Battery energy storage projects were among the major winners in Japan’s 3rd Long-Term Decarbonization Electricity Capacity Auction.  (Illustrative Photo; Photo Credit: Mike Mareen/Shutterstock.com)
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Japan Awards 1.25 GW Battery Storage in 3rd LTDA

OCCTO selects 19 battery storage projects in Japan’s 3rd long-term decarbonization auction as stricter rules reduce bidding capacity

Anu Bhambhani

  • Japan awarded about 1.25 GW of battery storage capacity across 19 projects in the FY2025 LTDA auction 

  • New auction rules excluded storage systems below 6 hours and tightened procurement and cybersecurity requirements, which impacted bids  

  • Battery storage made up around 29% of total awarded decarbonization capacity despite lower bid volumes 

The Organization for Cross-regional Coordination of Transmission Operators (OCCTO), in Japan, has awarded around 1.25 GW of battery energy storage system (BESS) capacity in the country’s 3rd Long-Term Decarbonization Electricity Capacity Auction (LTDA) for FY2025 

According to results released on May 13, 2026, the auction awarded a total of 7.3 GW across 32 projects, including battery storage, pumped hydro energy storage (PHES), nuclear, hydrogen, ammonia co-firing, biomass, and LNG-fired thermal plants.  

Battery storage represented about 29% of the total capacity awarded in the decarbonization category. 

Under revised FY2025 auction rules, storage projects with durations below 6 hours were excluded, while project categories were reorganized to separate lithium-ion batteries and PHES repowering from long-duration and non-lithium technologies. The updated rules also introduced tighter requirements for battery cell procurement and cybersecurity, according to Japan Energy Hub.  

As a result, battery storage bid capacity fell sharply to 2.73 GW from nearly 7 GW in the previous auction round. However, awarded storage capacity declined only slightly from 1.37 GW to 1.25 GW, including 551 MW of lithium-ion batteries and around 700 MW from other storage technologies. 

The auction also selected 2 pumped hydro projects. Beyond storage, nuclear projects secured the largest share of awards in the decarbonization category, while hydrogen-only thermal power plants also received LTDA contracts for the first time.  

In a separate LNG-fired thermal category, 4 projects – totaling about 3 GW – were selected, including projects from JERA, Hokuriku Electric Power, and Kyushu Electric Power. 

The list of winners in the auction is available here.