Japanese giant buys offshore wind developer

Japan’s TEPCO Renewable Power has made its first foray into overseas offshore wind, and plans two major projects in Victoria and WA.

Japan’s TEPCO Renewable Power has made its first foray into overseas offshore wind with the Flotation deal and plans to develop two major projects in Victoria and WA.

Tokyo Electric Power Company, one of the world’s largest electricity utilities, has bought Flotation Energy, which plans to develop several giant offshore wind farms in Australia.

The deal marks TEPCO Renewable Power’s first foray into overseas offshore wind and hands it ownership of the 1.5 gigawatt Seadragon project offshore Victoria in the Bass Strait and the 1.5GW Perth Array development offshore from the West Australian capital.

The buyout will ensure Victoria’s Seadragon project has funding to start supplies by 2028, the companies said in a joint statement.

Flotation is based in Scotland and has a 10GW project pipeline of offshore wind projects in Australia, the UK, Ireland, Taiwan and Japan.

“Following the visit of Japan’s Prime Minister to Australia, and the welcome news of both Victorian and the federal government commitment to developing offshore wind and transmission in Australia, we are also actively considering the development of our renewable pipeline in Australia,” TEPCO Renewable Power president Masashi Nagasawa said.

Victorian Premier Daniel Andrews in March confirmed a plan to build a major offshore wind industry in the state, part of moves to develop a new source of generation as coal exits.

Some 20 per cent or 2 gigawatts of the state’s power would be supplied by offshore wind by 2032, 4GW by 2035 and 9GW by 2040.

Flotation received $2.3m from the Victorian government to develop its wind farm and its local Victorian rivals include the developers of the $10bn Star of the South wind farm off Victoria’s Gippsland coast who plan to supply 20 per cent of the state’s electricity needs once the giant Yallourn coal plant closes in 2028.

While wind turbines on land still remain a dominant renewable source, offshore wind projects are expected to triple globally this decade with their cost of energy tumbling by two-thirds since 2012 and giant turbines now higher than the Eiffel Tower.

Alinta Energy has also proposed a giant $4bn offshore wind farm that could supply Victoria’s Portland aluminium smelter and the broader east coast grid, one of the biggest bets yet on the renewable technology attracting support from big name investors.