Market Overview

The onshore wind power segment continues to exhibit growth in cumulative installed capacity. This growth stems from the sequential commissioning of newly built facilities that have obtained FIT certification, as well as from the replacement of aging plants. Conversely, some small-scale farms with capacities below 4 MW have been decommissioned due to limited operational capacity.

In the offshore wind power segment, a large-scale project is scheduled to commence operation in FY2025. Further project development is facilitated by the Act on Promotion of Use of Maritime Areas for Development of Marine Renewable Energy Power Generation Facilities (the “Act”) and related legislation enabling the use of marine area for power generation. Additional large-scale projects selected through public tenders under the Offshore Wind Power Promotion Act are expected to begin operation between 2028 and 2030, resulting in a substantial increase in Japan’s offshore wind installation capacity.

Cumulative installed capacity for mid-size wind farms continues to decline, reflecting the scheduled expiration of FIT purchase periods by FY2027, after which these facilities will no longer be entitled to sell electricity at fixed prices. In contrast, cumulative installed capacity of small-size wind farms remain on an upward trajectory, as small-size wind power generation facilities that commenced operation prior to 2018 retain eligibility for the preferential FIT rates previously applied to this segment.*

[*Translator’s note: In 2018, The Ministry of Economy, Trade and Industry abolished the preferential FIT pricing for small-scale wind farms (>20 kW). Facilities commissioned in 2019 or later are subject to the same pricing framework applied to wind power systems with capacity of 20 kW or more.]

Noteworthy Topics

Environment Surrounding Wind Power Market

In February 2025, the 7th Basic Energy Plan was approved by the Cabinet, projecting that domestic wind power generation reaches approximately 44 to 96 billion kWh by 2040. *

The FIT system ended in FY2024 for all kinds of new wind farms with capacity of 50kW or more (with floating offshore farm as an only exception). Going forward, operations will be based on the FIP system, which places greater emphasis on the responsibility of power generators compared to the FIT system. Under the FIP system, power generators will be able to freely choose suppliers, but they will simultaneously be obligated to balance their planned capacity and actual generation capacity.

*Looking toward achieving carbon neutrality by 2050, the Offshore Wind Vision, the Renewable Energy Marine Area Utilization Act, and FIT/FIP system collectively promote wind power generation in Japan. Further details and our analysis are available in the market report.

Future Outlook

The domestic wind power market is projected to reach 293.5 billion in FY2025. The installed capacity is expected to expand primarily through increases in onshore wind turbines until around FY2028. Demonstration projects for offshore wind farms are underway, including fixed-foundation offshore wind farms that will commence operation in FY2028 and beyond. Subsequently, floating offshore wind farms will also commence. By FY2039, offshore wind power is projected to exceed onshore wind power in terms of installed capacity within Japan's total wind power generation. Under the circumstances, the wind power market size is forecasted to reach 1,284,800 million yen by FY2040 (approximately 438% of that of FY2025).

*Note: The estimate above presumes that the three offshore wind projects Mitsubishi Corp withdrew from in August 2025 will be succeeded by alternative developer.

Research Outline