Publication date: Sept 26, 2025

Retail Market Entry Begins with OCCTO Membership

Japan fully liberalized its electricity retail market in April 2016, opening its doors to new entrants for the first time. Foreign companies can participate, but only through a locally incorporated entity that obtains a retail electricity license from the Ministry of Economy, Trade and Industry (METI). As Japan does not issue a separate trading license, the retail license also serves as the standard route for participating in JEPXas a power trader.

One of the first steps toward obtaining a retail license is to apply for membershipwith the Organization for Cross-regional Coordination of Transmission Operators (OCCTO).

OCCTO serves as the central body in Japan’s power market, responsible for nationwide supply-demand balancing and the development of cross-regional transmission infrastructure. The OCCTO membership allows companies to apply for access to the OCCTO System, where retailers and generators submit mandatory supply and demand plans. Membership also enables retailers to secure wheeling agreementswith transmission system operators (TSOs) and subsequently to apply for JEPX membership.

The preliminary application for OCCTO membership needs to be completed prior to applying for a METI retail license. Once the license is granted, the retailer is required to submit a membership notification to OCCTO.

Retail Market Entry Begins with OCCTO Membership

Overcoming Entry Barriers

Navigating the retail market entry process as a foreign entrant presents various challenges beyond just the regulatory framework. The language barrier, the highly formalized application style, and the nuances of business culture in Japan often require careful handling to avoid missteps or delays. Based on Shulman Advisory’s experience, the process can take anywhere between 6 to 24 months, depending on the complexity of the application and the responsiveness of the regulators. This is where expert consultation becomes critical to streamline processes, be proactive in anticipation of common pitfalls, and maintain momentum toward license approval.