High Cost of Onshore Wind in Japan

Akihabara News (Tokyo) — As Japan seeks to expand its onshore wind power capacity in pursuit of carbon neutrality, high installation costs continue to stand in the way.

Installation costs fall mainly into three categories: turbine costs; foundations and site preparation; and electrical work and transmission infrastructure costs.

Of the three categories, turbines account for the largest proportion of the expense.

Even though the average cost of turbines has fallen over the past several years, Japan costs remain higher than the international average.

According to the Renewable Energy Institute (REI), average turbine costs per kilowatt in Japan have fallen by over 15% between 2016 and 2021. However, this is still about 13% more expensive than the international average.

There is no single explanation for Japan’s higher turbine costs, but REI suggests that one salient factor is Japan’s preferred class of wind turbine–developers tend to select a more expensive class of turbines which can better withstand strong winds, even in the face of major typhoons.

The rising cost of ready-mix concrete, needed for the pile foundations used in lowland wind farms, is another factor. In Osaka, for example, prices have increased by over 50% since 2013.

Prior to the introduction of the Renewable Energy Special Measures Act in 2016, wind power producers were required to bear additional costs when connecting to the grid.

If the transmission and distribution system operator determined that there was no available capacity, the producer was charged for grid upgrade costs.

Some operators, in an effort to offset the power production infrequency due to wind variability, also used to require producers to install battery storage, further driving up the costs.

In the wake of the 2016 legislation, such battery storage costs have been eliminated.

Nevertheless, according to figures provided by the International Renewable Energy Agency, installation costs in Japan are nearly 73% more expensive than the international average.

Despite this cost differential, REI asserts that “onshore wind power is a promising energy source that will be indispensable to the firm achievement of carbon neutrality in Japan.”

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