Policy findings on Japan’s transition to a decarbonized society derived from multi-model scenario analysis

Policy Recommendations Background

In his inaugural policy speech on October 26, 2020, Prime Minister Yoshihide Suga declared an intention to reduce emissions of greenhouse gases (GHG) to net zero by 2050 (to achieve carbon neutrality). This pledge replaced Japan’s previous Long-Term Strategy for reducing GHG emissions by 80% by 2050 with the more ambitious goal of net zero. The government announced its Green Growth Strategy in December 2020 and (as of the time of writing) is currently introducing amendments to the Act on Promotion of Global Warming Countermeasures. Revisions are also being made to Japan’s Basic Energy Plan with the aim of having a new plan formulated by summer 2021. The 10th anniversary this month (March 2021) of the Great East Japan Earthquake and the accident at Tokyo Electric Power Company’s Fukushima Dai’ichi Nuclear Power Plant comes at a pivotal time for debate on energy and climate policy.

Mr. Suga’s speech emphasized “reforms and adjustments within industrial structures, the economy and society”. This is certainly no understatement. While the issue of decarbonization has gained widespread recognition, it is a transition that will require the mobilization of a wide range of measures to accelerate both technological innovation and changes within society. Achieving this unprecedented transformation in energy policy will require improvements in scientific evidence from a diverse range of fields.

Model-based energy scenarios are one such form of scientific evidence. The use of scenarios in climate and energy policy has expanded considerably in recent times, prompted by the shift from the top-down approach of the Kyoto Protocol to the hybrid top-down/bottom-up regime of the Paris Agreement.

While the uncertainties from energy scenarios widely acknowledged, the uncertainties that arise out of differences in the models used are of particular importance (Krey, 2014). In the case of complex models with a high degree of nonlinearity, it is not uncommon for different models to produce different results even when working with the same assumptions. Accordingly, the uncertainties that come from differences between models need to be explicitly considered and analyzed when making policy judgements. The Energy Modeling Forum (EMF) at Stanford University has been undertaking research on this basis since the 1970s (Huntington et al., 1982).

The EMF 35 Japan Model Intercomparison (JMIP) (Energy Modeling Forum, n.d.) project undertook a multi-model scenario analysis of Japan’s 2030 reduction targets and Long-Term Strategy (2050 reduction targets) that considered a variety of different uncertainties. Japan’s current Nationally Determined Contribution (NDC) is a 26% reduction relative to FY2013 by FY2030 and the Long-Term Strategy is to target an 80% reduction by 2050 (the NDC is to be updated during this current year (as of this writing)). While a 100% emissions reduction was included in the EMF 35 JMIP scenario design, given that the project commenced in April 2017, the main scenarios used in the analysis were based on an 80% reduction by 2050. Nevertheless, the results of the EMF 35 JMIP analysis serve as a basis for a net-zero mitigation analysis.

Policy Recommendations

The following summarizes the multi-model analysis and its implications.

  • Large reductions of GHG will be needed in all emitting sectors if substantial reductions in GHG emissions (80%, net zero) are to be achieved by 2050. While electricity generation is a frequent focus of debate, it should be kept in mind that measures are needed across all sectors.
  • A distinction should be made between “robust” and uncertain measures. In the model analysis, improving economy-wide energy efficiency, promoting demand-side electrification, and a shift to low-carbon and decarbonized electricity generation were all robust conclusions in the sense that they were shown to be effective measures regardless of the scenario assumptions and choice of model. The exact make-up of the energy mix, on the other hand, remains uncertain. While policy debate tends to focus on particular energy mixes, when looking ahead as far as 2050, it is essential to retain flexibility in the energy mix and to adopt a flexible policy framework that can be revised as needed.
  • Large-scale CDR (the removal of CO2 from the atmosphere) will be important for achieving net-zero emissions. This means there is a need to target large-scale deployment, accelerating deployment on the basis of a major step up in innovation and development for technologies such as biomass power with CCS and the direct air capture of CO2.
  • While new innovations such as CDR are vital, the need for ongoing incremental innovation should also not be overlooked. Solar power, for example, is roughly twice as expensive in Japan as Germany and this is raising the cost of measures such as feed-in tariff systems and energy auctions, imposing a greater burden on electricity prices. As bringing the cost of solar PV into line with international level would permanently reduce the political cost, policies to reduce the cost of renewable energy should be further stepped up.

The full report can be downloaded below.

Policy Recommendation(PDF)