Can Japan Achieve Net-Zero Emissions? Climate Change Policy Developments in Japan and Its Implications

Yasuko Kameyama
April 29, 2020

This analysis is part of the Japan Looking Ahead program, which examines Japan’s ability to both overcome its internal challenges as well as offer innovative solutions to the world’s most pressing global challenges.

Abstract

At the 25th Conference of the Parties (COP25) to the United Nations Framework Convention on Climate Change (UNFCCC), Japan was harshly criticized by NGOs. Why? By answering this question, this article intends to (i) briefly go through the history of Japan’s responses to the  climate change problem and the factors that motivated such responses, (ii) examine how climate change is likely to affect Japan and its people, and (iii) forecast how Japan could overcome obstacles to take more ambitious actions towards achieving net-zero greenhouse gas emissions.

Until recently, Japan was reluctant to take tangible emission reduction measures mainly because of the two following reasons. First, many Japanese people had believed Japan was one of the most energy efficient countries in the world, and thus had very little potential for further improvements. Second, they compared Japan’s emission with those of other larger emitters such as the United States and China, and argued those major emitters should start reducing first before Japan make further effort. Due to these perceptions, the Japanese government was reluctant to reduce emissions in absolute terms.

Nevertheless, particularly after enforcement of Paris Agreement in 2016, Japanese non-state actors, namely local governments and business sectors started to recognize a global transition into a decarbonized society. Thus, independent of policies and positions taken at the national level, those Japanese actors are starting to change. Some of these initiatives could be seen as success stories within the next several years. 

 

1. Japan at COP25

At the 25th Conference of the Parties (COP25) to the United Nations Framework Convention on Climate Change (UNFCCC), held in Spain in December 2019, Japan was criticized by Japanese and non-Japanese NGOs for its continuing investment to build new coal power plants, both in and outside Japan. Climate Action Network, a consortium organization of environmental NGOs around the world, celebrated Japan by awarding the country as a winner of two “Fossil of the Day” awards. Fossil of the Day is an award given to countries judged by the environmental NGOs to have done their “best” to block progress in the negotiations or in the implementation of the Paris Agreement[1].

While the Japanese government has publicized its willingness to reduce national greenhouse gas (GHG) emission by 80% by 2050[2], its energy policy is still not in line with the goal. At the time of COP25, there were 22 new coal power plants in Japan that were planned to be built within the next few years[3]. As for outside Japan, Japanese government and mega-banks are the second largest investors of coal power plants in emerging and developing countries, next to Chinese[4]. It is hard to understand why Japan has been obsessed over continuing the use of coal as an energy source when many other countries are rapidly moving away from fossil fuel and shifting toward renewable energy.

This article looks back at Japan’s policymaking on climate change over the last three decades and examines why Japan has not been able to make a transition to a decarbonized society and seeks possibilities to change its direction.

 

2. History of Japan’s response to climate change

2.1 Japan’s emission trend

Japan’s GHG emission has risen rapidly throughout the post-World War II period, driven by industrialization and robust economic growth. The growth tentatively stalled in the late 1970s when the Japanese government responded to the Oil Crises and supported Japanese industries to invest in energy efficiency improvements but resumed again in the 1980s and 90s lead by economic boom and diffusion of a comfortable lifestyle among Japanese citizens. During the 1980s and 90s, an increasing number of households started owning more than two home utilities such as air conditioners and TV sets, and also started buying bigger-sized automobiles. For example, in 1990, there were 1.2 air conditioners and 2 TV sets per household[5].  The number of family members dwelling in one house started to decrease at the same time. All these factors contributed in continuing growth of GHG emissions.

Japan’s methane and nitrous oxide emission from the agriculture and mining sector is very limited. Actually, more than 90% of GHGs from Japan comes from fossil fuel combustion[6]. This share is larger than most other countries including developed countries. This means Japan specifically needs to tackle energy use to reduce its GHG dramatically.

Today, Japan is responsible for around 3% of global GHG emissions. The share has been slowly declining in the past two decades because of the continuing increase of the total amount of global GHG emissions lead by rapid economic growth of emerging economies such as China and India. Still, in absolute terms, Japan is the fifth largest emitter in the world. In absolute terms, Japan’s GHG emission have started to decrease recently since 2013 as is shown in Figure 1[7]. As for per capita GHG emission in Japan, it remains almost consistent throughout the last 30 years, while most other developed countries showed a decrease in per capita emissions during the same period.

 

Figure 1. Greenhouse gas emission in Japan

 

2.2 Early days of climate change discourse in the 1990s

How has Japan adapted to the climate change problem since its emergence out of the 1990s? The world had pointed out since the 1980s that climate change was one of the most urgent global risks that humanity should respond to, but Japanese policymakers remained uninterested in the issue[8]. Some environmental experts and government officials suggested Japan should take action and set emission reduction targets, but many other officials and politicians perceived climate change as an energy problem, and insisted that Japan’s energy efficiency was at the world’s highest level and little can be done to reduce energy consumption any further.

Throughout negotiations and up to the adoption of the Kyoto Protocol in 1997, developed countries were required to negotiate their respective GHG emission reduction targets for the year 2010 or so. Many developed countries proposed an equal emission-reduction percentage for all countries based on the argument that each country could cite its own reasons for not reducing GHG emissions as much as other countries, and it would thus be impossible to agree on differentiated targets[9]. However, Japan argued strongly for differentiated targets saying that Japan’s potential for further improvements in energy efficiency is less than most of the other countries[10]. Because Japan’s obstinate position on differentiated targets were supported by some other developed countries, such as Australia and Norway, the agreed reduction rates relative to 1990 emissions differed from country to country: 6% for Japan, 7% for the United States, and 8% for the European Union (EU) for the five years between 2008 and 2012 (referred to as “the first commitment period” in the Kyoto Protocol).

It took time for the Kyoto Protocol to enter into force, mainly due to two reasons. First, the United States, during the presidency of George W. Bush, decided to withdraw from the Kyoto Protocol in 2001. Second, China, which had been categorized as a developing country in the Kyoto Protocol, was not obliged to reduce its GHG emissions, and rather their emissions started growing rapidly due to economic growth. This meant the Kyoto Protocol was not effective to reduce global GHG emissions to mitigate climate change. Japan argued that a new agreement including major emitters should be agreed to replace Kyoto Protocol.

At this time, the Japanese government implemented a minimum level of emission-reduction policies, just enough to achieve its 6% reduction target committed under the Kyoto Protocol. As can be seen in Figure 1, Japan’s emission went down in 2008 and 2009, not so much due to emission reduction policies, but more because of a world-wide economic downturn.

Due to the reasons mentioned above, Japanese stakeholders had recognized GHG reduction as an energy saving problem. Discussions in Japan have concentrated on how much Japan could reduce CO2 emissions without harming the business community[11]. Japanese industries were keen on comparing the relative size of economic burden required to reduce emissions with other countries, particularly with the United States, the EU, and China. Japanese industries acknowledged fairly well the scientific knowledge of global warming and climate change mechanisms, but they asserted that reductions of CO2 emissions should be made exclusively in those countries where energy efficiency was worse than in Japan. For example, when then prime minister Taro Aso held a press conference to announce Japan’s GHG emission reduction target for 2020, he pointed to three aspects for consideration: (1) participation by all major emitters, namely the United States and China, (2) holding a balance between environmental conservation and economic growth, and (3) aiming at a long-term goal of reducing GHG emissions 60% to 80% by 2050, and that innovative technology and nuclear power are indispensable to reach such ambitious targets[12]. He also emphasized that deep emission cuts such as 25% reduction from 1990 would put a heavy economic burden onto household and thus was not acceptable under his administration.

Based on such recognition, Japan’s CO2 emission mitigation policies were exclusively focused on two pillars: further improvements in energy efficiency where any potential opportunities existed, and increased use of nuclear power to decarbonize electricity[13]. In the case of the former, a law on energy efficiency was used to promote additional improvements in the industrial sector. Nuclear power was popular among the industrial and business communities because it was considered the least costly way for them to reduce CO2 emissions. In contrast, renewable energy was considered as an expensive source of energy, because the government was not enthusiastic to support this option. Apart from traditional large-scale hydropower facilities, other renewable sources of energy such as solar power and wind power were neglected for a long time.

 

2.3 Nuclear power plant accident and the Paris Agreement

The northeast region of Japan was hit by a severe earthquake in March 2011, which resulted in the Fukushima Daiichi nuclear power plant accident. This led to a halt in the use of all nuclear power plants in Japan thereafter. Coal and natural gas power plants replaced nuclear power plants, which consequently increased Japan’s GHG emissions until 2013.

The accident itself was a huge tragedy for many Japanese citizens but was an opportunity for those who wanted to support renewable energy to replace nuclear power plants. Feed-in-tariffs for renewables were introduced for the first time in Japan in 2012. Under the scheme, electric power companies were obliged to purchase all electricity generated by solar and wind power facilities. A carbon tax was also introduced in 2012 to differentiate energy prices according to carbon intensity. The tax rate was low, only JPY  289 (about USD 2.6) per CO2/t, equal to JPY 250 per 1kiloliter of gasoline, and was not expected to make much difference in consumer behavior. However, the tax revenue was earmarked to be spent on energy-saving technology developments and implementations[14].

At the international level, a new round of negotiations was started in 2012 to agree on a new multilateral legal instrument that would include emission targets of all countries for years beyond 2020. To facilitate reaching an agreement, all countries were urged in 2014 to submit their respective emission targets for the year 2030 or so. Within Japan, the governmental department in charge of energy supply published the Energy Long-Term Demand-Supply Outlook in July 2015 confirming coal power plants would still be used to supply about 26% of electricity in the year 2030[15]. Nuclear power plants would also be rehabilitated to supply 20–22% of electricity in the same year. Renewable energy was expected to increase to supply about 22–24%. Based on such energy forecasts, the Japanese government then decided that Japan’s emission reduction target for the year 2030 would be to reduce its GHG emissions by 26% from the base year 2013.

The Paris Agreement was adopted at the 21st Conference of the Parties (COP 21), held in Paris at the end of 2015. The agreement set a long-tem temperature goal to keep the rise of the global mean temperature from before the industrial revolution below 2.0°C and to make best efforts for below 1.5°C. For the world to achieve these goals, global GHG net emissions must reach zero by the end of the 21st century (case of 2.0°C), or by 2050 (case of 1.5°C). Especially for the developed countries, there is no room to increase emissions. Rather, they need to make a rapid transition into a decarbonized society.

The Paris Agreement entered into force in November 2016 and countries are on their way to reducing their respective emissions. Japan’s emissions up to 2018 have decreased since 2013, and at least for the time being, it is on its way to fulfill the 2030 emission target.

 

2.4 Japanese government’s post-COP21 actions

The Paris Agreement was adopted at COP21 in December 2015, and in 2016 the world officially started moving based on what was agreed in the Paris Agreement. In May 2016, the Japanese government issued the “Global Warming Mitigation Policy Plan”, a 179-page document that described policies to be introduced to achieve its emission reduction target for the year 2030[16]. In the document, the government set emission reduction targets at sectoral levels to clarify responsibility of emission reduction. Much of the reduction was planned to be made in the building sector (household and office buildings), requiring 40% reduction from 2013 levels by 2030. Transportation and energy sectors were to reduce their respective sectoral emissions by 28% the same year. Meanwhile, the industry sector’s emission target was 7%. This was a reflection of the industry sector’s strong political objection against setting stringent emission reduction targets onto their own sector. The plan listed various policies to reduce emissions from the building sector, to a shift to zero-energy-buildings (ZEB), and to reduce emissions from the transportation sector by diffusion of electric and hybrid vehicles in that sector. As for the energy sector, enhancement of renewable energy was sought for but at the same time the plan also emphasized use of energy efficient fossil fuel power plants, as well as nuclear power plants, assuming that they were accepted by the Japanese people. As for the industry sector, the plan simply relied on the industry groups’ voluntary commitments. For many decades since the 1960s, there has been a strong tie, the so-called “iron triangle”, between Japanese bureaucrats (particularly Ministry of Economy, Trade and Industry (METI)), politicians (Liberal Democratic Party) and energy and energy intensive industries[17]. The role of government officials and politicians were to achieve national goals by giving industries benefits. This cooperative relationship shrank after the nuclear power accident of 2011, but those who wanted to continue the relationship utilized climate change policy to cling to the old custom.

The early enforcement of the Paris Agreement in November 2016 took by surprise Japanese government officials who had expected the United States to withdraw from the Paris Agreement after the new president came into office but before the agreement entered into force, a manner similar to what happened to the 2001 Kyoto Protocol. Considering such possibilities, some Japanese officials expected that it could take time for the Paris Agreement to enter into force. Japan took time in ratifying the Paris Agreement and was only able to ratify it in November 2016.

Those same Japanese government officials became confident once again when President Trump announced in June 2017 his intention to withdraw. They expected that the United States’ withdrawal could nullify the Paris Agreement, and the world could forgo aiming at a 1.5 or 2-degree long-term goal. The 5th Energy Basic Plan, which was adopted in July 2018[18], basically followed the structure of the Energy Long-term Demand-Supply Outlook of 2015. Both documents stated that Japan’s energy policies should be based on fundamental principles, namely, “safety”, “energy security”, “improvement of economic efficiency”, and “environmental suitability”[19]. In the plan, coal power plants are expected to continue to supply about 20% of electricity in 2030, as coal fulfills Japan’s energy security, as the most affordable and stable supply, according to explanations of the Agency for Natural Resources and Energy under METI. The Ministry of the Environment condemned METI and power companies because their decisions contradict the emission reduction target for the year 2030 that Japan submitted under the Paris Agreement, as well as the Global Warming Mitigation Policy Plan of May 2016[20]. Citizens’ groups have filed lawsuits against building new coal power plants and have succeeded in stopping some of them but other plans continue to make progress. The only way for the Ministry of the Environment to stop or delay construction of new coal power plants is by using environmental assessment procedures. The environmental minister can provide his objection against construction of new coal plants. However, this ministerial procedure is not legally binding, and METI can overrule the environment minister’s comments and facilitate assessment procedures.

In one of the COP21 decisions adopted in 2015 along with the Paris Agreement, countries are invited to communicate mid-century, long-term low greenhouse gas emission development strategies by 2020[21]. This was an important process for countries to assess their emission trajectory between their 2030 targets and net-zero emission target determined by the long-term temperature goal. By late 2018, Japan and Italy were the only G7 member countries that had not submitted this mid-century strategy. Because Japan was to host the G20 meeting in June 2019 in Osaka, the Japanese government thought the mid-term strategy should be submitted before the G20 meeting. A Roundtable Conference on the Long-Term Growth Strategy under the Paris Agreement was established and was held several times between the second half of 2018 and the beginning of 2019, and its recommendations were submitted to the Prime Minister in April 2019. Based on the recommendations, the relevant ministries and agencies worked together to submit a paper “Japan’s Long-term Strategy Under the Paris Agreement” just before the G20 was held in Osaka in June 2019[22]. Although the expected GHG emission reduction by various technologies are described in the 83-page document, no major policies are suggested to reduce Japan’s total emissions by 80% by 2050. The statement that “non-continuous innovation is necessary” is repeated throughout the paper, but there is no detailed explanation of “non-continuous innovation”. There was also no specific statement about the closure of coal-fired power plants in Japan. The paper did, however, project high expectations for hydrogen energy and carbon capture, utilization and storage (CCUS) technologies.

 

2.5  Japanese people’s perception on climate change impacts

As was described in previous sections, Japanese stakeholders had perceived climate change mainly as an energy problem, not as an environmental problem. Citizens’ understanding of climate mitigation actions were those such as “turn off the lights of unused rooms”, “turn off TV sets when no one is watching”, or “set air conditioners’ room temperature at 28°C in summer and 20°C in winter.” Because the Ministry of the Environment has no jurisdiction over national energy policy, what it can do under its own jurisdiction to reduce GHG emissions is limited. One of the limited capacities of the Ministry of the Environment is to call for behavioral changes by individuals. Campaigns and environmental public service announcements lead by the ministry affected how citizens understood climate mitigation actions. Of course, these actions are the first steps to reduce energy use, but their understanding did not go so far as to think what may happen if we did not do enough. Most Japanese citizens had learned about the effects of global warming but did not take it as their own risks. Even though many people had felt the climate becoming warmer, they welcomed warmer winter and did not imagine that a warmer climate could lead to extreme weather events that could harm their own lives. This perception, however, is gradually changing. In the last 100 years, Japan’s mean temperature has risen 1.2°C[23]. The hottest years are concentrated in years after 2000. Heavy rainfall and strong typhoons have increased in frequency. There are more people who are affected by severe heat in summer than in the old days. 71,000 people were taken to hospital by ambulance due to the heat waves of May and September 2019[24]. There is less snowfall in recent years. People are starting to realize that climate change is a reality that affects not only a few developing countries but all countries around the world, including Japan. In a survey on people’s perception on climate change conducted in Japan in 2016, 77%of respondents answered the question, “When do you expect climate change to be felt by ordinary people?” with the fact that they are already feeling the change[25].

Typhoons in 2018 and 2019 were perhaps the most influential impact that changed Japanese people’s perceptions of climate change today. There was relatively a low number of deaths compared to the physical damage to buildings and infrastructure, but thousands of houses and buildings were destroyed by strong wind and landslides or were partially flooded. Electricity power lines were disrupted, causing blackouts for many weeks. The General Insurance Association of Japan (2019) announced in December 2019 that the total amount of payment by insurance companies due to damages caused by two typhoons (Faxai and Hagibis) and a heavy rainfall of 25 October 2019 was 746 billion yen (about US$ 6.8 billion)[26].

The Japanese government estimates that without meaningful mitigation policy around the world, Japan’s mean temperature is likely to increase 4.5 °C more by the end of this century[27]. People taken to hospitals due to heat shock is predicted to double by the end of this century from today’s level. Frequency of heavy rainfall is likely to increase twice from what is experienced today.

Although not regularly taken up among Japanese stakeholders, the future impact of climate change is likely to affect Japan not only by physical damages inside Japan, but also by various events that could take place outside the country. This is because Japan relies on imports of goods, including food, energy sources, and raw materials. At the time of Thailand’s flood in 2011, many Japanese manufacturing companies had to halt operations in Japan because some parts could not be imported from Thailand. Some recent publications indicate 17% of Japan’s imports come from countries facing medium to high climate change and security vulnerabilities[28]. Japan imports about 60% of food from outside Japan[29]. This means climate change could affect Japanese food security if drought occurred in crop producing countries.

 

3.  How can Japan change?

3.1 Transition into decarbonized world

Before going into details of Japan’s recent developments, it is worthwhile to see changes that have taken place outside Japan. During the 18 years between adoption of the Kyoto Protocol and the Paris Agreement, many changes had occurred throughout the world without being noticed by most Japanese stakeholders. The first change was recognition and awareness of the urgency of climate change by the general public[30]. At the time of the Kyoto Protocol, there was much skepticism about scientific discourse concerned with climate change, and there was no sense of urgency among the general public. Even those who trusted scientific caution thought actual damages would be observed in the distant future or only in poor countries. In contrast, at the time of the Paris Agreement, the general public became aware that abnormal weather patterns were occurring more frequently around the world and the damages due to extreme weather events started affecting many people. Global understanding of the threat of climate change had become the basis of international consensus building.

Second, the global business community had begun moving towards decarbonization. Until the time of the Kyoto Protocol, the global economy relied on the premise that affordable oil and coal would be continuously supplied. Coal-fired power plants played a central role in supplying electricity in many countries and fossil fuel combustion cars became widespread. In such a society, any attempts to reduce CO2 emissions would immediately be taken negatively by private companies as economic burden. However, by the time of the adoption of the Paris Agreement, industries related to renewable energy, such as solar and wind power, had started to grow rapidly[31]. The price of energy from these sources was initially higher than that of fossil fuels, but some countries, particularly the EU member states, started introducing measures such as feed-in tariffs to obligate power companies to purchase renewable energy at a fixed price. Such measures have resulted in significant decreases in renewable energy prices, and renewable energy has recently been even cheaper than fossil fuel energy in many countries including developing countries. Although renewable energy still requires high initial investment cost, almost no running cost is needed because its owners do not have to spend extra money on fuel for many years. In addition, other industries such as the information technology industry and electric vehicle industry, where actions to reduce emissions lead to more business, have grown rapidly in many countries. Without the support of these new forces in the business world, it would not have been possible for negotiators to inscribe long-term goals in the Paris Agreement.

Transition in the business sector that took place up to adoption of the Paris Agreement in 2015 still continues today. Business leaders are aware of climate change and other related events such as extreme weather events and natural disasters[32]. For example, banks are now seeking for climate-related disclosure by companies. A taskforce on Climate-related Financial Disclosure (TCFD) was established under G7 financial ministers’ meeting in 2015 to discuss how disclosure of climate-related risks could help companies to prepare for risks they may face in the near future[33]. There have also been changes in corporate ethical investment behavior. In recent years, transparency of corporate behavior and information disclosure have been required, and investment decisions have been closely watched from an ethical standpoint[34].

Even in the United States, President Trump’s desire to leave the Paris Agreement has been only partially effective, because many local governments and businesses have taken action to decarbonize, irrespective of federal decisions[35]. U.S. industries are now split into two opposing sides in terms of climate change policies. Energy-intensive industries such as coal and iron-and-steel companies have consistently supported positions against the UNFCCC governance. On the other side, a growing number of companies, including Amazon, Google Inc. and Tesla, that can profit through businesses activities related to reducing emissions, support the Paris Agreement and other emission-reduction policies[36].

 

3.2 Japanese governments’ position on energy and climate

With respect to energy efficiency, individual products such as home appliances and fuel-combustion automobiles in Japan remain the best in the world. However, there are some areas where Japan is lagging behind other countries. Building zero-energy buildings with walls and windows that provid high thermal insulation, for instance, is one of the areas where Japan is far behind other countries. It is reported that around 76% of all private houses in Japan had almost no insulation in 2012[37]. Major energy saving is expected in the building sector if zero-energy-buildings replaced most old buildings. Legislation to set minimum standards for improvements of thermal insulation in buildings is gradually being implemented after adoption of the Paris Agreement.

Introduction of carbon pricing policies has been repeatedly discussed in the government. The Ministry of the Environment promotes an emissions trading scheme and carbon tax to give economic incentives to companies and individuals to shift towards a decarbonized society[38]. A carbon tax was installed in 2012, but the ministry considered that the tax rate should be higher to change consumption behavior. The emissions trading scheme has only been introduced at local levels, such as in Tokyo Metropolitan Area and Saitama Prefecture, but not at a national level. Meanwhile, such economic measures are strongly criticized by industry groups, saying that such policies will eventually raise the price of all commodities and lead to a recession and loss of international competitiveness of the Japanese economy.

Figure 2 shows electricity generation according to share of energy sources[39]. Nuclear power plants in Japan were shut down in 2012, and mainly natural gas and coal replaced nuclear. The share of renewable energy increased since policies to support renewable energy were introduced in 2012, although the speed of growth is not as fast as was expected. In order to fulfill the goal set by the Energy Outlook of 2015, all fossil fuel power plants need to go down, while renewable and nuclear increase.

The goal for renewables is to achieve additional diffusion to supply around 22 – 24% of the electricity supply by 2030, but the government is thinking of ending subsidies to renewable energy suppliers on the assumption that the price of solar panels has declined sufficiently that no additional subsidies are needed. That decision has been criticized by environmental groups, but METI and utility companies are not enthusiastic about resolving the remaining barriers to diffusion of renewable energy. Those barriers include liberalization of the electricity transfer section, such as use of power grids, support for technological developments related to batteries, and demand-side management of electricity[40]. By not giving privilege to newcomers of energy supplying businesses, METI and traditional electric power companies maintain cooperative relationship that benefit both sides.

Nuclear power is still among the preferred options of the current administration for further decarbonizing energy and can be seen in Figure 2 that the share has already increased to supply around 2% of electricity in 2016. However, it is unlikely to meet the supply goal of 2030, as nuclear power is still opposed by many citizen groups.

Figure 2. Electricity generation by energy sources

 

Apart from decarbonization of electricity power, the shift away of automobile use of fossil fuel is in progress worldwide, however Japan is still selling hybrid cars, which while much more energy efficient than traditional gasoline cars, do still rely on gasoline combustion. The ultimate solution is to replace fossil fuels with decarbonized electricity. Many countries have announced targets and timetables to shift to electric cars. Norway plans to stop all sales of new fuel-combustion cars in 2025, and similar goals have been set for 2030 in Sweden and Denmark. Even large emerging economies such as those of India and China are moving towards electrification in the transportation sector. Japan is reluctant to set such goals. In October 2015, Toyota announced that it would aim at reducing Toyota’s global average new-vehicle CO2 emissions by 90 percent by 2050 compared to Toyota’s 2010 global average[41]. In a way, Toyota was way ahead of the Japanese government decision. Meanwhile, even Toyota wants to leave diverse options in the future. That is, electric cars do not need innovative technologies, so Japanese companies have less international competitiveness in selling electric vehicles. Japanese technologies are more competitive in areas such as fuel cell cars, but it is still too expensive compared to other types of vehicles, and thus the Japanese government has not yet been able to determine the direction of the automobile industry.

 

3.3 Japanese non-state actors’ transition

While governmental officials and politicians continue to hold traditional views about putting priority on cheap energy sources and continuing economic growth, a great change was observed within the business community. Some Japanese business representatives attended the COP meetings and other gatherings of business leaders in 2016 and 2017, and were astonished to see a dramatic change in perceptions of the overseas business sector towards decarbonization. More and more companies in Japan gradually changed their minds to see emission reduction not as a cost but as an opportunity for new businesses. An organization of private companies called Japan Climate Initiative was launched in July 2018[42]. As of February 2020, 159 companies, 25 municipalities, and 64 other organizations are members to the initiative.

Perception changes of Japanese companies has slowly begun to emerge in various data. As for investments in companies that have high performance in terms of Environmental, Social, and Governance (ESG), for instance, Japanese investors regarded ESGs as charitable enterprises that had little to do with making profits and showed almost no interest in them until 2015. An initiative was taken by two major Japanese institutional asset owners, the Government Pension Investment Fund (GPIF) and the Pension Fund Association, that became signatories to the Principles for Responsible Investment (PRI) in 2015 and 2016 respectively, promising to  promote policies based on those principles. In July 2017, GPIF began tracking ESG indices for Japanese equities by focusing on indices selected from broad ESG criteria, and on gender diversity and the empowerment of women[43].

The share of sustainable investment assets of Japanese companies in the world total was negligible in 2014, but by 2016 the share had grown to 3.4%, and by the end of 2018, Japan accounted for 18.3% of the world’s total of 30.7 trillion US$ of sustainable investment assets[44]. Similarly, in December 2017, only five Japanese companies out of 95 companies worldwide were enrolled as TCFD supporters. As of February 2020, support for the TCFD has grown to over 1,030 companies and organizations globally, of which 236 are from Japan[45].

RE100 is another global corporate leadership initiative bringing together companies and organizations committed to 100% renewable electricity[46]. RE100’s purpose is to accelerate change towards zero carbon grids at global scale. When this initiative started in 2017, there were only three Japanese companies supporting it. As of January 2020, the number of Japanese supporters increased to 30, while the total number worldwide increased to 221. One reason why the number of Japanese supporters of RE100 is not growing as fast as other initiatives mentioned above, could be due to the energy plan decided by the government that expects fossil fuels to continue to supply electricity in 2030. This is rather unfortunate, when many private companies want to shift to zero emissions and the government’s plan is being an impediment to move faster.

 

3.4 How can non-state actors change the country?

One possible way forward is a scenario in which so-called non-state actors such as the businesses sector and local governments advance their actions voluntarily in a way that exceeds the national position. At least in the field of global environmental problems, non-state actors are playing more important roles in the 21st century than during the previous one. This is because it is becoming more difficult to arrive at an effective agreement among the nearly 200 countries participating in negotiations. Instead, a regime consisting of networks among diverse non-state actors are making substantial changes.

In the case of local Japanese governments, they use to set exactly the same emission reduction goals that were set at the national level. This, however, is not the case in recent years. Climate change mitigation and adaptation measures are being comprehensively considered by combining those measures with other policy goals such as social care for the elderly, revitalizing regional economies, preventing disasters, and managing waste. As of February 2020, 64 local governments (15 prefectures, 25 cities, 1 special ward, 18 towns, and 5 villages) have supported zero carbon emissions by 2050[47]. They include mega-cities such as the Tokyo Metropolitan Government, Kyoto, and Yokohama. Altogether, the group represent 52 million people, about 41% of the Japanese population[48].

What is still missing in Japan is action of the individuals towards deep decarbonization. In 2019, a Swedish young activist, Greta Thunberg, was frequently taken up by the media[49]. Stimulated by her action and speech, school strikes and climate marches were organized by youth in many parts of the world.  Such movements, however, are rare in Japan. For each climate march organized by youth in 2019, many cities around the world observed more than a hundred thousand participants, there were only a few thousand in Japan[50]. The youth of Japan and the public in general could be as concerned as people in other countries of likely climatic changes in the future, but they remain silent or indifferent, thinking that some responsible people should be taking effective measures to save the world.

 

4.  Conclusion

On 3 December 2019, just after COP25 meeting opened in Spain in 2019, Hiroshi Kajiyama, Minister of Ministry of Economy, Trade and Industry held a press conference[51]. When he was asked a question from the press about his thoughts of coal power plants in Japan being criticized at COP25, he responded, “We wanted to leave fossil fuel as an option as source of energy and electricity” as for a vision of 2030, we think reliance on nuclear should be minimum, renewable energy should grow, and we have to think about the best mix of all energy sources.” This reply was translated into English and was received negatively by NGOs that were attending COP25 in Spain. From Minister Kajiyama’s response, it was clear that he was considering an energy policy only from the aspect of stable and ample energy supply to Japanese industries, not from the point of tackling climate change or of meeting Japan’s emission reduction target. The Environment Minister Shinjiro Koizumi, who actually attended the COP25, was criticized for Minister Kajiyama’s remark[52], but there was little he could do to prevent it, because Ministry of the Environment has almost no authority over energy policy.

Rules set by the Paris Agreement became effective from the beginning of this year. The remaining issue is how to fill the gap between the total emission reduction targets of all countries for the year 2030 and the emission pathway required for the world to reach the long-term temperature increases of no more than 1.5–2.0°C. However, as of February 2020, very few countries have revised their emission targets and Japan is not one of them.

The Japanese government’s decision making on climate change is likely to continue to be affected by traditional internal politics consisting of relevant ministries, leading industry groups, and political leaders supported by those industry groups. Meanwhile, Japanese non-state actors are likely to be diversified, and behavior of those with clear ambition towards achievement of a zero-emission society may become quite independent of national decisions.

Such behavioral changes could result in emission cuts being made that are deeper than the projections of the government of Japan. Recently, Japanese industries and local governments’ initiative have moved politicians at the national level. On 20 February 2020, the first bipartisan coalition on climate crises was established by Japanese Diet members. If Japanese grass-root actions were able to change national position on climate change, it would be a dramatic transition not only for Japan’s climate change policy but also for the country’s general policy making process which used to be explained by the firm iron-triangle between politicians, bureaucrats, and industry.

For the United States, Japan’s transition towards a net-zero emission society should be taken as an economic alert for U.S. energy intensive industries and fossil fuel related industries. Industries such as coal and gas, mining, iron and steel, automobile, petrochemistry, etc. will face a challenge when global markets shift completely into a net-zero emission economy. In order to prevent such worst-case scenarios for American industries, they need to recognize the rapid changes going on within the Japanese community and reconsider how they should respond to climate change.  At the same time, the Japanese government and politicians have high respect for U.S. decisions. Once the American government completely changes gears and starts moving towards decarbonization, not only Japanese non-stakeholders but Japanese government itself will be obliged to reconsider its climate change and energy policies that currently still rely on fossil fuel.

Article author is Yasuko Kameyama, Deputy Director at National Institute for Environmental Studies, Japan.  

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