The Starting Point: Japan’s Post-Fukushima Energy System
The Fukushima disaster fundamentally reshaped Japan’s energy system. Before 2011, nuclear power supplied roughly 30% of the country’s electricity generation [World Nuclear Association]. Following the shutdown of the nuclear fleet, thermal generation filled the gap, increasing reliance on imported LNG, coal and oil.
More than a decade later, Japan remains heavily dependent on fossil fuels, but the transition towards a more diversified energy mix is underway.
Japan’s Evolving Energy Mix
The past decade has seen steady growth in renewable energy, led by solar deployment under the Feed-in Tariff scheme. Solar capacity reached approximately 80 GW by 2024, while nuclear generation has gradually returned through reactor restarts, with around 28% of pre-Fukushima capacity back online by 2025 [Aurora, 2026].
Nevertheless, thermal generation currently still accounts for the majority of electricity generation.
Japan’s 7th Strategic Energy Plan outlines a significantly different future energy mix. By 2040, the government is targeting 40–50% renewable generation, around 20% nuclear generation and 30–40% thermal generation. Offshore wind is expected to become an increasingly important contributor, with operational capacity projected to reach around 20 GW by 2040 and approximately 40 GW over the longer term [AFRY, Aurora].
Taken together, these targets point towards a power system that is less dependent on imported fossil fuels and increasingly reliant on a combination of renewable and nuclear generation.
Lessons from Precedent Markets
While Japan’s energy transition has its own characteristics, the experiences of the UK and Australia provide insight into what may come next.
In the UK, renewables supplied more than half of electricity generation in 2025 following a decade of supportive policy and investment [UK Government Statistical Release, 2026]. Australia has followed a similarly rapid trajectory, with renewables and storage supplying more than half of National Electricity Market demand during parts of 2025 [Enerdata, 2026].
In both markets, the challenge evolved alongside the generation mix. Early investment focused on building renewable capacity, but as penetration increased, issues such as congestion, curtailment and wholesale price volatility became more prominent. The transition was no longer solely about adding generation, it was about adapting the wider power system to accommodate it.
Japan’s 7th Strategic Energy Plan points towards a similar shift. As renewables account for a larger share of electricity generation, the focus is likely to expand beyond generation capacity and towards the infrastructure needed to support it.
Balancing Decarbonisation, Reliability and Energy Security
Within Japan’s transition, decarbonisation is not the only objective. Energy security sits alongside it as an equal policy priority, a legacy of the import dependency that followed Fukushima.
This is reflected in Japan’s approach to thermal generation. Rather than pursuing a hard phase-out, policymakers are investing in ammonia co-firing, hydrogen co-firing and carbon capture technologies to reduce emissions from existing assets over time [AFRY, 2026]. This is a more gradual pathway than those pursued in the UK or Australia, but one that reflects Japan’s distinct starting point and the importance placed on system reliability.
What Japan’s Energy Transition Means for Energy Storage
As renewable energy becomes a larger share of Japan’s generation mix, the challenge will increasingly shift from building generation capacity to integrating it efficiently into the power system.
Battery energy storage will play a growing role in absorbing surplus renewable generation, reducing curtailment and supporting grid stability. The past decade has been defined by changes in how Japan generates electricity. The next decade is likely to be defined by how effectively that electricity can be balanced, stored and delivered.
Sources: AFRY 2026; Aurora Energy Research, 2026; World Nuclear Association; UK Department for Energy Security & Net Zero, Energy Trends, March 2026; National Energy System Operator (NESO), Britain’s Energy in 2025; Enerdata, 2026.