How much battery storage will Japan ultimately need?

← Back to the entry point (all 19 questions)

The national plan has no required volume. What exists is a March 2026 outlook and three calculations in different units.

How many GW of batteries does Japan need? Neither the FY2040 supply-demand outlook of the 7th Strategic Energy Plan (February 2025) nor the GX 2040 Vision (same month) states a required volume of storage in GW or GWh. The model behind the outlook computes a balanced supply and demand, and batteries emerge as a result, not as a target (RITE, 68th Basic Policy Subcommittee). A figure appeared in a national document in March 2026, when the Agency for Natural Resources and Energy put its FY2040 outlook for supply-side batteries (grid-scale and renewables-co-located) at 2.8–10 GW. At the same time it explained that contract applications already exceed that range. The outlook is not a target, and applications have overtaken it.

What exists is three calculations in different units

← scroll sideways →

Fig. 1 — The three calculations differ in both purpose and unit. The same 1 MW battery is counted as standby volume for balancing, as volume discounted by duration for seats, and as stored energy for absorbing surplus. Sources: OCCTO; Agency for Natural Resources and Energy, Grid WG materials.

Balancing volume is counted in kW available on standby, seat volume in kW discounted by how long the unit can deliver continuously in the evening, and surplus absorption in kWh. The units differ, so they cannot be added. To these is added an industrial-policy target from the Battery Industry Strategy (established 2022, revised June 2026) of 150 GWh a year of domestic manufacturing capacity (with over 100 GWh a year in the pipeline on investment decisions already taken) — but that is factory capacity, not what the grid needs.

Abroad, system operators publish a single figure

Australia's system operator AEMO writes in its 2024 plan that 49 GW / 646 GWh of storage (including pumped and demand-side coordinated resources) is needed by 2050, noting 3.7 GW / 10.8 GWh today. Britain's NESO gives 23–27 GW of batteries by 2030 (from 5 GW in 2023); the German transmission operators' plan (approved by the regulator) gives roughly 55 GW / 136 GWh of large-scale storage by 2045; the European Commission stated in July 2026 a figure of 200 GW by 2030 and 500 GW by 2040 (all storage, including residential and pumped); and California gives 18.5 GW of lithium-ion batteries by 2035 (four-hour and eight-hour combined). All are stated in primary sources.

← scroll sideways →

Fig. 2 — Countries that write down a required volume, and Japan, which does not. The EU figure is 500 GW for 2040. Sources: AEMO 2024 ISP; NESO Clean Power 2030; BNetzA Netzentwicklungsplan (Version 2025); European Commission Electrification Action Plan (17 July 2026); for Japan, the supply-demand outlook of the 7th Strategic Energy Plan (February 2025). The bottom bar is the Agency for Natural Resources and Energy's connection-study intake (end-December 2025).

No required volume is written; only the volume wanting to connect piles up

What is large in Japan is the volume wanting to connect. Connection-study applications total 172 GW (end-December 2025). More than three times the 49 GW Australia has written down as needed by 2050 is piled up at the application stage. The state's outlook of 2.8–10 GW is under 6% of those connection studies. The battery volume OCCTO assumed when calculating FY2031 transmission congestion is 24.09 GW (connected, plus contracted units starting operation by the end of FY2031) — the largest figure we have been able to confirm on the state's side of the calculation.

We have divided the overseas figures by each region's peak demand. Australia's 49 GW (2050) exceeds the NEM's peak demand (about 35 GW). Britain's 23–27 GW (2030) is 40–50% of winter peak demand (the ratio moves with the choice of denominator). The reference dates differ — those are required volumes for 2030–2050, while Japan's is an actual at end-2025 — but Japan's connected volume stands at 0.4% of peak demand. Two orders of magnitude apart.

How an investor should read this

The national plan has no required volume; what it has is a range of outlook and separate calculations by purpose. System operators abroad write down required volumes for 2030–2050, and when we divide them by each country's peak demand they come to between 40% and parity. Japan's connected volume at end-2025 is 0.4%. Because there is no national target, judgement rests on the figures each operator holds. The primary-source figures assembled in this series are the tool for that.

The questions in this series

I. Why the grid ran without batteries in the past

II. Why thermal, nuclear and pumped storage are not enough

III. Where demand and the generation mix are heading

IV. The money, and what the state really wants

48-14Does the government actually want more batteries?
48-15What does battery storage resemble as an infrastructure investment?
48-16They say the earnings will thin out. Is that true?
48-17Can you copy the overseas playbook and make money in Japan?
48-18How much battery storage will Japan ultimately need? (this article)
48-19Is a battery the same wherever you put it?

The one question beyond the 1848-20 What do you pay, and what comes back?The answer differs by project, so we have built a calculator whose dials are made only from published figures. You can move unit price, clearing rate, seat fee, arbitrage spread and construction cost yourself.

Sources

Agency for Natural Resources and Energy, "Outlook for Energy Supply and Demand in FY2040 (supporting materials)," Cabinet decision of 18 February 2025 (no required storage volume stated); Cabinet Secretariat, "Outline of the GX 2040 Vision," February 2025; 2nd Distributed Energy Promotion Strategy WG, minutes and Material 5, 6 March 2026 (supply-side resources, FY2040: 2.8–10 GW; contract applications exceeding the outlook); OCCTO, 103rd Wide-Area Grid Development Committee, Material 3, 1 September 2026, p.56 (FY2031 assumption: 24.09 GW of batteries)
RITE, "Analysis of Japan's Energy Supply and Demand Towards 2050 Carbon Neutrality," 68th Basic Policy Subcommittee, 25 December 2024 (the model computes a supply-demand balance that always holds)
OCCTO, "Capacity Market Main Auction Clearing Results (FY2028)," 29 January 2025, Material 3-1 (expected capacity; adjustment coefficients for batteries); Agency for Natural Resources and Energy, Grid WG, Material 1, 2 December 2024 (method for estimating the curtailment outlook: 10% of minimum demand for six hours)
Battery Industry Strategy, 31 August 2022; "Battery and Power Source Industry Strategy," 2 June 2026 (target manufacturing capacity 150 GWh a year; pipeline on decided investments over 100 GWh a year)
AEMO, 2024 Integrated System Plan (49 GW / 646 GWh; 3.7 GW / 10.8 GWh today); NESO, Clean Power 2030, 5 November 2024 (23–27 GW); Bundesnetzagentur, Netzentwicklungsplan Strom Version 2025 (2045: approx. 55 GW / 136 GWh); European Commission, Electrification Action Plan, 17 July 2026 (200 GW and 500 GW); CPUC, IRP 2023 Preferred System Plan, 15 February 2024 (18.5 GW)
Agency for Natural Resources and Energy, 9th Next-Generation Power Grid WG, 27 March 2026 (connection-study intake approx. 172 GW); OCCTO, "Overview of Electricity Supply-Demand and Power Systems: FY2024 Results" (winter peak demand 147.84 GW)

Supervised by

Shinya Nakashima(Representative Director, Science X Inc.; Ph.D. in Engineering)

Works on the development, sale and technical due diligence of grid-scale battery storage plants. This column is written and supervised on the basis of hands-on transaction and evaluation practice.