Energy

Japan has been witnessing an upsurge in the number of companies showing interest in its fledgling offshore wind sector, says GlobalData, a leading data and analytics company.

GlobalData’s research reveals that the Japanese offshore market presently stands at a miniscule 68 megawatt (MW). However, 770 MW of capacity is in the pipeline across four projects, all of which are in the permitting stage. There are also a number of announced projects with a much higher total capacity.

Harminder Singh, Director of Power at GlobalData, comments: “The offshore wind market in Japan, though presently at a nascent stage, is increasingly showing positive signals to investors. The recent joint venture between Canadian Energy Company Northland Power and Shizen Energy is a testimony to this.”

According to the Japanese Wind Power Association, a number of foreign developers such as Ørsted, Equinor, wpd and CIP have established branch offices in the country, showing their intent to invest in the Japan’s offshore wind sector.

In January 2019, Danish offshore wind power company Ørsted had signed a memorandum of understanding with Tokyo Electric Power Company (TEPCO) to work together on offshore wind projects.

Earlier this year, the bill on promotion of the use of territorial waters for offshore renewable energy generation facilities was passed into a law. This was followed up in July this year by the identification of 11 areas as potentially suitable for development of offshore wind. In four of these areas, wind measurement and geological surveys will be conducted by the government immediately.

Singh concludes: “Global companies are looking to be the early entrants in the Japanese market to gain the first-mover advantage when the market starts growing. Cooperation with Japanese companies seems to be an important ingredient for this strategy. German electric utilities company RWE, for example, has signed a cooperation agreement with Kyuden Mirai Energy. The company is also eyeing collaboration opportunities with other Japanese players.

“Nowegian energy firm Equinor believes that since the waters are too deep in Japan, the availability of sites for bottom-fixed turbines is low. So, floating installations could be the game changer in the country. The company estimates 3.5 gigawatt (GW) of offshore wind potential in the country by 2030.

“As per GlobalData, the installed offshore wind capacity in Japan is expected to reach close to 3.8 GW, accounting for a staggering 33% of the total wind capacity in the country by 2030. Overall, the time ahead looks exciting for offshore wind in the country and the developments over the next few years will be interesting to watch.”