Home > News > Content
Five Minutes To Understand The Japanese Energy Market
- Jul 20, 2018 -

Bright spot in Japan's energy storage market:

It is expected that by 2030, Japan's new energy generation will account for 35% of the total generating capacity.

Japan's ambition in the field of energy storage is expected to be 50% of the world's energy storage capacity by 2020.

Japan's current subsidy program: providing 66% of the cost subsidy to households and business users who install lithium battery energy storage.

1. Paving the way for policy

From the overall picture, it is estimated that by 2030, Japan's new energy generation will account for 35% of the total electricity generation. In March 30, 2018, an expert meeting on the issue of long-term energy policy in 2025 was held, and a draft strategy was proposed to position renewable energy as a "power supply that is becoming a major possibility". The renewable energy is used as the main power source.

Compared with large scale solar power stations, the development of rooftop photovoltaic industry and distributed power station has been rising obviously in recent years because of the small land area, large demand account and geomorphic characteristics. At the same time, Japan has used incentives to encourage homes to use energy storage systems to mitigate the grid management challenges of a large influx of distributed solar energy, which also increases the demand for battery energy storage systems. The survey shows that in 2022, Japan will surpass Australia and Germany in the deployment of energy storage batteries in third place.

The Japanese economic and industrial province (METI, Ministry of Economy, Trade and Industry) has a budget of about $98 million 300 thousand, providing 66% of the cost subsidies for families and businesses with lithium electronic batteries. In addition, METI has also allocated $779 million for factories and small businesses to improve energy efficiency, a move aimed at stimulating the use of energy storage systems for solar power plants and substations.

In order to encourage new energy to enter households, the government provides a subsidy to families with zero energy housing reform. The subsidy comes from two channels of central government and local government. So far, the government subsidies can account for the entire retail price of 40-50%.

In addition to financial support, the Japanese government's policy orientation in the new energy market is also very positive.

Public utilities solar independent power plants are required to equip a certain proportion of batteries to stabilize the output of electricity.

Power Grid Corp is required to install batteries on the transmission network to stabilize the frequency or to purchase ancillary services from suppliers.

There are incentive policies to encourage batteries to be used in distribution networks, distribution networks or microgrids. They can also outsource battery business to third parties.

Consumers can also assemble their own solar energy and batteries, and even families can sell electricity stored by batteries.

In electric cars, such as Tesla, Mercedes Benz, BMW, NISSAN and so on, to promote the combination of electric cars, solar energy and batteries, this may become the mainstream of future battery sales in Japan, with great potential.

In fact, there are still some extension obstacles, such as lack of flexibility, not to sell electricity to others, the lack of electrical engineering knowledge and professional technology cause the difficulties of user installation, operation and maintenance.  Therefore, the Japanese government and regulators have formulated a series of battery energy storage policies and regulatory systems to promote the development of energy storage batteries.

Two. Market expansion

In addition to the government's support policy on energy storage, the reform of the power industry has led many enterprises to enter the market, promoted the application of energy storage in the power industry, coupled with the competition of the global battery market and the solar market. Now Japan has reached the Internet parity of solar energy and battery storage, and has financial viability.

With the process of the fifth electricity market reform in Japan, the retail market was opened up in 2017 and a real-time market was established. The trading market began to operate and predicted that the real time market would be operated in 2020, like the United States and Germany. Energy service providers can sell electricity to the battery energy storage system, and battery energy can provide ancillary services.

According to the market trend in 2017, there are two main options for solar power suppliers - reducing solar energy, or building battery storage equipment to absorb extra electricity. The photovoltaic power stations with energy storage are increasing, and the Power Grid Corp is also investing and installing some large energy storage power stations to ensure the stability of the power grid. In the future, Power Grid Corp can no longer invest its own battery equipment, but buy auxiliary services to the suppliers. Real estate developers want to have more value added to their own homes and start to choose a power storage system that can sell auxiliary services and battery power.

In addition, the Internet of things in recent years has also been the concern of the Japanese power company, developers, not only the energy sector of the Internet of things, such as energy block chain, virtual power plant new technology has never stopped the introduction of the footsteps, and the integration of infrastructure is imperative. In 2016, the Japanese government provided 3 billion 950 million yen to support the development of virtual power plants, which was greatly encouraged and supported, trying to resolve the contradiction between oversupply and demand. In the period of excessive supply of electricity, the excessive supply of electricity is integrated to store and sell when needed. American Tesla, Samsung and other battery suppliers have entered Japan to become partners of local enterprises.

Overall, the current power grid from the transmission, distribution network to users in all aspects of the battery energy storage users.