October 30, 2019 / 10:32 AM / 8 days ago

Germany's RWE looks to enter Japan offshore wind power market

TOKYO (Reuters) - German utility RWE is looking to invest in Japan’s offshore wind power projects and is in talks with potential Japanese partners as it aims to expand its global renewable portfolio, an executive said.

Rolf-Martin Schmitz, CEO of energy supplier RWE poses in front of a RWE logo following a news conference about the restructuring of the German utility in Essen, Germany, September 30, 2019. REUTERS/Wolfgang Rattay

“We see very good fundamentals if we look at the Japanese market with regards to growth in renewable in general, but offshore wind in particular,” Sven Utermohlen, Wind Offshore Global COO at RWE Renewables, told Reuters in an interview on Tuesday.

RWE has transformed itself by taking over the renewables activities of subsidiary Innogy and peer E.ON, which was part of a major reshuffle of Germany’s power sector.

RWE is now the world’s No.2 operator of offshore wind farms behind Denmark’s Orsted, with a total installed offshore wind capacity of 2.5 gigawatts. It established a subsidiary in Tokyo this year after studying the market for about a year.

“We want to be a leading offshore player in Japan, definitely a foreign offshore player in Japan,” Utermohlen said.

He declined to comment on which project RWE will invest in first or when, saying it depends on the Japanese government’s auction targets and process.

Japan’s offshore wind power market is expected to take off as the government enforced a law earlier this year to enhance development of wind farms.

It has identified 11 areas as potentially suitable for development, four of which were designated as “promising areas” where the preparation process, such as wind and geological research, will start immediately.

The government will pick “promotion areas” and conduct a tender to select operators for wind farms, but no timeline has been decided, an official at Japan’s industry ministry said.

RWE has already agreed to cooperate with Kyuden Mirai Energy, a unit of Kyushu Electric Power which supplies electricity to the southwestern island of Kyushu, for offshore projects in Japan, but the German company is also in talks with other Japanese firms for collaboration, Utermohlen said.

The world’s fourth-biggest renewable company is also considering investing in offshore wind farms in other areas in the Asia Pacific, he said, apart from Australia where it is already developing a solar power business.

“Japan is not the only market in Asia Pacific that we are looking into,” he said.

“Japan is...certainly the market where our engagement probably has been the deepest and the longest, but we are also looking at Taiwan, Korea and India,” he said.

Reporting by Yuka Obayashi; Editing by Kim Coghill

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