Japan’s demand for energy storage and batteries to power electric motors is likely to see substantial growth over this and the next decade. But China’s cheaper labor, looser eco standards and dominance of rare earth mining means Japan can’t produce today’s battery tech at competitive prices, leaving it vulnerable to global supply chains.

To reduce this reliance — which could end up being a repeat of the country’s long, ongoing history with fossil fuels and then solar panels — Japan is trying to side step the current battery landscape by focusing on the recycling of today’s lithium battery models while speeding ahead on solid-state battery (SSB) development. Through the drafting of best practices for reuse, Japan is also attempting to establish itself as a leader in international standards for energy storage safety and reliability.

This is taking shape through multiple collaborations between Japanese end-users and domestic and foreign manufactures, as well as targeted state support like the METI-funded National Institute of Technology and Evaluation (NITE), which runs the National LABoratory for Advanced Energy Storage Technologies (NLAB) in Osaka, the world’s largest battery testing facility.

Although the strategy is tacit acknowledgement by Japan that it has been surpassed in the current market — partly because of a weak upstream supply chain, there is reason for optimism. Japan far outshines any other country in terms of published SSB patents. And major automakers, like Toyota Motor and Nissan, have recently announced ambitious plans for the mass production of all-solid-state EVs, to be on the market as early as 2027. Meanwhile, NLAB conducted its first SSB tests this March.

If Japan’s recent partnerships can surpass the tech challenges of scaled SSB production and affordability, it should become a major player in the next-generation battery market — for both EVs and BESS.