This is the fifth and final article in a series of reports about Japan's energy policy.

In the first four parts of this series, I mainly outlined the current state and challenges facing the supply side of energy. But reflecting the growing popularity of the sharing economy and progress in digitization, we are going to see a sea change in how we use energy. In the last entry in this series, I'd like to think about both the supply and demand sides of Japan's energy, which is at a major turning point.

The catalyst for drastic change in Japan's energy and environmental policies is the Fukushima No. 1 nuclear power plant disaster that started in 2011. Until then, the government had focused on raising the ratio of nuclear power generation to tackle the burgeoning crisis of global warming, but the disaster brought an abrupt about-face, with Tokyo now seeking to reduce reliance on nuclear power as much as possible. In addition, the government has deregulated the postwar power industry structure under which regional power monopolies had dominated the supply chain from generation to retail. The deregulation still requires more revisions, but it is hoped that the paradigm shift under which the adjustments of supply and demand are now entrusted to the market economy rather than the monopolies-led supply chain will be an important starting point for future reform. And in a new environment with a completely liberalized market, Japan has to work through the following four changes.