractive, whereas wind power is at 16%. This market should continue to be good until saturation sets in, at which point FIT rates will begin to come down."

"We're busy in other places such as North and South America and the UK, but Japan is far and away our best market," says Xzeres international business development manager Ross Taylor,