Japan

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GH2 Country Portal – 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: 

  • a new mid-term volume target of 12 million tonnes per annum by 2040 (a sixfold increase from current levels); 

  • a “pathway” to low-carbon hydrogen – aiming for 3.4kg of CO2 emissions or less for 1kg of hydrogen produced; 

  • a 10% target for Japanese companies’ shares of the global electrolyser market. 

Capacity and Capacity targets

Given below is a comprehensive overview of Japan’s capacity targets as part of its Green Hydrogen Strategy

Overview of capacity targets

Impact Targets

Given below is a comprehensive overview of Japan’s impact targets as part of its Green Hydrogen Strategy

Impact targets

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 both rapidly growing and sufficiently large, and 2) Japanese companies are believed to have technological advantages in these sectors. 

The key areas include: 

  • Hydrogen supply (production and construction of the hydrogen supply chain) 

  • Decarbonised power generation 

  • Fuel cells 

  • Direct use of hydrogen (decarbonised steel, decarbonised chemicals, hydrogen-fuelled vessels) 

  • 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. 

Government green hydrogen lead 

Ministerial Council on Renewable Energy, Hydrogen and Related Issues 

Ministry of Economy, Trade and Industry (METI)