Japan
Green Hydrogen Vision
Japan’s green hydrogen vision is a cornerstone of its strategy to achieve carbon neutrality by 2050. Recognising the challenges of limited domestic fossil fuel resources and the high carbon emissions from traditional energy sources, Japan is investing heavily in hydrogen as a clean alternative. The vision centres around establishing a robust hydrogen supply chain by producing green hydrogen through renewable sources like wind, solar, and hydropower, both within Japan and through international partnerships with countries rich in renewables, such as Australia.
This vision also includes developing infrastructure for large-scale storage, transportation, and distribution of hydrogen across industries. Japan aims to use hydrogen to decarbonize key sectors like transportation, heavy industry, and power generation. The country’s commitment to this vision is evident through substantial government funding and private sector investments in research, development, and the deployment of hydrogen technology that would position Japan as a leader in the global shift toward a low-carbon hydrogen economy.
National Strategy
Japan released a revised Hydrogen Basic Strategy in June 2023. Japan was motivated by their 2050 Carbon Neutrality Declaration, made in October 2020 G7 commitments to move away from a reliance on Russian energy, growing calls for climate action, and new hydrogen subsidies under the EU’s Green Deal Industrial Plan and the US’ Inflation Reduction Act.
Japan’s first strategy, released in December 2017, was the world’s first national hydrogen strategy; however, the energy landscape has changed drastically. Japan’s revised strategy intends to generate public and private sector investment in hydrogen over the next decade and increase the use of hydrogen sixfold by 2040. To attract the public and private sectors to GX-related investments, the government plans to contribute upfront investments worth 20 trillion yen and achieve combined investments of 150 trillion yen or more over the next decade.
Japanese government officials highlighted three new features of the refreshed strategy:
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a new mid-term volume target of 12 million tonnes per annum by 2040 (a sixfold increase from current levels);
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a “pathway” to low-carbon hydrogen – aiming for 3.4kg of CO2 emissions or less for 1kg of hydrogen produced;
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a 10% target for Japanese companies’ shares of the global electrolyser market.
To further cement Japan as a ‘hydrogen society’, the “Hydrogen Society Promotion Act” was enacted in May 2024 to codify Japan’s vision and to strongly support the public implementation and utilization of hydrogen.
Capacity and Capacity targets
Given below is a comprehensive overview of Japan’s capacity targets as part of its Green Hydrogen Strategy
Impact Targets
Given below is a comprehensive overview of Japan’s impact targets as part of its Green Hydrogen Strategy
Policy Spotlight
The Japanese government highlights five key categories (nine areas) as its core strategic focus in the updated strategy. These areas were selected based on two criteria: 1) the market is rapidly growing and sufficiently large, and 2) Japanese companies are believed to have technological advantages in these sectors.
The key areas include:
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Hydrogen supply (production and construction of the hydrogen supply chain)
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Decarbonised power generation
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Fuel cells
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Direct use of hydrogen (decarbonised steel, decarbonised chemicals, hydrogen-fuelled vessels)
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Utilisation of hydrogen compounds (fuel ammonia, carbon recycling products)
Japan views Expo 2025 in Osaka as a chance to present its hydrogen technology and share its vision for a hydrogen economy.
The new hydrogen strategy also stipulates that the Japanese government will provide subsidies for establishing the hydrogen supply chain and developing infrastructure based on “carbon intensity.” This means that subsidies will be determined by the level of clean hydrogen emissions rather than the "colour” of hydrogen. The threshold for clean hydrogen is set at 3.4 kg of CO2 emissions per kg of hydrogen on a Well-to-Gate basis. In comparison, the threshold for ammonia is established at 0.84 kilograms of CO2 emissions per kg of ammonia on a Gate-to-Gate basis.
Financing
- The Japan Hydrogen Fund has officially launched, raising $400 million from investors in the banking, hydrocarbons, and automotive sectors. Notable contributors include automotive leader Toyota, oil powerhouse TotalEnergies, hydrogen and industrial gas provider Iwatani, and financial institutions such as MUFG Bank, Sumitomo Mitsui Banking Corporation, the Bank of Fukuoka, Tokyo Century, along with the government-supported Japan Green Investment Corporation for Carbon Neutrality.
- With the enactment of the “Hydrogen Society Promotion Act”, the Japanese government has allocated 3 trillion yen in subsidies (roughly 20 billion USD) through a Contracts for Difference (CfD) system that is designed to incent the adoption and uptake of Japan’s definition of ‘low-carbon’ hydrogen. The support measures are structured around two main pillars: price gap and infrastructure development support, administered through JOGMEC. The price gap support covers the difference between the benchmark price (what suppliers need to charge) and the reference price (what end-users would pay based on alternative fuel costs). The subsidy rate is 100% of eligible expenses, with specific caps to ensure budget control. To access the price gap support, projects must supply at least 1,000 tons of hydrogen equivalent annually and focus on hard-to-decarbonize sectors. Infrastructure development support has a higher threshold of 10,000 tons annually and requires clear regional economic benefits. These projects must demonstrate shared infrastructure potential for multiple users and have strong community support.
Government green hydrogen lead
Ministerial Council on Renewable Energy, Hydrogen and Related Issues
Ministry of Economy, Trade and Industry (METI)
Japan Organization for Metals and Energy Security (JOGMEC)
Agency for Natural Resources and Energy (ANRE)