The Japan Aerospace Exploration Agency (JAXA) has lined up tech companies and set out steps to build a large-scale solar energy system in space that could beam power down to Earth.

JAXA has been researching the possibility of a space solar power plant since 1998, but it recently recruited companies such as Mitsubishi Heavy Industries, NEC, Fujitsu and Sharp to work on getting a full-blown power station by 2030.

The overall plan is to build giant solar panels that orbit above the Earth's atmosphere to collect sunlight and generate electricity. The system would use the power to run a microwave radiation emitter or laser for beaming the energy down to Earth, where receivers would grab it and return it to electricity.

In space, the system won't be subject to the weather elements that affect the performances of terrestrial systems.

As you can imagine, there are several major challenges to make this work. Sending equipment up to space is one. Operating and maintaining the system cost effectively is another. How about minimizing losses during conversion and transmission of energy? Then there are safety issues with beaming microwave radiation to the earth (and convincing the public that it's not going to pose serious hazards to the people and environment).

But the concept is plausible enough for public and private enterprises to explore it. Pacific Gas and Electric in California, for example, has signed a power purchase agreement with a solar power developer, Solaren Corp. in Manhattan Beach, Calif.

JAXA aims to build a 1-gigawatt station up in space that would produce electricity at 8 yen per kilowatt hour. That price would be six times cheaper than the current electricity cost in Japan, according to Reuters.

The agency wants to have a 10-megawatt test system in space by 2020.