Japan's government will develop power transmission grids on the island of Hokkaido and the Tohoku region aiming to boost the country's installed wind power capacity by three times to 7.5 GW, according to reports.
The project will be launched in April and will involve some $3.3 billion in public and private spending. Power firms and wind power generating companies in each area will form special purpose vehicles for building transmission grids.
Subsidies from the central government would cover half the costs. The government will use the fees collected from wind power producers for using the networks to cover the costs, according to reports.
Wind power output in Japan stood at 179.63 million kWh in the fiscal 2010/2011 through March, below 0.1 percent of the country's total power output. If the power grids building project is launched in areas such as the Hokuriku and Sanin regions and Kyushu island, the country's installed wind power capacity could surge sixfold to 14.7 GW.
A Frost & Sullivan report projects the Japanese wind power sector to regain momentum in the current year with the expected start of offshore wind farms construction. Japan supports investment in offshore wind, despite the high infrastructure costs and grid connection problems, to offset the shutdown of nuclear reactors.
Meanwhile, investment in onshore wind farms in Japan has been declining since 2008 due to the adoption of complicated construction requirements and grid connection obstacles, Frost & Sullivan's Suchitra Sriram said in the report.