NEW YORK (AP) — Shares of solar equipment makers jumped Monday following the approval of subsidies in Japan that could make it one of the most attractive markets in the world.

Shares of First Solar Inc., the world's largest solar company, rose 4.6 percent. Shares of Suntech Power Holdings Co. increased by 10.3 percent, while U.S.-traded shares of Canadian Solar Inc. rose by 4 percent.

Japan's new incentive program, which is expected to begin in July, pays homeowners and businesses for the electricity they generate with solar panels. This allows them to eventually recoup the cost of installing the panels and encourages investment in the technology.

Germany has used a similar program to make it the world's largest solar market.

The Japanese subsidies, combined with incentive programs expected in China and Saudi Arabia, should give solar companies a boost at a critical time. Most solar companies have been reeling from a plunge in solar prices and an expected decline in European incentives.

First Solar shares, for example, are down 56.5 percent for the year.

Support for solar energy in Japan "has been expected ever since the Fukushima nuclear incident" last year, Robert Stone, an analyst with Cowen and Co. The country has a massive need for alternative sources of power since taking most of its nuclear power plants offline.

Jefferies analyst Jesse Pichel said Japan's solar program "will be one of the most attractive globally." Pichel predicted that its share of the global market will double next year to roughly10 percent of global solar sales.

Yet Stone cautioned that Japan could quickly become a crowded market as solar companies rush in. Companies that are already operating in Japan, such as Suntech Power and SunPower Corp., have big advantages over others.

In midafternoon trading, First Solar shares rose 64 cents, or 4.6 percent, to $14.59 and Suntech Power shares rose 17 cents, or 9.4 percent, to $2.01. The U.S. shares of Canadian Solar rose 14 cents, or 4 percent, to $3.63 per share, and LDK Solar gained a penny to $2.18.