Tokyo energy storage investment

How can Japan encourage investment in energy storage?

Japan’s development of revenue streams through its wholesale, capacity, and balancing markets, coupled with CAPEX subsidy schemes for grid-scale battery projects, provides a framework to encourage investment in energy storage.

What is energy storage in Japan?

Energy storage in Japan consists of thermal storage, hydro, pumped hydro, and Battery Energy Storage Systems. As Japan works to increase renewable penetration to meet its Net Zero targets, grid balancing becomes more critical to ensure grid stability and replace the inertia typically generated by thermal generators.

What are the requirements for battery energy storage in Japan?

There are a series of requirements to be eligible: projects must have a minimum capacity of 1 MW, the battery must be able to participate in various markets, and the battery must be directly connected to the grid. Energy storage in Japan consists of thermal storage, hydro, pumped hydro, and Battery Energy Storage Systems.

How will a new 'green financing model' work in Japan?

Investments will be focused on projects in the Kanto region, which comprises the Tokyo Metropolitan area and six surrounding prefectures. Much of the new investment fund’s remit is around establishing a new “green financing model” for investments in utility-scale battery energy storage system (BESS) assets in Japan, Gore Street said.

How much does Tokyo's FY2024 subsidy cover?

The subsidy covers up to 2 billion yen per project. A total of 12 projects totaling 180MW/595.3MWh was awarded 13 billion yen through Tokyo’s FY2024 subsidy for promoting grid-scale battery storage, the metropolitan government’s document released in February 2025 shows.

What are the requirements for a battery project in Tokyo?

These are the Ministry of Economy, Trade, and Industry (METI) and the Tokyo prefectural subsidies. There are a series of requirements to be eligible: projects must have a minimum capacity of 1 MW, the battery must be able to participate in various markets, and the battery must be directly connected to the grid.