Publication date: Sept 8, 2025 Japan Moves to Develop Hydrogen and Ammonia Supply Chains

Mitsubishi Exits Three Offshore Wind Projects in Japan

Mitsubishi Corporation announced that it will withdraw from the development of three OSW projects in Akita and Chiba prefectures, which the company won in Round 1 of the government’s public OSW auction. The company decided that, due to inflation and soaring material costs, the business environment had dramatically changed, making it impossible to secure profitability at any of the sites. Earlier this year, Mitsubishi Corporation had already disclosed that it was reassessing the business feasibility of the projects, as construction costs had risen beyond initial assumptions.

According to the Japanese government, the combined output of the three sites was set at approximately 1.7 GW, with operations scheduled to begin sequentially from September 2028 through December 2030. For the Choshi offshore site, construction of onshore substation facilities was planned to start in January this year, and work had already commenced locally.

Policy Response and Industry Implications

Under the guidelines for public occupation, when a winning OSW project operator withdraws, the government confiscates the security deposits collected in advance. For the three sites, the deposits are estimated to total around JPY 22 billion. In response to Mitsubishi’s decision, the government plans to review the circumstances behind the consortium’s withdrawal and revise the OSW auction rules. It will also aim to create an environment in which operators can more easily secure profitability and swiftly re-auction the three sites to select new developers.

Mitsubishi’s withdrawal may have repercussions for subsequent projects. Developers who won in Rounds 2 and 3, having been forced into zero-premium bids due to intense price competition, are facing even harsher conditions. Since the operational start date became a critical selection factor from Round 2 onward, there are already four projects with less than four years remaining before scheduled start-up, with the shortest being just three years. If improvement measures are not implemented, similar situations may occur. Mitsubishi’s withdrawal may also affect the implementation of the Round 4 auction process, which has already been delayed.

The Japanese government must promptly present a future roadmap, including re-auction, to sustain the industry’s motivation and momentum for development.

Mitsubishi’s withdrawal underscores that Japan’s OSW sector remains in a developing phase, with the domestic wind turbine supply chain still taking shape. The government is expected to reauction the sites promptly and strengthen the supply chain over the longer term, creating new opportunities for companies looking to enter the Japanese market.

Shulman Advisory has extensive experience advising clients about Japanese energy markets. If you are interested in learning more about our services, please contact us at info@shulman-advisory.com