Japan’s electricity transmission and distribution (T&D) system has not changed dramatically in the post-war period. Prices remain high even as investment in T&D has fallen rapidly, while new generators complain of uncompetitive charges to access the grid. Is the vertical unbundling of generation from T&D the answer? Evidence from other countries that have attempted this is mixed. While an Asian “Super Grid” remains a pipe dream, demand management through smart grids and smart appliances seems the most promising solution.