Japan Launches Second Round of Large Offshore Wind Power Auctions

A week after Japan’s first large offshore wind farm went into commercial service, the government confirmed that it has opened the next round of auctions for the development of the industry. The next auction is proceeding under revised parameters designed to open the industry to more companies and provide for broader participation in the development of offshore wind farms.

The structure of the earlier auctions was seen as heavily favoring large, Japanese companies and not providing opportunities for new entrants and a broader range of companies. Marubeni Corporation, one of Japan’s large conglomerates, won the first rights to develop and launch two projects on the Sea of Japan. A year ago, a consortium headed by Mitsubishi was declared the winner for all three project sites being auctioned while there were as many as five competitors for several of the projects. 

Responding to the calls to provide for a broader range of participants in the industry, Japan’s Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism set new parameters for the next round of auctions. Bids with earlier start-up dates for the wind farms will be given priority but one consortium will be limited to a maximum of winning a total of 1 GW during each auction.

The new round provides for a total of four different sites which are projected to provide at least 1.8 GW of offshore power generation. One location is off the coast of Happo Town and Noshiro City, in Akita Prefecture located in northwest Honshu, Japan’s largest island. The second site is in the same region offshore of Akita City, while the third is to the south in central Honshu off Tainai City. The other location is in southern Japan off Eshima, in Nagasaki Prefecture on the island of Kyushu. The individual projects are projected to range in size between 300 and 700 MW.

Proposals are due by June 30, 2023. The government will announce the individual winners, possibly starting by the end of 2023 and completed by March 2024. The projects will be timed to avoid potential scheduling conflicts at the port of Akita, which will support several of the developments.

The first two large, commercial offshore wind farms are being commissioned near shore at Akita. They are relatively small, with a total of 33 wind turbines, and are expected to produce approximately 140 MW of power, but were an important learning tool for the industry. They are being seen as a milestone as the country moves forward with plans for its green energy transition.

Last year, the Japanese government expanded its goals for offshore wind energy development. The target for wind is 10 GW by 2030 and 30 to 45 GW by 2040.