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Wärtsilä president and chief executive officer Håkan Agnevall said the emerging data-center market in Japan would require additional power and added he expected a mix of on-grid and off-grid generation
In sum – what to know
Japan adds momentum – Tokyo Gas is identifying data-center opportunities in Japan and expects demand for both on-grid and off-grid power.
Long ties matter – Wärtsilä and Tokyo Gas have worked together for around three decades across baseload and balancing power projects.
No orders yet – The companies have signed a cooperation agreement, but Wärtsilä said it is too early to discuss potential megawatts or gigawatts.
Wärtsilä is working with Tokyo Gas to explore power opportunities linked to Japan’s emerging data-center market, adding a new dimension to a relationship that stretches back decades.
Wärtsilä president and CEO Håkan Agnevall recently said the two companies have a long-standing relationship dating back around 30 years. Historically, Wärtsilä supplied smaller power plants for baseload requirements in different parts of Japan’s energy system.
Over the past five years, however, the relationship has increasingly involved balancing power. Agnevall pointed to the Sodegaura project, a 100-120-megawatt balancing power plant, as the latest example.
The new development is that Tokyo Gas is now identifying opportunities connected to data centers in Japan. Agnevall said the companies will work closely together, describing Tokyo Gas as a well-established and highly regarded player in the Japanese energy system.
He said the emerging data-center market would require additional power and that he expected a mix of on-grid and off-grid generation. However, Agnevall stressed that it was too early to provide details about the potential size of the opportunity. He said he could not discuss how many megawatts or gigawatts could ultimately be involved.
“There is certainly potential in the Japanese market,” Agnevall said, also pointing to the broader issue of national sovereignty. He said Japan wants to have data centers on its own soil.
The Tokyo Gas relationship also has implications for how Wärtsilä allocates its available production capacity. The company has previously said it does not want to put “all our eggs in the data center basket” and wants to diversify its geographical presence while maintaining relationships with strategic customers.
Agnevall specifically identified Tokyo Gas as a strategic customer because of the companies’ decades-long relationship. When deciding where to allocate capacity, he said, “Tokyo Gas is high on the list.”
At the same time, Wärtsilä is not reserving production slots for Tokyo Gas or other customers. Agnevall said the company is not working with customers on slot reservations.
The timing of potential orders therefore remains open. When asked how quickly the cooperation could turn into orders, Agnevall said Tokyo Gas should be asked about its plans, but confirmed that the Japanese company is seriously examining power generation for data centers.
Agnevall recently said data center demand was “holding up” and that the company continued to take in orders, although there is normally a delay between signing orders and announcing them.
