On Friday, in a significant development, the Japanese government said it aims to eliminate gasoline-powered vehicles in the country in the next 15 years so as to reach net zero carbon emissions and generate nearly $2 trillion a year in green growth by 2050.
The “green growth strategy,” sees an increased adoption of hydrogen in the auto industry; it is meant to be a vehicle for achieving Japanese Prime Minister Yoshihide Suga’s October pledge to eliminate carbon emissions on a net basis by mid-century.
Green investment has been a top priority in Suga’s strategy to help revive the economy hit by the COVID-19 pandemic and bring the country at par with other leading economies such as the European Union.
“The government has set up ambitious targets to achieve a carbon neutral society in 2050,” said Yukari Takamura, professor at the University of Tokyo. “Making clear goals and policy direction in the green growth strategy will give incentives for companies to invest in future technology.”
The government has offered a whole range of financial incentives, including tax breaks to support companies, as it targets $870 billion (90 trillion yen) a year in additional economic growth through green investment and sales by 2030 and $1.8 trillion (190 trillion yen) by 2050.
A 2 trillion yen green fund will support corporate investment in green technology.
The plan seeks to replace the sale of new gasoline-powered vehicles with electric vehicles, including hybrid and fuel-cell vehicles, by the mid-2030s. To speed up the adoption of electric vehicles, the government is aiming to hammer down the cost of vehicle batteries by more than 50% to 10,000 yen or less per kilowatt hour by 2030.
It aims to boost hydrogen consumption to 3 million tonnes by 2030 and to about 20 million tonnes by 2050 from 200 tonnes in 2017, in areas such as power generation and transportation.
The Japanese government has already identified 14 industries for growth areas, including offshore wind and fuel ammonia, and has set a target of up to 45 gigawatts (GW) of offshore wind power by 2040.
Tokyo also aims to ramp up the adoption of renewable energy “as much as possible” by 2050, through increased installations of off-shore wind farms, with reference goal of renewable energy sources accounting for 50% to 60% of the nation’s power by 2050, up from less than 20% now, while reducing reliance on nuclear power.
($1 = 103.5500 yen)