Wow, I would love to hear more about your great-grandfather and this photo. I am not an expert on military history but I am a Japanese historian, so I will attempt to answer.

He appears to be a member of the Imperial Guard Cavalry Regiment. According to a book called Japanese Military Uniforms 1841-1929, "the main duties of the Imperial Guard Cavalry was to guard the Imperial Palace and to escort the emperor on his trips from the palace. However, at times they were dispatched to actual combat duty. In March of 1904, a mere four platoons of Imperial Guards cavalry held off and drove back an advance by over 1,000 Russian cavalry." (Nakanishi)

This particular uniform is a dress uniform, used from the late Meiji period (around 1886 on) to early Showa (1920s-30s). The jacket would have been navy blue. The braiding would have been blue or red. The pants would have been red, and the cap either red or black with a white feather. The jacket collar and piping on the pants would have been light green to signify him as a member of the cavalry. All in all, quite flashy!

The design of his cuffs and cap suggest he was some kind of private. The flag is an "attendance flag" (rather than the Emperor's standard, which would have been carried by someone of higher rank) (Nakanishi). As a member of the Imperial Guard, his duties would have been mainly in Japan serving the Emperor, but it is possible he was involved in the Russo-Japanese War or other major conflict such as the first Sino-Japanese War or the invasion of Taiwan. Take a look at some of the images below. Also, if you speak Japanese or know someone who does, you should consider contacting the War-Bereaved Families Association, a group for the families of Japan's veterans, to see if they can find any more information for you.

Images: This postcard is apparently from the 1920s. The uniforms appear identical. Also notice the red and white flags. http://www.meijishowa.com/photography/3058/110705-0003-imperial-guard-cavalry

It also matches some of the uniforms in this drawing of the Imperial Japanese Army in 1900. https://en.wikipedia.org/wiki/Uniforms_of_the_Imperial_Japanese_Army#/media/File:JapaneseArmy1900.JPG

It seems to match the photos in this book of the Imperial Guard Cavalry as well. The book is published by the War Bereaved-Families Association, but unfortunately it seems to be out of print. (The image is from Ebay). https://picclick.com/m1-Japan-Imperial-guard-cavalry-regiment-Photos-album-122382279998.html#&gid=1&pid=1

Sources: Nakanishi, Ritta. Japanese Military Uniforms 1841-1929 (Nihon no gunsō: bakumatsu kara nichiro sensō.) Tōkyō: Dainihonkaiga, 2006.