Japan has a population with high density in cities, which makes the Japanese market highly challenging in comparison with other countries. For instance, if near-shore and offshore installations could be used for wind energy. Offshore applications are more expensive because the construction costs are high. However, it is often the case that the wind is significantly stronger offshore, which could counteract any of the higher expenses. Additionally, equipment itself is improving. The price, measured in kilowatt-hour being produced, will be lower, since turbines will be more efficient. Therefore, there is an increased interest in wind energy. When compared to additional renewable energy sources, wind is highly competitive today. The largest wind turbine manufacturer in the world, Vestas wind systems, is highly involved in capital investments in Japan for the purpose of enhancing its generating capacity power from wind turbines.

World War II taught Japan to not become dependent on energy supplies from foreign nations, as the their oil supply lines were destroyed. Japan truly needs to produce energy by itself, and since its an island nation with relatively few natural resources requires constant flow of foreign investment as well as technological innovation.

Energy production using what is known as mini and microhydroelectric power plants are also gaining traction in Japan. The country has many streams and rivers, which are ideally suited for constructing such microhydroelectric plants, as are defined by the New Energy and Industrial Technology Development Organization to be producing an output reaching a maximum a hundred kilowatts. In comparison, minihydroelectric power plants can produce up to a maximum of a thousand kilowatts of electrical energy.

The smaller-scaled mini- and the micro-hydroelectric plants have been designated originally as suitable for production of electricity only in mountainous regions, but they have now, through innovation, come to be regarded as ideal for Japanese urban areas also. For example, Kawasaki City Waterworks and Tokyo Electric Power Company have already begun the implementation and development of small-scale hydroelectric power plants inside several Japanese cities.