Introduction
Evaluating the profitability of offshore wind projects requires close attention to cost-related indicators such as CAPEX, OPEX, LCOE, and IRR.
However, in Japan’s designated Promotion Zones, publicly available cost data remain scarce, leaving investors and developers with limited information for decision-making.
In this article, we assess the Akita Yurihonjo Offshore Wind, estimating CAPEX, OPEX, LCOE, and IRR using the NEDO cost model, based on representative site conditions including distance to shore, water depth, and distance to port.
While these figures are independent estimates, they provide useful insights into the characteristics of this zone and a basis for relative comparison with other areas.
This article focuses not on project progress or policy background, but on the cost analysis. If you would like to learn more about the project overview of the Akita Yurihonjo Offshore Wind Project, please see the article below.
👉 Akita Yurihonjo Offshore Wind Project
1. Area Overview
- Area Name: Akita Yurihonjo Offshore
- Location: Southwest Offshore, Akita
- Estimated Capacity: 845 MW
- Status: Promotion Zone
- Potential Developer: Mitsubishi Corporation Offshore Wind Ltd., C-TECH CORPORATION, Venti Japan Inc., Mitsubishi Corporation
2. Assumptions (Representative Values)
In this article, the representative point was set at the center of the designated promotion area polygon based on its coordinates. Water depth and distance conditions were estimated using data from NeoWins.
| Item | Estimated Value | Notes |
|---|---|---|
| Water Depth (m) | 19 m | Depth at representative point |
| Distance to Shore (km) | 2.0 km | Shortest distance to landfall point |
| Distance to Port (km) | 7 km | Straight-line distance to assumed O&M port |
3. CAPEX / OPEX Estimates
CAPEX and OPEX were independently estimated by DeepWind with reference to NEDO’s Offshore Wind Cost Model (October 2024).
| Foundation type | Estimated CAPEX | Estimated OPEX |
|---|---|---|
| Monopile | USD 2190 Million | USD 38 Million/year |
4. LCOE Estimate
The LCOE was independently estimated by DeepWind with reference to NEDO’s Offshore Wind Cost Model (October 2024) and NeoWins data.
| Foundation type | Estimated LCOE |
|---|---|
| Monopile | 106 USD/MWh |
5. IRR Estimate
| Price conditions | Estimated IRR | Assumed Power Selling Price | Assumed Operating Period |
|---|---|---|---|
| Bid Price | 3.2 % | 11.99 yen/kWh | 25 years |
| Expected Price (using market transactions or corporate PPAs) | 8.4 % | 18 yen/kWh | 25 years |
6. Profitability Rating (DeepWind Independent Evaluation)
| Evaluation Metric | Score (★1–5) | Result |
|---|---|---|
| Profitability (Bid Price) | ★ | Unprofitable |
| Profitability (Expected Price) | ★★★ | Neutral |
| Overall Rating | B Rank | At the bid price the project is not viable; however, with the right conditions, there is potential. Achieving cost reductions and securing policy support will be crucial. |
Conclusion
The Akita Yurihonjo Offshore Wind Promotion Zone highlights both opportunities and constraints from a cost perspective. With shallow waters and close proximity to shore and port, the site enjoys favorable physical conditions. However, at the awarded bid price, profitability remains out of reach with an IRR of just 3.2%. By contrast, under an expected market or corporate PPA price scenario, the IRR rises, showing that the project’s viability hinges on cost reductions, supportive policies, and flexible offtake structures.
DeepWind will continue to provide independent cost analyses of Japan’s offshore wind promotion zones, offering investors and developers practical insights for comparing project opportunities and understanding the evolving economics of the market.
If you would like to compare the CAPEX, OPEX, LCOE, and IRR of other Promotion Zones, please also check out this summary article.
🌊 Cost Analysis of Japan’s 12 Offshore Wind Promotion Zones
Explore more categories at DeepWind:
- 🔍Market Insights – Understand the latest trends and key topics in Japan’s offshore wind market
- 🏛️Policy & Regulations – Explore Japan’s legal frameworks, auction systems, and designated promotion zones.
- 🌊Projects – Get an overview of offshore wind projects across Japan’s coastal regions.
- 🛠️Technology & Innovation – Discover the latest technologies and innovations shaping Japan’s offshore wind sector.
- 💡Cost Analysis – Dive into Japan-specific LCOE insights and offshore wind cost structures.
