Mitsubishi Corporation is reviewing the business plans for the three projects that were awarded to Mitsubishi Corporation Offshore Wind-led consortia in Japan’s first offshore wind auction round due to changes in the macroeconomic environment, the company announced on February 3, 2025.
“In the wake of the pandemic and the Ukraine crisis, the business environment for offshore wind power has significantly changed and is continuing to change worldwide due to factors such as inflation, the depreciation of the yen, tight supply chains, and rising interest rates,” said Mitsubishi in the statement. “We will consider the appropriate next steps after thoroughly examining the results of our review,” the statement continued.
The consortia, which also include Chubu Electric Power’s group company C-Tech Corporation and, for the Yurihonjo project, Venti Japan, were awarded a total of 1.7GW in areas off the coast of:
- Noshiro City, Mitane Town, and Oga City in Akita Prefecture (478.8MW at 13.26 yen per kWh)
- Yurihonjo City in Akita Prefecture (819MW at 11.99 yen per kWh)
- Choshi City in Chiba Prefecture (390.6MW at 16.49 yen per kWh)
Their bid prices were considerably lower than those of the other auction participants.
Unlike in the subsequent auction rounds, which were run under the feed-in-premium (FIP) subsidy scheme that pays a variable premium on top of revenues asset owners can generate by selling power and environmental value, the first round was run under the feed-in-tariff (FIT) scheme that pays owners a fixed per kWh price in exchange for the generated power and environmental value.
As such, while completely scrapping the projects or delaying them until the market conditions change in a major blow to the industry are possible outcomes, Mitsubishi also has the option of converting the projects to the FIP scheme and trying to secure offtakers through PPAs at higher prices than the FIT prices it was awarded in the auction.
