Rising costs were cited as the reason for exiting from the Noshiro-Mitane-Oga (479 MW), Choshi City (390 MW) and Yurihonjo (819 MW) projects located off the coasts of Akita and Chiba prefectures, Japan, which had target commissioning dates in 2028 and 2030. According to Mitsubishi Chief Executive Katsuya Nakanishi, making the announcement on 27 August, cost increases had ‘far exceeded projections’, including construction prices more than doubling since the 2021 bidding phase.  

The withdrawals are expected to have a significant impact on Japan’s near-term 2030 offshore wind targets. The gap between the current pipeline and Japan’s 5.7 GW target, including operational capacity, projects under construction, and awards from the Round 2 and 3 auctions, has now widened to 2.2 GW (or 38% of the total target), according to the latest Westwood Energy analysis.

The Japanese government has stated that it plans to re-auction the three sites, although it remains undecided whether the sites will be reauctioned first or if Japan will proceed with its fourth auction, previously targeted to launch as early as autumn 2025.

However, this short-term setback may not necessarily reflect the outlook for future rounds, notes Hui Min Foong, Senior Analyst – Offshore Wind. She suggests it presents an opportunity for the government to use Round 1 as a learning experience, reassess its approach and refocus efforts on supporting future auctions, including Rounds 2 and 3. ‘This is especially critical since many projects won under zero-premium bids, and will likely face similar cost issues. Improving the wider business environment and bidding system will be key to the success of future projects,’ she says. ‘This is especially true looking further ahead, 10 to 15 years from now, where Japan is well positioned to leverage its vast floating wind potential, reinforced by recent policy momentum.’

Foong also notes that port development is underway in Akita, ‘offering a positive note for prospective future bidders’. She adds: ‘Even if 2030 targets are not met, it will still be a significant achievement should Japan be able to bring its 3.5 GW capacity pipeline to commercial operation, given that operational capacity currently stands at 308 MW.’

Global wind capacity to double by 2032
Meanwhile, global onshore and offshore wind capacity is set to double by 2032, according to the latest outlook from Wood Mackenzie. It reports that the industry is poised to add its second terawatt of capacity by 2030 – accomplished in just seven years compared to the 23 years it took to reach the first terawatt in 2023.

This year, the wind industry is ‘on track for a record-breaking finish to 2025’, with global wind capacity additions expected to reach 170 GW for the year. The sector could connect more than 70 GW in 4Q alone, marking a record quarter with gross capacity additions that exceed the total annual additions of any year before 2020, says Wood Mackenzie.

Its forecast shows a 13% quarter-on-quarter upgrade driven by substantial onshore growth in China, with global wind capacity set to double by 2032 compared to 2024 levels. While key markets like the US face policy-driven setbacks, the industry is predicted to ‘achieve historic scale over the next decade’. Excluding China, global cumulative wind capacity is expected to reach 1 TW in 2031, with global capacity doubling from 2024 levels by 2034.

On the other hand, policy frameworks that once reliably drove wind sector growth are now creating significant uncertainty across major markets, challenging this trajectory, warns Wood Mackenzie. Notwithstanding those difficulties, the report’s authors maintain a ‘cautious outlook’, noting ‘unprecedented industry expansion remains evident’.

Chinese market expansion accounts for the majority of global wind growth. ‘While other established markets struggle with policy uncertainty and economic headwinds, we’re witnessing an unequalled concentration of growth in China that’s reshaping the industry landscape,’ says Sasha Bond-Smith, Research Analyst at Wood Mackenzie.

The onshore wind forecast for China increased significantly this quarter, driven by data centres and demand for electrification. ‘This acceleration reflects superior profit resilience in liberalised power markets, where wind demonstrates stronger returns compared to solar technologies,’ comments Wood Mackenzie. However, it also notes that the offshore wind sector in China faces ‘considerable challenges’, with sea-use conflicts severely disrupting project timelines and halting construction even for projects already underway.

Wood Mackenzie’s latest analysis positions wind to match solar power generation output over the forecast period in China, ‘reinforcing wind’s critical role in the country’s power system as it pursues aggressive decarbonisation targets while managing unprecedented electricity demand growth’.

Meanwhile, the US wind market is facing fundamental restructuring as incentives expire. The One Big Beautiful Bill Act (OBBBA), passed in July 2025, triggered significant policy-driven adjustments. The legislation’s termination of tax credits after 2027 has caused a rush among developers to accelerate projects to the greatest extent possible, creating a surge in near-term installations, reports the market analyst.

‘This policy shift has weakened the outlook for the US sufficiently to drop it below India and Germany in 10-year additions. This represents a pivotal moment that forces developers to reassess project viability based on market fundamentals such as power demand growth and competitive positioning against other technologies,’ it says.

The global wind market outside China and the US is reported to be demonstrating ‘stability’. Onshore projects continue to progress across Europe, the Asia-Pacific and emerging markets, reports Wood Mackenzie, supported by tender outcomes and robust project pipelines. (However, it warns that ‘green hydrogen market slowdowns still limit related upside potential for wind development’.)

The offshore sector continues to encounter significant challenges, with elevated costs and tender failures constraining development across multiple regions, according to the analysis. European policymakers are reported to be facing mounting pressure to sustain offshore momentum through improved contract structures, while emerging markets are delaying first commissioning timelines amid financing and technical hurdles.

But the authors remain upbeat. ‘The wind industry’s most significant transformation in decades continues to unfold,’ concludes Kárys Prado, Senior Research Analyst at Wood Mackenzie. ‘From the first MW-scale turbine in 1941 to 16 GW in 2000, then 1 TW in 2023, we’re now racing toward 2 TW by 2030. While achieving historic scale, success will depend on how effectively the industry navigates this new geography of growth and adapts to evolving policy landscapes.’