On October 29 Prime Minister Yoshihide Suga announced that Japan would commit itself to net zero carbon emissions by 2050. This was a big reversal for Japan, which previously spoke of hitting that goal sometime between 2050 and 2100, which was still building and exporting coal-fired utilities, etc.

The question is: is this just a bit of greenwashing--announcing a lofty goal but not the measures to make it happen--or a real change?

While there is no guarantee, the likelihood of real action has been raised by a big shift on the part of important segments of both business and the LDP. In 2018, companies created a new lobby, the Japan Climate Initiative (JCI), which, so far, includes 394 of Japan's largest corporations. JCI has forged links with powerful leaders in the ruling Liberal Democratic Party (LDP), including two who may one day become Prime Minister: Administrative Reform Minister Taro Kono and Environment Minister Shujiro Koizumi. (Polls show Kono the favorite of the public if Suga has to step down this autumn.) This January, 92 JCI member companies urged that Japan achieve 40-50% renewables by 2030. Last summer Keizai Doyukai, a federation of executives from 1,000 leading corporations, targeted renewables at 40%.

When CEOs from four JCI companies--SONY, Ricoh, Kao, and Nissay Asset Management--met with Kono in November, SONY chieftain Kenichiro Yoshida delivered a troubling alert, Kono told the Financial Times. Unless Japan upped its renewables-based electricity generation to 40% or more by 2030, SONY and other companies could be forced by its customers to shift much production offshore. Apple, for example, will eliminate by 2030 suppliers who don't use 100% renewable electricity. SONY's facilities in Europe can meet this demand, but not those in Japan.

Some of Japan's businesses have already changed some practices. Japan's megabanks have stopped financing new coal plants (but will keep financing existing ones); several trading companies said they will stop investing in coal mines.

While the momentum is on the side of more decisive action, resistance is strong. Suga promised a reversal of coal policy (without specifics). Keidanren still supports the use of coal for some time to come on grounds of energy security. METI has talked of phasing out "inefficient" coal plants--which Keidanren supports--but not all. Suga pledged that only electric cars would be sold by 2035; METI wants hybrids to be included in the term electric. Most experts think a carbon tax is necessary and Suga said that Japan would work on that. Keidanren opposes it.

We'll know a lot more about the balance of power when METI releases its latest Strategic Energy Plan in June.

Here is my commentary on all this in Toyo Keizai:
Japanese: https://toyokeizai.net/articles/-/412405
English: https://toyokeizai.net/articles/-/414068

Richard Katz