In depth: Smart meters in a deregulated Japanese electricity market

Japan electricity reform starts with organisation to share electricity
Japan has begun the process of unbundling its electricity system in a bid to improve competition and introduce a higher volume of renewable energy into the grid

If a country needs a catalyst to reform its electrical system, then Japan’s was the earthquake that struck the east of the country in March 2011, followed by a 30-metre high tsunami that destabilised the Fukushima Daiichi Nuclear Power Plant, writes Rose Bundock, content editor of

The aftershocks of the natural disaster were felt in the energy sector with Japan’s largest utility Tokyo Electric Power Company (Tepco), manager of the nuclear power plant, hit by major outages followed by insufficient power generation and consequent climbing electricity prices.

The fragility of the country‘s electricity system and exposure to energy insecurity prompted Japan‘s government to devise an Energy Liberalisation plan, which kicks off this year. The unbundling of the traditional generation, transmission and distribution structure aims to ensure that electricity can more easily be shared between regions, that regional monopolies are broken keeping prices down, and consumers are encouraged to better understand their energy consumption as well as contribute to the grid as prosumers.

The deregulation timetable officially began in April with the creation of a nationwide grid management body. The Organization for Cross-Regional Coordination of Transmission Operators will marry up power supply with demand to ensure a reliable supply in all areas of the country in the event of a future natural disaster. All power suppliers are obliged to join the new body, which also has a remit to promote renewable energy.

The full opening up of the retail electricity market will follow in 2016, with regional utilities expected to spin off their power transmission and distribution sections into separate companies by 2020, in the final phase of…

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