The second Long-Term Decarbonized Power Sources Auction (LTDA) confirmed the explosive growth of Japan’s battery energy storage (BESS) market, as such projects dominated both successful and unsuccessful bids.

The results underscore the technology’s growing role in enhancing grid flexibility and supporting the integration of variable renewables like wind and solar. Additionally, among the winners announced at the end of April were two pumped-storage hydro plants, one ammonia co-firing retrofit, and one adjustable hydro project.

In the FY2024 round, total bids reached 13.61 GW, with 6.34 GW — roughly 47% — awarded. Of this, 5.03 GW (worth ¥346.4 billion per year) went to projects ranging from BESS and thermal plant retrofits to other decarbonized solutions.

An additional 1.31 GW was secured by four dedicated LNG-fired plants under a separate category, reflecting the importance that energy planners put on LNG’s role as a lower-carbon, dispatchable power source.

The auction also reflects government willingness to help cover safety upgrades of nuclear plants, as four utilities secured awards for 3.15 GW. This is seen as progress in the effort to restart long-idled reactors such as Tomari NPP Unit 3 and Kashiwazaki-Kariwa NPP Unit 6.