Japan – an island nation with divine wind
Energy Blog, 31 January 2020
Yurie Kawada discusses the opportunities and challenges for the up-and-coming Japanese offshore wind sector.
In an attempt to keep one of my New Year’s resolutions, I have been reading up on the history of Japan. While doing so, I was reminded of the most interesting fact that the once-invincible Mongol empire crossed the Sea of Japan twice in the 1270s and 1280s in a bid to conquer the world beyond China. Both times they were beaten due to strong winds and storms. In gratitude for this, the Japanese named the strong winds on their land the “divine wind” and huge weather events such as typhoons, tsunamis and earthquakes have always featured significantly in Japan’s history. Fast forward 750 years, and we now see that the weather is radically shaping the evolution of renewable energy in this densely populated island country.
As you will recall, the Great Tsunami of 2011 hit the eastern coast of Tohoku region and subsequently destroyed the Fukushima Nuclear Power Station, an event which caused enormous damage to the country. This, understandably, led to strong opposition towards nuclear power and subsequently all the Japanese nuclear power plants were halted in 2012. This left a big gap in the country’s energy mix as nuclear power had contributed 26% of the country’s generation capacity.
The post Fukushima solar boom
On a ‘lighter’ note, in the same year, the FiT was introduced to accelerate the introduction of renewable energy in the country. Early solar schemes were awarded a hefty price of 40 JPY/kWh, equivalent to an astonishing 330 EUR/MWh.
Predictably the share of renewable energy in the Japanese generation mix surged from 10% in 2010 to 16% in 2017. The main contributor to this was the commissioning of around 40 GW of large-scale solar PV projects prior to 2018. A further 25 GW of solar PV capacity currently holds a FiT license, waiting to be built within a 3-year window in accordance to the additional measure the ministry (METI) introduced in 2016.
Why so little wind development?
What has been surprising is that, unlike the evolution of renewable energy in other countries the Japanese onshore wind sector has lagged behind its solar cousin, with only 3.5 GW onshore wind capacity commissioned so far. Although we know the wind sector has a higher barrier to entry than solar PV, due to its increased development complexity and associated capital intensity, this tenfold disparity in installed capacity is still surprising; so what is the fundamental reason behind it? The answer is actually just two words: hairpin bends.
Japan is a mountainous country with a lot of sharp, hairpin bends. This makes it an exciting place to drive but it also makes it technically difficult to get a 100 metre-long turbine blade to the top of a hill. With 60-70% of the country covered by mountains and hills, a lot of Japan’s onshore wind potential is currently out of reach, and it would require a radical shift to innovative technologies such as two-piece blade design to unlock it.
This of course begs the question of why, given the divine winds and hairpin turns, the Japanese offshore wind market has yet to fully taken off.
On paper Japan’s potential for offshore wind looks obvious. Japan is surrounded by one of the world’s longest coastlines at 30,000 km, equivalent to the combined coastlines of the UK, France, Germany, Belgium and the Netherlands. The Japan Wind Power Association claims that there is 600 GW worth of offshore wind development potential within the country in its nascent offshore wind industry (JWPA 2012), and yet Japan’s first commercial offshore wind farm is yet to see the light of day.
There are several reasons behind this: firstly, as the Mongolians discovered to their cost, the Japanese ocean is subject to unpredictably strong winds, typhoons and earthquakes; secondly, unlike Europe, the sea becomes very deep very quickly; and finally, the optimal offshore wind sites are typically located in less populated areas which typically don’t have a suitable grid connection. These three challenges combined are giving the locals good reason to pause and follow a more considered approach.
The role of the Government
The biggest driver for swift growth of any renewable industry is decisive and robust implementation of necessary regulatory frameworks. In the case of Japanese offshore wind, this would include changing laws to allow offshore leases over long-term periods and allocation of support schemes such as the FiT. In fact, in response to increasing demand, the government is now doing just that and in 2019 announced plans to organise the first offshore wind tender, now expected to be held in 2020.
Ahead of the tender, we are already seeing some market activity on the ground; some experienced European parties are announcing partnerships with local counterparts in a plan to combine local knowledge and expertise with European offshore wind experience to submit a competitive bid package for the upcoming tender. Meanwhile, to harness the potential of deeper waters, Japanese companies are turning their world-famous innovative thinking to the challenge of developing floating turbines to further open up the industry’s potential.
The lessons from Europe
The emergence of this new and potentially huge market in offshore wind has coincided with some of the European countries reaching “support scheme free” status for their offshore wind industries. Whilst this proves the maturity of the industry, it has also led to a decrease in returns for investors, who are starting to look elsewhere in their search for yield. Therefore, recycling the accumulated European development experience to tackle the more challenging environments in Eastern Asia such as Taiwan and Japan seems a logical step.
Despite the challenges, the time for Japan’s offshore wind industry seems to be arriving as the government looks to 600 GW of offshore wind potential as the answer to its renewable energy needs. Although strong winds in the Sea of Japan may have defeated the Mongolians, this time, modern Japan is welcoming foreigners to help unlock our “divine wind”. The sun may be setting on the Japanese nuclear industry, but it looks to be rising on the offshore wind one.