The Japan Aerospace Exploration Agency (Jaxa) said it plans to build a huge solar power station in space that can beam down solar energy to a substation on Earth through microwaves or laser beams.
The proposed Space Solar Power System (SSPS) is expected to reduce the impact of global warming and mitigate Japan's energy problems.
The proposal involves development of a miles-wide range of photovoltaic panels similar to solar panels used on Earth, which will then be placed in a geostationary orbit, writes the Telegraph.
The large panels are able to gather huge amounts of energy as the solar rays are five times more powerful in space.
The electricity generated is also estimated to be six times cheaper than Japan's current energy costs.
Jaxa researcher Tatsuhito Fujita said that in the next few years a satellite that can test the microwave's transmission should be placed into low orbit with a Japanese rocket.
A test version of the orbital solar panels is scheduled for launch by 2020.
The final version of the panels that generate 1GW of energy should be launched in space ten years later.