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 Happo Noshiro 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 Happo Noshiro Offshore Wind Project, please see the article below.
👉 Akita Happo Noshiro Offshore Wind Project
| Revision History |
| 2025-10-05: Updated OPEX model and LCOE&IRR recalculation. |
1. Area Overview
- Area Name: Akita Happo-cho, Noshiro City Offshore
- Location: Northwest Offshore, Akita
- Estimated Capacity: 375 MW
- Status: Promotion Zone
- Developer: ENEOS Renewable Energy Corporation, Iberdrola Renewables Japan, Tohoku Electric Power
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) | 14 m | Depth at representative point |
| Distance to Shore (km) | 1.7 km | Shortest distance to landfall point |
| Distance to Port (km) | 4.8 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.
| Foundation type | Estimated CAPEX | Estimated OPEX |
|---|---|---|
| Monopile | USD 960 Million | USD 33 Million/year |
4. LCOE Estimate
The LCOE was independently estimated by DeepWind with reference to NEDO’s Offshore Wind Cost Model and NeoWins data.
| Foundation type | Estimated LCOE |
|---|---|
| Monopile | 111 USD/MWh |
5. IRR Estimate
| Price conditions | Estimated IRR | Power Selling Price | Assumed Operating Period |
|---|---|---|---|
| Bid Price | ー | 3 yen/kWh (zero premium) | 25 years |
| Modeled Price (using market transactions or corporate PPAs) | 9.4 % | 20 yen/kWh | 25 years |
6. Profitability Rating (DeepWind Independent Evaluation)
| Evaluation Metric | Score (★1–5) | Result |
|---|---|---|
| Profitability (Modeled Price) | ★★★★ | Promising |
| Overall Rating | A Rank | High investment potential; profitability is achievable depending on other factors such as port and grid infrastructure. |
Conclusion
In this article, we assessed the offshore wind Promotion Zone off Happo and Noshiro in Akita Prefecture, evaluating profitability through CAPEX, OPEX, LCOE, and IRR. Thanks to shallow waters and close port access, the estimated LCOE is as low as 111 USD/MWh, and assuming a sales price of 20 JPY/kWh, the IRR reaches 9.4%.
This places the project in the “A-rank” category, making it one of the attractive zones among Japan’s Promotion Areas in terms of both cost efficiency and profitability. Future auction results and PPA market trends will be key factors to watch for investors and developers.
DeepWind will continue to deliver independent cost assessments of Japan’s offshore wind promotion zones, helping investors and developers benchmark opportunities and better understand the market’s evolving economics.
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
Weekly digest with actionable insights for investors, developers, and stakeholders in Japan’s offshore wind. 🎁 Welcome gift: Japan Offshore Wind: 2025 Market Outlook (PDF)📩 DeepWind Weekly
- 🔍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.
