Mitsubishi Engineering giant abandons ‘unfeasible’ wind farms
Surging costs are making offshore wind projects unaffordable, industrial giant Mitsubishi has warned.
The Japanese company on Wednesday pulled out of a trio of major schemes in its home country, blaming inflation, higher interest rates and stretched supply chains.
Mitsubishi had originally committed to the projects in late 2021 but said the business environment had “significantly changed” since then.
The company added: “We have determined that establishing a viable business plan is not feasible given the current conditions.”
It is the latest blow to the global offshore wind industry as companies battle financial and political turbulence.
In the US, Donald Trump has thrown several projects into disarray. The US president has signalled that schemes proposed by the likes of Danish giant Ørsted and Norway’s Equinor will not be allowed to go ahead.
Meanwhile, European wind developers have warned that they cannot push forward with green energy projects without subsidy support from governments.
In the UK, Ed Miliband, the Energy Secretary, is presiding over a renewables auction that is expected to award record amounts of support to offshore wind farms as part of his clean power targets.
Meanwhile, companies are facing rising prices and long lead times for key pieces of equipment. That is partly due to tariffs and other trade restrictions that have been placed on steel, fibreglass and other raw materials needed to manufacture them.
For example, China in April placed curbs on exports on permanent magnets and rare earth elements used in certain wind turbine components, creating greater competition between industries for supplies.
Beijing’s move was made in retaliation after Mr Trump imposed sweeping tariffs on foreign goods shipped to the US, including steel.
Mitsubishi’s decision to scale back its ambitions in Japan will be seen as a major blow to the country’s green energy ambitions.
It was due to build three schemes – two in the northern area of Akita and another east of Tokyo – and had received pledges of government support to do so.
Japan wants to grow the amount of power it generates from wind from around 1pc today to up to 8pc by 2040.
However, the country’s mountainous geography and deep coastal waters mean it will likely need to rely on more nascent floating offshore wind technology to achieve this.
Floating offshore wind farms are more expensive to build than both their fixed-bottom offshore and onshore equivalents.
source www.telegraph.co.uk
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Sunface Jack
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The time of wind energy has passed. Its value is is entertainment… sailing boats
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