Japan’s government has announced an ambitious plan to increase the supply of hydrogen as part of its efforts to reduce carbon emissions. The plan aims to raise the annual supply by six times, from the current 2 million tons to 12 million tons by 2040, and will involve a funding injection of 15 trillion yen ($107 billion) from both private and public sources to build up hydrogen-related supply chains over the next 15 years. The revised plan focuses on nine strategic areas, including the development of water electrolysis equipment, fuel storage batteries, and large-sized tankers for transporting hydrogen.
Japan’s decarbonization strategy aims to use clean coal, hydrogen, and nuclear energy to transition to renewable energy, with a view to becoming a “hydrogen society.” However, the hydrogen industry is still in its infancy, and the government is drafting legislation to support building necessary infrastructure and supply chains for the commercial use of pure hydrogen and ammonia, another source of hydrogen.
The revised plan is part of Japan’s efforts to address concerns about energy security. Following Russia’s actions in Ukraine, Japan’s leaders are pushing for the faster adoption of renewable energy such as solar, wind, and geothermal. So far, Japan has been mainly relying on hydrogen produced from fossil fuels.
While the plan has been hailed as a triple achievement in decarbonization, energy supply, and economic growth, some experts believe it primarily caters to big business interests that are heavily invested in fossil fuel-based technologies and have power over government policies.
Prime Minister Fumio Kishida said that Japan aims to achieve an “Asian zero-emission community” by contributing Japanese technology in decarbonization areas such as hydrogen and ammonia. The government is hoping that the ambitious targets will encourage long-term investment in developing a large-scale hydrogen supply and demand.
In addition to the hydrogen plan, the Cabinet approved an annual energy report calling for a “green transformation” plan that promotes next-generation solar batteries, offshore wind power, and renewed use of nuclear energy. The report also predicts a shortage of liquefied natural gas due to economic sanctions against Russia for its war on Ukraine, with European demand pushing LNG prices higher, and Japan needing to come up with a long-term strategy for securing stable energy supplies.