Japan aims to achieve “carbon neutrality” by balancing greenhouse gas emissions and absorption to zero by 2050. As companies in the industry face this issue, SIRC Co., Ltd. a startup from Osaka City University (currently Osaka Metropolitan University), is providing powerful solutions utilizing advanced sensing technology. Furthermore, they thought that a high-performance chip that can output current, power, angle, frequency, etc. in real time, which is the company's core technology, would be a trump card on the demand side in “demand response,” which contributes to leveling power supply output fluctuations, and J-POWER has been responsible for Japan's electricity supply for a long time.
What connected the two companies was “GRIC” one of the largest startup conferences in Japan, with the purpose of “Japan's startup ecosystem going global” hosted by ”for Startups, Inc.”. The two companies met at GRIC2023 repeated discussions, and announced a capital and business alliance and joint studies for the development of “measuring instruments for individual device measurement” which is a trump card for demand response, in August 2024. Co-creation of 5mm square chips filled with advanced technology and J-POWERS's abundant technology, capital, and markets is about to change the future of energy in Japan. We interviewed both companies about their encounters and initiatives.
SIRC Co., Ltd.
Mariko Takahashi, Representative Director and CEO
J-POWER (Electric Power Development Co., Ltd.)
Ryou Yamamoto, Assistant Manager, Planning Office, Innovation and New Business Development Department
for Startups, Inc.
Ryuta Majima, Open Innovation Dept. Conference Group
From Kansai to the world. Advanced sensing technology presented at GRIC
ーPlease tell me about SIRC's business.
Takahashi: We are a startup company from Osaka City University (currently Osaka Metropolitan University) that has a sensor chip named “SIRC Device” as the core technology. The “SIRC device” is an innovative sensor chip with the same function as an electric power meter attached to buildings, etc., and we have obtained a patent for this technology and are developing and selling products using SIRC devices. Currently, “IoT power sensor units” and “IoT angle sensor units” are mainly sold, and both can be retrofitted to existing equipment at manufacturing sites, and the feature is that they can be easily attached without modification to the equipment. The power sensor acquires the power value, and the angle sensor acquires the position of the needle on the analog meter and converts it into data. By easily visualizing this information on the cloud, we support our customers' efforts to decarbonize and improve work efficiency.
What we are putting particular emphasis on is problem solving for the theme of “decarbonization.” In recent years, the term “decarbonization” has been widely used, but since we provide products that can easily measure electricity, we are developing a BtoB business that supports effective decarbonization efforts, mainly for manufacturing customers.
Normally, the power consumption of a company or business site as a whole can be seen from electric power company statements, etc. However, even if we know the total amount, we don't know the breakdown of where that electricity is being used. Everyone is facing the challenge of not knowing exactly what to do even if they say carbon neutrality or decarbonization in that state. Therefore, by easily attaching our sensors, which can be retrofitted to measure electricity, to customers’ own equipment, machines, and devices, it is structured so that we can understand in real time how much electricity each facility or device consumes.
Furthermore, cloud services are provided as a means of eliminating the trouble of visualizing data and providing tips for reduction. If you use our “SIRC Cloud,” data collected by sensors is automatically graphed, waste of electricity can be discovered without hassle, and it is also equipped with a function to automatically calculate CO2 emissions.
ーThank you for explaining difficult topics in an easy-to-understand manner. J-POWER is a power generation and transmission company, but what does the Innovation Promotion Department do within it?
Yamamoto: The Innovation and New Business Development Division mainly invests in startup companies and develops new businesses. Speaking of why we are doing it, power generation from coal-fired power plants originally accounted for a large proportion of our power generation business. After all, in the current trend of a world called carbon neutrality, in simple terms, it is clear that coal-fired power generation, which earns our income, is shrinking, and it is necessary to start a replacement business. As a result, the Innovation Promotion Department was set up, and several new businesses have already started.
ーThank you very much. I've heard that GRIC triggered the capital and business alliance between SIRC and J-POWER. Please tell us about the circumstances of your participation.
Takahashi: We are based in Osaka, but when we participated in the university startup pitch event “U-START UP KANSAI Open Pitch” planned by KSII (Kansai Innovation Initiative, an organization that handles growth support for university startups), we were able to receive the “GROWTH INDUSTRY CONFERENCE Award” where you can get the right to speak at GRIC. Among the various awards, such as those that can be exhibited at the Kansai Expo, this was the one we wanted to get our hands on the most. This is because, after all, when working in Kansai, there aren't many opportunities to participate in big pitch events in Tokyo. I was so excited that I was happy to take that ticket back to the office.
Companies were selected for each theme at GRIC, and we took the stage in the “GREEN” theme with environmental themes such as decarbonization and carbon neutrality.
Majima: Let me add a little bit about KSII's efforts. Originally, KSII aimed to promote Kansai university startups to Tokyo and even to the world, so they had a passion for providing a “place to get involved” for Kansai startups. As a result, GRIC was also sponsored. We at GRIC also always talk about bringing “Japanese” startups to the world, and we do not just focus on Tokyo. We also hoped that people would gather from all over Japan, like KSII's efforts.
So, I was really happy that SIRC actually came to GRIC in 2023, and even an example of a capital and business alliance was born in this way, and I was so moved that I almost cried when I heard the story. I think it's a form that embodies the purpose of “bringing the Japanese startup ecosystem to global standards,” which is GRIC's purpose.
GRIC is a unique and meaningful pitch event where you can meet business companies
ーThe GRIC event you were looking forward to. How was your experience?
Takahashi: It was more amazing than I expected! First, investors often participate in other pitch events, but GRIC is very unique, and many people from business companies also came. Moreover, the “GREEN” pitch we participated in had themes such as decarbonization, etc., so when I heard about it later, it seems that people from various industries came. We're talking about visualizing electricity and saving energy, so it's not flashy, but I think it was a place where we were able to promote our company to business companies.
Furthermore, various business companies were interested in networking after that. There were also companies where people from the business department also attended on the same day and had specific interviews. I was also allowed to set up a booth, and KSII also did PR, so I met many corporates there as well.
Majima: In fact, I also heard that a famous overseas company brought in a person in charge of building infrastructure to meet with SIRC.
Takahashi: Thankfully, there were scenes like that too. I think it's very unusual for a pitch event that there are people who can make such decisions, and that practical people who actually run the site come. I was wondering if this was a characteristic of GRIC.
One of those companies was J-POWER. Yamamoto-san even went on the spot to talk a little bit further, saying, “You can use it for something like this,” but this is also quite unusual. In most cases, after the pitch, the scene often ends in the form of “I'm interested, so please tell me about the business once more” or “Let's have another interview” but Yamamoto even made suggestions. I thought “An amazing person came” and he left a strong impression on me. So at a later date, when I was on a business trip to Tokyo, I contacted them and visited him.
At that time, we also received simple proposals. The content was “I think it can be used for such a market,” which is a step ahead of the “measuring instrument for individual device measurement” to be jointly developed this time. I have also met many people, and during the first interview, I was surprised that it was unusual to meet someone who had thought so deeply and received specific suggestions, so I was listening to him.
ーWell, please be sure to tell me the story on J-POWERS's side too. It seems that they were on of the first attendees of GRIC.
Yamamoto: Yes. Actually, I went to GRIC looking for another company, and I happened to hear Takahashi CEO's pitch there, and it really matched my sense of challenge. I intuited that “individual device measurement,” which is also the theme of the joint study that was released recently, could be done, so I went to the booth after the pitch. We listened to a lot of stories and talked about our thoughts, and we talked about wanting to do it together.
Speaking of why I came so quickly, it was right after I was transferred to the Innovation and New Business Development Department, and before the transfer, I was launching power services on the consumer side, such as demand response and retail sales of electricity. Demand response, in particular, had a lot of business issues and issues within me, so I found something that fits perfectly with those issues!
ーCould you tell us again about “demand response”? What were the issues, and how did you think SIRC's products would match?
Yamamoto: To explain this in detail, demand and supply of electricity must match at the same time, so that balance is always achieved, but in the past, when demand increased, power plants were operated and supply was increased to respond. However, now, the introduction of renewable energies with unstable power generation output, such as solar power generation and wind power generation, has expanded, and in addition to the fact that daily fluctuations in power generation output are increasing, the number of thermal power plants that have been responsible for adjustments until now is decreasing steadily due to the trend of decarbonization, so the balance adjustment power on the supply side is weakening. Therefore, in the future, the side that uses electricity will also need to proactively balance the power system, so businesses where the energy demand side is compensated by “adjustment power,” which changes the amount of electricity consumed according to the usage status of electricity, are emerging, and this is “demand response.”
However, while the idea is great, there are many challenges in implementing it. If you compare it to electricity usage at home in an easy-to-understand manner, for example, electricity was tight during the evening hours, so I turned off the air conditioner. However, at that time, my daughter on the 2nd floor happened to use a hair dryer. When this happens, the electricity consumption of the entire house will be zero. There is no change in the supply-demand balance for the entire house called Japan. However, efforts are being made to save electricity by turning off the air conditioner. If you use this SIRC sensor, you will be able to pick up that buried power saving record.
If you think about the unit of an entire house in Japan, it is evaluated by how much the total usage amount has dropped by combining the plus and minus of the air conditioner and dryer, but what we are trying to do is measure the amount of power consumption at terminals such as air conditioners, dryers, rice cookers, microwave ovens, etc., and properly evaluate the amount of electricity saved for each one, and this sensor can be used there.
The key to a capital and business alliance is the power of people. A collaboration to transform Japan's energy landscape has begun
ーIt was exactly the technology you were looking for. After that, did the discussions on the capital and business alliance progress smoothly?
Yamamoto: Yes. Although I had a story in my mind regarding the investment in SIRC, honestly speaking, I was concerned whether this would properly be approved within J-Power. However, after preparing detailed materials and presenting the case, things progressed smoothly and led to the investment.
Takahashi: I was truly impressed by the depth of detail in Mr. Yamamoto’s presentation materials. Our core technology lies in sensor chips, with power measurement serving as the foundation. However, when a business entity makes an investment decision, the key perspective shifts to understanding "what value it generates." This perspective can also be described as business synergy.
For partner companies that we are already collaborating with on a business level, it is relatively easier to envision how the relationship can evolve and create a win-win situation through deeper cooperation. However, in the case of J-Power, we first met at GRIC, and at that point, they were not yet a user of our sensors. For Mr. Yamamoto to recognize the necessity of these sensors, convey that understanding to others, and navigate the investment approval process is an incredibly high hurdle.
Having worked with numerous business corporations, I fully understand the difficulty of this process. There are projects that move forward and those that don’t—but from my experience, the key differentiator is "people." Mr. Yamamoto, while having a calm and gentlemanly demeanor, possesses a strong inner passion. Once he decides "this is it," he relentlessly pursues it.
During the evaluation process, we received many in-depth questions. In fact, our engineers even asked, "Is he an expert in sensing technology?"—that’s how specialized and precise his inquiries were. These were the kinds of questions that could only come from someone with a deep understanding of the field. His passion and conviction in determining the right direction for the future of the business, as well as his solid strategic vision, made the entire collaboration process incredibly enjoyable.
Meeting such an outstanding individual at GRIC reaffirmed for me that it was a truly valuable event. It was a highly productive business matching opportunity that led to real business outcomes.
ーWhat is the current status of the project?
Yamamoto: Right now, we are refining the sensor’s requirements. We’ve consulted with relevant government agencies, such as the Agency for Natural Resources and Energy, and we’ve gained clarity on the necessary specifications. This year, we plan to conduct a Proof of Concept (PoC) by implementing the sensor in one of our customers' facilities that are already using our demand response services.
— So, the plan is to verify any issues that arise and eventually commercialize the product for market release, correct?
Yamamoto: Yes, that’s right. However, our company does not intend to monopolize this demand response metering device. Instead, we hope that SIRC can distribute it widely to power companies across Japan, contributing to the country’s energy supply.
SIRC’s products are already widely used in factories and support energy-saving initiatives. In the short term, we aim to highlight how these sensors help reduce unnecessary electricity use and lower electricity costs. Eventually, we hope to create a model where customers can receive financial returns based on their contributions to balancing electricity supply and demand.
Takahashi: In the demand response market, there has never been a case of using contactless power sensors. Therefore, one of our key challenges is to develop sensors that meet the necessary use cases and technical requirements. Our ultimate goal is to pioneer and expand a new market together so that, as Mr. Yamamoto mentioned, we can help transform the way energy is managed across Japan.
Large-scale power consumers are typically industrial clients with high energy usage. J-Power already has a strong presence in this market, and our existing manufacturing clients who use our sensors could also benefit from this collaboration. By working together, we hope to create a business that significantly impacts Japan’s entire manufacturing industry—and not just manufacturing, but other industries as well.
Yamamoto: Absolutely.
— It sounds like there’s a lot you can accomplish together.
Yamamoto: Definitely. First, we want to successfully develop the individual metering devices for each piece of equipment that we are currently working on. Beyond that, there are many other ways SIRC’s products can contribute, and we hope to deepen our collaboration.
Takahashi: We collaborate with many energy companies, but business alliances focused on a specific development theme like this are quite rare. By achieving our goals, we also want to demonstrate the value of capital and business alliances, making more companies aware of the opportunities in this space.
Many companies hesitate to invest in development-heavy projects, as they can be seen as time-consuming or risky. In particular, even if a product is already developed, investments in market development for new business areas are often perceived by large corporations as high-risk money. However, by making these investments, companies can accelerate the adoption of startup-driven innovations, creating new markets and fostering a win-win relationship that benefits both Japan’s economy and the global economy.
We are committed to bringing this initiative to life, presenting it to the world, and ensuring that more people become aware of it. This way, similar efforts can spread across Japan’s entire industry. Wouldn’t you agree?
Yamamoto: Absolutely. We will make this a success.
Majima: Thank you. I truly feel that the vision we had when launching GRIC has been well understood.
— Mr. Yamamoto, what does GRIC mean to you?
Yamamoto: I see GRIC as an event that is highly relevant to our existing business, with a strong presence of startups that are already making an impact. What stands out most is that these aren’t just pie-in-the-sky ideas—the startups here have solid technologies and are already entering the market, which makes them very appealing from a corporate venture capital (CVC) perspective. It’s much easier to consider investment when the companies have tangible business potential.
Majima: Thank you. I’ve been supporting startups for about nine years, and I’ve recently felt that large corporations are finally taking collaboration seriously. When I started this conference five years ago, I knew that without this shift, Japan’s startup ecosystem would hit a ceiling.
Looking at global examples, corporations hold the resources and assets, and without their collaboration, the ecosystem cannot grow.
Seeing our vision come to life through concrete success stories like this is truly inspiring. I sincerely hope for the success of this project and look forward to working together to spread this movement further. Thank you very much.
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