The report "Japan Microgrid Industry by Connectivity (Grid-connected, Off-grid), Offering (Power Generators, Controllers, Energy Storage, Software, Services), End User (Commercial & Industrial, Military, Utilities), Type, Power Rating & Geography - Global Forecast to 2027", published by MarketsandMarkets, Japan Microgrid Market to Grow at a CAGR 19.8% from 2022 to 2027
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Growing need for reliable power supply fueling the growth of microgrid market in Japan
According to Swiss Business Hub Japan 2022, the microgrid market in Japan will grow rapidly in the years to come which is driven by a combination of factors such as a growing demand for reliable and efficient energy supply, increasing use of renewable energy sources, and the need to improve energy resilience and security. Also, several pilot projects, often involving public-private partnerships, have been subsidized by the government. Japan has relatively strict government regulations related to the utilization and deployment of distributed energy generation. The Japanese government has been promoting the development of microgrids through various policies and initiatives, such as the "Basic Energy Plan" and the "Green New Deal", which aim to encourage the integration of renewable energy sources, enhance energy efficiency, and improve the resilience and security of the energy system.
In addition, Japan has been facing energy challenges in the aftermath of the 2011 Fukushima disaster, which highlighted the need for a more resilient and secure energy system. For over a decade, an energy revolution has been underway in Japan, spurred on by the 2011 Great East Japan earthquake and tsunami. Since then, dozens of microgrids have sprung up across the country to help Japan meet its energy needs and build resilience. The Japanese city of Higashi Matsushima, which was severely impacted by the 2011 earthquake and tsunami, decided to rebuild its energy infrastructure using microgrids and decentralized power. Following the disaster, the city faced significant challenges in restoring its energy infrastructure, as the traditional centralized power system was not resilient to natural disasters. In response, the city decided to adopt a more resilient and decentralized energy system based on microgrids. The microgrid system in Higashi Matsushima consists of a network of small-scale power generation units, including solar panels and wind turbines, which are connected to a local grid. The system can operate independently of the main grid, providing a reliable and resilient source of power in the event of a disruption to the main grid. The microgrid system has also enabled the city to promote the use of renewable energy sources, reduce its carbon footprint, and lower its energy costs. The city has been recognized for its innovative approach to energy management and has become a model for other communities in Japan and around the world.
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Aichi, Kyoto, and Hachinohe were the first microgrids in Japan, initiated by the New Energy and Industrial Technology Development Organization in 2003. As of 2018, there are approximately 40 microgrids in Japan. Since the 2011 disaster, the number of grids has undoubtedly increased. 94% of the nation's energy needs are now met by fossil fuel imports, and despite intentions to restart many of its reactors, progress has been slow. Japan is also investing in its commercial and industrial sectors to ensure energy security and meet the country’s increasing energy demand. Microgrids can provide a reliable and decentralized energy supply, which can help to improve the resilience and security of the energy system. This has led to an increase in the adoption of microgrids, thereby fueling the growth of the microgrid market in Japan.