SSE signs deal to create Japan offshore wind vehicle
SSE announced on Wednesday that its renewables division has signed an agreement with Pacifico Energy, one of Japan's largest developers of renewable energy, to create a joint ownership company to pursue offshore wind energy development projects in Japan.
The FTSE 100 power generator said the move to enter Japan's growing offshore wind market would help support the further expansion and diversification of SSE Renewables' longer-term growth pipeline.
It said the creation of the joint ownership company would involve the acquisition by SSE Renewables of an 80% interest in an offshore wind development platform from Pacifico Energy and its affiliates for $208m (£153.48m), of which $30m would be deferred subject to a number of conditions.
The consideration remained subject to customary completion adjustments.
SSE said Japan had “clear” offshore wind targets of 10GW by 2030, and between 30GM and 45GW by 2040, as the country looked to decarbonise and achieve greater energy independence.
The targets were backed by a government commitment to run regular offshore wind auctions for support.
Key elements of the transaction included the transfer of up to 20 Japan-based employees from Pacifico Energy to the newly-created company, who would be complemented by SSE Renewables employees.
The vehicle would then acquire a number of early-stage offshore wind development projects geographically spread across Japanese waters, with the potential to progress to deliver multiple gigawatts.
Those early-stage projects were expected to use a mix of fixed and floating technology, and were working towards being selected for future auctions.
SSE said the two most advanced projects had secured grid access, with “advanced” local stakeholder engagement already undertaken.
“Today is an exciting next step for SSE Renewables as we enter Japan which has huge ambitions for offshore wind deployment,” said SSE Renewables managing director Jim Smith.
“And in Pacifico Energy we have found a fantastic local partner with hugely complementary local capabilities, experience and insights that can help bring our expertise in developing, building and operating offshore wind to Japan.
“We want to help realise Japan's renewables ambitions and be a significant part of their offshore wind plans during the decades ahead, and we're looking forward to working with the new team, as well as with local communities and other stakeholders to realise the benefits of the offshore wind industry.”
At 0842 BST, shares in SSE were down 0.22% at 1,591p.