Orsted Hopes COVID-19 Will Not Slow Japan's Offshore Wind Projects
Orsted, the world's largest offshore wind farm developer, is concerned the coronavirus may delay auctions for offshore projects as it prepares to enter the market, the head of its Asia-Pacific unit said.
"The pandemic will not influence investment decisions and general confidence in offshore wind, but it could delay the projects' timeline," Matthias Bausenwein, president of Orsted Asia-Pacific, told Reuters in a telephone interview.
"We hope that we won't see any major delays," he said. The Danish company and Japan's Tokyo Electric Power Company Holdings (TEPCO) will make a joint bid for a project off Choshi city, near Tokyo, which could happen later this year. Prime Minister Shinzo Abe on Tuesday declared a state of emergency to fight new coronavirus infections in major population centers after a jump in the cases in Tokyo sparked concern that Japan was headed for an explosive outbreak.
Orsted's offshore wind projects in Taiwan have not been affected, but they may see an impact over time, Bausenwein said in the late Thursday interview. Still, Orsted is optimistic about growth potential in Japan.
"There is strong fundamental need for offshore wind power in Japan," he said, pointing to the country's plan to boost renewable energy and its need to replace some coal-fired power and nuclear power. "We see that there is a momentum in Japan's wind power market finally," he said, as an auction framework has been put in place, making it easier for the company to make an entry. The Japanese government enforced a law last year to enhance development of offshore wind farms.
Bausenwein declined to give Orsted's business target for Japan, but said it planned to stay for a long time. "We never enter a market just for one project, we always want to build a long-term presence ... build a portfolio of projects in order to build our local team and local footprint," he said. Asked whether Orsted would look for other partners for other projects, Bausenwein said he would not rule that out but the company was not talking to anyone now. "For now, we will focus on making this partnership with TEPCO work," he said.
In the Asia-Pacific region, Taiwan, Japan and South Korea are key markets for Orsted, he said, although it is also monitoring other markets in the region including China.
(Reporting by Yuka Obayashi Editing by Robert Birsel)