Japan’s staying power: a strength for the energy transition From Hamburg to the world: EEHH trip to Smart Energy Week 2026

From city partnerships and economic cooperation to climate protection: Hamburg and Japan share a close bond. To learn about current market trends and explore business prospects for member companies, the EEHH cluster, represented by Jingkai Shi and Sibyl Scharrer, travelled to Tokyo in March for the Smart Energy Week. Smart Energy Week is considered one of the largest trade fairs for renewable energies and energy technologies in the Asia-Pacific region. Seven specialised trade fairs are presented under one roof at the Tokyo Big Sight exhibition centre, including Wind Expo and H2 & FC Expo. The fair serves as a large B2B platform that brings together international companies, investors and political decision-makers.

Offshore wind energy is set to become a mainstay of Japan’s energy transition. The path will not be an easy one. Mitsubishi’s withdrawal from the first round sends a clear signal –  the framework conditions must be improved. As a leading hydrogen nation, Japan is currently facing hesitant demand. The government is launching a series of support measures to accelerate the development of the entire value chain. The import of hydrogen and the development of an international supply chain play a particularly vital role in the market ramp-up in Japan.

Offshore wind: slow start, momentum increasing

The expansion of offshore wind energy in Japan is at an early stage. Since 2024, around 30 sites off the coast in different stages of development have been categorised for the construction of offshore wind farms. Most of these areas are located in the northwest of the country, in Hokkaido and Akita prefectures for example. Although the project pipeline is huge, the installed capacity so far remains modest.

Shortly before Smart Energy Week, Japan’s largest offshore wind farm to date, the 220 MW Kitakyushu Hibikinada, began commercial operations. The project comprises 25 turbines from Vestas, each with a capacity of 9.6 MW.

Designing a market-driven tendering mechanism is a key task for the Japanese government to promote offshore wind energy. In the first round of tenders, the feed-in premium model was applied. In 2021, a consortium led by Mitsubishi won the contract for three projects with an aggressive price bid (equivalent to 0.07-0.10€/kWh), with a total planned capacity of 1.7GW.

However, due to increased costs, the weakness of the yen and global supply chain problems, Mitsubishi announced in August 2025 that it would abandon the projects. Mitsubishi’s withdrawal represents a bitter setback for the Japanese offshore wind industry and at the same time underlines the need for stronger political support in the current challenging macroeconomic environment. Classic funding and support designs no longer promise sufficient yield security for capital-intensive energy projects.

For the new tender rounds, the Japanese government plans to break new ground with the “Long-term Decarbonisation Power Supply Auction" (LTDA) model. The focus is on the likelihood of the projects being realised. A central feature of the LTDA model is remuneration based on installed capacity. Successful bidders will receive an annual capacity payment (JPY/kW/year) over a 20-year period, which is intended to cover construction costs and fixed operating and maintenance costs.

At the same time, 90 percent of market-based revenues must be paid back to the state; this applies, for example, if an operator generates revenue by concluding a PPA.  Whether the new support design will create confidence and growth remains to be seen. However, some European market players were optimistic.

Expansion into the exclusive economic zone (EEZ) could be a decisive factor for the accelerated expansion of offshore wind energy. This allows access to the open sea, but requires the use of floating technology. Port infrastructure in Japan is a critical bottleneck for the logistical preparations of such projects.

Another challenge lies in the grid connection. Unlike in Europe, Japan lacks centrally coordinated planning for the offshore wind transmission grid. Moreover, the existing high-voltage grids have limited capacity to transport large amounts of electricity over long distances from offshore wind sites to central demand centres. Project developers often have to organise the grid connection themselves and bear the costs, which significantly increases the investment risk.

Hydrogen ramp-up with many hurdles

Japan aims to become climate-neutral by 2050. As early as 2017, the country was the first in the world to present a national hydrogen strategy. Since then, this strategy has been continuously developed and in 2024 it was incorporated into a promoting law for the development of a hydrogen society. Hydrogen is thus a central component of Japan’s green transformation, which pursues three goals: energy security, economic growth and the reduction of greenhouse gases.

Demand for hydrogen, especially green hydrogen, is falling short of expectations and is slowing down the ramp-up of the hydrogen economy worldwide. Although Japan is placing increasing emphasis on “low-carbon hydrogen”, this climate-neutral energy source of the future is proving to be highly uncompetitive in practical application. High investment/production costs and a lack of (comprehensive) infrastructure are cited as the main reasons.

To support producers in building a large-scale supply chain for low-carbon hydrogen and its derivatives, the Japanese government offers a support mechanism that compensates for the price difference between supply and demand over a 15-year period. Eligible companies are obliged to supply hydrogen to sectors that are difficult or impossible to electrify, such as the steel and chemical industries.

Another targeted support measure is the “Hub Development Program”, which aims to greatly expand the use of hydrogen and its derivatives. State subsidies are intended to enable the development of necessary transport chains, from import terminals to trailer- or pipeline-bound transport through to the supply of end customers.

In contrast to Germany, great importance is attached to the use of hydrogen in the mobility sector in Japan. The Japanese government is promoting the introduction of fuel-cell-powered commercial vehicles in selected regions. In the first funding phase, five regions, including Tokyo, were prioritised.

Both Germany and Japan face the challenge of a high dependence on energy supplies. The establishment of an international and resilient supply chain is essential to ensure security of supply for the decarbonisation of heavy industry and other areas of application.

The Japanese conglomerate Kawasaki Heavy Industries is driving development forward with pioneering projects. In 2020, the world’s first transport ship for liquid hydrogen, the “Suiso Frontier”, was built. Two years later, the ship successfully completed its first transport mission between Australia and Japan. (We report on the project and the import facility in the port of Kobe in the Blog)

Kawasaki is currently planning construction of a larger and integrated import infrastructure in the Japanese capital. The Port of Tokyo offers favourable location conditions for this, including transport links to several highways and Haneda Airport, nearby electricity supplies and industrial areas and a suitable deep-water port. Shortly after the foundation stone was laid in early 2026, Kawasaki announced that it would build the world’s largest liquid hydrogen transport vessel with a capacity of 40,000 m³. Delivery is scheduled for 2030. The project is funded by the national research programme “Green Innovation Fund”.

Technology research as a strategic focus

At the end of the trip, the EEHH cluster visited Fukushima prefecture together with representatives of the University of Hamburg to further deepen research exchange.

A prime example is the “Fukushima Hydrogen Energy Research Field” (FH2R), a 10 MW plant for the production of and research into green hydrogen. The test field, equipped with an AEL electrolyser, opened in 2020 and produces around 1,200 m³ of green hydrogen per hour using solar power from the surrounding open-space plants. In mathematical terms, this corresponds to the amount of energy that can cover the monthly electricity consumption of around 150 households or refuel 560 fuel-cell cars. The FH2R also includes storage and transport infrastructure.

A particular challenge in hydrogen production from renewable energies is the fluctuating power supply due to weather conditions and other factors. FH2R uses information from a forecasting system to predict the market demand for hydrogen, as well as additional data from an electricity grid control system to optimise the use of electricity from renewable sources. The aim is to develop a highly efficient hydrogen energy management system.

Some of the hydrogen produced at FH2R will be reused in the nearby “Namie Green Ammonia Integrated Control System Demonstration Field” (NAMICS) plant. The project, jointly operated by JGC and Asahi Kasei, is also funded by the NEDO Green Innovation Fund. In two phases until 2030, the production, storage and transport of green ammonia are to be tested on an industrial scale. Around four tons of green ammonia are produced on the site every day. This can be used, among other things, as a NOx reducing agent in thermal power plants or as a raw material for fertiliser production.

Conclusion

The trip provided the EEHH cluster with a comprehensive insight into the regulatory framework, the market potential and the prospects for cooperation with Hamburg in the core topics of renewable energies. Japan’s business culture is characterised by “staying power” that reflects strategic planning and resilience. A strong private-public partnership is also one of the country’s strengths and makes a significant contribution to long-term investment security and increased competitiveness.

The energy transition is not an end in itself, but a necessary step towards future viability and at the same time a cornerstone of economic security. Especially in times of geopolitical uncertainty, reliable partners are of great importance. The close exchange with Japan offers valuable impetus and opens up new perspectives for bilateral cooperation in this important field of the future.