Mitsubishi Corporation (MC) has announced a strategic review of its offshore wind projects in Japan due to changing macroeconomic conditions. Through its subsidiary Mitsubishi Corporation Offshore Wind Ltd., the group is leading three projects in Akita and Chiba prefectures.
A less favorable economic environment
Since the project awards in December 2021, several factors have impacted the offshore wind industry. The effects of the pandemic and the Ukraine crisis have led to widespread inflation, yen depreciation, and supply chain disruptions. Additionally, rising interest rates have increased financing costs, challenging initial profitability forecasts.
Three projects under reassessment
The projects under review involve offshore wind installations in three areas: Noshiro-Mitate-Oga and Yurihonjo in Akita Prefecture, as well as Choshi in Chiba Prefecture. Mitsubishi Corporation, in collaboration with its partners, has made progress in development, but evolving financial and industrial conditions necessitate a reassessment of business plans.
Next steps to be determined
In response to these constraints, the company plans to thoroughly examine the viability of its investments before deciding on the future course of operations. It has not yet specified whether these adjustments will lead to project reorientation, delays, or potential reconfiguration of investments.
