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Mitsubishi Corp. plans big European offshore wind farms

Trading house seeks expertise to tap growing demand for renewables

Mitsubishi Corp. already operates a midsize offshore wind farm in the Netherlands.

TOKYO -- Japanese trading house Mitsubishi Corp. will construct and operate large-scale offshore wind farms in Belgium and the Netherlands, as it eyes further business development in Europe for wind power.

The company is pursuing offshore wind farm projects, hoping to build know-how in this growing sector as the enactment of the Paris Agreement on climate change is set to accelerate the global shift to renewable energies.

Mitsubishi has experience in solar energy and onshore wind farms in Europe. But as space to build onshore sites becomes limited, governments are boosting subsidies for offshore wind farms. The company has built and operates two midsize offshore wind farms in the Netherlands and Portugal. Leveraging this experience, the trading house will jump into large-scale projects in the Netherlands and Belgium.

The company will construct the Norther wind farm in the North Sea, roughly 23km off Belgium's coast. Each turbine can generate up to 8.4 megawatts, the most in the world. The 44 turbines will have a combined capacity of 370MW, which can power 400,000 households. The windmills will be attached to the ocean floor. The project is to cost 150 billion yen ($1.3 billion).

The trading house will partner with Belgian renewable energy company Elnu as well as Eneco, a Dutch public energy firm. Mitsubishi acquired a 25% stake in the wind farm's operating company, apparently for 15 billion yen.

A joint venture of Mitsubishi Heavy Industries and Denmark's Vestas will provide turbine blades and generators. Dutch civil engineering company Van Oord will be contracted for installation work. Construction starts in January, with operations slated to begin in summer 2019.

In the Netherlands, Mitsubishi Corp. will partner with Eneco, Van Oord and British-Dutch firm Royal Dutch Shell to build a wind farm off the coast of Borssele in the southwest. Mitsubishi and Shell will jointly establish an operating company for the farm. Power capacity of the 80 or so turbines will total 680MW, the largest in the country. The project will cost on the level of 300 billion yen, with operations starting in 2020. Companies used in the Norther project are expected to supply turbines and participate in installation.

Mitsubishi Corp. not only will invest in the operating company for both wind farms, it also will participate in all aspects of the projects. The trading house will take part in planning as well as selection of engineering companies and price negotiations. And considering the anticipated high returns from the wind farms, it plans to solicit Japanese private-sector lenders for financing.

Mitsubishi Corp. also will dispatch workers for operations on the ground. The company hopes to use the expertise of a special team at its London subsidiary to win projects in the North Sea such as with the U.K. and France.

Pressure to decrease carbon dioxide emissions will rise as a result of the Paris Agreement, which lays out policies to combat global warming starting in 2020. Demand will grow for offshore wind farms in particular, due to looser restrictions and as equipment makers lower costs further. 


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