Japan: Land of the Rising Wind

Significant market opportunity

• All nuclear plants shut down pending safety checks

• Spending increase to about $29.5 billion on fossil fuel imports

Since the Fukushima accident in March 2011

Source: CIA

Significant market opportunity

• Japan Wind Power Association revises 50 GW target to 75 GW by 2050

2.5 GW of capacity in 2010

Source: Siemens

Government developing infrastructure

Launched a 5-year, $162 million project

• Aimed to better integrate wind power to grid• Development of wind power output prediction service

to better forecast high wind power supply• Based on successful integration system used in Spain

Offshore wind potential

• Ministry of Environment estimates offshore potential alone at about 1,000 GW

• 4 projects totaling 254 MW in development• Government recently raised feed-in-tariff but industry

says it’s still insufficient• Developing projects with floating turbines to operate in

deep water

Currently, there are 49.6 MW of offshore wind capacity (including 4 MW of floating turbines)

Offshore wind investment

• Softbank subsidiary, SB Energy, providing investment

• Wind Power Energy to develop a 90 MW project• 18 turbines to be located 600 meters to 1,600

meters off of Kamisu • Expected to be operational in 2017

First commercial offshore project in development

Competitive landscape

• Danish wind turbine manufacturer

• Has most installed capacity in Japan

• Entered into offshore wind joint venture with Mitsubishi which will better position the company to compete in offshore wind projects

Vestas Wind Systems

Courtesy Vestas Wind Systems A/S

Competitive landscape

• Developed a 2.85 MW turbine specifically for the Japanese market

• New turbine can withstand typhoon-strength winds, lightning strikes, and turbulent conditions

• Second to Vestas in market share

General Electric

Courtesy: GE

Competitive landscape

• Currently has 123 MW of installed capacity

• Recently won a 17-turbine supply contract for a project on the northwest coast

• In 2013, won a 6-turbine supply contract, for Akita Port, to debut direct-drive technology

Siemens AG

Courtesy: GESource: Siemens

Foolish takeaway

Experts agree that wind power will gain favor similar to solar power’s popularity• Vestas, GE, and Siemens are all well-positioned to

profit from the growing popularity of wind power in Japan

• Despite trading at 52-week highs, Vestas offers the greatest growth potential as it is a pure-play on wind

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