Japan Solar Energy Market Size, Share, Trends and Forecast by Deployment, Application, and Region, 2026-2034

The Japan solar energy market size was valued at USD 6.5 Billion in 2025. Looking forward, IMARC Group estimates the market to reach USD 12.9 Billion by 2034, exhibiting a CAGR of 7.89% from 2026-2034. The market in Japan is primarily driven by the growing demand for sustainable energy, adoption of advanced storage solutions, policies favoring renewable initiatives, flexible innovations in solar cells, interest in decentralized power systems, incentives for net-zero energy buildings, attainment of energy independence, and rising investment in large-scale photovoltaic developments.

The Japan solar energy market share is significantly expanding due to the government's support through various policies and incentives such as feed-in tariffs and subsidies that promote the usage of solar power systems in residential, commercial, and industrial sectors. Furthermore, with Japan's ambition to achieve carbon neutrality by 2050, the government is now pushing renewable energy efforts, of which solar power is one of the main factors. For instance, in May 2024, Japan's Ministry of Economy, Trade and Industry launched a public-private consortium that comprises 150 organizations, such as Toshiba and Sekisui Chemical, along with local governments, to advance the commercialization of flexible perovskite solar panels. These lightweight and flexible solar cells can be installed on various surfaces. The consortium plans to make capacity targets for perovskite solar cells by 2040, and estimated statistics suggest that the capacity can amount to 38.3 GW, which would cross the capacity of conventional photovoltaic panels by 2050.

In addition, escalating consumer awareness regarding environmental sustainability is fostering the demand for clean energy solutions, thereby supporting the Japan solar energy market growth. In addition, the limited availability of land in Japan is encouraging floating solar farms, which efficiently make use of space and increase yield from energy. For example, on August 2, 2024, a report indicated that the existing feed-in tariff (FIT) and feed-in premium (FIP) schemes have made it easy to install rooftop solar panels on residential buildings by exempting their owners from participating in the FIT/FIP bidding processes. Such schemes aim at promoting the use of solar energy through easier installation and reduced costs. Besides this, incentives for building net-zero energy houses (ZEH) that operate at net zero energy consumption through improved efficiency and solar power generation are further strengthening the market.

Japan Solar Energy Market Trends:

Integration of Energy Storage System

The growth of solar power has led to the need for energy storage solutions to manage the inconsistent nature of renewable energy. For instance, on June 5, 2024, Sumitomo Corporation announced its plans to increase its battery storage capacity in Japan from the current 9 megawatts (MW) to over 500 MW by March 2031. This initiative aims to stabilize renewable energy output, improve grid reliability, and assist Japan in moving towards a more sustainable energy system. Furthermore, Japanese research institutions are leading the development of next-generation lithium-sulphur and solid-state battery technologies that promise higher energy densities and longer lifetimes. These developments will lead to better large-scale storage implementations that improve the overall efficiency of energy use. In addition, the integration of energy storage with AI-driven management systems has led to more precise load balancing, reduced energy waste, and optimized peak demand management.

Development of Space-Based Solar Power (SBSP) Systems

Japan is making significant progress in space-based solar power (SBSP) technology, with the goal of capturing solar energy directly from space. As of April 19, 2024, the Japan aerospace exploration agency (JAXA) has revealed plans for a demonstration in 2025, which will feature a 180-kilogram satellite in low Earth orbit, that will transmit almost 1 kilowatt of power from the altitude of 400 kilometers, or 250 miles. This innovative initiative involves launching satellites equipped with cutting-edge solar panels to gather solar energy and send it back to Earth using microwaves. Unlike traditional solar systems, SBSP provides a constant and abundant energy supply not affected by weather or time of day, making it a reliable and sustainable source of energy. Apart from demonstrating the technology, this project aims to assess the feasibility of large-scale SBSP systems and address key challenges such as efficiency, safety, and cost-effectiveness. Besides that, Japan is actively investing in joint research and development initiatives to develop SBSP technology. Innovations in wireless energy transmission and advanced materials for solar panels are enhancing the efficiency and life of these systems.

Corporate Commitment to Renewable Energy

Corporations in Japan are increasingly turning to renewable energy, motivated by the country's sustainability objectives and new regulations regarding renewable energy usage. A prominent example of this transition is the RE100 initiative, which, on June 24, 2024, called for Japan to expand its installed renewable electricity capacity from 121 gigawatts in 2022 to 363 gigawatts by 2035. To achieve this ambitious target, RE100 recommended critical measures, including the streamlining of project approval processes, enhancement of grid connectivity, and the mobilization of approximately 18 trillion yen in public and private investments between 2025 and 2030. Companies are integrating renewable energy into their supply chains to meet operational needs and promote carbon neutrality. Large-scale power purchase agreements are gaining popularity, allowing businesses to secure renewable energy at competitive prices while supporting the development of new energy projects. In addition to this, new on-site solar installations and energy-efficient infrastructure are emerging as integral parts of corporate strategies, reflected by their commitment to sustainable practices.

Japan Solar Energy Industry Segmentation:

Analysis by Deployment:

• Rooftop
• Ground-mounted

Rooftop solar installations are crucial in Japan's solar energy landscape, primarily due to the scarcity of land and the growing desire for energy independence among both residential and commercial sectors. These systems effectively utilize urban areas and help lower energy expenses for homes and businesses. Government incentives, such as feed-in tariffs, have encouraged widespread adoption, making rooftop solar an attractive and viable option for sustainable energy production.

Ground-mounted solar installations are essential for addressing Japan's substantial energy needs. Typically located in rural or underutilized industrial areas, these setups contribute significantly to the country's renewable energy goals. Their ability to scale and produce more energy than rooftop systems make them ideal for large utility projects. These installations support Japan's efforts to diversify its energy sources while improving grid reliability and decreasing reliance on imported fuels.

Analysis by Application:

• Residential
• Commercial and Industrial
• Utility-scale

Residential solar energy systems play a significant role in Japan's solar market as homeowners seek a means of achieving energy independence and saving on costs. Subsidized by the government and supported by tax incentives, residential solar energy systems are finding wider acceptance in urban and suburban settings. They complement the country's sustainability targets, allowing households to add to the energy grid and provide a reliable decentralized energy supply that is part of Japan's long-term renewable energy goals.

Solar applications in the commercial and industrial sectors are necessary to enable businesses to lower their operational energy costs. These installations rely on large rooftops and unused land to generate high energy, enabling companies to achieve their sustainability goals and reduce their carbon footprint. This sector will be one of the main drivers for guiding Japan's economy towards a cleaner and more energy-efficient future as companies turn to renewable strategies to comply with environmental regulations.

Utility-scale solar installations play a big role in Japan's large-scale renewable energy strategy. These generally sit in rural or otherwise underutilized locations and often add substantially to the grid with high-capacity power output. It is useful for solving Japan's power deficit and saving the consumption of imported fossil fuels. Utility-scale applications are imperative for achieving the ambitious target of renewable energy in the country and securing its energy safety.

Regional Analysis:

• Kanto Region
• Kansai/Kinki Region
• Central/ Chubu Region
• Kyushu-Okinawa Region
• Tohoku Region
• Chugoku Region
• Hokkaido Region
• Shikoku Region

The Kanto region, where Tokyo is the capital, is one of the most prominent areas of Japan's solar energy market as it has a high population density and strong energy consumption. Urban regions are mainly dominated by rooftop installations, with government incentives and corporate investments. The Kanto region is a significant economic zone that looks towards clean energy alternatives to reduce its ecological footprint and guarantee continuous power supply in the wake of increased urbanization.

Kansai region, which has Osaka and Kyoto, is very important for Japan in its solar energy development. The industrial and commercial applications of solar energy are prominent in this region due to regional economic activities. As electricity demand is high, Kansai focuses on utility-scale projects and energy efficiency initiatives. The region's commitment to sustainability matches with its historical emphasis on innovation and environmental stewardship.

The Chubu region, with Nagoya at its center, is a major industrial hub in Japan's solar landscape. Solar installations in manufacturing facilities and industrial zones are on the rise, mirroring the region's demand for alternative energy solutions. Its location and geography make it suitable for a combination of rooftop and ground-mounted solar projects that will further increase its contributions to national energy goals.

The Kyushu-Okinawa region receives plenty of sunlight, but many utility-scale solar farms crowd the landscape. The regional initiatives and favorable climatic conditions promote the region on renewable energy while offering energy independence to its islands and, reducing reliance on imported fossil fuels and developing it to represent Japan's leadership in clean energy transition.

The Tohoku region, with its vast land availability, supports large-scale solar projects, particularly in rural areas. Post-2011 earthquake recovery efforts have intensified renewable energy investments here, with solar energy serving as a cornerstone for sustainable redevelopment. The region's contributions are pivotal in diversifying Japan's energy mix and achieving long-term environmental goals.

The relatively low population density in the Chugoku region allows for utility-scale solar farms. Its location, combined with regional support for renewable initiatives, contributes to the national grid. Ground-mounted solar installations predominate and correspond to a region focused on using unused land for clean energy production and increasing economic activities.

Hokkaido's vast open spaces are well-suited for large-scale solar farms, even though the region is relatively cold. Ground-mounted solar farms find a good home here, with regional initiatives to expand renewable energy capacity. The sustainability focuses in the region contributes to meeting energy needs in Japan's northernmost regions while also serving the national agenda of having a diversified energy mix.

The Shikoku area takes advantage of its sunny weather conditions with open spaces to focus solar energy development. Much development is residential and smaller, commercial-scale installations motivated by regional goals for energy independence. Adoptive efforts of renewable energies towards Shikoku strengthen their grip on Japan's effort into a sustainable energy future.

Competitive Landscape:

The solar energy market in Japan is highly competitive, characterized by a diverse array of domestic and international participants, fostering a competitive environment that drives innovation and cost reductions. Government policies, such as feed-in tariffs and renewable energy targets, have attracted numerous companies to invest in solar projects across various scales, from residential installations to large utility-scale developments. This competitive landscape has led to technological advancements and increased efficiency in solar energy production, contributing to Japan's transition towards a more sustainable energy mix. Japan's 22nd solar auction, concluded in November 2024, exemplifies the competitive dynamics of the market, with an allocation of 56.4 MW of photovoltaic capacity. The auction's lowest bid, priced at JPY 7.5 (USD 0.049) per kWh, reflects a continuing trend toward more cost-efficient solar energy solutions, underscoring advancements in technology and increasing market efficiency.

The report provides a comprehensive analysis of the competitive landscape in the Japan solar energy market with detailed profiles of all major companies.

Key Questions Answered in This Report

• 1.What is solar energy?
• 2.How big is the Japan solar energy market?
• 3.What is the expected growth rate of the Japan solar energy market during 2026-2034?
• 4.What are the key factors driving the Japan solar energy market