Japan’s NTT ventures into offshore wind market

Japanese telecommunication giant Nippon Telegraph & Telephone (NTT) has invested more than JPY 1 trillion ($US9.3 billion) to expand renewables business in the Japanese renewable energy market, according to Nikkei.  

Noticeably, NTT is the first company with the capacity to enter Japan’s power distribution market after it was fully deregulated in 2016.

NTT will partner with Mitsubishi Corp. to supply over 14,000 Lawson convenience stores. To meet power demand from these stores, the company will develop large solar and offshore wind plants.

NTT plans to invest JPY 100 billion (US$9.28 billion) a year in the next five years to strengthen its energy infrastructure and expand renewable energy capacity from 300 MW to 7GW by 2030, via solar and offshore wind.

With a strategy to utilize its 7,300 telephone exchanges in Japan as mini generators and sell power directly to consumers, NTT, however, is facing a challenge. As Japan’s regional utilities have preeminence over the transmission lines, NTT needs to establish its own transmission and distribution network to compete in the power market.

Although NTT’s spokesperson told Reuters that it has no plan to build its own supply networks nor to compete with existing power utilities, it said that it intends to strengthen its “decentralization energy infrastructure.” 

In fact, NTT has invested $5.5 billion to build power distribution network close to its telephone exchanges. Wind InfoLink predicts that NTT is likely to venture into power distribution or even transmission network market to compete with existing utilities. If these ambitions are materialized, it could lower costs of renewables generation.