Japan: ‘Fresh, Unsaturated BESS Market’ Says GridBeyond
Energy storage is rapidly evolving in Japan, presenting promising opportunities according to GridBeyond’s Director of Market Optimisation. The Ireland-based energy resource manager, in collaboration with its Japanese partner Port Inc., announced their first joint project on June 26, 2025.
Port Inc., which provides contract services to electricity and gas companies in Japan, is finalizing approximately 900,000 contracts annually. Earlier this year, the company officially registered as an energy storage business with regulators after initially registering as a power generation entity. Recent regulatory changes have opened up Japan’s electricity markets, allowing energy storage asset operators to participate under new definitions. To support its clients in electricity procurement from storage facilities, Port Inc. has developed three equally sized battery energy storage systems (BESS) with a capacity of 2MW/8MWh (4-hour duration). Two of these facilities, located in Gunma Prefecture about 100 km north of Tokyo, commenced commercial operation earlier this month, while preparations for the third site are underway.
GridBeyond, leveraging its AI-driven platforms and forecasting capabilities, aggregates and optimises the management of approximately 2GW of battery storage assets across various markets, including CAISO (California) and ERCOT (Texas) in the United States, as well as in the UK and Ireland. The company has initiated energy trading from one of the 2MW front-of-the-meter BESS projects in Gunma. A launch event was held this week in Tokyo at the Embassy of Ireland, attended by Ireland’s Minister for Enterprise, Tourism and Employment, Peter Burke. Port Inc. President and CEO Hirofumi Kasuga stated, “Our collaboration with GridBeyond transcends a technical partnership—it creates new potential for the energy market as a whole.” He noted that this initial deal represents a significant step toward large-scale battery deployment in Japan, with plans for further collaboration between 2025 and 2028.
In discussions with Energy-Storage.news prior to the announcement, GridBeyond’s Ali Karimian highlighted the untapped potential of Japan’s market. “Currently, we see the market as very fresh and far from saturation,” Karimian said. “One key reason for this is the limited number of players involved. The market has only recently opened up for ancillary services, making it a new landscape.” Last year, GridBeyond developed its first proof-of-concept bid optimizer for the Japanese market, demonstrating the capability to simulate market participation for potential customers and partners. Although the battery projects presented by GridBeyond’s sales team are smaller than those in the U.S. or Europe, Karimian expressed optimism about the opportunities. “Returns have been remarkable,” he noted, largely driven by ancillary services pricing.
The ancillary services market in Japan is attracting participants due to its high clearing prices and ‘pay-as-bid’ auction system, unlike ‘pay-as-clear’ systems elsewhere. Furthermore, similar to markets in the UK, ERCOT, or CAISO, the Japanese BESS market allows for revenue stacking, enabling participation in other markets alongside ancillary services. There are also contracted revenue opportunities available through the Long Term Decarbonization Auction (LTDA) capacity market, as well as incentive programs from both the national government and the Tokyo Metropolitan Government that offer significant capital expenditure support.
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