Japan''s Battery Market Expands, But Auction
With battery allocations halved and discharge requirements raised to six hours, developers warn the economics of storage projects
Solar panels in the western Japanese city of Kitakyushu: As Japan integrates more renewables into its energy mix, the market for battery storage is forecast to grow. (Photo by Shinya Sawai)
Lithium-ion batteries (LiBs) have long been the dominant choice for energy storage for grid applications. Despite their widespread adoption, LiBs pose several critical challenges that threaten the sustainability and security of Japan's energy transition.
Rystad forecasts Japan's battery storage capacity could reach about 4 GW based on projects under construction, planned and awarded, which would require $6 billion in investment.
That is creating surging interest in battery energy storage systems (BESS) to smooth mismatches in supply and demand. Since December 2023, companies have announced investments of at least $2.6 billion in Japanese battery storage projects, according to calculations by Reuters.
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