Setback for Japanese offshore wind bill as Diet runs out of time
Industry hopes bill will pass in next session as natural disasters and scandals disrupt legislative agenda
A law designed to set a framework for offshore wind expansion in Japan faces delays after falling victim to a legislative logjam that meant the Diet, Japan’s parliament, ran out of time to debate the bill.
Analysts said earlier this year that the bill represents an important first step in promoting large-scale development off the Japanese coast, even though a number of crucial details were still left hanging such as responsibility for offshore grid links.
The legislation was among several bills that fell victim to the extra demands on policy-making time caused by heavy rains which have caused havoc in some areas of the country, and the fallout from political scandals.
Yoshinori Ueda of the Japan Wind Power Association (JWPA) said in a note to Recharge that the bill’s supporters will now try to get it reintroduced in the next session of the Diet.
Japan has emerged as a potential key future market for both fixed-bottom and floating offshore wind.
Under the proposed bill, national and regional governments would form mixed councils that have the task of identifying issues for offshore wind development in their area.
Developers would then lodge bids for the use of offshore zones in an auction that take into account both the electricity price from the project and the suitability of its development plan. As part of the bids, companies need to submit an occupancy plan with operation and construction details, address environmental concerns and name a bid price.
Winners will get the right to build and operate offshore wind projects for up to 30 years (including decommissioning periods), with support being paid for a period of 20 years. After that, operators will need to seek power purchase agreements or operate the wind farms on a merchant basis.
Robert Liew, a senior analyst at Wood Mackenzie Power & Renewables, told Recharge the bill likely faces a temporary delay rather than a fundamental problem, noting it enjoys the support of the Prime Minister and the Cabinet.
“It’s a blow, but the next session could be held as soon as the autumn,” said Liew. “I think it will still eventually get passed. There are some delays and it’s unfortunate timing, but I can’t see any reason there would be significant opposition.”