Japan’s offshore wind market is at a pivotal stage, with industry and government alignment needed to ensure project viability and progress towards national energy targets, according to a new white paper from the Global Wind Energy Council (GWEC) and renewable energy consultancy OWC. The report, *Unlocking Japan’s Offshore Wind Potential: Strategic Pathways to Overcome Market Bottlenecks and Drive Industrial Growth*, recommends establishing a public–private forum and redesigning the offshore wind auction framework to support sustainable development.
Japan has held three rounds of offshore wind auctions. The single bidder from Round 1 has withdrawn, while the winners of Rounds 2 and 3 face financial challenges. These outcomes highlight the need for reform, particularly in auction design, to ensure that future projects can reach financial close.
The paper identifies three areas requiring attention: auction frameworks, offtake mechanisms, and wider market bottlenecks. Short-term measures focus on re-tendering Round 1 and preparing for upcoming auctions without legislative change, while long-term actions aim to improve market stability from Round 5 onwards.
Recommended auction reforms include balancing price and non-price criteria, introducing structured public–private dialogue, and developing a two-stage auction model to provide developers with greater certainty. The report also calls for a review of price limits under current offtake mechanisms, and suggests revising the Feed-in Premium scheme towards either a two-sided Contract for Difference or Feed-in Tariff model to support more predictable returns.
Further recommendations include improving transparency in certification, introducing risk-based assessments, and shifting from pipeline-based to Commercial Operation Date targets to better track delivery and investment readiness. Measures to limit curtailment and compensate affected projects would also strengthen investor confidence.
