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Climate Change

Japan sets sights on 50% renewable energy by 2050

Government envisions nearly $2tn impact from green growth plan

The Omatazawa hydropower dam operated by Tokyo Electric Power Co. Holdings: The government sees a larger role for renewables in Japan's energy mix. (Photo courtesy of Tepco)

TOKYO -- Japan unveiled a plan Friday to achieve its goal of net-zero greenhouse gas emissions by 2050 that calls for tripling renewables' share of power generation to at least 50%.

The government estimates that its "green growth strategy" will generate 190 trillion yen ($1.83 trillion) in economic effects that year. The road map lists challenges and solutions in 14 key fields, including hydrogen and offshore wind. It calls for average net emissions of zero from new building and home construction by 2030 and for ending all sales of new gasoline-only vehicles by the middle of that decade.

The anticipated shift from fossil fuels to electricity across the Japanese economy is expected to increase electricity demand by between 30% and 50%. This makes ending power companies' reliance on coal-fired power plants and sharply increasing adoption of renewables a crucial step of the plan.

The focus on decarbonization "is not a constraint on growth," Prime Minister Yoshihide Suga told a news conference Friday. Investment to reach the emissions targets will generate new economic growth, in turn spurring further investment and creating a virtuous cycle, he argued.

The government looks to raise Japan's now-minimal offshore wind capacity to as much as 45 gigawatts by 2040 -- exceeding Germany, a leader in renewable energy.

The road map also sets a target of consuming roughly 20 million tons of hydrogen in 2050, with thermal power plants that use the clean-burning fuel seen generating 20% of Japan's electricity. Bringing down the cost of hydrogen, which is now several times as expensive as natural gas, to competitive levels by boosting demand will be key.

Tokyo is playing catch-up with such major European economies as Germany, the U.K. and Spain, which get about 40% of their energy from renewables. The target of 50% to 60% is seen as the most that Japan can feasibly achieve, given such limitations as a dearth of usable land.

Autos -- including low-cost minicars -- are another focal point of the plan. Japan has long been a world leader in conventional gasoline-fueled cars, and pivoting to green technology will likely take time.

"I can't see this being achieved without groundbreaking technological innovation," said Akio Toyoda, chairman of the Japan Automobile Manufacturers Association and president of Toyota Motor. "And we could risk losing our international competitiveness without efforts throughout the supply chain."

The shift could be problematic for the industry's massive network of parts suppliers, not least because electric vehicles use half as many components as those with combustion engines.

And "if autos become like home appliances," then "Japan may lose its edge" as it becomes easier for manufacturers to source parts from around the world, said Toshihiro Nagahama of the Dai-ichi Life Research Institute. "The government will need to provide support, including capital, to related industries."

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