On 16 April, the Japanese government declared a nationwide “State of Emergency” to stem the spread of COVID-19, which is an expansion of the declaration made by the Prime Minister Shinzo Abe for seven prefectures on 7 April 2020.
The level of restriction in Japan is moderate compared to other countries. Almost all the factories, transportation, wind farm project operation and construction have been running business as usual. Nevertheless, according to Japan Wind Power Association (JWPA), the following concerns remain:
As business trips to and from Europe have been banned, foreign supervisors cannot visit Japan and therefore WTGs trial operations may be suspended;
Wind turbines project construction execution may be at the risk. Following the COVID-19 cases reported at construction sites, Japanese constructors Shimizu Co., one of the largest construction companies in Japan, Nishimatsu Co. and Toku Construction Co. began negotiations with their customers to halt construction work, this covers wider construction work and is not specific to just wind power. Potential delays in construction work at Tohoku and Hokkaido may cause significant impact on project commission execution, as project contractors must complete construction work before snowfall;
Negative impacts on the movement of O&M workforce and the flow of components and spare parts to local windfarms, as business trips are restricted nationwide by “State of Emergency”;
Delay of EIA and offshore wind farm site nomination as it becomes difficult to hold meetings with local residents and communities under the nationwide physical meetings restriction. If the situation lasts only a few months, it will not have a big impact. However, if the situation continues for more than six months, there will be a potential risk of one-year delay in the development of new projects.
According to GWEC Market Intelligence, Japan has a total cumulative installed wind power capacity of 3,923 MW by the end of 2019, of which 66 MW is offshore wind power, making it the third largest wind market in Asia after China and India. For offshore alone, nearly 15 GW of wind projects were in the EIA pipeline in Japan as of January 2020. There is a strong sense of growing momentum at both a policy and business level, and many of the leading global players have now formed joint ventures with local Japanese companies and/or set up local operations.
2020 is expected to be an important year for the offshore wind energy sector in Japan with the awarding of contracts for the first wave of commercial projects, and the announcement of the framework for further competitive bidding rounds.