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Nissan, Sony and other major Japanese firms call on government to ramp up clean energy deployment

The 92 companies want Japan to double its 2030 renewable energy target. Despite its carbon neutral pledge, the world’s fifth-biggest emitter is one of the most challenging markets for businesses to adopt 100 per cent clean energy.

Major Japanese corporations including Nissan, Panasonic, Ricoh and Sony Corporation have called on the Japanese government to ratchet up the share of renewables in the country’s energy mix by 2030.

In a statement on Monday (18 January), the 92 companies, which are all members of the Japan Climate Initiative, called for clean energy to make up 40 to 50 per cent of Japan’s electricity mix by 2030—or roughly double the government’s current target of 22 to 24 per cent.

Japan is the world’s third-largest economy and fifth-biggest emitter, and the companies hail from a wide range of sectors including construction, aviation, shipping, retail, steel and finance.

More than 120 countries such as South Korea, New Zealand and Japan have pledged to become carbon neutral by 2050, and a significant and rapid expansion of renewable energy as well as greater energy efficiency are needed to achieve the target, the companies said.

“In order for Japan to meet its responsibilities to be one of the leaders in global efforts, the target needs to be much more ambitious. An ambitious target will stimulate renewable energy deployment, and Japanese companies will be able to play a greater role in the global business environment, where decarbonisation is accelerating,” the companies said in their statement. “It will enable Japanese companies more committed to the challenge of mitigating the climate crisis.”

The companies that are part of the Japan Climate Initiative—a network of companies, local governments and non-governmental organisations—are all supporters of corporate climate initiatives such as RE100, Science Based Targets or the Taskforce on Climate-related Financial Disclosures.

An ambitious target will stimulate renewable energy deployment, and Japanese companies will be able to play a greater role in the global business environment, where decarbonisation is accelerating.

Message from 92 Japan Climate Initiative member corporations

Although Japanese prime minister Yoshihide Suga’s pledge for his country to go net zero by 2050 by last year was widely welcomed, Japan is among the most challenging countries in the world for businesses to adopt 100 per cent renewable energy. Other Asia Pacific markets with the same reputation are Australia, mainland China, Indonesia, Singapore, South Korea and Taiwan.

This was according to a report by RE100 last December, which collected data from 261 major businesses with clean energy commitments.

Renewables are more costly in Japan than more polluting sources of energy, and are of limited availability. Large-scale procurement options are limited to hydro plants operated by regional utilities and feed-in tariff-certified renewables, which includes solar power, the report noted. 

Green energy certificates are in high demand but Japan’s tracking systems are fragmented and relatively difficult to navigate. Installing solar panels on rooftops is an option, but this can only meet a small portion (5 to 20 per cent) of commercial buildings’ electricity demand, according to the RE100 report.

“Allowing offsite corporate power purchase agreements (PPAs) between consumers and generators directly will lead to more market competition and drive down costs,” the report noted. Offsite PPAs are contracts that allow companies to buy renewable energy generated from a different location than their premises.

In another proposal last August pushing for greater deployment of low-carbon energy, Japan’s Renewable Energy Institute—a think tank founded by SoftBank chairman and chief executive Masayoshi Son—argued that the country could phase coal out completely by 2030, a sharp drop from about 31.5 per cent of the energy mix in 2018.

This is necessary to achieve the goal of the Paris climate accord to cap global warming at below two degrees Celsius by the end of the century. In 2018, renewable sources supplied 17 per cent of Japan’s electricity. Natural gas supplied 38 per cent and nuclear, 6 per cent.

The institute projected that the renewable sources of solar, wind, hydro, bioenergy and geothermal could meet 45 per cent of the country’s energy needs by 2030, with the remainder generated from natural gas. 

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