Japan power, auto parts: Grid storage battery market

Research evidence excerpt

Japan power, auto parts: Grid storage battery market

Japan power, auto parts: Grid storage battery Global Markets Research

market 26 June 2026

EQUITY: JAPAN UTILITIES

We forecast earnings growth, particularly in supply-demand Research Analysts

adjustment market Japan utilities & oil

Shinichi Yamazaki - NSC

Faster moves into energy storage as means of expanding electric power shinichi.yamazaki.a3@nomura.com

market, using EVs as mobile storage batteries +81 3 6703 1133

Japan autos & auto parts

Storage battery businesses generating income from supply-demand adjustment Wataru Ishimoto - NSCmarket wataru.ishimoto@nomura.com

Storage battery businesses generate earnings in three ways: arbitrage in the wholesale +81 3 6703 1802

market for electric power (Japan Electric Power Exchange; JEPX), providing adjustment

capacity in the supply-demand adjustment market, and participating in the capacity

market. The supply-demand adjustment market in particular is a good match for storage

batteries, given the need for storing or discharging electricity in a short space of time, and

selling prices are high too. The decline in battery prices and the expansion of electricity

markets since the 2010s has resulted in a rapid increase in entrants into the storage

battery market. Grid-connected storage batteries totaled roughly 640MW as of end-

December 2025, while the pipeline of battery projects for which connection study

applications or connection contract applications had been made stood at some

202,000MW, equivalent to over 50% of power generating capacity in Japan. That said,

margins in the supply-demand adjustment market have been falling from previous highs

owing to a string of rule revisions. We expect margins to fall further as rules change, and