JAPAN Law and Practice Contributed by: Yutaro Fujimoto, Yurika Masakane, Hirokazu Tanaka and Yutaro Kato, Nagashima Ohno & Tsunematsu
Specified Electricity Wholesale Business (Tokutei Oroshikyokyu Jigyo) This is the aggregation business of small power sourc- es, including residential rooftop solar and batteries. Specified Electricity Wholesale Business operators sell such aggregated power wholesale to electricity retail business operators, etc (also referred to as an “Electricity Aggregation Business”). The Electricity Business Act has regulated this business since 1 April 2022, as it has much in common with the Electric- ity Generation Business, in that aggregated power is also an important power source for the national power system. General Electricity Transmission and Distribution Business (Ippan Sohaiden Jigyo) This operates and maintains an electricity transmis- sion and distribution network. A General Electricity Transmission and Distribution Business corresponds to the electricity transmission and distribution seg- ment of the business that each of the major utilities (including their wholly owned subsidiaries) has con- ducted and continues to conduct since its inception under the regional monopoly regime. General Electric- ity Transmission and Distribution Business operators (ie, TSOs) are also required to provide ancillary servic- es such as supply-demand adjustment and frequency control in their region. Electricity Distribution Business (Haiden Jigyo) This has also been a regulated business since 1 April 2022. It handles the operation and maintenance of a certain portion of the electricity distribution network in the service area of a TSO. While the General Electric- ity Transmission and Distribution Business covers the electricity distribution business in Japan, the Electric- ity Business Act allows a TSO to transfer or lease a part of its facilities in its service area to an Electricity Distribution Business operator (ie, a distribution sys- tem operator or DSO). DSOs are also required to pro- vide ancillary services in their area. Electricity Transmission Business (Soden Jigyo) This business transmits electricity to a TSO through transmission lines that the Electricity Transmission Business operator operates and maintains on its own. Unlike a TSO and a DSO, an Electricity Transmission
Business operator is not responsible for providing ancillary services as provided by TSOs and DSOs. Specified Electricity Transmission and Distribution Business (Tokutei Sohaiden Jigyo) The Specified Electricity Transmission and Distribu- tion Business operator is allowed to sell electricity on its own network to consumers within a certain limited geographical area. Electricity Retail Business (Kouri Denki Jigyo) This business sells electricity to consumers. 1.2 Principal State-Owned or Investor-Owned Entities All the major utilities are investor-owned companies with one exception: Tokyo Electric Power Company Holdings. More than 50% of this major utility’s shares are held by the Nuclear Damage Compensation and Decommissioning Facilitation Corporation – a quasi- government institution that receives half of its capital from the government and which was established in response to the Fukushima nuclear incident in 2011. All the major utilities are listed on a stock exchange in Japan and their stock is freely traded in the market. Generation As of May 2026, there were more than 1,000 Electricity Generation Business licence holders. The principal Electricity Generation Business opera- tors are the major utilities or their wholly owned sub- sidiaries and J-Power. As of May 2026, there were also 145 Specified Elec- tricity Wholesale Business licence holders. Transmission and Distribution As of March 2026, there were ten TSOs, three Elec- tricity Transmission Business licence holders and 51 Specified Electricity Transmission and Distribution Business licence holders. At the time of writing, there were no DSOs. The main transmission and/or distribution network operators are the major utilities or their wholly owned subsidiaries, as well as J-Power Transmission Net- work Co, Ltd.
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