Japan has set itself the ambitious net-zero carbon emission reduction target by 2050. However, to reach this goal the country needs global collaboration and investment in clean energy. Learn about challenges and opportunities opening-up for Swiss companies in this market.
Overview
Regulation framework, focus sectors and business opportunities
In 2020 Japan has announced its target to realize carbon neutrality by 2050. The Strategic Energy Plan which was communicated 2021 foresees that the power sector will be decarbonized through decarbonized power sources. Innovations in renewable energy generation and distribution as well as carbon storage/utilization technologies based on CCUS/Carbon Recycling are important pillars to achieve this goal.
The industrial production should be electrified by decarbonized power sources whereever possible. When electrification is not feasible (for instance in case of high-temperature heat demand) decarbonization through the use of hydrogen, synthetic methane and synthetic fuels is promoted. In certain sectors innovations get special attention, e.g. hydrogen-reduced iron making and artificial photosynthesis.
The "Green Innovation Fund" has been mandated to support innovations for reducing carbon emission. The Japanese industry has to develop and implement new technologiesin order to reach the zero emission target. However, the government admits that to reach this goal the country needs global collaboration and investment.
Energy
Energy
In 2021, the Japanese government released the 6th Basic Energy Plan outlining the country’s long-term energy strategy and providing clear indications of what Japan’s energy-related future looks like to help guide business decisions and reveal opportunities in the market. The Japanese government started promoting renewable energy to reduce the country's reliance on fossil fuels in 2012 and aims to increase the share of renewables in the power generation mix from just under 15% in FY2019 to 37% in FY2030.
Hydrogen
Japan is planning to buy substantial volumes of hydrogen and ammonia from overseas to mix with fossil fuels in thermal power plants and to help decarbonize heavy industries such as steel and chemical production. Mobility is another market for which the Japanese government has high hopes for hydrogen. Although Japan currently does not insist that all hydrogen imports should be low carbon hydrogen, local production projects are all targeting low carbon options such as electrolysis using renewable energy. The Ministry of Economy, Trade, and Industry (METI) is expecting that most of the hydrogen supply will be imported, and major industrial players are already positioning themselves with investments in relevant technology and supply chain projects.
Carbon storage
Carbon capture, usage and storage
According to Japan's carbon neutrality strategy low carbon technologies would be employed as pillars of the transition, including carbon capture, usage and storage (CCUS). This technology allows to keep burning fossil fuels in hard-to-decarbonize sectors by offsetting or capturing/utilizing emissions from power plants and industrial processes, or by extracting CO2 directly from the atmosphere. Major Japanese industrial corporations are already researching and experimenting with the technology, however it is not ready for industrial use yet. This opens partnership opportunities for foreign players.
Individual Consultation
Are you interested to explore your opportunities related to the Japanes carbon neutrality strategy and discuss your plans the our consultant for the Japanese market?
Find suitable opportunities for your Cleantech business in Japan
Are you constantly on the lookout for early information, relevant tenders, worldwide projects, and general market insights? Check out the Business Opportunities database. It is updated daily, and you may set an email alert.