Japan Unveils Bold 2040 Climate & Energy Plan: Emission Cuts, Nuclear Expansion & Renewable Push

Japan has approved new climate, energy, and industrial policies through 2040, aiming to cut greenhouse gas emissions by 73% from 2013 levels and increase renewable energy to 50% of its electricity mix. The government is shifting towards nuclear expansion by supporting next-generation reactors while fostering industrial clusters in low-carbon sectors. Challenges include rising costs in offshore wind projects and geopolitical uncertainties, such as U.S. policy shifts on climate commitments.

Japan Unveils Bold 2040 Climate & Energy Plan: Emission Cuts, Nuclear Expansion & Renewable Push

Japan has approved new long-term policies targeting reductions in greenhouse gas emissions, an updated energy strategy, and a revised industrial policy, all extending through 2040. The measures, aimed at enhancing policy stability for businesses, emphasize decarbonization, energy security, and industrial growth to bolster economic development.

The revised climate policy commits Japan to reducing greenhouse gas emissions by 60% from 2013 levels by 2035, increasing the target to 73% by 2040. This builds on the country’s existing goal of a 46% reduction by 2030. When initially proposed, the new targets received pushback from experts and members of the ruling coalition, who advocated for more aggressive cuts. Public sentiment also favored stronger measures, with over 80% of 3,000 public comments calling for stricter targets. However, the environment and industry ministries upheld the proposed goals, citing extensive expert discussions that had already taken place. Japan intends to submit these new targets as part of its Nationally Determined Contribution (NDC) under the Paris Agreement later this month.

The updated energy policy sets a target for renewable energy sources to make up as much as 50% of the country’s electricity mix by fiscal year 2040. Additionally, nuclear power is expected to contribute 20%, reflecting Japan’s commitment to cleaner energy while addressing increasing power demands. Despite these goals, the country’s nuclear sector has faced significant challenges following the 2011 Fukushima disaster, which has slowed reactor restarts. As a result, nuclear power accounted for only 8.5% of Japan’s electricity supply in 2023.

A major shift in Japan’s energy approach is the removal of its previous objective to reduce reliance on nuclear power. Instead, the government now supports constructing next-generation reactors to strengthen the role of nuclear energy in the country’s future power generation.

In parallel with the climate and energy policies, Japan has approved an integrated industrial strategy that aligns with its emissions reduction and energy plans. This strategy includes fostering industrial clusters in regions rich in renewable and nuclear energy resources, aiming to develop competitive low-carbon industries.

Despite these policy advancements, several challenges could affect Japan’s ability to achieve its targets. One major concern is the domestic offshore wind sector, a crucial component of the renewable energy expansion plan. Rising inflation and increasing project costs have created obstacles, prompting Mitsubishi Corporation to reassess three domestic offshore wind projects.

Another potential complication arises from global geopolitical shifts. The decision by U.S. President Donald Trump to withdraw the United States from the Paris Agreement, along with his administration’s negative stance on renewable energy, has introduced uncertainty into global climate cooperation. This shift in U.S. policy could complicate Japan’s efforts to expand renewable energy initiatives and collaborate with international partners.

Despite these challenges, Japan’s new policies represent a significant commitment to balancing economic growth with climate responsibility. The country’s focus on decarbonization, energy security, and industrial advancement aims to position Japan as a leader in the global energy transition while ensuring long-term policy certainty for businesses and investors.