Market Spotlight: Growing the Japanese Storage Market

Synopsis

After years of expectation, Japan’s low-carbon capacity auctions and attractive subsidies now provide a 20-year fixed revenue for newly developed power sources, including battery energy storage systems (BESS). As the fifth-largest energy consumer in the world by country, Japan has a mature power sector that has capacity to take on BESS projects of scale. Hear from experts operating within the Japanese market to understand how to access these incentives, potential hurdles, and the opportunities that this increasingly attractive market represents.

• With the increase of intermittent generation assets and limited interconnection between regions with priority dispatch for nuclear, what is the current need for BESS grid services and how will the market shape in the coming years?
• How accepting is the market for non-domestic players and what should developers consider before moving into the Japanese market?
• How is the Long-term Decarbonization Auction shaping the investment landscape for this asset class going forward, and are projects still viable from an equity and debt perspective without this?
• From volatile intraday prices and potential for arbitrage to capacity markets and ancillary services, which business models are most likely to bridge the gap between earnings and investment targets in 2024 and what lessons can be learned from other regions?