For months, industry sources have been confident that whenthe next slate of FITs was announced – covering projects installed between April2014 and March 2015 – it would include a separate subsidy for offshore wind,which is currently paid at the same rate as onshore wind.

The panel, established last November, has formally endorsed anoffshore wind FIT of ¥36 ($0.35) per kWh – up from the ¥22/kWh payoutcurrently offered to onshore and offshore wind developers.

Analysts, however, remain sceptical that such a rate, which may set a precedent for future subsidies, is high enough toencourage significant development in Japan’s nascent offshore wind market, given the country’schallenging physical conditions and lack of experience in the sector.