UK, Japan agree on offshore wind investment pact worth up to GBP9 billion

The UK and Japan agreed to an offshore wind investment pact worth up to GBP9 billion ($12.1 billion), with Japanese investors set to back 5.9 gigawatts of UK floating wind projects as part of a broader economic partnership between the two nations.

The UK-Japan Offshore Wind Compact, developed in partnership with UK state-owned Great British Energy, will support floating offshore wind developments, including the Ossian and Green Volt projects off Scotland's east coast and the Erebus project in the Celtic Sea, according to a June 13 statement.

When operational, the projects are expected to generate enough electricity to power 8 million UK homes, the government said.

The pact came as UK Prime Minister Keir Starmer met Japanese counterpart Sanae Takaichi in London on June 14 ahead of the annual Group of Seven summit in Evian-les-Bains, France, from June 15-17.

"These landmark agreements will bring multibillion-pound investment into the UK, creating tens of thousands of new jobs and driving new developments," Starmer said in a statement.

"As G7 economies and close security partners, we are working together with Japan on some of the most innovative technology in the world, harnessing the best of British and Japanese research and industry to deliver growth and security to every corner of the United Kingdom."

Japanese influence

The pact makes the UK Japan's leading clean energy partner in Europe, according to the statement.

Japanese investors have long played a significant role in European offshore wind. In 2011, Marubeni, one of Japan's largest trading houses, became the first Japanese company to invest in offshore wind, acquiring a 49.9% stake in the Gunfleet Sands project in the UK from Orsted.

Fifteen years on, Marubeni is partnering with UK utility SSE and Denmark's Copenhagen Infrastructure Partners to develop the Ossian floating wind project in Scotland. The project has a capacity of up to 3.6 GW and was awarded to the consortium as part of the ScotWind leasing process in 2021.

The UK-Japan investment pact also extends to Green Volt, a floating wind development in Scotland of up to 560 megawatts that was awarded contract for difference support in 2024.

The project is being developed by Vargronn -- a joint venture between Eni's Plenitude and HitecVision -- and Flotation Energy, which counts Japan's largest utility TEPCO among its shareholders. The wind farm is slated for first power in 2029.

The Erebus floating wind farm in the Celtic Sea, with a capacity of up to 100 MW, is also referenced by the UK-Japanese pact. The project won a CFD in January as part of the UK's Allocation Round 7 auction.

France's TotalEnergies owns an 80% stake in the project, with the remaining 20% held by Simply Blue Group, which is backed by Japan's Kansai Electric Power.

Broader pact

Beyond offshore wind, the UK-Japan agreement included energy-related commitments from Hitachi Energy's UK business, which pledged to create at least 500 jobs over five years and invest GBP18 million in a new Stafford facility to support grid expansion.

Rolls-Royce and Japan's Atomic Energy Agency also agreed to collaborate on next-generation nuclear technologies.

The broader investment package totals more than GBP18 billion across infrastructure, financial services and advanced technologies.

In other UK offshore wind news on June 15, London-listed investor TRIG agreed to sell its entire 17.5% stake in the 588-MW Beatrice project in Scotland to co-shareholder Equitix for GBP155 million.