www.teitimes.com

May 2025 • Volume 18 • No 3 • Published monthly • ISSN 1757-7365

THE ENERGY INDUSTRY TIMES is published by Man in Black Media • www.mibmedia.com • Editor-in-Chief: Junior Isles • For all enquiries email: enquiries@teitimes.com

Gearing up for growth Japan’s clean power push

TEI Times catches up with Hitachi

Energy’s Maxine Ghavi to discuss the

key takeaways from WindEurope 2025.

Page 13

The clean energy revolution in

Japan is gathering momentum, and

both domestic giants and foreign

heavyweights are driving the shift.

Page 14

News In Brief

EU walks gas tightrope as it

weighs up supply options

The European Union is weighing

up its options on securing more gas,

as it faces pressure from the US to

buy more supplies, while ponder-

ing how to exit long term gas con-

tracts with Russia.

Page 2

Landmark New York offshore

wind project cancelled

US Interior secretary Doug Bur-

gum has ordered Equinor to halt

work on the 810 MW Empire Wind

project off the coast of New York

City.

Page 4

Asia outshines Europe and

US in energy transition

momentum

Asia has already built up a consid-

erable lead over several European

countries and the US in terms of

energy transition progress so far in

2025.

Page 5

France makes hydrogen

grants but cuts ambition

France has reduced its target for

installed electrolyser capacity

power by 2030 from 6.5 GW to 4.5

GW in a recent national strategy

update.

Page 7

Global nuclear capacity to

reach 494 GW by 2035

Advancements in small modular

reactor technology and supportive

policies for low-carbon baseload

power are behind a renewed inter-

est in nuclear power, with capacity

forecast to grow from 395 GW in

2024 to 494 GW by 2035.

Page 8

Siemens Energy delivers

strong Q2

Germany’s Siemens Energy has

delivered a strong second quarter

of scal year 2025, exceeding mar-

ket expectations.

Page 9

Technology Focus: Modular

geothermal opens new

opportunities

Having demonstrated the ability to

convert waste heat from existing oil

and gas operations into renewable

power without the need for any new

drilling, a modular, mobile geo-

thermal system also has the poten-

tial to support the fast-growing,

power-hungry data centre market.

Page 15

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The rise of articial intelligence will impact the energy sector in many ways, increasing

electricity demand while transforming the sector itself. Junior Isles

World leaders and businesses unite on energy security

THE ENERGY INDUSTRY

TIMES

Final Word

Junior Isles hears why

world leaders are on

the same page when

it comes to energy

security. Page 16

Articial intelligence (AI) is set to

drive surging electricity demand from

data centres while unlocking signi-

cant opportunities to cut costs, enhance

competitiveness and reduce emissions,

according to a new report by the Inter-

national Energy Agency (IEA).

The IEA’s special report, ‘Energy

and AI’, projects that electricity de-

mand from data centres worldwide is

set to more than double by 2030 to

around 945 TWh. AI will be the most

signicant driver of this increase, with

electricity demand from AI-optimised

data centres projected to more than

quadruple by 2030.

In the US, power consumption by

data centres is on course to account for

almost half of the growth in electricity

demand between now and 2030, says

the IEA. Driven by AI use, the US

economy is set to consume more elec-

tricity in 2030 for processing data than

for manufacturing all energy-inten-

sive goods combined, including alu-

minium, steel, cement and chemicals.

In advanced economies more broadly,

data centres are projected to drive

more than 20 per cent of the growth in

electricity demand between now and

2030, putting the power sector in

those economies back on a growth

footing after years of stagnating or de-

clining demand in many of them.

“AI is one of the biggest stories in

the energy world today – but until

now, policy makers and markets

lacked the tools to fully understand the

wide-ranging impacts,” said IEA Ex-

ecutive Director Fatih Birol. “Global

electricity demand from data centres

is set to more than double over the

next ve years, consuming as much

electricity by 2030 as the whole of Ja-

pan does currently. The effects will be

particularly strong in some countries.

For example, in the United States,

data centres are on course to account

for almost half of the growth in elec-

tricity demand; in Japan, more than

half; and in Malaysia, as much as one-

fth.”

While the increase in electricity de-

mand for data centres is set to drive up

emissions, this increase will be small

in the context of the overall energy

sector and could potentially be offset

by emissions reductions enabled by

AI if adoption of the technology is

widespread, according to the report.

Additionally, as AI becomes increas-

ingly integral to scientic discovery,

the report nds that it could accelerate

innovation in energy technologies

such as batteries and solar PV.

“With the rise of AI, the energy sec-

tor is at the forefront of one of the

most important technological revolu-

tions of our time,” Dr Birol said. “AI

is a tool, potentially an incredibly

powerful one, but it is up to us – our

societies, governments and compa-

nies – how we use it. The IEA will

continue to provide the data, analysis

and forums for dialogue to help policy

makers and other stakeholders navi-

gate the path ahead as the energy sec-

tor shapes the future of AI – and AI

shapes the future of energy.”

Continued on Page 2

A high-level gathering of govern-

ments and industry has concluded

with shared understanding of a broad-

er and more resilient approach to en-

ergy security.

The ‘Future of Energy Security

Summit’ co-hosted by the Interna-

tional Energy Agency (IEA) and the

UK government in London last

month, saw decision makers from 60

governments and over 50 major en-

ergy companies, alongside interna-

tional institutions and civil society

organisations, come together to reas-

sess and reframe energy security in a

rapidly transforming world.

Speaking just ahead of the event,

IEA Executive Director, Dr Fatih Bi-

rol, told the Financial Times that there

were “three golden rules” for energy

security: a diversication of energy

supplies, enough political predictabil-

ity to allow companies to make huge

long-term investments, and global co-

operation.

Referring to the crisis caused by the

loss of Russian pipeline gas from Eu-

rope and the rush to source alternative

supplies of energy, Dr Birol said he

thought the “lessons from Ukraine

have not yet been fully understood”.

It was clear at the Summit, however,

that despite the ongoing geopolitical

rifts, all countries agree that having

secure and reliable supplies of energy

is a top priority, and those supplies are

growing more insecure.

“In challenging geopolitical and

economic times, this Summit has

demonstrated that while the nature of

energy security is evolving, the need

for international cooperation remains

constant,” said Dr Birol at the London

event. “What emerged from our dis-

cussions was not only a shared under-

standing of the challenges ahead, but

a recognition that the solutions –

whether technical, political, or nan-

cial – will be more effective if pursued

together. This Summit has made it

clear for the world that we are in a

new era of energy security.”

The Summit opened with a clear

recognition that energy security can

no longer be understood solely in

terms of traditional risks. While safe-

guarding oil and gas supplies and

maintaining emergency response

mechanisms remain critical, partici-

pants agreed that the future of energy

security must also encompass newer

dimensions such as cyber security,

extreme weather events, supply

chain resilience for critical minerals

and clean technologies, and integra-

tion of electried and decentralised

systems.

UK Secretary of State for Energy

Security and Net Zero Ed Miliband,

said. “We have discussed how to

drive our collective energy security,

and here in the UK we have an-

nounced a £300 million boost for

offshore wind supply chains through

Great British Energy... In a changing

and uncertain world, Britain is deter-

mined to strengthen our alliances and

double down on our commitment to

multilateralism.”

Natasha Green, Programme Lead,

Global Energy Transition, at UK-

based energy think-tank E3G, com-

mented: “This summit was touted as a

possible lame duck given uncertain-

ties over attendance and hyped ten-

sions over fossil fuels beforehand.

“What happened instead, was the

vast majority of countries showing a

deep appetite to collaborate on pursu-

ing a secure energy transition and

turning to the IEA as a critical analyst

and convenor in this endeavour.”

AI will have major

impact on energy

sector, say new

reports

Birol: Global electricity demand from

data centres is set to more than

double over the next ve years

THE ENERGY INDUSTRY TIMES - MAY 2025

Junior Isles

The European Union is weighing up

its options on securing more gas, as it

faces pressure from the US to buy more

supplies, while pondering how to exit

long-term gas contracts with Russia.

US President, Donald Trump has sug-

gested that the EU buys about $350

billion of US LNG in order to reduce

its trade decit. According to arah

Brown, Europe Programme Director,

Emer, it would e difcult to fath-

om” how the EU could accommodate

this. “Europe already takes 45 per cent

of its LNG from the US, and that is

valued at about $13-18 billion per

year,” she said.

The European Commission has reit-

erated that it is ready to discuss energy

with the Trump administration as part

of trade talks, but it is careful about

doing so on Trump’s terms.

“We are absolutely ready to discuss

and to negotiate,” said Commission

spokesperson Anna-Kaisa Itkonen.

“We want to replace Russian LNG.

This means we could operate with the

US, but also with our other partners,”

Itkonen said, adding that the EU was

keen to avoid “over-dependence on

any single supplier”.

The bloc is also concerned that

Trump’s ambition to sell more LNG

to the EU does not align with its re-

newables ambitions.

The EU’s position is further compli-

cated by its goal to eliminate Russian

gas from its energy system by 2027

under its RePowerEU plan.

Last month Brussels said it was ex-

ploring legal options that would allow

European companies to break long-

term Russian gas contracts without

paying hefty penalties.

“If the whole idea is not paying Rus-

sia, then [paying compensation]

would undermine the whole purpose,”

one E ofcial told the Financial

Times.

The complexity for the Commis-

sion’s lawyers, however, is that con-

tracts are condential and tend to dif-

fer. Using the war in Ukraine to call

force majeure may not be legally suf-

cient, one E ofcial said.

Instead of a full ban on Russian gas

imports, Brussels-based think-tank

Bruegel has argued in favour of tariffs,

noting that they would generate reve-

nue for the EU and force Russian sup-

pliers to lower prices to remain com-

petitive. Further, unlike sanctions,

tariffs only require a majority of EU

member states to back them in order to

be approved. Hungary’s pro-Russia

government has already threatened to

reject gas sanctions, which need unan-

imous approval from the EU’s 27 mem-

ber states.

“It’s a mess,” one EU diplomat told

the FT. ow does the  t in all this

ow do we diversify

Despite pressure from Brussels, EU

nations are also wary of forcing com-

panies to cut LNG contracts with Rus-

sia amid concerns that it will push up

prices when companies are struggling

with geopolitical turmoil and high

costs.

Cold winter weather and geopolitical

instability sent European gas prices

soaring to a twoyear high in the rst

quarter of this year.

The average TTF price – a key indi-

cator of gas prices in Europe – reached

.h in the rst three months

of this year, a 9 per cent increase on the

nal uarter of 202.

The rise was sparked by a cold win-

ter which reduced storage levels, ongo-

ing geopolitical tensions, and anxieties

about a trade war with America after

President Trump promised a raft of

import tariffs on European countries.

According to Montel Analytics Q1

2025 saw multiple occurrences of brief

unkelaute” periods, prolonged pe-

riods of low wind. Combined with a

cold snap, this resulted in high levels

of fossil fuel-powered generation and

therefore high prices.

The energy analytics company said

fossil fuel generation jumped 23 per

cent on the previous quarter to

22.h, with gas red power the

major contributor (60 per cent) to this

total.

he report emphasises the signi-

cant uncertainties that remain,

from the macroeconomic outlook

to how quickly AI will be adopted.

It also notes questions over how

capable and productive AI will be-

come, how fast efciency im-

provements will occur, and wheth-

er bottlenecks in the energy sector

can be resolved.

Commenting on the energy de-

mand from data centres and poten-

tial bottlenecks, Charlie Morgan, a

partner in Herbert Smith Freehills’

disputes practice, said: “With elec-

tricity demand from data centres set

to more than doule in the next ve

years because of AI, the onus is on

organisations at every point of the

AI supply chain to keep the show

on the road. Doing so in an environ-

ment riven by uncertainty because

of geopolitical concerns and rapid

technological advances requires

work upfront thinking about what

would happen if things go wrong.”

Some experts, however, are less

concerned about the pressure that

AI and data centres will put on en-

ergy demand. As the IEA released

its report, Energy Intelligence, an

independent information company,

released its outlook report, ‘Energy

and Articial Intelligence.

According to the report, the wide-

ly touted explosion in power de-

mand is overstated, with AI likely

to only moderately increase global

electricity demand by 2050. Eco-

nomic growth, industrial electri-

cation and air conditioning, for

example, are expected to be of

greater signicance to gloal ener-

gy demands.

Michael Collins, Director, Energy

Transition Research at Energy Intel-

ligence, commented: “Our research

indicates that forecasts predicting

an explosion in energy demand due

to AI are likely to be overstated.

While we may see increases in the

shortterm, efciencies in AI hard-

ware and software, and the enets

the technology will bring to the

power sector, will likely e signi-

cant mitigation.”

In the short-term, as AI’s rollout

expands, demand from data centres

is estimated to reach 1000 TWh by

2026 from 460 TWh in 2022, an

increase of around117 per cent, said

the report. However, in the medium

to long term Energy Intelligence

expects increases to be at least par-

tially offset y signicant efciency

gains as processors improve, new

cooling solutions are integrated,

and training algorithms are opti-

mised. Leading GPU manufactur-

ers have told Energy Intelligence

that these efciencies will likely

scale at least as quickly as AI itself.

It also agreed with the IEA in its

prediction that increased rollout

and technological enhancements

to AI will serve as a net accelerator

of the low-carbon transition, irre-

spective of its impact on global

electricity demand.

“AI is expected to play an impor-

tant role in efforts to improve costs

and efciency of lowcaron power

generation, transport, and storage,

helping to accelerate the transition

by rapidly decarbonising energy

grids and easing the integration of

more intermittent power generation

technologies such as solar or wind,”

said the report. Energy Intelligence

also said it has witnessed a strategic

shift in how the US, EU and China

are positioning energy systems to

support AI’s power needs; energy

supply, therefore, is likely to impact

how AI industries develop across

geographies as much as AI will

shape energy demand.

Continued from Page 1

Tariffs proposed by the US’ Trump

administration could throw the green

energy sector into turmoil, according

to clean energy experts.

The heavy duties on electrical com-

ponents, battery storage and other

equipment from China, southeast Asia

and Europe pose a serious threat to an

industry already feeling the effects of

the US President’s anti-green energy

stance.

Executives warned that the added

costs from tariffs would result in

higher power bills. Electricity prices

rose twice as fast as ination last year,

according to Bank of America, with

several utilities requesting double-

digit price increases from regulators

to cover the rising costs of labour,

materials and upgrades to the grid.

Sandhya Ganapathy, Chief Execu-

tive of EDP Renewables North Amer-

ica, one of the largest developers of

wind, solar and battery storage in the

US, told the FT: “This could be a po-

tential de-railer when we really have

to usher in this new era of energy

dominance to put the US at the epi-

centre of data centres and AI technol-

ogy. It is unsettling from a business

perspective and creates disruption.”

Julien Dumoulin-Smith, analyst at

Jefferies, an investment bank, said the

tariffs created “a lot of turmoil” at a

time when businesses were already

uncertain about whether Trump

would cut lucrative incentives for

green energy provided by former US

President Joe Biden.

He explained: “Tariffs provide an-

other reason for companies to delay

investments. And the current problem

is that there just isn’t a big enough

domestic US supply chain yet in many

renewable sectors, such as solar, bat-

tery storage and wind. There aren’t

many options but to purchase from

overseas.”

The US wind sector imports a lot of

components such as blades, drive-

trains and electric systems, with al-

most half of imports coming from the

EU in 2024, according to Rystad.

A February report by Wood Mack-

enzie warned that universal 25 per

cent tariffs on all imported wind prod-

ucts would increase project costs by

7 per cent and put some projects at

risk.

Richard Power, Partner at Clyde &

Co., commented: “While President

Trump’s tariffs are sector-agnostic,

the US’s low-carbon energy industry

is likely to be hit particularly hard as

crucial components for solar energy,

battery storage and other renewable

energy projects are predominantly

sourced from China, southeast Asia

and Europe.

“As the capital cost of developing

such projects increases, the competi-

tiveness of the US’s clean energy in-

dustry will likely deplete as innova-

tion is stied and investors lose

interest, having already lost many

federal incentives.”

More than 40 per cent of the world’s

electricity was generated by non-

fossil fuel energy sources in 2024,

according to a new report from think-

tank Ember.

he ndings, however, came as car-

bon dioxide emissions, which warm

the planet, rose to an all-time high,

with hot weather pushing up the over-

all demand for power. That meant an

overall increase in the use of fossil

fuelred power stations.

“Amid the noise, it’s essential to

focus on the real signal. Hotter weath-

er drove the fossil generation increase

in 2024, but we’re very unlikely to see

a similar jump in 2025,” said Phil

Macdonald, Ember’s Managing Di-

rector. The reports notes that solar

power continues to be the fastest-

growing energy source, with the

amount of electricity it generates dou-

bling every three years since 2012.

“Solar power has become the engine

of the global energy transition,” said

Macdonald.

While solar has been the clean en-

ergy champion Dr Beatrice Petrovich,

senior analyst at Ember says she is

looking forward to seeing wind –

which generated 18 per cent of EU

electricity – accelerate this year

thanks to faster permitting and, hope-

fully, more favourable conditions.

Last month Ørsted, the world’s larg-

est offshore wind power developer,

called on Europe to do more to support

an industry at risk of a “downward

spiral”, as Donald Trump’s new tariffs

heap further pressure on its struggling

US operation.

Rasmus Errboe, Chief Executive of

the Denmark-based company, said Eu-

ropean offshore wind was in a “tough

place” due to rising costs, supply chain

constraints and uncertainty over elec-

tricity prices. He also said Trump’s

new tariffs would have a “meaningful

impact” on the cost of its projects in

the US, where Ørsted has faced sig-

nicant difculties.

At the recent WindPower Europe

event in Copenhagen last month, the

wind industry proposed a new deal to

speed up and de-risk the build-out of

homegrown and competitive offshore

wind energy. The proposal calls on

European governments to auction at

least 100 GW of new offshore wind

over 2031-2040.

Headline News

Clean energy share of global electricity mix tops

40 per cent

EU walks a tightrope as

it weighs up gas supply

options

The EU is facing a complicated task in balancing trade talks with the Trump administration

over gas supplies, while accelerating its exit from use of Russian gas. Junior Isles

Trump tariffs could severely disrupt renewables industry

Photo by Christian Lue

Siemens Energy is a trademark licensed by Siemens AG.

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THE ENERGY INDUSTRY TIMES - MAY 2025

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Conﬁrmed speakers include

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Ellermann-Kingombe

Connie

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Anna

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Romanian Minister

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NATO Assistant

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Former EU Commissioner

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Professor,

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’

pril 8-10 saw more than 16

000 visitors attend what is

Europe’s biggest conference

and exhibition for the wind power

sector. With Europe facing unprece-

dented competitiveness and security

challenges, it was a timely gathering.

Europe has ambitious targets for

new renewables capacity, the bulk of

which is planned to come from

wind. Wind provides 20 per cent of

the electricity Europe consumes to-

day; the EU wants it to be 35 per

cent by 2030 and over half by 2050.

Having installed 16.4 GW of new

wind power capacity in 2024, ac-

cording to WindEurope – the organ-

isation representing the region’s

wind power sector – Europe now

has 285 GW of wind power capaci-

ty: 248 GW onshore and 37 GW

offshore. The EU-27 accounts for

231 GW of the total installed capac-

ity, 210 GW onshore and 21 GW

offshore.

WindEurope expects Europe to in-

stall 187 GW of new wind power ca-

pacity over 2025-2030, with the EU-

27 installing 140 GW of this – 23

GW a year on average. This would

bring total installations in Europe

and the EU to 450 GW and 351 GW,

respectively by 2030. Notably, Eu-

rope will need to add 15 GW/year of

offshore wind by 2030. It is a tall or-

der, but it is what is needed if the EU

is to achieve its targets for decarbon-

isation and energy security.

Fresh from the Copenhagen event,

Maxine Ghavi, Hitachi Energy’s

Head of Europe, commented on the

headwinds facing the sector and the

challenges Europe faces in achieving

its ambitions for offshore wind.

“Overall, there were a lot of valu-

able discussions at WindEurope,”

she said. “[But] The main takeaway

was that the fundamentals have not

changed. The energy trilemma – en-

ergy security, affordability and sus-

tainability – is [still] there. And su

ply chain was, of course, a topic –

can we achieve the targets when con-

sidering supply chain constraints?”

Although the global wind power

industry has been growing strongly

for decades, over the last few years

wind capacity additions have been

held back by a combination of global

macroeconomic challenges such as

high ination and cost of capital, as

well as domestic policy barriers.

However, it is now experiencing

massive growth, which presents a

new set of problems.

Ghavi said that the sudden growth

has really “caught everybody off-

guard”, noting: “As an industry, we

hadn’t really built for that capacity.”

Companies like Hitachi Energy have

therefore been investing in building

up manufacturing resources and cre-

ating framework-type agreements

with project developers in order to

accelerate the building of the infra-

structure needed to connect wind

farms to the grid.

ommenting specically on the

supply chain issues, Ghavi cited

what she sees as perhaps the top two

concerns. “It isn’t about a product or

a box that has to be delivered. We

are a supplier to our customers, and

we have multiple suppliers that we

have to manage and deal with. So,

it’s simply the capacity, number

one… The decisions as an industry

and as suppliers we were making

ve years ago wasnt in terms of ca-

pacity because in some cases for a

period of time, capacity in the mar-

ket actually decreased. We’re now

back in that swing where we are all

expanding capacity.”

Accordingly, Hitachi Energy has

been making investments globally,

with plans to spend $9 billion from

20202. A signicant portion of

that is for Europe,” said Ghavi. “We

already have a lot of factories. We’re

focusing uite a it on rowneld vs

greeneld, ecause thats the faster

way to respond to have the capacity

up and running.”

Hitachi Energy is also working

with its customers on the approach

to projects and contracts.

“The business model has changed

from transactional to partnerships

and strategic, because there is no

way that any single company can do

this alone along the value chain,”

said Ghavi. “So, this gives us the

visibility so that we can then go back

and build around that visibility to

make investments in capacity expan-

sion, people, R&D, engineering,

project execution and service.

“The visibility horizon we were

discussing with our customers up

until 18 months ago was 5-10 years;

now we are talking 10, 15, 20

years… Planning really needs to be

done holistically as clusters, as a re-

gion, to address the challenges.”

Further, this level of planning

needs to be considered along the en-

tire value chain – from technology,

to project execution, to attracting

people and talent. Ghavi noted that

Hitachi Energy has increased its

workforce from 2020-2024 by 20

per cent and plans to hire an addi-

tional 15 000 people by 2027.

Hiring also comes with its chal-

lenges, as Ghavi explained. “It

takes time to expand [manufactur-

ing capacity]. And it also goes back

to people: they have to be trained.

You can’t hire 15 000 people over a

three-year period and not be con-

cerned about things like health and

safety, and integrity.”

In addition to ramping up manufac-

turing capacity and adding person-

nel, the other top issue in terms of

supply chain challenges, according

to Ghavi, is the raw materials used in

products. Hitachi Energy therefore

has to share visibility with its suppli-

ers, in the same way it does with its

own customers.

“We do frame agreements and ca-

pacity reservation agreements with

our customers, and we have to do

the same thing with our critical sup-

ply chain as well,” explained Ghavi.

She added: “Having a global foot-

print where we can leverage a glob-

al supply chain and manufacturing

also helps us in the process of

sourcing from different places and

being able to manufacture in differ-

ent places, while following the

same methodologies.”

Asked whether there were specic

concerns in terms of the raw materi-

als supply chain, Ghavi noted the

availability and price volatility of

copper as an example. “It goes back

to whether we have enough supply

and that we have it reserved so that

we can leverage.”

An important aspect, often over-

looked in meeting targets for actual

wind power generation targets, is

service. It is an area where Ghavi

says Hitachi Energy has “really put a

stake in the ground” with the ap-

pointment of its new CEO.

“We’ve always focused on service

but now we have taken it to the next

level. There is now a business unit

that is 100 per cent dedicated to ser-

vice,” she said. “Service is a great

opportunity but we also have a re-

sponsibility to extend the lifetime of

the existing installed base. This will

make what is already installed more

sustainable. That helps the capacity

and our customers… it’s about get-

ting more out of that asset.”

Certainly, adapting business mod-

els and expanding capacity resources

is part of the equation but there is

still much the industry needs to do as

a whole. Vestas, Europe’s largest

wind turbine manufacturer recently

warned of a large gap between the

ambitious targets set for the industry

and the reality on the ground.

Anders Runevad, Chair of Den-

mark’s Vestas, recently told the Fi-

nancial Times: “There is a fairly big

discrepancy between the ambitious

political targets that have been set

and then you translate that to what’s

actually happening. ere denitely

behind that curve.”

He said streamlining the process of

securing permits was just one of the

changes needed to boost an industry

that many countries are relying on to

meet their net zero carbon emissions

targets.

At the start of the Copenhagen

event, WindEurope issued what it

called the ‘Copenhagen Call to Ac-

tion’, highlighting three steps to

boost Europe’s energy independence

and competitiveness.

The call to action noted that the

European wind energy supply chain

is growing to deliver on the in-

creased wind volumes Europe needs.

It is currently investing over €11 bil-

lion in new factories to meet the

Clean Industrial Deal goals. “But

Europe isn’t building enough new

wind farms to support its competi-

tiveness and energy security objec-

tives” it said. The main reasons are

poor permitting, slow grid build-out,

ad auction design and insufcient

electrication.

The industry therefore called on

governments to:

n Apply the new EU permitting

rules, noting that “they work

wonders” – Germany is now

permitting 7x as much onshore wind

as ve years ago. And lter out

zombie projects from grid

connection queues, which are

“clogging up the system”.

n emove arriers to electrication.

Let industry get state aid to electrify

with renewable PPAs, which are not

just for onsite power. Remove non-

energy taxes and charges from

electricity bills so renewables

become “an obvious choice for

consumers”.

n De-risk wind investments with a

stable pipeline of 2-sided Contract

for Difference auctions. CfDs

improve costs of capital and

visibility on revenues and are good

value for governments.

Henrik Andersen, WindEurope

Chairman, summed up: “Europe is

in a moment of transition. To secure

European inuence in the gloal

economy, we need more secure, af-

fordable and sustainable energy.

Wind energy is already driving in-

dustrial growth and energy indepen-

dence across Europe, we just need to

scale up.”

Last month, WindEurope held its annual conference and exhibition in Copenhagen. Junior Isles later caught up with

Hitachi Energy’s Maxine Ghavi to hear her key takeaways.

Gearing up for growth in the

face of headwinds

THE ENERGY INDUSTRY TIMES - MAY 2025

Industry Perspective

Ghavi: The main takeaway

was that the fundamentals

have not changed

apans energy mix reects a com-

plex dynamic etween historical dis-

ruptions and decaronisation initia-

tives. he ukushima aiichi nuclear

power plant disaster in 20 prompted

the shut down of all the nations nu-

clear reactors, many of which are still

ofine. hile progress has een

slower than expected, clean energy

generation has shifted the energy mix.

he country commissioned aout 20

 in solar capacity and a little over

  in wind power in 2020202.

hile net installed capacity hardly

increased in recent years, additions

may accelerate in the near future. his

is driven y the inistry of Economy,

rade and Industrys expectation

electricity demand will rise sharply

y 2050  y 050 per cent  driven

y electrication in transport, indus-

try, and heating, as well as digital in-

frastructure such as data centres.

Investment environment

apan offers investors a solid invest-

ment prole, with roust economic

fundamentals and a strong commit-

ment to innovation, particularly in

clean energy. he country enoys -

nancial staility, reected in upper

medium grade sovereign credit ratings

 oodys assigns an A rating with

a stale outlook, and  an A rat-

ing, also with a stale outlook. apan

ranks th out of  countries on the

loal Innovation Index, underscor-

ing its technological and research

strength. his extends to the renewale

energy sector, where apan ranks 0th

on the E enewale Energy ountry

Attractiveness Index.

eyond these indicators, apan

maintains a alanced institutional

environment. It ranks 20th on the

loal orruption erceptions Index

and th on the orld ustice roect

ule of aw Index, indicating a rela-

tively transparent and lawful gover-

nance system. owever, challenges

remain  its 0th place on the eport-

ers ithout orders ress reedom

Index suggests areas for improvement

in media openness.

wo other key considerations for

investors are currency volatility and

interest rates. he apanese yen has

uctuated signicantly in recent

years, rising from ust aove 00

to the  dollar in late 2020 to over

0 in une 202. As a result,

foreign investors often need to hedge

currency risks, increasing costs. n

the other hand, orrowing in yen re-

mains cheap: the interank rate is

around 0. per cent, far lower than in

any maor developed economy.

Policies and incentives

apans key net ero policies include

the reen rowth trategy (202),

which identies  highgrowth sec-

tors, and the  romotion Act,

which introduced growthoriented

caron pricing and climate transition

onds. he trategy highlights critical

energyrelated industries such as off-

shore wind, solar, geothermal, and

nextgeneration heat energy. It also

promotes the development of E and

attery industries.

o support this transition, the in-

istry of Economy, rade and Industry



he clean energy revolution in

apan is gathering momentum,

and oth domestic giants and

foreign heavyweights are driving the

shift. ith old offshore wind targets

and solar growth surging, investors are

eyeing opportunities  despite policy

hurdles and currency risks.

Decarbonisation commitments

limate action in apan has een slow

ut has improved in recent years. It

pledged in 205 to reduce greenhouse

gas () emissions y 2 per cent

from 20 levels y 200. his was

raised in 2020 to  per cent y 200

and net ero y 2050. A 202 energy

plan and a ill passed in 202 aimed

to raise the share of clean energy in the

energy mix. hey proected nonfossil

fuel sources to account for 5 per cent

of the total mix y 200, up from 

per cent in 2022. enewales would

increase to  per cent and nuclear

to 2022 per cent, while fossil fuels

would fall to  per cent from  per

cent.

he nation continues to face energy

sector challenges typical of island

nations with few or no natural re-

sources. It is therefore heavily reliant

on imported fossil fuels, complicating

its energy security  especially given

the geopolitics of eing a neighour

to hina. Its historically fragmented

electricity network also limits ef-

cient power distriution. In terms of

expanding clean energy generation,

proect development has een slow,

constrained y lengthy approval pro-

cesses and geographic limitations

such as mountainous terrain. ritics

have agged apans controversial

reliance on unproven technologies

such as caron capture and storage

and ammonia coring.

Energy mix

apans electric power generation in

202 highlights the sustantial ongo-

ing shift in its energy landscape. Elec-

tricity generation declined 2. per

cent, with nonfossil fuel generation

falling and clean energy generation

rising, according to the Energy Insti-

tute’s Statistical Review of World

Energy 2024. lean energy output

umped 0.5 per cent, thanks to in-

creases of almost 50 per cent from

nuclear power and  per cent from

other renewales, including solar and

wind.

created a 2 trillion (. illion)

fund to provide continuous support

for  proects, demonstrations,

and social implementation proects

for up to 0 years to companies that

commit to amitious goals”. he

asic ydrogen trategy (20),

updated in 202, targets 2 million

tonnes of hydrogen supply y 200.

uclear power is eing reinforced y

extending reactor lifespans to 0

years. ax incentives include deduc-

tions for energyefcient euipment

and renewale energy investments.

owever, signicant contradictions

persist. apans fossil fuel susidies

totalled  illion from 2022, under-

mining decaronisation goals y dis-

couraging E adoption and renew-

ale energy expansion.  and

ammonia coring remain costly and

largely unproven. Additionally, per-

mitting and regulatory hurdles con-

tinue to delay renewale proect roll-

outs. apans climate nance

contriutions are rated highly insuf-

cient”, posing further ostacles to

international climate cooperation.

Investors backdrop

apan has a roust mix of domestic and

international investors in its clean en-

ergy sector, particularly in solar and

wind. he market gained momentum

after the 202 introduction of the

eedinariff scheme. eading do-

mestic investors include trading hous-

es such as arueni, itsuishi, it-

sui, and umitomo, as well as utilities

like EA (a epcohuu Electric

oint venture), ansai Electric, and

epco, all of which are actively ex-

panding their clean energy portfolios.

oreign investors have also entered

the market in force. otale names

include enmarks rsted, erma-

nys E, and orways Euinor,

typically in partnership with domestic

rms to develop offshore wind capac-

ity. he offshore wind sector has e-

come particularly active. or example,

in ecemer 202, apans industry

and land ministries selected two con-

sortiums to develop offshore wind

locks in the third maor pulic auc-

tion round. ne consortium  com-

prising EA, reen ower Invest-

ment, and ohoku Electric  won a

5  proect off Aomori refec-

ture. Another consortium, including

ansai Electric, arueni, arutaka,

okyo as, and , secured a 50

 proect off amagata refecture.

oth proects will use iemens

amesa turines and are scheduled to

egin operations in une 200.

eanwhile, E and ansai

Electric are awaiting environmental

approval for a proposed 00 

offshore wind farm near okkaido. A

growing concern for offshore inves-

tors is the rising cost ase against

xed auction prices  driven in part

y the weakened yen, which makes

imported turines more expensive.

his is one of several policy and -

nancial challenges that authorities

must urgently address.

Prepared for The Energy Industry

Times by Joseph Jacobelli, Managing

Partner, Asia Clean Tech Energy In-

vestments Ltd.

E EE I IE  A 2025

Energy Transition Investment Series

This is the latest in a series of country analyses, where TEI Times looks at Japan’s generation and consumption

proles, policy, emissions targets an inestment attractieness

Japan’s clean power push: global

capital meets local ambition:

Japan offers investors a solid

nvestent role th ro-

bust economic fundamentals

and a strong commitment to

innovation

Electricity generation

declined 2.6 per cent in

 th nonossl uel

generation falling and clean

energy generation rising

eothermal energy can pro-

vide clean, renewable, basel-

oad electricity, but it has its

challenges. Upfront project costs

are high due to the need to drill and

explore potential sources and, in

some parts of the world, projects

can be subject to lengthy permitting

periods. In the US, for example, it

can take up to seven years to obtain

the necessary permits for a geother-

mal project. This long permitting

time delays the start of energy pro-

duction and adds to the overall cost

of the project.

The technology is also limited by

geography. Geothermal resources

are often located in specic regions

with high geothermal activity, such

as Iceland, Indonesia, the Philip-

pines, and specic locations in the

western United States.

Consequently, uptake has been lim-

ited. According to the International

Energy Agency’s most recent report

on the sector, geothermal meets less

than 1 per cent of global energy de-

mand and its use is concentrated in a

few countries with easily accessible

and high-quality resources. It says,

however, that with continued tech-

nology improvements and reductions

in project costs, geothermal could

meet up to 15 per cent of global

electricity demand growth to 2050.

This would mean the cost-effective

deployment of as much as 800 GW

of geothermal power capacity world-

wide, producing almost 6000 TWh

annually, i.e., equivalent to the cur-

rent electricity demand today of the

US and India combined.

In recent years there have been

several innovations that could go

some way to making this possible,

one of the most interesting being

one from Geothermal Gradient. The

US-based company has developed

an innovative system that is bring-

ing geothermal energy to the oil and

gas sector, with the potential to also

power the rapid global expansion of

data centres.

Known as the HXC system, it is

essentially a system that conveys

heat from generally dirty wastewa-

ter sources for use in an organic

Rankine cycle (ORC) for power

generation.

Benjamin Burke, CEO of Geother-

mal Gradient, explained the roots of

technology. “The whole idea, for this

started with my previous work in the

oil and gas industry as a geoscientist,

and seeing the opportunity that was

all around the industry, in the form

of heat waste. Fluids were constantly

being produced and cooling off on

the surface… I realised there was an

opportunity in the thermal side of

water and that’s where the spark for

the company really came from.

“I was one of the company’s co-

founders in 2020. The HXC system

itself came from the need to connect

ORC units to oil and gas facilities…

We needed to convey heat from a

generally dirty uid stream, some-

thing that certainly contains scale,

oil, gas, high brine content, and in

some cases rags and plug parts. But

we needed to convey just the heat to

the ORCs and most ORCs require

very clean water. That’s where the

idea of the HXC came from.”

The system has two key compo-

nents. One is the HXC sled to con-

vey heat from a produced uid

stream to the ORC. The second sled

is the ORC itself, and Geothermal

Gradient is able to adapt any off-the-

shelf ORC to work with a dry air

cooler.

“It’s a water-free cooling mecha-

nism, which has water in its loops,

but doesn’t consume any water, said

Burke. “The two units can come off

a lorry or truck and be installed in

one day. And we can do that in any

rural location in the world.”

He notes that the same sled con-

cept can really be used in a number

of ways. The company has in fact

had a good amount of interest from

oil and gas operators all over the

world.

The units are also sized so they

can be installed as small modules,

according to the operator’s needs.

Each sled can produce anything

from 75 kW to 300 kW using differ-

ent sized ORC generators.

“The modularity is what our cli-

ents really like about it,” said

Burke. “Along with that ease and

quick installation, we have the mo-

bility. So, if an oil and gas well site

only ows the right amount of uid

for a year or two, the modularity

means that we can move it on to the

next site.”

he system needs uid at a tem-

perature of at least 70-75°C to oper-

ate, and 2000 barrels/day to make a

reasonable amount of power. “The

more the merrier in terms of both

temperature and uid ow, to get

more power,” noted Burke.

A handful of projects have already

been completed or are underway in

the oil and gas sector and more are

on the way. Geothermal Gradient’s

rst system was at a pilot proect in

Nevada, in the western United

tates, while its rst commercial in-

stallation is with an oil and gas op-

erator in the Williston Basin in

western North Dakota. The second

commercial project is due to start

up this month (May) in western

Louisiana.

Burke added: “We’re very excited

to work on a project in Argentina,

which will hopefully be kicking off

later this calendar year, as a well as

a proect in man at a steam ood

eld.”

The technology is now also gar-

nering interest from geothermal op-

erators and data centre operators.

urke explained: eve had ve

different geothermal operators ap-

proach us in the last four months…

Some geothermal operators are op-

erating and drilling, and planning to

have larger facilities. Our equip-

ment can help them to get to rst

electrons very quickly and test

some of their wells. They are look-

ing to use us, while their large more

bespoke multi-megawatt power

units are in construction.”

But it is the growth of data cen-

tres, driven y the advance of arti-

cial intelligence, that makes the fu-

ture even more exciting. The HXC

system is well suited for deploy-

ment at liquid-cooled data centres.

These data centres typically have

processors sitting in a bath of water

or some form of refrigerant. This

heat from the processors is pumped

outside the building, usually to a

uid chiller and cooled off.

“Our equipment, in making pow-

er, can act as that uid chiller,” said

Burke. “Additionally, we can use

ground loops – just like a thermal

energy network or a district heating

network would have a ground loop

for rejecting heat to the subsurface.

So, a data centre is essentially a

building with a pipe of hot water

coming out of it, which to our

equipment looks a lot like an oil

and gas well and we can cool that

uid stream ust as we could cool

an oil and gas well.

According to Burke, the company

has received “a lot of initial excite-

ment” over the idea of a water-free

solution for data centre cooling. This

is important since many of the exist-

ing cooling solutions for water-

cooled data centres involve some

type of misting, or evaporative cool-

ing, which can be a problem in parts

of the world where water is scarce.

According to Burke, the econom-

ics of the technology also stack up

well, versus current solutions. This

he says, goes hand-in-hand with

emissions savings of about 0.5 kg

(1 lb) of CO

for every kWh, when

compared with savings against the

grid. This roughly doubles for die-

sel installations.

Geothermal Gradient has initially

adopted a lease model for HXC,

which is well suited to the modulari-

ty of the system.

Burke noted: “Although we cer-

tainly can sell the units, we’ve start-

ed as a leasing model because a lot

of oil and gas operators tend not to

own the heavy equipment that they

use – they tend to lease the drill rigs

and a lot of equipment that goes onto

a site. So, the idea of leasing our

geothermal euipment ts very

cleanly with their business model.”

The lease approach also makes

HXC cost competitive with existing

solutions. “In leasing these units,

[compared to] the incumbent solu-

tion that we are replacing, we are es-

sentially one-to-one or slightly less

expensive than the amortisation cost

of the uid chillers that operators

currently use,” said Burke. “Plus,

they get power [from the HXC sys-

tem], as opposed to pulling power

from the grid. Or even worse, from

an emissions standpoint, using diesel

generation for the power. Compared

to the incumbent solutions there is

about a 10-20 per cent [cost] saving

for oil and gas operators.”

He explained that a one-off solu-

tion for a client is not the most cost-

effective option but noted: “At a full

build-out we’re on the order of 8-11

cents/kWh, when power generation

is the goal.” Burke added: “If heat

rejection is the goal – for a lot of our

clients, uid chilling is the primary

goal – whatever they get from that is

secondary. So there, you have to

equate the cooling duty of the solu-

tion along with the kilowatt hours of

electricity produced, and you still

end up with about the same num-

ber… that’s a very competitive num-

ber for a baseload power solution.”

As long as water is owing, day or

night HXC can make power and pro-

vide cooling duty. With a capacity

factor above 90 per cent, this com-

pares very favourably with solar at

20-25 per cent or wind at 30-40 per

cent. “When this capacity factor is

normalised against the levelised cost

of energy, we’re as cheap as wind

and solar, if not more so,” said

Burke.

The technology certainly has a

bright future. As Burke summed up:

“We’re really excited about the op-

portunities to take advantage of ther-

mal resources that are being pro-

duced every day and have that

advantage work for our clients, work

for ourselves, and in some cases

work for public entities where the

wells are in the public domain. It’s

been gratifying to see that interest

truly worldwide in the uptake of our

technology.”

A new technology

developed by

Geothermal Gradient

col reene the

geothermal energy

landscape. Having

demonstrated the

ability to convert

waste heat from

existing oil and

gas operations into

renewable power

without the need

for any new drilling,

this modular, mobile

system also has

the potential to help

satisfy the needs

of the fast-growing,

power-hungry data

centre market.

Junior Isles explains.

Modular geothermal opens new

opportunities

THE ENERGY INDUSTRY TIMES - MAY 2025

Technology Focus

Geothermal Gradient has

oleted ts rst oeral

installation at a Chord Energy

well-pad in North Dakota, USA

THE ENERGY INDUSTRY TIMES - MAY 2025

Final Word

or fear of repetition, I seldom

re-visit a topic twice in a row.

But sometimes, needs must.

Late last month, the International En-

ergy Agency (IEA), in collaboration

with the UK government held ‘The

Future of Energy Security’ summit in

London – a topic whose importance

cannot be overstated.

The summit was held to examine the

geopolitical, technological and eco-

nomic factors affecting energy secu-

rity at the national and international

level. ailed as the rst conference of

its kind on the future of energy secu-

rity, the political importance of the

meeting was clear. Along with over 50

major energy companies, more than

60 governments attended the meeting

– at a time when there is increasing

geopolitical fragmentation.

When the summit was announced

last August, the aim was to dene

energy security in the 21st century –

certainly the denition has changed

post-2022 following the energy crisis

exacerbated by Russia’s invasion of

Ukraine and the subsequent physical

attacks on energy infrastructure.

According to Dr Fatih Birol, Execu-

tive Director of the IEA, there were a

few key conference takeaways from

the IEA’s perspective. Despite having

different priorities and perspectives,

energy policies and national pathways,

there was “a readiness” to engage and

cooperate on energy issues.

“They all recognise that we are enter-

ing a new era of energy security,” said

Dr Birol. “I say new era because

countries agreed that we still have to

pay utmost attention to traditional

energy security risks, such as oil and

gas, but at the same time the emerging

energy security risks such as critical

minerals and supply chains.”

With the expansion of clean energy

technologies such as renewables,

electric vehicles, battery storage, etc,

critical minerals and supply chains are

becoming increasingly important.

Countries agreed that there is no na-

tional security without energy secu-

rity. “This is one area where I can say

we had full consensus,” noted Dr Birol.

With countries becoming more inter-

connected and interdependent most

governments recognise that, as Dr

Birol put it, “no country is an energy

island today”. The clear correlation

between UK electricity prices and gas

prices, even on an island like the UK,

is clear evidence of this.

aking his own reections on the

conference, UK Secretary of State for

Energy Security and Net Zero, Ed

Miliband, stressed that clean energy

was no longer just about climate

change, but that clean energy and en-

ergy security are now linked.

He said: “I believe this summit

marks the coming of age of the era of

clean energy. For the UK govern-

ment, that era of clean energy is the

rock on which global security and

prosperity can be built.”

He added: “In a world of fragmenta-

tion, there is huge value in multilater-

alism – in countries working together

for their own national interests… In

the years since Russia’s invasion of

Ukraine, many countries have experi-

enced what the UK has, due to their

exposure to fossil fuels and the weap-

onisation of energy… It’s clear that

countries feel that they can enet

individually from accelerating the

clean energy transition. Because the

lesson of what has happened in the past

is that the cost of solar and wind has

fallen dramatically, in part because of

the increase in deployment. One thing

is clear to me, and that is that this clean

energy transition is an unstoppable

transition.”

Although China was not represented

at the London summit, at a UN meet-

ing two days earlier, President Xi

Jinping said his country would “not

slow down its climate actions” and

noted that the country had “built the

world’s largest and fastest-growing

renewable energy systems as well as

the largest and most complete new

energy industrial chain”.

But while most countries around the

world agree that clean energy – renew-

ables and nuclear – is the best way

forward, at the summit the US, under

the Trump administration, was vocal

in its support for fossil fuels.

Tommy Joyce, Acting Assistant

Secretary at the US Department of

Energy, declared in a plenary session

that the goal of reaching net zero

greenhouse gas emissions by 2050 was

“harmful and dangerous”, and warned

of “putting abstract emission goals in

the interests of our adversaries rst and

the security of our people last”.

During the press questions and an-

swers session at the London summit,

one journalist asked whether Joyce

used the opportunity of meeting with

Miliband to tout oil and gas for the

UK, or to attack climate policies.

“Apart from warm words” about the

energy transition, she argued that there

were few concrete outcomes.

Miliband avoided discussing the

conversations he had with Joyce and

instead offered more warm words

about the energy transition.

Just ahead of the London summit,

during a webinar organised by the

Energy & Climate Intelligence Unit

(ECIU), panellists were more forth-

coming on questions related to dia-

logue between the US and this side of

the Atlantic.

With the move away from Russian

gas, the UK, and indeed the broader

EU, has been forced to look elsewhere.

But in the new geopolitical landscape

they are nding that sourcing new gas

can come with strings attached.

Commenting on the headlines

around the US, the EU, and how tariffs

are impacting the trans-Atlantic rela-

tionship, Sarah Brown, Europe Pro-

gramme Director, Ember, said: “The

main focus has been around the $350

billion of LNG, which the US is saying

that Europe must take to cover its trade

decit. Europe already takes 5 per

cent of its LNG from the US, and that

is valued at about $13-18 billion per

year. So how you can accommodate

00 illionyear is uite difcult to

fathom.”

Even if the EU imported all of its gas

from the US, Brown says this would

only equate to around $30-35 billion

per year.

While the European Commission

has indicated that while it might buy

more US gas in the future, anything it

agrees to must be aligned with its green

objectives, and that European environ-

mental policies and standards are not

up for debate.

The EU, through its REPowerEU

programme has a target to reduce gas

demand by 50 per cent by 2030, which

according to Ember’s calculations

means the bloc is unlikely to take

anything more than $13-18 billion of

US LNG.

The situation in the gas market is

complex. Historically in the face of oil

price volatility Europe increased reli-

ance on natural gas, which was rela-

tively secure. With the souring of rela-

tions with Russia, this is no longer the

case, creating other problems for the

bloc.

Weighing in on the debate, Michael

Bradshaw, Professor of Global Energy,

Warwick Business School, University

of Warwick, Associate Fellow, Cha-

tham House, said: “As we have seen

in a relatively short period of time,

Europe has been able to pivot away

from the traumatic reduction in supply

of Russian gas but has become increas-

ingly dependent on the global LNG

market… Europe has been very lucky,

in that the previous two winters have

been mild… but LNG has now become

geopolitical because it has also been

caught up in the tariff wars between

Washington and Beijing.”

Interestingly, he seemed to caution

against putting too much reliance on

renewables, at least in the immediate

future, especially for the UK.

“I would guard against seeing the

green energy plan as being a solution

to UK gas security because the major-

ity of gas demand for the UK lies

outside the power sector. And the real-

ity is, in the coming 5-10 years we will

still need natural gas as a source of

exiility,” said radshaw.

On this he has a point. But ulti-

mately, the UK and Europe’s decision

to back clean energy will reap rewards

in terms of environment, affordabil-

ity, energy security and therefore

national security.

Go clean, stay secure

Junior Isles

Cartoon by Jem Soar