Tokyo-based energy management specialist NextDrive K.K. and Fukuoka-based Shizen Operations Inc. (asset management and operations and maintenance (O&M) service provider)have signed a memorandum of understanding to form a strategic partnership aimed at expanding grid-scale battery energy storage system operations throughout Japan, with a shared ambition to acquire 100 megawatts of projects over the next three years.

Partnership Structure and Role Division

The agreement, announced on September 16, 2026, brings together two companies with distinct but complementary capabilities. NextDrive, led by CEO Jeryuan Yan, will take the lead on project acquisition, development, construction, and financing, drawing on what the company describes as an extensive investor network.

Shizen Operations, whose representative director is Shinsuke Ojima and which operates as a group company of Shizen Energy Inc., will support the acquisition phase through domestic due diligence and will then provide long-term asset management and operations and maintenance services once projects reach commercial operation.

Once assets are live, NextDrive will serve as the aggregator, applying optimized bidding algorithms to maximize revenue from the systems. Shizen Operations will focus on maintaining reliable day-to-day performance of the physical assets and supporting long-term stewardship.

The joint initiative will target project rights acquisition across six of Japan's major regional power grid areas: Tohoku, Tokyo, Chubu, Kansai, Chugoku, and Kyushu. The business model has been described as designed for rapid capital deployment, leveraging NextDrive's fundraising capability and investor relationships.

What Each Company Brings to the Table

NextDrive currently has battery energy storage projects totaling 30 megawatts either operational or under development in Japan. The company operates an energy management platform that connects grid, commercial, industrial, and residential energy resources, and provides energy trading solutions focused on distributed energy resources. It operates across Japan, Taiwan, and the broader Asian region.

Shizen Operations was established in May 2013 and has built a track record managing approximately 680 megawatts in asset management capacity and more than one gigawatt in cumulative operations and maintenance management across Japanese renewable energy assets, spanning solar, wind, and energy storage. The company describes its services as a fully integrated, one-stop solution for optimizing and maximizing the value of renewable energy plants.

Market Timing and the Co-Optimized Market

The partnership has been timed with a significant structural shift in Japan's electricity market. Starting in fiscal year 2027, Japan's electricity market is scheduled to transition to what is being called a co-optimized market, where energy supply and balancing capacity will be traded and optimized simultaneously rather than through separate mechanisms.

Both companies have cited this transition as a key driver behind the collaboration. Norihiro Suzuki, director of Shizen Operations, described the change as ushering in an era that demands sophisticated operational strategies.

He said the combination of NextDrive's control technology and capital structuring capabilities with Shizen Operations' asset and operations management expertise would allow the partnership to offer investors robust risk management alongside high returns.

For battery storage operators, successfully navigating the co-optimized market will require faster and more sophisticated bidding and control algorithms than have previously been necessary. NextDrive has positioned its technology platform as specifically suited to adapt to these dynamics.

Strategic Rationale and Investor Positioning

The partnership has framed its offering partly around accelerating market entry for institutional investors. The business model is structured so that investors can deploy capital quickly into battery storage assets that are already being developed and managed by experienced operators.

Jeryuan Yan, CEO of NextDrive, said that battery storage systems are becoming critical infrastructure supporting grid stability as renewable energy becomes a main power source.

He described the partnership with Shizen Operations as combining the core strengths of both companies to develop and operate grid-scale battery assets over the long term, and characterized the grid-scale battery business as a growth driver for NextDrive.

Suzuki of Shizen Operations echoed that framing, noting that the collaboration would allow the company to utilize its asset management and operations and maintenance expertise to stabilize energy infrastructure and contribute to decarbonization goals.

Broader Context for Japan's Battery Storage Market

Japan's renewable energy sector has been expanding steadily, and grid-scale battery storage has been identified as a critical component needed to support greater penetration of variable renewable generation such as solar and wind.

The shift to a co-optimized market structure from fiscal year 2027 onward is expected to significantly change the economics and operational requirements for battery storage assets, making sophisticated market participation capabilities increasingly valuable.

Shizen Operations' parent company, Shizen Energy Inc., is an established player in Japan's renewable energy sector, giving Shizen Operations access to a broader group ecosystem as it expands into the battery storage operations market alongside NextDrive.

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