Work

Performance and Policy Implications of Retail Electricity Market Liberalization in Japan under the Energy Crisis

Year: 2026

Type: article

Abstract: This study evaluates liberalization of Japan's retail electricity market, using the 2022 global energy crisis as a "stress test" alongside the government's 2025 verification results.While liberalization successfully expanded consumer choice, the crisis exposed critical structural vulnerabilities in market design.The analysis reveals that the heavy reliance of new entrants on spot markets and asymmetric procurement structures, compared with incumbent utilities, led to significant instability.Furthermore, the coexistence of regulated and liberalized tariffs distorted price signals during the crisis.The findings indicate that retail competition alone cannot ensure price stability or supply resilience during severe external shocks.Japan's experience highlights that sustainable market reform requires not only deregulation but also robust procurement mechanisms, rational tariff design, and strong regulatory governance to function effectively under crisis conditions.

Source: Journal of the Korean Society of Mineral and Energy Resources Engineers

DOI: 10.32390/ksmer.2026.63.1.183

Authors: Yunji Her, Yeonjei Jung

Institutions: Dankook University, Seoul National University of Science and Technology

Language: English

Topic: Electric Power System Optimization

Subfield: Electrical and Electronic Engineering

Field: Engineering

Domain: Physical Sciences

SDG: Affordable and clean energy

Open Access status: diamond

OpenAlex ID: W7134258275