Sumitomo has announced plans to significantly increase its battery storage capacity in Japan, aiming to install over 500 megawatts (MW) by March 2031, up from the current 9 MW. This initiative is part of the company's broader efforts to support Japan's transition to renewable energy and decarbonization goals.
As Japan seeks to expand its renewable energy sources to enhance energy security and meet decarbonization targets, the demand for battery storage is expected to rise. Battery storage plays a crucial role in mitigating the fluctuations in renewable energy supply, particularly from solar and wind sources.
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Shigenobu Hamada, head of Sumitomo's energy storage business unit, emphasized the company's commitment to stabilizing and decarbonizing the electricity system through the development and operation of large-scale battery storage facilities. He stated, “Our goal is to develop a competitive battery storage business by leveraging our proprietary operational systems.”
Sumitomo anticipates significant growth in Japan's local battery storage capacity, projecting an increase from 2 gigawatt hours (GWh) in 2023 to 40 GWh by 2030. Globally, battery storage capacity is expected to expand from 190 GWh to 2,206 GWh over the same period.
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While battery storage is rapidly expanding worldwide, Sumitomo acknowledges that Japan has lagged behind due to smaller price differences in the wholesale electricity market, making it challenging for storage developers to generate profits. However, the company believes that the Japanese market will gain momentum with government support and institutional changes, such as the development of a market for adjusting electricity supply and demand.
Sumitomo has already installed three energy storage facilities in Japan, including a 6 MW facility in Chitose, Hokkaido. The company plans to identify suitable sites for additional battery storage installations, targeting locations with a combined capacity of 1,700 MW.
