【Article】Recent Trends and Law Amendments Regarding Offshore Wind-Power Generation Business

2020.03.14 ナレッジ

ナレッジパートナー：越元瑞樹

　(Click here for the 【Japanese version】)

TMI Associates
Mizuki Koshimoto (Partner)

1. Recent Trends in Offshore Wind-Power Generation Business

A global transition to renewable energy, centered on solar and wind power generation, is currently taking place, being triggered by the Paris Agreement reached in 2015. Renewable energy accounted for 26%, i.e. more than a quarter, of global power generation in 2018.

The Japanese government has positioned renewable energy as becoming its main power source and is taking certain measures to achieve this goal. Among others, offshore wind-power generation is a particularly important power source since lands suitable for onshore wind-power generation projects are limited. The government plans to take further measures to promote the introduction of offshore wind-power generation business (see the Fifth Basic Energy Plan determined by the Cabinet on July 3, 2018).A total of 10 million kW of such energy is expected to be introduced by 2030.

Currently, in Japan, the sea areas where offshore wind-power generation projects are actually implemented or planned to be implemented can be mainly divided into “port and harbor” areas (Article 2, Paragraphs 3 and 6 of the Port and Harbor Act) and “general sea” areas.

In relation to “port and harbor” areas, plans for offshore wind-power facilities have been approved using a public bidding process based on the public bidding system for occupation plans introduced by the amended Port and Harbor Act which came into effect in July 2016 (Article 37-3 of the Port and Harbor Act).

On the other hand, in relation to “general sea areas”, the “Act on Promoting Utilization of Sea Areas in Development of Power Generation Facilities Using Maritime Renewable Energy Resources”, which came into effect on April 1, 2019 (the “Offshore Renewable Energy Usage Act”), established unified rules for long-term occupation, and plans for offshore wind-power generation projects within general sea areas are steadily progressing in various places.

Together with the enforcement of the Offshore Renewable Energy Usage Act, offshore wind-power generation projects have been progressing rapidly, especially since 2017. As of the end of August 2019, approximately 12.58 million kW (approximately 13 GW) of projects have undergone environmental assessment procedures (Procurement Price Calculation Committee (February 4, 2020); “Opinion on Procurement Prices, etc. for 2020 (Draft)”, 48).

The following is a summary of the timeline of recent key events in offshore wind-power generation business:

February 8, 2019 – Start of requesting provision of information from prefectures on promising areas, etc. for designation as promoted areas within general sea areas (1st time).

April 1, 2019 – Introduction of an occupation system through a public bidding process for general sea areas through the enforcement of the Offshore Renewable Energy Usage Act.

May 17, 2019 – Cabinet decision on the Basic Policy Pertaining to the Offshore Renewable Energy Usage Act.

June 11, 2019 – Announcement of the Guidelines for Designation and Operation of the Public Bidding Process.

July 30, 2019 – Announcement of promising areas (11 areas) for designation as promoted areas.

November 29, 2019 – The certified period for port and harbor areas extended to 30 years in accordance with the partial enforcement of the Amended Port and Harbor Act, 2019.

December 6, 2019 – Public notice and inspection of the draft designation of promoted areas within the offshore sea area of Goto City, Nagasaki Prefecture.

December 13, 2019 – Start of requesting provision of information from prefectures on promising areas, etc. for designation as promoted areas (2nd time).

December 27, 2019 – Designation of the offshore sea area of Goto City, Nagasaki Prefecture, as a promoted area under the Offshore Renewable Energy Usage Act.

January 21, 2020 – Start of requesting provision of information from business operators on promising areas, etc. for designation as promoted areas (deadline February 14, 2020).

February 3, 2020 – Announcement of implementation of the first large-scale offshore wind-power generation project for commercial use in Japan at the Ports of Akita and Noshiro.