Tokyo-based power company Looop will instal the first solar power plant with its own battery storage in the Philippines, as it and other smaller energy firms seek profits outside of Japan’s turbulent market.
Looop will spend about 3 billion yen ($20.32 million) on the facility, located in the province of Ilocos Norte on the northern island of Luzon. Looop is a “new power company,” an energy business other than Japan’s 10 major power retailers. It mainly sells power to households while also handling battery and renewable energy development projects.
The solar plant in the Philippines will have a generation capacity of 30,000 kilowatts. The facility will begin supplying half of that amount by the end of the year, with the remaining 15,000 kW coming online in March 2026. Looop estimates the plant will be able to supply 40,000 kilowatt-hours annually, equivalent to the electricity consumed by 16,000 Philippine households.
Electricity prices in the Philippine power market are reportedly unstable. Looop’s plant will bypass the market, selling electricity directly to Philippine power companies at a fixed price. The facility will also house batteries capable of storing about 4,400 kWh, enabling solar power to be supplied in a stable manner.
The company plans to raise the overseas share of its total profits to between 20% and 25% from the current 5% by 2030. It aims to pursue projects of a similar scale in Malaysia, Thailand and Vietnam.
Looop plans to raise the overseas share of its total profits to between 20% and 25% from the current 5% by 2030.
“Compared with out past overseas projects, the Philippines one is much bigger and the technical requirements are much more rigorous,” said Takumi Morita, the executive at Looop who handles overseas operations. “The key will be how many projects of this kind we can secure going forward.”
The company plans to be competitive by developing expertise in installing solar power facilities with batteries suited to the local environment.
Investment in renewable energy in emerging countries like the Philippines is growing every year. In the Philippines, coal-fired power accounts for about 60% of the total mix. The government is promoting investment in renewable energy, creating opportunities for smaller, more flexible new power companies.
Renewable energy will account for 85% of power generation in South Asia and 95% in sub-Saharan Africa by 2050, according to a forecast by the International Renewable Energy Agency. That is three to four times greater than in 2017.
Multiple new power companies are expanding into emerging markets. In 2023, Tokyo-based Updater installed a 20-kW solar facility at a corn processing plant in Tanzania and began supplying power there. In July, it launched a project at a local coffee farm in which it installed solar panels and batteries and began selling power to the farm at a fixed price for 10 years.
“We want to advance renewable energy projects in places like Tanzania, where demand for electricity is growing,” said a representative from Updater. “As a new power company, we want to find business opportunities outside of the retail sale of electricity.”
Erex, another Japanese firm, is developing biomass power plants with a total capacity of 120,000 kW in Vietnam. It is also working on biomass projects in Cambodia. The company is using Japan’s Joint Crediting Mechanism, under which reductions in carbon dioxide emissions in emerging countries are partially counted as reductions in Japan.
“Biomass power generation also helps create local jobs,” said an Erex representative. “There is also the support of the Vietnamese government, so we see good opportunities there.”
Leveraging its overseas expansion, the company aims to grow its pretax profits to a range of 19 billion yen to 20 billion yen in the fiscal year ending March 2030, up from 6.3 billion in that ended March 2025.
Business conditions are volatile for new power companies focused on sales within Japan. The Ministry of Economy, Trade and Industry has indicated plans to require power retailers to secure medium- to long-term contracts, and regulations change frequently. Geopolitical factors are also driving up procurement costs for electricity in Japan, risking a squeeze on profits. Amid these uncertain domestic market conditions, companies are looking for new revenue streams overseas to drive growth.
This article was first published in Nikkei Asia.
