![Japan Power Market Size Japan Power Market Summary](https://s3.mordorintelligence.com/japan-power-market/japan-power-market-size-image-1735465266044.webp)
Study Period | 2019 - 2030 |
Base Year For Estimation | 2024 |
Forecast Data Period | 2025 - 2030 |
Market Volume (2025) | 328.33 gigawatt |
Market Volume (2030) | 349.71 gigawatt |
CAGR | 1.27 % |
Market Concentration | Medium |
Major Players![]() *Disclaimer: Major Players sorted in no particular order |
Japan Power Market Analysis
The Japan Power Market size is estimated at 328.33 gigawatt in 2025, and is expected to reach 349.71 gigawatt by 2030, at a CAGR of 1.27% during the forecast period (2025-2030).
Japan's power sector is undergoing a significant transformation in its power generation mix, with a diverse portfolio of power plants across different technologies. As of September 2023, the country's power infrastructure comprises 4,338 solar power plants, 1,757 hydroelectric facilities, 487 thermal power stations, and 361 wind power installations, highlighting the nation's commitment to diversifying its energy sources. The installed capacity distribution reflects this diversity, with thermal power contributing 150.06 GW, renewable energy at 87.26 GW, hydroelectric power at 49.13 GW, and nuclear power at 33.08 GW as of 2023.
The power transmission and distribution infrastructure in Japan presents unique characteristics, with the nation divided into two distinct frequency zones—Eastern Japan operating at 50 Hz and Western Japan at 60 Hz. This division necessitates specialized frequency converter facilities to enable electricity exchange between regions. According to the Japanese Institute of Energy Economics, approximately 4% of the country's electricity is lost during transmission, driving investments in advanced technologies like superconducting transmission lines to improve efficiency.
Japan's power sector is witnessing substantial developments in power transmission infrastructure to accommodate growing renewable energy integration. Major projects include the expansion of the Shin-Shinano frequency converter and the construction of the Hida FC station, aimed at enhancing cross-regional power transfer capabilities. The Organization for Cross-regional Coordination of Transmission Operators (OCCTO) is overseeing significant transmission network developments, including projects to increase interconnection capacity between regions to 10.3 GW for the Tohoku-Tokyo line and 3 GW for the Tokyo-Chubu connection by 2027.
The market is experiencing significant momentum in renewable energy project development, particularly in offshore wind power. Notable developments include the Noshiro Offshore Wind Power project (84 MW) and Akita Offshore Wind Power project (54.6 MW), both commissioned in December 2022. The sector is also seeing advancement in biomass energy, with multiple projects under development, including the Yatsushiro Biomass Power Plant (75 MW) scheduled for operation in 2024 and the Fukuyama Biomass project (52.7 MW) planned for 2025, demonstrating the country's commitment to expanding its renewable energy portfolio.
Japan Power Market Trends
Government Initiatives and Energy Policy Support
The Japanese government's comprehensive policy framework and strategic initiatives are serving as major catalysts for the energy market's transformation. The cornerstone of this support is the Sixth Strategic Energy Plan, unveiled in October 2021, which established ambitious targets for renewable energy integration, aiming to increase the renewable share in the energy mix to 36-38% by 2030. This is complemented by the Japanese Green Growth Strategy, introduced by the Ministry of Economy, Trade, and Industry (METI) in October 2020 and revised in 2021, which outlines a clear roadmap toward carbon neutrality by 2050 through the adoption of cutting-edge technologies including low-carbon hydrogen, advanced nuclear reactors, and carbon recycling.
The government's commitment is further demonstrated through substantial investments in research and innovation across various energy sectors. These initiatives are creating a favorable environment for corporate R&D activities and technological advancement in the power sector. The policy framework extends beyond just setting targets, encompassing practical support mechanisms such as the Feed-in Tariff (FiT) system, which has been operational since July 2012 and undergoes annual rate revisions by METI to ensure continued encouragement of renewable energy deployment. This comprehensive policy support is creating a stable and predictable environment for power market development, attracting both domestic and international investments in the sector.
Technological Advancements and Infrastructure Development
Japan's power market is experiencing significant growth driven by rapid technological advancements and substantial infrastructure development initiatives. A prime example is the introduction of Virtual Power Plant (VPP) solutions, as demonstrated by the collaboration between Fujitsu Limited and AutoGrid Systems Inc. announced in April 2021. This partnership aims to bring AutoGrid's flagship VPP solution, AutoGrid FlexTM, to the Japanese market, enabling enhanced monitoring and control capabilities for power generation operations. These technological innovations are particularly crucial for optimizing the utilization of distributed energy resources and supporting the integration of renewable energy sources into the grid.
The infrastructure development drive is evident in the numerous transmission and distribution projects being undertaken across the country. Major utility companies are investing in upgrading and expanding their network infrastructure, with projects such as the Shin-Shinano frequency converter expansion project by Toshiba Energy Systems & Solutions Corporation marking significant progress in grid modernization. This project, which commenced operations in April 2021, represents Japan's first HVDC system interconnecting the east-west grids operating at different frequencies (50Hz and 60Hz), demonstrating the country's commitment to developing a more resilient and efficient power infrastructure. These technological and infrastructure improvements are essential for accommodating the growing share of green power and ensuring a stable clean power supply across the country.
Energy Security and Supply Diversification
Japan's strategic focus on enhancing energy security and diversifying its power supply sources is emerging as a crucial driver for the power market. As an island nation with limited indigenous resources, Japan has traditionally been heavily dependent on energy imports, particularly for thermal power generation. This dependency has prompted proactive measures to secure stable energy supplies, as evidenced by the significant long-term LNG procurement deals signed with the United States and Oman in December 2022. These agreements, involving major players like JERA, Mitsui & Co., and Itochu Corp., secure approximately 2 MTPA of LNG supply over ten years starting from 2025, demonstrating Japan's commitment to maintaining reliable energy sources.
The push for supply diversification is further reinforced by the development of domestic energy resources, particularly in the renewable sector. The country is actively expanding its renewable energy infrastructure, with significant investments in solar, wind, and geothermal power projects. This is exemplified by the development of various offshore wind projects and the expansion of geothermal power facilities, which leverage Japan's natural resources. The diversification strategy is particularly important given the expiration of approximately 6 million tonnes/year of long-term LNG supply contracts in 2023, which has prompted a renewed focus on developing alternative energy sources and strengthening domestic power generation capabilities.
Segment Analysis: Power Generation Source
Thermal Segment in Japan Power Market
The thermal power segment continues to dominate Japan's power generation landscape, accounting for approximately 47% of the total installed capacity in 2024. With an installed capacity of around 150.23 GW, thermal power plants remain crucial to Japan's energy security and baseload power generation. The segment is characterized by a diverse mix of fuel sources, with LNG-fired plants contributing about 53% of thermal capacity, followed by coal-fired plants at 32%. Japan's heavy reliance on thermal power generation reflects its limited indigenous energy resources and the need for stable, dispatchable power generation. Major utility companies like JERA, Hokkaido Electric Power Co., and Kansai Electric Power Co. operate significant thermal power assets across the country, with many facilities strategically located near major industrial and population centers.
![Market Analysis of Japan Power Market: Chart for Power Generation Source](https://s3.mordorintelligence.com/japan-power-market/japan-power-market-Japan-Power-Market-Market-Share-by-Power-Generation-Source-Segment-2024-1737050774437.webp)
Renewables Segment in Japan Power Market
The renewable power segment is experiencing the most dynamic growth in Japan's power market, with a projected compound annual growth rate of approximately 4% from 2024 to 2029. This robust growth is driven by Japan's ambitious renewable power targets and supportive government policies, including the Feed-in Tariff (FiT) system. The segment's expansion is particularly notable in solar power, which dominates the renewable mix, along with significant developments in wind energy, including both onshore and offshore projects. Major utilities and independent power producers are actively investing in renewable projects, with notable developments including the Ishikari Bay offshore wind power project and various biomass power generation facilities across the country. The government's commitment to achieving carbon neutrality by 2050 continues to provide strong momentum for renewable power deployment.
Remaining Segments in Power Generation Source
The hydropower and nuclear power segments play vital complementary roles in Japan's power generation mix. Hydropower, with its long history in Japan, provides essential grid stability and peak load management capabilities through both conventional and pumped storage facilities. The segment benefits from Japan's mountainous terrain and abundant water resources. Meanwhile, the nuclear power segment, despite facing challenges since the Fukushima incident, remains an important component of Japan's energy strategy, particularly for achieving low-carbon power generation goals. Both segments contribute to the country's energy security and help maintain a balanced power generation portfolio, with utilities like Tokyo Electric Power Company and Kansai Electric Power operating significant hydropower and nuclear assets.
Segment Analysis: Power Transmission and Distribution (T&D)
Transmission Lines Segment in Power T&D Market
The power transmission lines segment represents a critical component of Japan's power transmission and distribution infrastructure, with extensive development projects across various voltage levels ranging from 500kV to 110kV. Major power companies like TEPCO Power Grid, Chubu Electric Power Grid, and Kansai Transmission and Distribution are actively expanding their transmission networks through projects like the Higashi Shimizu Line (275kV), Soma-Futaba Bulk Line (500kV), and various other high-voltage corridors. These developments are primarily driven by the need to integrate new power generation sources, particularly renewable power projects, and enhance grid reliability. The transmission segment is characterized by both overhead and underground power lines, with overhead lines being the preferred choice for long-distance transmission due to economic considerations, while underground cables are predominantly used in crowded urban areas.
Grid Modernization Segment in Power T&D Market
The grid modernization segment is experiencing rapid growth as Japan focuses on upgrading its aging infrastructure and implementing advanced technologies. This includes the development of frequency converter facilities to address Japan's unique dual-frequency system (50Hz in Eastern Japan and 60Hz in Western Japan), installation of smart grid technologies, and enhancement of cross-regional interconnections. Companies are investing heavily in projects like the Shin-Shinano frequency converter expansion and the development of HVDC systems to improve power transfer capabilities between regions. The modernization efforts also encompass the implementation of automated remote control and monitoring systems, secure information-sharing networks, and advanced grid management technologies to enhance system reliability and operational efficiency.
Remaining Segments in Power Transmission and Distribution (T&D)
The remaining segments in Japan's T&D market include substation infrastructure and power distribution networks. The substation segment encompasses various voltage transformation facilities, ranging from major bulk power substations to smaller distribution substations, with companies implementing both new installations and modernization of existing facilities. The distribution network segment focuses on the last-mile connectivity, comprising both overhead and underground distribution lines that directly serve end consumers. These segments are integral to the overall power delivery system, with ongoing projects focusing on aging management, demand coverage, reliability upgrades, and economic improvements across different regions of Japan.
Japan Power Industry Overview
Top Companies in Japan Power Market
The Japanese power market is dominated by major regional utilities, including TEPCO, Kansai Electric Power, Kyushu Electric Power, and other established players. These companies are increasingly focusing on renewable energy integration and digital transformation initiatives, with significant investments in smart grid technologies and IoT-enabled power infrastructure. Strategic collaborations with technology providers and international energy companies have become commonplace as utilities seek to enhance their operational capabilities and expand their renewable energy portfolios. Companies are also prioritizing research and development in areas such as energy storage, grid modernization, and advanced power generation technologies. The market has seen a notable shift towards customer-centric innovations, with utilities developing new service offerings and digital platforms to meet evolving consumer needs. Infrastructure modernization and sustainability initiatives remain key focus areas, with companies making substantial investments in upgrading existing facilities and developing new clean energy projects.
Regional Utilities Lead Market Consolidation Efforts
The Japanese power market structure is characterized by strong regional monopolies, with each major utility historically controlling specific geographical territories. These established players maintain significant market presence through their extensive infrastructure networks, long-standing customer relationships, and integrated operations across generation, transmission, and distribution. The market has witnessed gradual transformation following deregulation efforts, though incumbent utilities continue to maintain dominant positions in their respective regions. Recent years have seen increased collaboration between traditional utilities and new market entrants, particularly in renewable energy development and technological innovation.
The industry landscape is evolving through strategic partnerships and joint ventures, particularly in areas such as offshore wind development and solar power projects. Major utilities are pursuing vertical integration strategies while simultaneously exploring horizontal expansion opportunities through partnerships with technology providers and international energy companies. The market has seen a gradual shift from pure utility operations to more diversified energy service offerings, with companies expanding into adjacent sectors such as telecommunications and smart city solutions. Traditional boundaries between utilities are becoming increasingly fluid as companies seek growth opportunities beyond their historical service territories.
Innovation and Sustainability Drive Future Success
Success in the Japanese power market increasingly depends on companies' ability to balance traditional utility operations with innovative energy solutions and sustainability initiatives. Incumbent players must focus on modernizing their infrastructure while developing new revenue streams through digital services and renewable energy projects. The ability to integrate advanced technologies such as AI and IoT into operations while maintaining reliable service delivery has become crucial. Companies need to demonstrate strong environmental stewardship while managing the transition to renewable energy sources, particularly given Japan's ambitious carbon reduction targets and growing public awareness of sustainability issues.
Market contenders can gain ground by focusing on niche segments such as renewable energy development, energy storage solutions, and smart grid technologies. Success factors include building strong partnerships with established utilities, developing innovative business models, and maintaining operational excellence while meeting stringent regulatory requirements. The regulatory environment continues to evolve, with policies increasingly favoring renewable energy integration and market liberalization. Companies must maintain flexibility in their strategic planning while building robust stakeholder relationships across the value chain. The ability to navigate complex regulatory requirements while delivering innovative solutions will be crucial for long-term success in this market.
Japan Power Market Leaders
-
Hokkaido Electric Power Company
-
Tohoku Electric Power Company
-
Tokyo Electric Power Company
-
Chubu Electric Power Company
-
Hokuriku Electric Power Company
- *Disclaimer: Major Players sorted in no particular order
![Japan Power Market Concentration](https://s3.mordorintelligence.com/japan-power-market/japan-power-market_1630954497314_Picture3.webp)
Japan Power Market News
- May 2024: JERA, a Japanese power utility company, announced plans to invest USD 32.4 billion in the development of renewable energies, LNG, hydrogen, and ammonia by 2035. The company has a target of 35 Mt in annual LNG transaction volumes, 20 GW of renewable energy capacity, and 7 Mt of hydrogen and ammonia.
- October 2023: J-Power, a major player in the Japanese power sector, unveiled its strategy to shutter two coal-fired power plants at its Matsushima facility in southern Japan. Each of these plants has a capacity of 500 MW. This move aligns with J-Power's goal of curbing carbon dioxide (CO2) emissions by 2025. As the second-largest coal-fired power producer in Japan, trailing only JERA, J-Power is set to permanently close its No.1 plant and temporarily halt operations at the No.2 plant by March 2025. In a bid to enhance efficiency and reduce emissions, J-Power is considering constructing a gasification facility at the No.2 plant, with plans to recommence operations in 2028.
Japan Power Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Scope of the Study
- 1.2 Market Definition
- 1.3 Study Assumptions
2. EXECUTIVE SUMMARY
3. RESEARCH METHODOLOGY
4. MARKET OVERVIEW
- 4.1 Introduction
- 4.2 Installed Power Generation Capacity and Forecast, till 2029
- 4.3 Electricity Generation and Forecast, Japan, till 2029
- 4.4 Renewable Energy Mix, Japan, 2023
- 4.5 Recent Trends and Developments
- 4.6 Government Policies and Regulations
-
4.7 Market Dynamics
- 4.7.1 Drivers
- 4.7.1.1 Declining Price and Installation Cost of Solar PV Systems
- 4.7.1.2 Advancements in Renewable Energy Technologies and Supportive Government Initiatives
- 4.7.2 Restraints
- 4.7.2.1 Fluctuating LNG Costs and High Reliance on Imports Impact Natural Gas Power Generation
- 4.8 Supply Chain Analysis
- 4.9 PESTLE Analysis
5. MARKET SEGMENTATION
-
5.1 Power Generation Source
- 5.1.1 Thermal
- 5.1.2 Hydroelectric
- 5.1.3 Nuclear
- 5.1.4 Renewable
- 5.2 Power Transmission and Distribution (T&D)
6. COMPETITIVE LANDSCAPE
- 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
- 6.2 Strategies Adopted by Leading Players
-
6.3 Company Profiles
- 6.3.1 Hokkaido Electric Power Company
- 6.3.2 Tohoku Electric Power Company
- 6.3.3 Tokyo Electric Power Company
- 6.3.4 Chubu Electric Power Company
- 6.3.5 Hokuriku Electric Power Company
- 6.3.6 Kansai Electric Power Company
- 6.3.7 Chugoku Electric Power Company
- 6.3.8 Shikoku Electric Power Company
- 6.3.9 Kyushu Electric Power Company
- 6.3.10 Okinawa Electric Power Company
- *List Not Exhaustive
- 6.4 Market Ranking/Share (%) Analysis
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
- 7.1 Progress in Japan’s Offshore Wind Power Sector
Japan Power Industry Segmentation
The generation of electricity through various sources like fossil fuels, renewable energies, and nuclear energy, as well as the transmission and distribution of electricity to the end user, constitutes the power market.
The Japanese power market is segmented by power generation source and power transmission and distribution. By power generation source, the market is segmented into thermal, hydroelectric, nuclear, and renewable. The market sizes and forecasts were made based on electricity generation capacity and installed power generation capacity (GW).
Power Generation Source | Thermal |
Hydroelectric | |
Nuclear | |
Renewable |
Japan Power Market Research FAQs
How big is the Japan Power Market?
The Japan Power Market size is expected to reach 328.33 gigawatt in 2025 and grow at a CAGR of 1.27% to reach 349.71 gigawatt by 2030.
What is the current Japan Power Market size?
In 2025, the Japan Power Market size is expected to reach 328.33 gigawatt.
Who are the key players in Japan Power Market?
Hokkaido Electric Power Company, Tohoku Electric Power Company, Tokyo Electric Power Company, Chubu Electric Power Company and Hokuriku Electric Power Company are the major companies operating in the Japan Power Market.
What years does this Japan Power Market cover, and what was the market size in 2024?
In 2024, the Japan Power Market size was estimated at 324.16 gigawatt. The report covers the Japan Power Market historical market size for years: 2019, 2020, 2021, 2022, 2023 and 2024. The report also forecasts the Japan Power Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.
Our Best Selling Reports
Japan Power Market Research
Mordor Intelligence provides a comprehensive analysis of Japan's power and electricity sectors, drawing on our extensive expertise in energy research and consulting. Our detailed examination covers the full spectrum of Japan's power generation landscape. This includes nuclear power, thermal power, hydropower, and emerging renewable power sources such as solar power and wind power. The report analyzes critical aspects of power transmission and power distribution. It also explores the evolution of smart grid technology and microgrid implementations, while assessing the state of power infrastructure and power equipment.
This strategic report, available as an easy-to-download report PDF, provides stakeholders with actionable insights across industrial power, commercial power, and residential power segments. Our analysis encompasses conventional power systems, clean power initiatives, and distributed power solutions. It offers valuable perspectives on power trading dynamics and utility operations. The report examines both wholesale power and retail power markets, providing detailed coverage of green power initiatives and their impact on the traditional electrical power sector. Stakeholders benefit from our thorough assessment of power transmission networks and the emerging technologies transforming Japan's energy landscape.