Carbon Recycling Fund Institute
Progress Report 2023
—Achieving Concrete Progress Toward a Carbon Recycling Society—

September 2023
Carbon Recycling Fund InstituteContents

1. Outline
2. Trends in carbon recycling
3. The importance of carbon recycling, the roles of the Carbon
Recycling Fund Institute (CRF), and progress to date
4. Recommendations for realizing a carbon recycling society
5. Summary

Attachment 1. Examples of activities by CRF members
Attachment 2. Summary of the questionnaire conducted to CRF
members
Attachment 3. Overview of the CRF

Outline

Trends in carbon recycling* Measures against climate change, as well as trend setting and actions to achieve carbon neutrality, are in
progress though energy and resources supply chain risks persist. The Sharm el-Sheikh Implementation
Plan to call for the strengthening of measures in each field of climate change remedies and the Mitigation
Work Program were adopted at COP27 (November 2022, Sharm el-Sheikh in Egypt). The Conference
decided to take measures to compensate for loss and damage, establish a fund as part of these efforts, andset up a migration committee to make recommendations on starting the operation of these financial
measures in the lead-up to COP28.
* The Sixth Assessment Report published by the IPCC in March 2023 points out that the greenhouse gas
emissions reduction targets set by national governments are not enough, and suggests CO2 reduction of
65% by 2035 and 80% by 2040 (compared with FY2019) as targets after 2030 to control the average
global temperature increase to 1.5℃. Current actions are not enough to achieve NDCs and further actions
such as investment expansion are required. Meanwhile, the Report clearly shows that the 1.5℃ target canbe achieved by implementing inclusive long-term plans and adaptation activities, that the implementation
costs are falling, and that measures selected and implemented over the next ten years are highly likely tohave impact from now until several thousand years ahead.
* To realize green transformation (GX), the Japanese government has launched Tokyo GX Week since 2022
(scheduled to be held from September to October in 2022 and 2023) to organize international conferences
related to energy and the environment. The government hosted international meetings such as theInternational Conference on Carbon Recycling and the Asia CCUS Network Forum during GX Week todeepen discussions and promote the implementation and realization of policies leading to GX.
Furthermore, the government is stimulating dialogue among businesses in the GX League. The GX
League comprises businesses that are trying to accomplish GX and aim for sustainable growth now andin the future with an eye to realizing carbon neutrality and social change by 2050, and that can collaborate
with companies having the same ambition as well as with government and academia.
* Summary of the communique at the G7 Hiroshima Summit in May 2023: Alignment and reconsiderationof nationally determined contribution (NDC) goals for the 1.5℃ target and goals in long-term low-GHG
emissions strategies, fund raising including private capital for further implementation and developmentof clean technologies and activities, importance of transition finance, shift to a nature-positive economy,
and pursuit of safe, healthy, and low-cost sustainable clean energy supply chains.
* The GX Promotion Act (Act on the Promotion of a Smooth Transition to a Decarbonized GrowthOriented Economic Structure) was passed in Japan in May 2023. Policies for carbon neutrality such as
clean energy strategies have been formulated and updated and businesses, municipalities, and academia
are taking measures accordingly.
* The Japanese government revised the Carbon Recycling Roadmap in June 2023. Carbon recycling is
positioned to reduce CO2 emissions throughout the supply chain of products, etc. and contribute torealizing a carbon-neutral society by 2050. The potential of CO2 recycling through carbon recycling isestimated to be about 200 to 100 million tons as of 2050 (equivalent to carbon recycled products used inJapan).


Roles of the Carbon Recycling Fund Institute (CRF) and the progress to date
* Roles of the Carbon Recycling Fund Institute (CRF):
The CRF is a platform for coordination between stakeholders who are working to create a sustainablecarbon system and provides a place for information sharing. We consolidate members’ opinions to
overcome obstacles CRF members face in taking initiative for the development and social implementationof carbon recycling technologies, and support creation and social implementation of innovations that
contribute to carbon recycling as a facilitator to promote measures through dialogues with stakeholders.
* Progress of activities from 2022 to July 2023:- The CRF has begun group activities for realizing a sustainable carbon recycling system. In FY2022,
the CRF studied possibilities in Takehara and other cities in Hiroshima Prefecture, with members andparticipating companies exploring items that would lead to collaboration.
- Regarding research grants, the CRF selected 16 projects, including three conducted by start-ups in
FY2023, and 16 projects including three conducted by start-ups in FY2022. Of 40 projects selectedfrom FY2020 to FY2022, progress has been made in 11 of them. Specifically, one project is in theprocess of verification testing, seven have been selected as national projects, and three are being jointly
researched in the private sector.
- The CRF has promoted information sharing among members and other stakeholders by, for example,
enhancing our website and organizing the online carbon recycling salon. More than ten introductions
have led to dialogues between individual companies.
- To establish an environment where the private sector works on carbon recycling related to CO2 sinks
as a business activity, the CRF established a forestation fund as the third fund in April 2023 and started
afforestation with fast-growing trees. We also created the CO2 Sinks Study Group as a place fordiscussion about the future development of green and blue carbon.
- The CRF organized the second term of a program called “Carbon Recycling University” to develop
carbon recycling coordinators. We also jointly organized a “local Carbon Recycling University” with
Hiroshima University in February 2022, where local young people and young employees from member
companies think about the future of the community through carbon recycling.
- The then-Chairperson of the CRF, Mr. Nobuo Fukuda, gave a video speech as a high-level government
respondent at the 8th UN STI Forum. The moderator commented that carbon recycling is an extremely
important technology for mitigating climate change in his speech in response to the significance ofbuilding a sustainable carbon system that leverages the Earth’s inherent functions.



Revisions to three core recommendations to promote the achievement of a carbon recycling society(Revisions are underlined.):The CRF made the following recommendations based on discussions among members about what society
should become and processes to realize it, as members take the initiative in working on the development
1and social implementation of carbon recycling technologies. The CRF is taking the lead with its members
in implementing the recommendations to achieve carbon neutrality, mainly through carbon recycling andrealize a carbon recycling society, according to the roles described in Chapter 2.
Develop and promote innovation, develop human resources- The CRF and its members should formulate and implement growth strategies to achieve carbon neutrality
by 2050. They should also develop carbon recycling technologies and products, verify these technologies
and products, deploy them in the real world at a faster pace, and expand investment in them. To help
achieve these goals, we should engage in cross-industry coordination, including coordination with startup companies, and take full advantage of open innovation. We should also leverage government-led
support to implement measures such as a “Basic GX Policy.”- To support the activities of these industries, the national government should enhance its measures, suchas by providing greater support to accelerate green transformation. Solid and continuous support should
be provided for highly motivated companies that take the initiative.
- Between 2030 and 2050, personnel who can implement carbon-neutrality measures and carbon recycling
should be developed.
- A deeper understanding of carbon neutrality and carbon recycling should be fostered among the generalpublic in order to promote greater adoption by society.
Create CO2 value chains- Carbon recycling technologies and products establish their importance and roles in society through theirdeployment and application, so CRF members should promote the creation of CO2 value chains that
contribute to the valuation of CO2 by promoting the understanding and usage of carbon recycling
technologies and products.
- CO2 separation and recovery is the key technology in the value chain. The CRF will enhance the efforts
that will work with it and help CO2 suppliers and users work together to develop a strategy for the
dissemination of CO2-derived products.
- To maintain and enhance Japan’s international competitiveness, the national government should promotemeasures across the ministries that provide incentives, such as offering premiums for products andservices that use CO2 value chains.
- Quantitative evaluation of obtained and accumulated data regarding CO2 separation, capture, and usage
should be promoted, as should the visualization of CO2 flow based on LCA. Furthermore, efforts should
be made to further the overall optimization of the effects and impact of introducing carbon recycling.
- Discussion on matters that would have major impacts on and consequently transform the social structure,such as emission trading, carbon taxes, and carbon pricing, should be promoted. Unified systems that
ensure fairness between industries should be prepared and implemented without delay.
- CO2 sinks such as oceans and vegetation should be evaluated, and international rules should be actively
deployed. Support should be provided for small-scale voluntary credit frameworks that serve as their base.
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Integration with regional revitalization and expansion to the global market- CRF members should create examples that leverage the strengths and features of communities bycollaborating with local governments. In particular, the agriculture, forestry, and fishing industries should
be revitalized as they contribute to CO2 sinks. Examples include planting fast-growing trees and building
fish reefs made of CO2 concrete.
- The national government should strengthen support for creating examples of CO2 value chains throughcollaboration between the private sector and local communities.
- Efforts should be expanded to the global market, including the licensing business. Particularly for Asian
countries, carbon-neutrality technologies should be introduced to nurture carbon recycling into one ofJapan’s growth industries, contributing to carbon neutrality throughout Asia.


Summary
The importance of carbon recycling to capture and fix CO2, and use CO2 and carbon compounds as
resources, is rising at an unprecedented speed in order to achieve carbon neutrality based on a balanced
combination of environment and economy. As such, the Carbon Recycling Fund Institute serves as aplatform for cross-industrial and industry-academic-government coordination, implementing theserecommendations and other activities. The Institute will promote the creation of a framework for global
carbon recycling, namely a “Sustainable Carbon System,” in various fields including resources, energy, andfood through industry-academic-government coordination and cooperation with overseas parties as well as
cross-industrial collaboration in the private sector to help achieve carbon neutrality not only in Japan but
also across the globe.



Attachment 1. Progress made through actions by members of the CRF working towards therealization of a carbon recycling society
CRF members have made progress in verification as well as research and development on CO2 separation andcapture, fuel conversion, mineralization, conversion to chemicals for the social implementation of carbon
recycling technologies, as well as CO2 capture and fixing. These are the next to renter practical use coordination
with the agriculture, forestry, and fishing industries. Attachment 1 introduces examples of these developments.



Attachment 2. Summary of the questionnaire conducted to CRF members



Attachment 3. Overview of the CRF

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1. Trends in carbon recycling
Measures against climate change and movements to achieve carbon neutrality continue, and trend setting
and action are in progress even though resources and energy supply chain risks persist. The Sharm el-Sheikh
Implementation Plan, which calls for the strengthening of measures in each field of climate change remedies,and the Mitigation Work Programme to enhance ambitions for and implementation of mitigation by 2030,
were adopted at COP27 (November 6 to 20, 2022, Sharm el-Sheikh in Egypt). Conference delegates alsodecided to take measures to compensate for loss and damage (loss and damage caused by adverse effects
of climate change), establish a fund as part of these efforts, and set up a migration committee to makerecommendations on putting these financial measures into action ahead of COP28.
The IPCC’s Sixth Assessment Report published in March 2023 recommends CO2 reductions of 65% by2035 and 80% by 2040 (compared with FY2019) as targets after 2030 to control the average global
temperature increase to 1.5℃. It updates scientific insights from the Fifth Assessment Report with regard
to the reality and impact of climate change, and updates long-term and short-term prospects. It argues thatcurrent actions are not enough to achieve NDCs, so further action such as investment expansion are required.
Meanwhile, the Report clearly shows that the 1.5℃ target can be achieved by implementing inclusive longterm plans and adaptation activities, that the implementation costs are falling, and that measures selected
and implemented over the next ten years are highly likely to have impact from now until several thousand
years ahead.
To realize green transformation (GX), the Japanese government launched Tokyo GX Week in 2022
(September to October 2022) to organize international conferences related to energy and the environment.
The government hosted international meetings such as the International Conference on Carbon Recycling
and the Asia CCUS Network Forum during GX Week to deepen discussions and promote theimplementation and realization of policies leading to GX. Furthermore, the government is stimulating
dialogue among businesses in the GX League. The GX League comprises businesses that are trying toaccomplish GX and aim for sustainable growth now and in the future with an eye to realizing carbon
neutrality and social change by 2050, and that can collaborate with companies having the same ambition as
well as with government and academia.
G7 Ministers’ Meeting on Climate, Energy, and Environment (April 2023) associated with the G7
Hiroshima Summit in May 2023 positioned data-based decarbonization in the industry and appropriate
evaluation of contributions to reduction towards a net-zero society as priorities, and agreed on taking
concrete action to coordinate initiatives. The keywords were nature positivity and the promotion of businessleadership, actions, and partnerships for a recycling-based economy and resource efficiency.
The GX Promotion Act (Act on the Promotion of a Smooth Transition to a Decarbonized Growth-Oriented
Economic Structure) was passed in Japan in May 2023. Policies for carbon neutrality such as clean energy
strategies have been formulated and updated and businesses, municipalities, and academia are taking
measures accordingly.
The Japanese government revised the Carbon Recycling Roadmap in June 2023. Carbon recycling is
positioned as a key technology for reducing CO2 emissions throughout the supply chain of products, etc.
and helping to realize a carbon-neutral society by 2050. The government changed its plan, bringing forward
4

the start widespread use of carbon recycled products (general-purpose products) to around 2040, andestimated the potential of CO2 recycling through carbon recycling to be about 100 to 200 million tons as of2050 (equivalent to carbon recycled products used in Japan).

Figure 1. Ministry of Economy, Trade and Industry – Plan for expanding carbon recycling
Source: Ministry of Economy, Trade and Industry website

Figure 2. Ministry of Economy, Trade and Industry – Forecast of energy-derived CO2 emissions

5Source: Ministry of Economy, Trade and Industry website

2. Roles of the Carbon Recycling Fund Institute (CRF) and progress to date
Many carbon compounds containing CO2 are essential for maintaining the Earth’s systems, including life
itself. For example, greenhouse gases, including CO2, protect the Earth’s environment from the harsh coldof space. Plants use CO2 to synthesize carbon compounds and provide them to nature; indeed, our own
bodies are made up of carbon-based substances. The carbon system is a vital part of the atmosphere, land,and seas.

Figure 3. Model of the Earth’s carbon cycle
Source: Created by the Carbon Recycling Fund Institute based on materials from the National Institute forEnvironmental Studies, Center for Global Environmental Research

What we must aim to do is achieve the 1.5°C target and go beyond that to create truly sustainablesocioeconomic systems. To do so, we must not look at CO2 as an enemy but instead restore and maintainour planet’s health by creating carbon recycling societies that are based on the idea that CO2 is a resource
to be circulated and utilized. Based on this comprehensive approach, it is vital that we identify and capture
CO2 produced through social and economic activities. We need to make dramatic changes to our energy
production and usage, including developing and introducing renewable energy and transforming ourlifestyles. We must switch to the use of value-added materials for the materials that are indispensable forour societies and economies, such as concrete and chemicals. Furthermore, we must harness the power ofnature in industries such as agriculture, forestry, and fishing while fixing CO2 and turning it into a resourceby capturing and storing it. Transforming it into a value-added product and creating a market for it is crucial,which will require promoting integrated initiatives that take the entire CO2 value chain, including CCS andhydrogen, into account.

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Figure 4. Conceptual image of the CO2 value chain used in realizing carbon recycling societies
Source: Carbon Recycling Fund Institute materials

In August 2019, employees from 15 corporations established the Carbon Recycling Fund Institute (CRF)
with a mission of supporting the creation and social implementation of innovation that contributes to carbon
recycling by carrying out publicity activities, providing research grants, issuing policy recommendations,and more. The aim is to address both the problems of global warming and global energy access. The purposeof the CRF is to serve as a platform through which stakeholders can work to achieve carbon neutrality andcreate carbon recycling societies (sustainable carbon systems), led by the key concept of carbon recycling,
and to facilitate related activities.
Now, four years since its establishment, the CRF has more than 180 members who support its goals andparticipate in its activities (125 corporate members, 13 local governments, 19 academic members, and 26
individuals, as of August 20, 2023). The CRF serves as the foundation through which the private sector will
implement carbon recycling policies, the heart of the Green Growth Strategy Through Achieving Carbon
Neutrality by 2050 announced by the Japanese government.
[Example of progress: research grant activities]
Through its research grant activities, the CRF supports research and development on carbon recycling
by academia, established businesses, and start-ups that are both unique and innovative, and measuresthat contribute to the steps that lie beyond this: verification testing and actual implementation in society.
Specifically, research grants are provided to both individual researchers and research teams in a broad
range of fields related to carbon recycling, such as CO2 separation and capture, conversion to fuelusage and chemicals, mineralization, social science-related research, research related to CO2 sinks(soil, forests, blue carbon, biological use, agriculture, forestry, and fishing industries), hydrogencreation, geoengineering, functional materials, medical fields, and more.
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CRF’sgrant

National
funding
Accelerating
implementation
in society

Figure 5. Overview of the Carbon Recycling Fund Institute’s research grant activities
Source: Carbon Recycling Fund Institute materials

The CRF selected 12 of the 35 applications in FY2020, 12 of the 46 applications in FY2021, 16(including three start-up projects) of the 84 applications in FY2022, and 16 (including three start-up
projects) of the 87 applications in FY2023. Over the four years from FY2020 to FY2023, the CRF has
provided over 350 million yen in grants.

8

Research Grant: 16 Projects Adopted in FY2023
Field
CO2 separation andcaptureCO2 separation andcapture（Direct Air

Study title

Name of Research Representative(Organization)

Development of Defect-Free MOF Ultrathin Membranes for CO2 Capture

Shunsuke TANAKA（Kansai University）

Room temperature and atmospheric pressure CR technology using innovative
separation adsorbent and photocatalyst

Hideki TANAKA（Shinshu University）

Highly efficient atmospheric CO2 capture featuring with a new CO2 emission system

Fuyuhiko INAGAKI（Kobe Gakuin University)

DAC System with Innovative Separation Membrane and Photoresponsive Absorbent

Tatsushi IMAHORI（Tokyo University of Science）

Capture）[Startup support framework]

Conversion to fuels

Development of novel on-demand laser driven chemical process

Akira KUWAHARA（Nagoya University）

Development of highly effective cathode catalysts for electrochemical CO2 reduction

Yoshikazu ITO（University of Tsukuba）

Development of Direct Air Capture (DAC) system using zeolites

Development of Fluidized Bed Plasma Reactor for Innovative Direct Methanol
Conversion tochemicals

Production from CO2
Development of Reaction System for Selective Conversion of CO2 to Chemicals with
Waste Silicon as a Reducing AgentKei IKEGAMI（Planet Savers Inc.）

Nobusuke KOBAYASHI（Gifu University）
Ken MOTOKURA（Yokohama National University）

Development of technology to convert CO2 into useful chemicals using electrochemical Katsuhiko TAKEUCHI（National Institute of Advanced
dehydration reactions

Industrial Science and Technology）

Conversion tochemicals

Development of fatty alcohol production from CO2 using microorganisms(Using organisms)
Social sciences
Conversion to highvalue-added materials
Technologies related
to the use of bioenergy
Direct use of CO2

Regime Change for Carbon-Neutral Agriculture, Forestry, and Fisheries

Kosuke NISHIO（Utilization of Carbon Dioxide
Institute Co., Ltd.）
Ayu WASHIZU （Waseda University）

Development of Direct Coating Process of Carbon Nanotube Films from Carbon Dioxide Yuta SUZUKI（Doshisha University）
Development of a novel electrochemical device for effective utilization of unused

Akifumi IDO（Central Research Institute of Electriccarbon resources

Power Industry）[Startup support framework]

Atsushi Alex MAZAWA（Kyoto University Innovation

A New Bio-Energy with Carbon Capture & Storage

Capital）

CO2 hydrate storage and discharge system

Shin’ya OBARA（Kitami Institute of Technology）

Research Grant: 16 Projects Adopted in FY2022
Field
CO2 fixation bymineralization

Conversion to fuels

Study title

Name of Research Representative(Organization)

Development of next-generation CO2 solid adsorbent without the use of water or heat

Kiminori SATO (Tokyo Gakugei University)

Development of a novel CO2 immobilization technology using microbial fuel cell

Daisuke SANO (Tohoku University)

Practical strengthening of biomass concrete using wood ash

Masahiro OUCHI (Kochi University of Technology)

Development of heat exchanger-less CO2 methanation process using advanced thermal
storage technology

Takahiro NOMURA (Hokkaido University)

Conversion to

Ultra-high efficient CO2 reduction developed using an innovative photocatalyst design

Tomoko YOSHIDA (Osaka Metropolitan University)

chemicals

Small molecule conversion in nanopores created by cyclic porphyrin assemblies

Yusuke KURAMOCHI (Tokyo University of Science)

Conversion tochemicals(Using organisms)

Development of microbial production technology for nylon precursor compounds frombiomass resources
Development of a clean carbon recycling process using microbes with C1 methanol,
which is industrially available in stable supply
Development of CO2 reduction method using hydrothermal processing of industrial

Reuse and recycle ofcarbon resources, etc.

waste
[Startup support framework]
Development of carbon neutral technology and carbon value creation using biomass

Masashi SHIMIZU (Micro Bio Factory Co., Ltd.)
Shuhei NODA (RIKEN)
Naoto TSUBOUCHI (Hokkaido University)
Koryu KAWATANI (Innovare Co., Ltd.)International joint research with the Bandung
Institute of Technology, etc.

materials
CO2 separation andrecoverySocial sciences

Selective airborne CO2 collection triggered by solidification[Startup support framework]
Development of a direct air capture (DAC) system incorporating porous PCPs/MOFs
Message design to promote carbon recycling products

Development of ocean mobility for visualization of CO₂ absorption and circulation
processes in the ocean and analysis of blue carbon in coastal shallow water areas
Utilization of CO2
sinks

Epigenetics analysis of plants for the development of functional fertilizers that increase
the photosynthesis rate under long-term and high carbon dioxide concentrations
Enhancement of plant CO2 uptake using a chemical compound

Fuyuhiko INAGAKI (Kobe Gakuin University)
Daisuke ASARI (Atomis Inc.)
Hidenori KOMATSU(Central Research Institute of Electric Power
Industry), International joint research with SaintMary’s University
Ikuo YAMAMOTO (Nagasaki University)
Joint research with JAMSTEC, MeteorologicalResearch Institute, Nagasaki Marine Industry Cluster
Promotion Association
Shoko MATSUSHITA plant CO2 (Nihon University)
Yohei TAKAHASHI (Nagoya University)

Figure 6. List of research projects selected for grants by the CRF
FY2023 (upper list) and FY2022 (lower list)
Source: Carbon Recycling Fund Institute materials

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Among the applications chosen to receive grants from the CRF, seven projects have been selected andare currently receiving NEDO research grants or national project grants such as Green Innovation
Fund grants, while three projects have led to joint research with private companies. One of the projects
selected in FY2022 entered the verification testing phase in July 2023 after development proceeded
due to using the CRF grant.

Research Grant: Stepped-up Projects
Field

CO2 fixation
Conversion tofuels

Conversion tochemicals

CO2
separationand capture
Socialsciences
Utilization of
CO2 sinks

Adoptedyear

Development of a novel CO2 immobilization technology
using microbial fuel cell

Name of Research
Representative(Organization)
Daisuke SANO (Tohoku University)

FY2022NEDO
MOE

Development of new CO2 mineralization method using
waste seawater and biogenic amine

Ko YASUMOTO (Kitasato University,
Kitasato Institute)

FY2021

JST/OPERA

Removal of the bottlenecks in microalgal biofuel production
through molecular breeding of a unicellular green alga

Shigeaki HARAYAMA (Chuo
University)

FY2021

GI FundDevelopment of an Ultra-efficient Method for Producing
Polyurethane Raw Materials from CO2

Katsuhiko TAKEUCHI (National
Institute of Advanced Industrial
Science and Technology)

FY2021

Joint research withcompanies

Development of technology for synthesizing lactic acid andpolylactic acid from carbon dioxide

Hajime KAWANAMI (National
Institute of Advanced Industrial
Science and Technology)

FY2021

Joint research withcompanies

Adaptive research on new low-temperature methanol
synthesis catalyst to IGCC+CCS

Noritatsu TSUBAKI (University of
Toyama)FY2020JST

Development of CO2 absorber for low-cost CO2-freehydrogen production

Kei INUMARU (Hiroshima University) FY2021

Joint research withcompanies

Selective airborne CO2 collection triggered by solidification

Fuyuhiko INAGAKI（Kobe Gakuin
University)

FY2021,
FY2022

MOE

Research on the Realization for“Carbon-Recycle Complex” along Seto-Inland-Sea

Takayuki ICHIKAWA (Hiroshima
University）

FY2020

JST/A-STEP (tryout)

Development of a compact horticultural system withatmospheric CO2 enrichment by membrane separation

Shigenori FUJIKAWA (Kyushu
University)

FY2021

JSPS/Grants-in-Aid
for Scientific Research

Enhancement of plant CO2 uptake using a chemicalcompoundYohei TAKAHASHI (Nagoya
University）

FY2022Adopting
institution

Study title

Field trial

Figure 7. Examples of achievements from CRF research grant activities
Source: Carbon Recycling Fund Institute materials[Example of progress: Workshop for realizing a carbon recycling society]
The CRF has promoted working group activities to connect CO2 emitters and potential CO2 users, andseeks opportunities to perform social pilot testing of carbon recycling and then deploy it in society byleveraging the strengths of local communities.
In FY2022, the CRF organized a workshop in Takehara, Hiroshima Prefecture. Not only member
companies that have offices in Takehara or other cities in Hiroshima Prefecture, but also leading local
companies and officials, participated in the workshop and discussed creation of the Takehara Model.
Several CO2 value chains are now connected following introductions to the technologies and activitiesof participating companies, tours at related facilities, and other activities. As individual activities start,
the CRF will support them.
We plan to deploy this model to other regions by organizing similar workshops on deploying carbon
recycling technologies in society.

10Figure 8. Overview of the CO2 value-chain creation workshop
Source: Carbon Recycling Fund Institute materials[Example of progress: Carbon Recycling University—Program to nurture the next generation ofpeople who will be involved in realizing a carbon recycling society]
Carbon neutrality-oriented R&D and commercialization requires a major, global-scale mission andlong-term efforts involving complex systems. That is why it is essential that the people involved in theprocess see the challenges as ones that they face themselves and that they take a proactive approach
while drawing in those around them, expanding their circle of collaboration. In FY2021 the CRF
started Carbon Recycling University courses for young employees who are expected to become core
members of their companies in the future. In these courses, participants develop the skills and mindsetsthat are important when implementing ideas in collaboration with organizations and people withvarious ideas and values. These skills and mindsets are cultivated through discussions withmanagement personnel from promising startup companies and colleagues. In 2022, the second year of
the courses, 20 young employees from member companies participated. They engaged in group workon four themes selected based on their own recognition of issues: (1) energy, (2) upcycling, (3)decentralized societies, and (4) CO2 visualization and valuation.
In addition, the CRF planned the local Carbon Recycling University as an opportunity for young
workers from member companies and local young people to think about the future together. In FY2022,
we organized this event at Hiroshima University with the University’s help.

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Figure 9. Samples of team presentations at the Carbon Recycling University courses in the second year
Source: Carbon Recycling Fund Institute materials

Figure 10. Local version of the Carbon Recycling University (at Hiroshima University)
Source: Carbon Recycling Fund Institute materials

12[Example of progress: The Tale of Carbo and Risa – Digital content for the young]
Due to the importance of reaching the younger generation, the CRF created “The Tale of Carbo andRisa,” digital content for junior high and senior high school students. The fascinating story introduces
examples of carbon recycling. We are now working on turning it into a series. Carbo and Risa, highschool students in the year 2222, when sustainable carbon societies are commonplace, together with
Sasuke the Ninja Owl, travel through time to around 2022 and learn about the efforts devoted toinnovation and the passion of people involved in it. It is available for viewing on the CRF website.
Sasuke also plays an active part in PR activities as the CRF’s mascot.

Figure 11. Sample content from the Tale of Carbo and Risa and Sasuke
Source: Carbon Recycling Fund Institute materials
[Activity progress: Messages from the CRF’s leaders]
Senior leaders from the CRF explain the importance of carbon recycling and call for collaboration atinternational symposia and exhibitions. In FY2022, the then-CRF’s Chairperson, Mr. Nobuo Fukuda,gave a presentation at the International Conference on Carbon Recycling in October and ViceChairperson Mr. Masayoshi Kitamura presented during World Smart Energy Week 2022 in March,receiving many responses.
In addition, Mr. Fukuda, CRF Chairperson at the time, gave a three-minute video speech as a highlevel government respondent at the 8th UN STI (Science, Technology, and innovation) Forum held at
the UN headquarters in May 2023. In response to his speech on the significance of building asustainable carbon system that leverages the Earth’s inherent functions to address climate change andsolve challenges such as sustainable procurement of resources, energy, and food, the moderator
suggested that carbon recycling is a crucial technology.

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Figure 12. Then-Chairperson Mr. Fukuda and Vice Chairperson Mr. Kitamura giving speeches
Source: Carbon Recycling Fund Institute materials

[Activity progress: Establishment of a forestation fund and strengthening of work on CO2 sinks]
The CRF established a forestation fund in April 2023 as a measure for concrete work on CO2 sinks,
which play a key role in attaining carbon neutrality. In the preparatory stage, we interviewed CRF
members and exchanged information and opinions with the relevant ministries, namely the Ministryof Economy, Trade and Industry and the Ministry of Agriculture, Forestry and Fisheries (Forestry
Agency). Positioning the CO2 sinks study group founded at the same time as the basis, we will planand implement the following activities: afforestation using fast-growing trees, etc. and exit strategies;
discuss the credit system associated with these activities; obtain necessary data; organize PR activities
and events to promote understanding across the general public; coordinate with the agriculture, forestry,
and fishing industries on measures such as blue carbon; and cooperate with municipalities and local
industries. The first study group meeting took place in July 2023 under a theme of forestation.
In June 2023, we organized a forestation event, “Forest of Carbo and Risa,” in the town ofHigashimatsuyama, Saitama Prefecture (area flooded due to the collapse of the Oppegawa Riverembankment during Typhoon Hagibis in 2019). Over 80 people, including local agricultural workers,
assembly members, CRF members and their families, joined this event. They planted 200 fast-growing
paulownia saplings developed by a CRF member, which mature in about five years. We hope thatsimilar activities will spread as measures for abandoned farmland and disaster control in addition toafforestation.
We believe that this activity also provides a solution to strengthen the energy, resources, and foodsupply chain and their production in Japan.

14Forest of Carbo and Risa can be searched for on Google Map.

https://goo.gl/maps/4LjryK8NBu6AS2mF8
A panoramic airborne video is available on YouTube.
https://youtu.be/z0k0z58fZ24

3. Recommendations for realizing a carbon recycling society
The CRF made the following recommendations based on discussions among members about what society
should become and processes to realize it, as members take the initiative in working on the development
and social implementation of carbon recycling technologies. The CRF is taking the lead with its members
in implementing the recommendations to achieve carbon neutrality, mainly through carbon recycling andrealize a carbon recycling society, according to the roles described in Chapter 2
Develop and promote innovation, develop human resources- The CRF and its members should formulate and implement growth strategies to achieve carbon neutrality
by 2050. They should also develop carbon recycling technologies and products, verify these technologies
and products, deploy them in the real world at a faster pace, and expand investment in them. To help
achieve these goals, we should engage in cross-industry coordination, including coordination with startup companies, and take full advantage of open innovation. We should also leverage government-led
support to implement measures such as a “Basic GX Policy.”- To support the activities of these industries, the national government should enhance its measures, suchas by providing greater support to accelerate green transformation. Solid and continuous support should
be provided for highly motivated companies that take the initiative.
- Between 2030 and 2050, personnel who can implement carbon-neutrality measures and carbon recycling
should be developed.
- A deeper understanding of carbon neutrality and carbon recycling should be fostered among the generalpublic in order to promote greater adoption by society.

15Create CO2 value chains- Carbon recycling technologies and products establish their importance and roles in society through theirdeployment and application, so CRF members should promote the creation of CO2 value chains that
contribute to the valuation of CO2 by promoting the understanding and usage of carbon recycling
technologies and products.
- However, suppliers, which reduce CO2 emissions, have no connection with users, and there is no linkage
to product s with respect to exit strategies and markets, so and it is important to establish these networks.
The CRF serves this purpose.
- To maintain and enhance Japan’s international competitiveness, the national government should promotemeasures across the ministries that provide incentives, such as offering premiums for products andservices that use CO2 value chains.
- Quantitative evaluation of obtained and accumulated data regarding CO2 separation, capture, and usage
should be promoted, as should the visualization of CO2 flow based on LCA. Furthermore, efforts should
be made to further the overall optimization of the effects and impact of introducing carbon recycling.
- Discussion on matters that would have major impacts on and consequently transform the social structure,such as emission trading, carbon taxes, and carbon pricing, should be promoted. Unified systems that
ensure fairness between industries should be prepared and implemented without delay.
- CO2 sinks such as oceans and vegetation should be evaluated, and international rules should be actively
deployed. Support should be provided for small-scale voluntary credit frameworks that serve as their base.
Integration with regional revitalization and expansion to the global market- CRF members should create examples that leverage the strengths and features of communities bycollaborating with local governments. In particular, the agriculture, forestry, and fishing industries should
be revitalized as they contribute to CO2 sinks. Examples include planting fast-growing trees and building
fish reefs made of CO2 concrete.
- The national government should strengthen support for creating examples of CO2 value chains throughcollaboration between the private sector and local communities.
- Efforts should be expanded to the global market, including the licensing business. Particularly for Asian
countries, carbon-neutrality technologies should be introduced to nurture carbon recycling into one ofJapan’s growth industries, contributing to carbon neutrality throughout Asia.

16

4. Summary
The importance of carbon recycling to capture and fix CO2, and use CO2 and carbon compounds as
resources, is rising at an unprecedented speed in order to achieve carbon neutrality based on a balanced
combination of environment and economy. As such, the Carbon Recycling Fund Institute serves as aplatform for cross-industrial and industry-academic-government coordination, implementing theserecommendations and other activities. The Institute will promote the creation of a framework for global
carbon recycling, namely a “Sustainable Carbon System,” in various fields including resources, energy, andfood through industry-academic-government coordination and cooperation with overseas parties as well as
cross-industrial collaboration in the private sector to help achieve carbon neutrality not only in Japan but
also across the globe.

17

Attachment 1. Examples of Progress of Members for Building a Carbon Recycling Society
CO2 separation and capture, fuel conversion, mineralization, and conversion to chemicals are expected to
become widespread around 2030. Following these advancements, CO2 absorption and fixation, carbon recycling(CR) system building, and other related subjects will be put into practice. Related verification and technology
development are conducted through cross-industry coordination, collaboration among industry, academia, andgovernment, as well as municipality coordination. This attachment introduces examples of these developments.
List of examples:
Comprehensive actions- (Verification testing and research and development) Establishment (main operator: New Energy and Industrial
Technology Development Organization (NEDO)) and operation and administration (Japan Carbon Frontier
Organization) of an R&D and demonstration base for carbon recycling (Osaki-kamijima-cho, Hiroshima)- (Technology demonstration) Advances at Soma IHI Green Energy Center (IHI Corporation)- (Development and verification testing) Construction of a plastic recycling system to build a recycling society(Mitsubishi Chemical Group Corporation)- (Development and verification testing) Development of technology for producing liquid fuel from CO2 (Idemitsu
Kosan Co., Ltd.)CO2 separation and capture- (Commercialization (financial contribution and joint development)) Development of next-generation compact
CO2 separation and capture equipment (Marubeni Corporation)- (Verification testing) Japan’s first test to separate and capture CO2 in exhaust gas from a coal-fired plant using asolid absorbent (Kawasaki Heavy Industries, Ltd.)- (Verification testing) Installation of a biogas purification system at a sewage treatment plant in Kurashiki,
Okayama (Asahi Kasei Corp.)

Fuel conversion- (Commercialization) Start of Japan’s first continuous procurement of biofuel for ships on a commercial basis(Toyota Tsusho Corporation)- (Research and development) Research and development of a technology to produce liquid fuel from CO2(Sumitomo Heavy Industries, Ltd.)

Conversion to chemicals- (Pre-feasibility study) Partnership with an overseas company in the circular carbon methanol business using CO2
and green hydrogen (Mitsubishi Gas Chemical Company, Inc.)- (Commercialization) Successful creation of glass from CO2 in the air (Revcell Co., Ltd.)

Mineralization- (Verification testing) Development of biochar concrete and its application to construction site facilities (Shimizu
Corporation)18

- (Verification testing) Successful development of a system to fix CO2 into fresh concrete efficiently (Taiheiyo
Cement Corporation)

CO2 sinks- (Commercialization) Wooden construction technology and ZEB that contribute to the creation of a recycling
society (Toa Corporation)- (Verification testing) J Blue Concrete to create blue carbon and reduce CO2 (Electric Power Development Co.,Ltd.)
- (Verification testing) Coordination agreement with Miyazaki Prefecture on a resource recycling project using
agricultural resources (Sojitz Corporation)

System building and support- (Verification testing) Verification of a GX cycle management service that helps companies promote green
transformation (ITOCHU Corporation)- (Verification testing) Application of a water-surface drone for blue carbon calculation (verification by KDDI
Research, Inc.)- Building of a CCUS value chain digital platform (development by Mitsubishi Heavy Industries, Ltd.)

19

Comprehensive actions


Example of a member’s progress: Establishment of an R&D and demonstration base for carbon
recycling (Osaki-kamijima-cho, Hiroshima)
Stage: Verification testing and research and development
Main operator: New Energy and Industrial Technology Development Organization (NEDO)
Implementation member(s): Japan Carbon Frontier Organization
NEDO held an opening ceremony for an R&D and demonstration base for carbon recycling (Osakikamijima-cho, Hiroshima) in September 2022. NEDO started the construction of the facility in 2020 inaccordance with the Carbon Recycling 3C Initiative released by the Ministry of Economy, Trade andIndustry in 2019. Japan Carbon Frontier Organization operates and manages the base. The base attracts
many domestic and international visitors as a showcase of carbon recycling technologies.
The base supplies CO2 that has been separated and captured at the Osaki CoolGen IGCC demonstration
plant to companies and organizations that research carbon recycling technologies.
The base consists of three areas: a demonstration research area, an algae research area, and a basic
research area. NEDO has adopted 11 themes (one of them was finished in FY2022) and conducted
research and development on them for early social implementation to contribute to the realization ofcarbon neutrality by 2050.
R&D and demonstration themes
Development of efficient CO2-use concrete (FY2020 toFY2022: Ended in FY2022)
Research of selective synthesis technology of chemical
products for carbon recycling (FY2020 to FY2024)
Development of a gas-to-lipids bioprocess (FY2020 toFY2023)
Establishing a research base and developing technologies
that lead to increased CO2 utilization rate for the
production of microalgae-derived SAF (FY2020 toFY2024)
Research & development of CO2 fixation by microalgae
and high-value ingredients production (FY2022 to
FY2024)Development of a CO2 decomposition and reduction
process using atmospheric pressure plasma (FY2022 to
FY2024)
Production of value-added chemicals from CO2 usingboron-doped diamond electrodes (FY2022 to FY2024)
Research and development of carbon recycled LP gas
manufacturing technology and process (FY2022 to
FY2024)R&D of silicon carbide derived from industrial waste
using CO2 as a carbon source (FY2022 to FY2024)
Development of algal biomass production andapplication technologies enabling high efficient CO2
utilization (FY2022 to FY2024)
Carbon recycling technology demonstration and R&D
with co-production of multiple valuable commodities byusing seawater (FY2022 to FY2024)

20

Research and development by
The Chugoku Electric Power Co. Inc.
Kajima Corporation
Mitsubishi Corporation
Kawasaki Heavy Industries, Ltd.
Osaka University
Hiroshima University
The Chugoku Electric Power Co. Inc.
Institute of Microalgal Technology, Japan(IMAT)
Algal Bio Co., Ltd.
The Kansai Electric Power Co., Inc.
Tokai National Higher Education andResearch System
Kawada Industries, Inc.
Keio University
Tokyo University of Science
Japan Carbon Frontier Organization
ENEOS GLOBE Corporation
Nippon Steel Corporation
University of Toyama
Tohoku University
Nippon Steel Corporation
Waseda University
Sasakura Engineering Co., Ltd.



Example of a member’s progress: Advances at Soma IHI Green Energy Center
Stage: Technology demonstration
Implementation member(s): IHI Corporation
Since April 2018, IHI has coordinated with Soma City in Fukushima Prefecture in operating the Soma
IHI Green Energy Center (SIGC), a smart community project site aimed at new urban development inorder to recover from the Great East Japan Earthquake and restore the local economy. As the figure
below shows, SIGC’s concept is generating renewable energy mainly based on solar power and using it
within Soma city area (local production of energy for local consumption), reinforcing the area’s disasterprevention functions and revitalizing the area.

5. Figure 13. Smart community model
Source: IHI materials

The SIGC operates 1.6 MW solar power generation facilities, a 5.5 MWh battery system with an output
of 1 MW and water electrolyzers which generate hydrogen. The electric power is mainly supplied to
the neighboring sewage treatment plant and waste incinerator of Soma City. Any intermittent power
shortage is compensated by purchasing grid power. When the facility generates power at full capacity
during good weather, the amount of power exceeds the battery capacity, resulting in surplus power.
Then, hydrogen is generated using the water electrolyzers and stored in the tanks. Two tanks at the site
can store up to 400 Nm3 of hydrogen.

21

Figure 14. Equipment used at the SIGC: (from left to right) solar power generation facilities, battery system,and hydrogen tanks
Source: IHI materials

SIGC is working on ‘aquaponics,’ which is a novel method of combining onshore aquafarming andhydroponics and completely circulating water and nutrients. Also, Recycled Fertilizer Soma is
produced from sewage sludge emitted from the sewage treatment plant powered by SIGC.

Figure 15. Aquaponics (left) and corn cultivated using recycled fertilizer from sewage sludge (right)
Source: Soma City website

The supply of e-methane (synthetic methane) for Odekake Minibus, a community bus service operated
by Soma City, started in January 2023. These are Japan’s first vehicles that use e-methane. This fuelingservice is operated as part of the smart community project intended to contribute to the local production
for local consumption of solar power, as well as regional promotion and development in Soma City.
The e-methane is produced by using green hydrogen produced using solar power and CO2 methanation
system in the SIGC. The SIGC will continue to produce e-methane and to demonstrate its application
as renewable vehicle fuel.

Figure 16. e-methane station and Soma City community bus
Source: IHI website

22



Example of a member’s progress: Construction of a plastic recycling system to build a recycling
society
Stage: Development and verification testing
Implementation member(s): Mitsubishi Chemical Group Corporation
As a specialty material company that provides innovative solutions, Mitsubishi Chemical Group
Corporation aims to build a recycling society. For plastic recycling, the company works on plastic
recycling in addition to the sales expansion of plant-derived bio engineering plastic, DURABIO™, andbiodegradable plastic, BioPBS™.
The Mitsubishi Chemical Group started the verification testing of a resource recycling system thatstarts from paper cups made of BioPBS™ by coordinating with Okinawa City. Okinawa City hosted
the FIBA Basketball World Cup 2023 from August 25, 2023. To add biodegradability, BioPBS™ isused instead of PE, which is conventionally used to add water resistance, for the interior of 40,000
originally designed paper cups produced by Okinawa City to promote the event. The paper cups wereused at home games of Ryukyu Golden Kings, a professional basketball team of the B League, inMarch 2023 and will be used as drink cups at events in Okinawa City, etc. Ryukyu Kanri Sangyo K.K.
collects and transports used paper cups. Kyowa Kako Co., Ltd. and Ryukyu University jointly combine
them with cattle feces for composting using composting facilities at the university. The compost isplanned to be used for greening activities and other purposes in Okinawa City. The resource recycling
system in Okinawa City will be verified through this project. Okinawa City and Ryukyu Kanri Sangyo
also plan to take a leading role in organizing delivery lectures at elementary schools in Okinawa Cityand other events.
The operation of a plant to reuse waste plastic as a petrochemical raw material is scheduled ∗ to start by
the end of FY2023. Development of an acrylic resin chemical recycling technology and consideration
for the social implementation of the recycling system are also underway.

∗ ENEOS Corporation and Mitsubishi Chemical Corporation jointly operate one of Japan’s largest facilities
with a processing capacity of 20,000 tons per year.

23

Figure 17. Resource recycling system operated with Okinawa City (left), composting facilities at Ryukyu
University (upper right), and composting (lower right)
Source: Mitsubishi Chemical Group website



Example of a member’s progress: Development of technology for producing liquid fuel from CO2
Stage: Research and development and verification testing
Implementation member(s): Idemitsu Kosan Co., Ltd.
Idemitsu Kosan Co., Ltd. is developing next-generation technologies for Fischer-Tropsch reaction (FTreaction/synthesis), ∗ which is considered to be the most compatible for chemicals production from CO2
and the production of carbon hydrogen. The company is also building and optimizing the consecutive
production process of liquid synthetic fuel and is involved in research and development for scaling up
in the future. This research is conducted on consignment for New Energy and Industrial Technology
Development Organization (NEDO).

∗ Reaction process to synthesize liquid high hydrogen that can serve as an alternative to petroleum from COand hydrogen through catalysis reaction

24Materials

Synthesis gas
production

Fuel production

R&D of next-generation FT reaction
FT productselectivity control(Co-)
electrolysis

Renewable energyderived power

Consecutive production
process

Technology using
electrolysis(synthesis gas production)

Overseas
renewableenergyhydrogen, etc.

FT synthesis

Direct FT

Factory,etc.

Fuel use

Liquidsynthetic
fuelTechnology using fuel(Direct FT)

R&D of liquid synthetic fuel production processusing renewable energy-derived power

Figure 18. Consecutive liquid synthetic fuel process using FT reaction
Source: NEDO website

In addition, the company proposeda project to consider local CO2
recycling

throughelectrolysis

using an artificial photosynthesis
technology in order to promote thecreation of a circular carbon
societymodel

throughCO2

recycling that is publicly sought by
the Global Environment Bureau of
the Ministry of the Environment,with Toshiba Energy Systems &Solutions

Corporation,

Toyo

Figure 19. Conceptual image of a circular carbon society modelthrough CO2 recycling
Source: Idemitsu Kosan website

Engineering Corporation, and other companies. The project was adopted as a consignment project.

The company creates a basic plan that assumes that all processes from CO2 separation and capture andSAF ∗ production through consumption will be verified using CO2 electrolysis equipment developed by
Toshiba Energy Systems & Solutions, and evaluates the feasibility of the business.
In addition, the development and deployment of ATJ ∗∗ verification equipment using the state-of-the-art
process technology proposed by Idemitsu Kosan for the widespread use of SAF was adopted as a
NEDO Green Innovation Fund Project (Fuel production technology development projects using CO2).
Sustainable aviation fuel. The jet fuel is produced from sustainable supply sources with small CO2
emissions from raw material production, captured through combustion processes.
∗∗ Alcohol to jet. Technology and process to produce SAF from ethanol.
Registered in Annex 5 of the SAF international standard, ASTM certification, ASTM D7566.
∗

25

The company aims to build Japan’s first large-scale SAF supply chain with an eye on creating theabove-mentioned carbon recycling society in the long run.

Figure 20. Establishment of SAF supply chain
Source: Idemitsu Kosan website

CO2 separation and capture

Example of a member’s progress: Development of next-generation compact CO2 separation andcapture equipment
Stage: Commercialization (and joint development, with investment)
Implementation member(s): Marubeni Corporation
Marubeni Corporation is developing Carbon Capture, Utilization(CCU) for reusing CO2 or converting the same into othervaluable products jointly with Carbon Clean Solutions Limited(hereafter referred to as CCSL) in the U.K., whose proprietary
technologies are introducing out-of-the-box modular solutions
for easy, affordable and scalable carbon capture.
The chemical absorption method is a CO2 separation and capture
technology. CCSL has developed their own new recovery solvent
used in this method and offers a technology to capture CO2 athigher efficiency and lower cost than with conventional recovery
solvents. This technology has the world’s highest costcompetitiveness among currently commercialized CO2 capture
technologies. This technology has been adopted in CCU projects

Figure 21. Facilities of CCSL
Source: Marubeni materials

around the world and in about 50 cases of CO2 capture.
The company is continuing development to commercialize compact next-generation CO2 separationand capture equipment that further reduces cost.


Example of a member’s progress: Japan’s first test to separate and capture CO2 in exhaust gas from acoal-fired plant using a solid absorbent
Implementation stage: Verification testing

Implementation member(s): Kawasaki Heavy Industries, Ltd.
26

Kawasaki Heavy Industries, Ltd. and Research Institute of Innovative Technology for the Earth (RITE)
constructed pilot-scale test equipment (a capacity of 40 tons of CO2/day) of an energy-saving CO2
separation and capture system with Kansai Electric Power Co., Inc. in the Maizuru power plant of
Kansai Electric Power. They will start a test to separate and capture CO2 in combustion exhaust gas
from the coal-fired plant in FY2023. This project was adopted as research on the applicability ofadvanced carbon dioxide solid absorbent to coal combustion exhaust gas by NEDO and is conductedby Kawasaki Heavy Industries and RITE with the help of Kansai Electric Power. Verification testing isscheduled from FY2023 to FY2024.
To realize a carbon neutral society, it is necessary to establish and apply technologies to separate andcapture CO2 in exhaust gas from factories, thermal power plants, etc., which will save more energy.
Among others, the solid absorption method can significantly reduce the energy required for CO2
separation from conventional technologies and has great potential as a next-generation separation andcapture technology.
Kawasaki Heavy Industries and RITE have set the goal of improving the performance of their energy
saving CO2 separation and capture system and making it larger by developing and improving solid
absorbent and the KCC (Kawasaki CO2 Capture) moving bed system in the carbon dioxide capture
technology practical application research project started in FY2015 on consignment for the Ministry of
Economy, Trade and Industry. (NEDO became responsible for the project in FY2018). Kawasaki
Heavy Industries will design and construct the pilot-scale test equipment. A consecutive operation test
will be conducted using a solid absorbent developed by RITE. In addition, there is a plan to evaluate
the reliability, operability, and economic efficiency when the equipment is installed in a coal-fired plant

OilthermalboilerDenitrationElectric dust
collector

Desulfurization

Smoke
stack

with the help of Kansai Electric Power while considering future social implementation.

Absorption tower (CO2absorption process)Conveyor

Exhaust gas

CO2-free gas

Solid absorbent

Regeneration tower (CO2desorption process)
Steam

CO2

Drying tower

Absorbent surface
coated with amine

Dry gasAmine

Substance known tochemically absorb CO2

Potential
construction site

KCC moving bed
systemFigure 22. Verification testing flowchart (left and middle) and conceptual image of the pilot-scale test equipment
installation in Maizuru power plant (right)
Source: News release from Kawasaki Heavy Industries



Example of a member’s progress: Installation of a biogas purification system at a sewage treatment
plant in Kurashiki, Okayama
Stage: Verification testing
Implementation member(s): Asahi Kasei Corp.
27

Asahi Kasei Corp. and Kurashiki City concluded an agreement on the performance evaluation andverification of a biogas purification system in Kurashiki, Okayama in September 2022.
This system performs highly selective separation of CO2 and methane gas (bio methane) in biogas
using K-GIS zeolite. K-GIS zeolite is a new absorbent developed by Asahi Kasei that selectively
absorbs CO2. Conventional absorbents absorb methane at the same time as CO2, but K-GIS zeolite
absorbs an extremely small amount of methane, which makes it possible to separate and capture highly
pure methane very efficiently. In addition, this absorbent can also capture highly pure CO2.
The biogas consists of methane generated from sewage sludge, garbage, etc. (about 60%) and CO2(about 40%). For example, bio methane is gathering attention in the U.S. and Europe as a carbon
neutral fuel that serves as an alternative to natural gas, resulting in a rapid increase in demand.
Kurashiki City uses the biogas generated from sewage sludge for power generation at the Kojima
sewage treatment plant. Some portion of the biogas is input into this system to purify bio methane.
Note that the biogas is mixed with separated CO2 to return it to the original state and is used as power
generation fuel at this verification to avoid wasting it.

Figure 23. Flowchart of biogas processing and a new biogas purification system verificationequipment at the Kojima sewage treatment plant in Kurashiki
Source: News release from Asahi Kasei

Fuel conversion


Example of a member’s progress: Start of Japan’s first continuous procurement of biofuel for ships on
a commercial basis
Stage: Commercialization
Implementation member(s): Toyota Tsusho Corporation
Toyota Tsusho Corporation conducted the first biofuel operation trial at Singapore Port in 2021. Since
then, the company has verified the effectiveness of biofuel and supply operations at Nagoya Port forcommercialization, including biofuel supply trials with the ship-to-ship bunkering, where a fuel supply
ship pulls in next to a tugboat or a coastal trading vessel operating within a port and supply fuel to it. In
April 2023, the company started Japan’s first continuous supply of biofuel for ships on a commerciallybasis.
28

Toyota Tsusho, in cooperation with a recycling company, is continuing to procure waste cooking oilcollected from the employee cafeterias and other facilities of the Toyota group and Toyota Tsusho
group companies, and biofuel refined from these oils as part of the raw materials that are blended withheavy oil and supplied.

Figure 24. Car carrier receiving biofuel from the fuel supply ship
Source: Toyota Tsusho website



Example of a member’s progress: Development of a liquid fuel synthesis technology using CO2
through FT synthesis
Stage: Research and development
Implementation member(s): Sumitomo Heavy Industries, Ltd.
Sumitomo Heavy Industries, Ltd. is developing a mineralization technology ∗, algae cultivation
technology, electrochemical reduction of CO2 using diamond electrodes, carbon recycling liquid fueltechnology, and other technologies to use CO2. For the carbon recycling liquid fuel technology,
Fischer-Tropsch (FT) synthesis ∗∗ using CO2 as a carbon source for conversion to heating oil, jet fuel, or
middle distillate equivalent to light oil can be used to reduce loads on end users, for example, by
combining with currently distributed mobility fuel.
In FY2022, the company confirmed that liquid carbon hydrogen and wax are generated even at
atmospheric pressures with a CO2-CO-H2 feed by using the FT catalyst to which a promoter to improvereaction characteristics is added. The company is considering the use of a slurry bed reactor for FT
synthesis using a feed containing CO2 and continuing technology development to start a 50-L scale
bench test in 2025.

∗ Technology to inject CO

2 into extracted calcium to fix it as CaCO3∗∗ Reaction process to synthesize liquefied hydrocarbons that can serve as an alternative to fuels from CO andH2 through catalytic reaction29

Reforming
reactor

Decarbonationunit

FT reactor

Decarbonation
required

The principal
component ismethane.

Characteristics of synthetic fuel
 Paraffin-based fuelLight oil with a high cetane
number (premium light oil)Rare fuel denaturalization
 Sulfur-freeNaphtha Heating or jet oil Light oil
Zero SOx in exhaust gas
 Aroma-freeRetention time (min.)
Example of chromatogram (middle distillate) obtained when CO2
Zero soot in exhaust gas
FID output (arbitrary)

Naturalgas
H2O

Desulfurization

GTL (gas to liquid) process

Heating oil
Jet oilLight oiland synthesis gas are supplied to the Co/SiO2 catalyst to which thepromoter is added

CN fuel process of Sumitomo Heavy Industries
Reverse shift
reactor

FT reactor

Simple process configuration
Even if CO2 is mixed in, the FT reactor
converts it.

Sulfur-free
Aroma-free

FT synthesis experiment equipment

Figure 25. FT fuel synthesis process (left) and characteristics of synthetic fuel (right)
Source: Sumitomo Heavy Industries materials

Conversion to chemicals


Example of a member’s progress: Partnership with an overseas company in the circular carbon methanol
business using CO2 and green hydrogenStage: Pre-feasibility study
Implementation member(s): Mitsubishi Gas Chemical Company
Mitsubishi Gas Chemical Company, Inc. (MGC) is promoting Circular Carbon Methanol("CarbopathTM" ∗), a technology for recycling CO2, waste plastics, biomass and other inputs intomethanol for use in chemical products, fuel, and power generation. Methanol can be used for a range of
products and because it can be produced from CO2 it is expected to be a powerful resource for building
a carbon-neutral society through the deployment of CCU.
Cement Australia ∗∗ (CA) and MGC signed a memorandum of understanding to study the manufactureand sale of renewable methanol made from CO2 captured at CA’s Gladstone plant and green hydrogenusing MGC's newly developed methanol production technology. Through this collaboration, CA and
MGC aim to establish an approach to CCU that can accelerate the transition to a net-zero future.
Leading the shift to renewable construction in Australia, CA is committed to advancing Australia’s
2050 net-zero targets from deploying its renewable building materials at scale to advancing next
generation technologies such as carbon capture and utilization.


Example of a member’s progress: Successful creation of glass from CO2 in the air
Stage: Commercialization
Implementation member(s): Revcell Co., Ltd.

∗ Circular Carbon Methanol (CCM) has been officially named “CarbopathTM” by MGC. The name

CarbopathTM expresses MGC’s desire to be a pioneer in promoting CCM
https://www.mgc.co.jp/eng/corporate/news/2022/210704-e.html∗∗ A Holcim and Heidelberg Materials joint venture company
Head Office: Darra, Queensland; CEO: Rob Davies
30Revcell Co., Ltd. developed a CO2 absorption and capture filter to capture CO2 at locations around us
such as home, stores, and commercial facilities after achieving success with its high-pressure oxygen
capsule and infection prevention negative pressure room businesses under the concept of scientificallystudying air. The company is proposing a system to absorb CO2 with the filter attached to a compact
device, such as an air purifier, and to recycle it as glass at glass factories.
Carbon recycling economy in which anybody can participate at locations aroundthem
Revcell is a filter manufacturer
CO2 absorption filter
Recycling

Glass material

Glassmaterial X

By attaching the CO2 filter to various air-conditioning equipment (such as air purifier, air conditioner, and fan),carbon dioxide can be captured from locations around us. You can contribute to carbon negativity by storing theused filter that captured carbon dioxide or to carbon neutrality and carbon recycling by recycling it as glass.

Figure 26 Conceptual image of the CO2 absorption filter attached to an air purifier (left) and Recoglass (right)
Source: Revcell materials

Both the production method and chemical composition of RecoglassTM produced in this way is thesame as conventional glass.
Recoglass can be used like conventional glass as jars, containers for high-end beauty products, bottles,
glasses, and construction materials, for example. In Japan, Revcell collaborates with a leading clean
room manufacturer for air purifiers with the DAC function and a leading glass manufacturer forrecycling into glass.

Mineralization


Example of a member’s progress: Development of biochar concrete and its application to construction
site facilities
Stage: Verification testing
Implementation member(s): Shimizu Corporation
Shimizu Corporation developed environmentally conscious concrete (hereafter referred to as
SUSMICS-C) that stores carbon in concrete structures by mixing concrete with biochar to which thenational J-Credit system can be applied as carbon storage for agricultural land use. SUSMICS-C uses
biochar, which is carbonized wood that has absorbed CO2 in the air during its growth process, and fixes
CO2 inside concrete. Carbon negativity can be achieved by using SUSMICS-C together with lowcarbon cement, in which blast furnace slag replaces a portion of cement, in the production of whichlarge amounts of CO2 are emitted.
Biochar is made of sawdust disposed of during softwood or hardwood lumber processing. Sawdust
biochar made by carbonizing sawdust can fix a large amount of carbon stably compared to other typesof biochar. The carbon content is about 90% and the fraction of biochar carbon remaining after 100
31years is also as high as about 90%. 1 kg of biochar fixes about 2.3 kg of CO2. By adding 80 kg of
biochar to 1 m3 of concrete, approximately 183 kg of CO2 can be fixed. Using low-carbon blast furnace
cement as cement material can reduce CO2 emissions by up to 118% compared to normal concrete.
SUSMICS-C has great workability as well as superior environmental performance and can be pumped
up at construction sites. In addition, its strength is equivalent to normal concrete. Therefore,
SUSMICS-C can not only be applied to secondary concrete products, but also widely used for concrete
work at construction sites.
This time, SUSMICS-C was applied to the temporary road paving at Shimizu’s construction site for the
first time at an actual work site and verified. Blast furnace cement type B was used as the cement
material and 60 kg/m3 of biochar was mixed into 1 m3 of concrete, reducing CO2 emissions by 99%
compared to normal concrete. The volume of SUSMICS-C is 34.5 m3 and the quantitative CO2
reduction amount is about 6.7 tons. It was confirmed that SUSMICS-C can be used in the same way asnormal concrete and that the compressive strength of SUSMICS-C core test pieces sampled from
specimens retains performance that sufficiently satisfies the design standard strength.
Shimizu will expand the application range of SUSMICS-C and apply it to not only temporary
structures but also permanent concrete structures to realize a decarbonized society. In addition, Shimizu
will work on improving the environmental value by applying SUSMICS-C, for example, by aiming toobtain certification in the J-Credit system.

Figure 27. Powder and granular biochar (left) and application to an actual construction site (right)
Source: Shimizu Corporation website



Example of a member’s progress: Successful development of a system to fix CO2 into fresh concrete
efficiently
Stage: Verification testing
Implementation member(s): Taiheiyo Cement Corporation
Taiheiyo Cement Corporation developed CARBOCATCH® ∗, a system to fix CO2 into fresh concrete
efficiently. CARBOCATCH® is their proprietary system that circulates cement slurry, which is a
mixture of cement and water, in a sealed container filled with CO2 to fix CO2 efficiently. This system
can efficiently fix externally supplied CO2 into the cement slurry as solid fine calcium carbonate athigh efficiencies of more than 90% (more than 330 kg per ton of cement in the cement slurry).

∗ CARBOCATCH is a registered trademark of Taiheiyo Cement Corporation in Japan32

CARBOCATCH® was established as part of a carbon recycling technology to fix captured CO2 into
cement and concrete based on the knowledge obtained from a NEDO grant-aided project ofDevelopment of Carbon Circulation Technology for the Cement Industry (FY2020 to FY2021). Wavedamping blocks made of CARBOCATCH® slurry fix about 8.0 kg (23 kg/t-cem **) of CO2 per 1 m3 of
concrete. This result supersedes the 10 kg/t-cem targeted by NEDO. It has been also confirmed that theconcrete made with the CARBOCATCH® slurry is equal to or better than conventional concrete interms of fresh properties, strength development, durability, suppression of bleeding and reduction ofsetting time.
Practical applications of the CARBOCATCH® system are being studied. Production test on actual
equipment was carried out for precast concrete products at one of the subsidiary companies. Test
construction was also conducted at the Kumagaya Plant of Taiheiyo Cement to evaluate theapplicability for pavement concrete. These tests revealed higher quality compared to conventional
concrete, demonstrating that the system is an effective CCU technology that can be applied to generalpurpose concrete production.
CARBOCATCH® can be applied for various purposes, so the company is currently conducting
research and development with an eye to deploying it in every field.

CARBOCATCH®

Figure 28. System of CARBOCATCH® (left)
Conceptual diagram of concrete composition using CARBOCATCH® slurry (right)
Source: News release from Taiheiyo Cement

Figure 29. Wave-damping block made of CARBOCATCH® slurry (left)
Precast concrete products made of CARBOCATCH® slurry (second from left)(consecutive foundation blocks for guardrail)** The intensity changes due to the use of cement in addition to the CARBOCATCH® slurry duringconcrete manufacturing
33

Test work of pavement concrete using CARBOCATCH® slurry (second from right and right)

CO2 sinks


Example of a member’s progress: Wooden construction technology and ZEB that contribute torecycling society
Stage: Commercialization
Implementation member(s): Toa Corporation
Toa Corporation has worked on the promotion of a recycling society in construction projects, forexample, by renovating logistics facilities, hospitals, and large facilities or introducing co-generationand solar power generation facilities before recycling economy (circular economy) started gaining
attention. The company currently focuses on wood buildings and zero energy buildings (ZEB).
Recycling of forest resources leads to national land conservation and global warming prevention in
Japan where forests account for two-thirds of the national terrain.
Toa Corporation aims to achieve local production for local consumption of construction materials and avirtuous cycle of local economy and environmental preservation through effective use of these forest
resources. Members for wood buildings are lighter than general steel construction with the same size,
so the CO2 generated during work is also reduced. Moreover, wooden structures are believed to reducestress on people. The company has built wooden buildings, including two hotels. The company adopted
a hybrid structure combining steel construction and wooden construction for the second experimentbuilding completed in March 2023 in the Toa Research & Development Center and plans to obtain
ZEB certification for it.

Figure 30. Hotel constructed using Toa’s advanced wooden construction techniques (left)
Technology research building, Toa Corporation (right)
Source: Toa Corporation website



Example of a member’s progress: J Blue Concrete to create blue carbon and reduce CO2
Stage: Verification testing
Implementation member(s): Electric Power Development Co., Ltd.
Electric Power Development Co., Ltd. (J-POWER) is developing a technology to create seagrass bed
more effectively using J Blue Concrete, which is an alternative material that is mainly made of coal ash
and copper slag. Coal ash is a by-product from coal-fired plants and copper slag, which is a by-productfrom copper smelters. Blue carbon (CO2 sequestration and storage by algae, etc.) is expected to be34

produced from seagrass bed creation. The company installed wave-damping blocks made of J Blue
Concrete in Wakamatsu-ku, Kitakyushu, Fukuoka, where it is based, to create a new seagrass bed.
Moreover, the company obtained a certified J blue credit, a new credit system for blue carbon, for thecreated seagrass bed in FY2021 for the first time as a private facility. Currently, J-POWER is
improving the attachment of algae to increase the blue carbon amount by working on the surface shapeof J Blue Concrete.
J Blue Concrete is a low-carbon construction material and the material-derived CO2 emissions is about
40% of standard concrete because it uses a large amount of by-products and less cement. J Blue
Concrete contributes to carbon neutrality both in terms of blue carbon and low carbon (material-derived
CO2 emissions) and is an effective construction material for blue infrastructure (symbiotic port
structure). Therefore, J-POWER is not only meant for internal use, but also for social implementation.
5 years after block installation

3 years after block installation

Figure 31. Algae attachment to J Blue Concrete blocks in Wakamatsu-ku, Kitakyushu, Fukuoka
Source: Electric Power Development materials

Concrete

Water

J BlueConcrete

SeawaterCementCementFine aggregate (sand)Coal ash

Coarse aggregate (rock)

Copper slag

Air

Air

Figure 32. Comparison between concrete and J Blue Concrete
Source: Electric Power Development materials



Example of a member’s progress: Coordination agreement with Miyazaki Prefecture on a resource
recycling project using agricultural resources
Stage: Verification testing
Implementation member(s): Sojitz Corporation
Sojitz Corporation concluded a coordination agreement with Miyazaki Prefecture on a resource
recycling project using agricultural resources in Miyazaki (such as fast-growing tree and Sorghum∗).
With the G7 Agriculture Ministers’ Meeting in Miyazaki (April 22 to 23, 2023) as inspiration, the∗ One of the five largest crops that is a widely used gramineous plant, from consumption to industrial use.

Many species are available. Those with a strong growth potential grow over 5 m four months after seeding.
35

company uses agricultural resources through coordination between the public and private sectors andconducts verification with the aim of building a local recycling model in Miyazaki Prefecture.
Sojitz began test planting fast-growing Japanese aspen ∗∗ at Kawaminami-cho in Koyu, Miyazaki aspart of its fast-growing tree project in May 2022. In April 2022, the company started test production ofSorghum in addition to Japanese aspen, making use of unused agricultural land and agricultural land
during the fallow period in the prefecture. The company had the first harvest in August and confirmed
their growth potential. Going forward, they will work on the verification of resource recycling where
harvests are processed into biomass fuel or ration for livestock and delivered to consumers. By
concluding the agreement, the company receives information on the production of agricultural
resources and other matters from Miyazaki Prefecture and plans to work together to evaluate its
popularity and other characteristics as a product.

Figure 33. Conceptual image of circulation of Sorghum and Japanese aspen (left), Sorghum (upper right), andJapanese aspen (lower right)
Source: News release from Sojitz∗∗ Tree species with a high growth amount and early cutting age that is expected to have a growth amount of 200 m3 or more

per hectare five years after planting

36

Many production materials such as fuel and feedstuff come from overseas. There is a need to shift
towards a sustainable production structure that relies more on domestic resources. Sojitz aims to build a
new local recycling model of agricultural resources with Miyazaki Prefecture to contribute to thegrowth of agriculture and related industries in Miyazaki Prefecture.

System building and support


Example of a member’s progress: Business partnership with a British environmental solutions
company with an eye to expanding the scope of EU-ETS and introducing the Carbon Border
Adjustment Mechanism
Stage: Commercialization
Implementation member(s): ITOCHU Corporation
ITOCHU Corporation formed a business partnership with CF Partners ＊ (CFP) to expand emission
trading. CFP is a UK-based environmental solutions company that sells emission credits in Europe.
In April 2023, the European Union (EU) Council decided on the introduction of the Carbon Border
Adjustment Mechanism (CBAM). The CBAM is a mechanism to put carbon costs on steel products,
aluminum, cement, fertilizer, and other products according to their emissions when they are imported to
the EU. After the mandatory emissions reporting period started in October 2023, the imposition ofcarbon costs is expected to start in 2026. The EU Council also decided to expand the EU Emissions
Trading System (EU-ETS) to the marine sector. The EU-ETS will apply to ships with a total tonnage of
5,000 tons or more departing from or arriving at EU from 2024. In 2026, it will be obligatory topurchase the emission quota for all emissions. This restriction is also expected to apply to the Japanesemarine sector.
ITOCHU Corporation supports emission trading, especially in Japan and Asian countries, as a sales
liaison of emission credits procured and retained by CFP, using their global sales network across a wide
range of industries. The company also organizes seminars and communicates industrial information
based on the actual situation of the EU-ETS for customers in a wide range of industries, promotes theprovision of solutions suitable for customer-specific needs, identifies needs to address the CBAM andthe marine EU-ETS, and sells emission credits jointly with CFP.

*Headquarters: London, U.K., Co-CEOs: Jonathan Navon and Thomas Rassmuson
37

Figure 34. Conceptual diagram of actions with an eye for introducing CBAM
Source: ITOCHU Corporation website

 Example of a member’s progress: Application of a water-surface drone for blue carbon calculation
Stage: Verification
Implementation member(s): KDDI Research, Inc.
KDDI Research, Inc. conducted a verification experiment to survey seagrass beds and calculate blue
carbon ∗ by using a water-surface drone in June 2022 in collaboration with Toba City in Mie and KDDI
Corporation.
During this verification, the water-surface drone autonomously followed a pre-set course using asmartphone to survey the distribution area of seaweed and algae and capture images of the target
seagrass beds with its built-in underwater camera. The analysis of the recorded video footage
confirmed that the ability to determine the cover degree, which represents the percentage of the area
occupied by seaweed and algae, was confirmed. In the past, divers used to visually survey the
distribution area of seaweed and algae in Toba. The use of water-surface drones enables remotenavigation incorporating expert opinions and decisions, as well as fixed-point observation thatconsistently tracks precise locations. They will also mitigate the risk of accidents during diver surveys
and allow for remote monitoring and control, thus enabling significant business DX.
This project won the 31st Grand Prize for the Global Environment Award＊ in March 2023.

∗ Carbon captured in the marine ecosystem, including seagrass beds∗∗ The award is launched in 1992 to promote the coexistence of industrial development and global

environment. It is hosted by Fujisankei Communications Group and sponsored by the Ministry of
Economy, Trade and Industry, the Ministry of the Environment, the Ministry of Education, Culture, Sports,
Science and Technology, the Ministry of Land, Infrastructure, Transport and Tourism, the Ministry ofAgriculture, Forestry and Fisheries, the Ministry of Internal Affairs and Communications, Keidanren, andthe Japan Chamber of Commerce and Industry.
38

Lifting and lowering device

Underwater camera(vertically moved by operating
the lifting and lowering device)

Figure 35. Water-surface drone (left and second from left), and the logo of the 31st Grand Prize for the Global
Environment Award (right)
Source: KDDI Research, Inc. website



Example of a member’s progress: Building of a CCUS value chain digital platform
Stage: Development
Implementation member(s): Mitsubishi Heavy Industries, Ltd.
Mitsubishi Heavy Industries, Ltd. is jointly developing the CCUS value chain digital platform,
CO2NNEX™, with IBM Japan, Ltd. The company aims to contribute to the activation of the CO2
ecosystem and global environment protection by connecting the CCUS value chain, where captured
CO2 is transported, utilized and stored, with the IoT and block chain, enabling visualization, tracking,trading and optimization.
During the proof-of-concept of CO2NNEX for e-methane started in October 2022, the company aims topromote the widespread use of e-methane and establish its environmental value while exchanging
opinions with related organizations and companies.
In February 2023, the company leveraged its CO2NNEX knowledge to build a demonstration system of
the CO2NNEX for e-methane digital platform with Osaka Gas Co., Ltd. and IBM Japan Ltd. The
CO2NNEX for e-methane system visualizes CO2 emissions across the supply chain, including the
production, transportation, supply, and use of e-methane, which is synthetic methane produced as aresult of methanation, and allows for the trading and transfer of environmental value.
In March 2023, the company entered into an agreement with Osaka Gas Co., Ltd to conduct a
feasibility study on a project to develop a CO2 value chain for CCUS (Carbon Capture, Utilization, andStorage), including transporting CO2 captured in Japan overseas, utilizing it to produce e-methane,synthetic gas produced through methanation, and storing it underground.

39

Figure 36. Building a global CO2 value chain
Source: Mitsubishi Heavy Industries website

40

Attachment 2. Summary of the questionnaire conducted to CRF members

Questionnaire period: March 9, 2023 through March 28, 2023
Questionnaire targets: 117 corporation members, 21 individual members, 11 local government members, and 17
academic members
Number of responses: 88
1.

Expectations from carbon recycling (CR)227High expectations from CR
強く期待する

59

Moderate expectations from
期待するCR
Low expectations from CR
あまり期待しない

Figure 1 Expectations from CR
Main reasons (High expectations and Moderate expectations from CR)
It’s an important way to achieve carbon neutrality (CN) in and outside Japan.



We expect future business opportunities from carbon separation, capture, and recycling.

CO2 separation and capture contribute to urban mine resources and S+3E.



We look forward to system design such as subsidies and penalties in relation to GHG reduction.



We have been asked to reduce CO2 emissions from the supply chain.

Main reasons (Low expectations from CR)

2.

Feasibility is questionable in light of the current state of CR.

Roles and position in the CR area
0

10

20

30

40

50

Carbon炭素源供給
source supply
Separation,分離・回収・輸送
capture, and transport

Current
現在の立ちUse, absorption,and fixation
利用・吸収・固定

位置/役割
roles

position and

Finance andinvestment
金融・投資
Education and widespread
use
教育・普及
Research and研究・開発
development

Potential
今後可能性
position andConsulting and commercialization
コンサルティング・事業化支援のある立ち
roles in the
future
位置/役割

System building
and establishment
仕組み構築・整備
Public organizations

公的機関（自治体含）(including municipalities)

Figure 2 Current position and roles in the CR area41

3.

CR technology development areas
0

5

10

Chemical
化学品
Fuel
燃料

Mineralization
鉱物化
Directuse (use of industrial gas)
直接利用（産業ガス利用）
Chemical化学吸収
absorption

Others
その他
Agriculture
農業

CCS
CCS

6
3

1

Forestation
植林
Soilfixation
土壌固定

2

1

DAC
DAC

14

6

1

Membrane separation
膜分離

Oceansand rivers (blue carbon)
海洋・河川（ブルーカーボン）

13
13

0

Physical物理吸収
absorption

15

3

0

3

Figure 3 CR technology areas
Other responses

We hope for cost reduction (CAPEX/OPEX) through modular development.



Research and development that leverages our strengths

Reduction in amine emissions(1) What respondents expect from technology development and phases of technology development337

CO2削減量Amount of CO2 reduction

25

早期実用化が可能

Early practical application possible

付加価値が高いHigh added value

25

社会的意義が高い

High social significance

26

その他

OthersFigure 4 What respondents expect from technology development

0
4

7

事業化段階

Commercialization phase

実証段階

Verification phase24

研究開発段階Research and development
phase

39

アイデア段階Idea phase

NEDO等

NEDO, etc.

Figure 5 Phases of technology development

42

(2) Degree of challenges considered to be bottlenecks against social implementation
4

Technologies

Social systems

3
We strongly agree

We agree2

We do not agree
10

Figure 6 Degree of challenges considered to be bottlenecks against social implementation(3) Support considered to be required (coordination between companies, coordination with startups,
widespread use of related products, public financial support)
4
We strongly agree
3
We agree2

We do not agree
10

Figure 7 Support required for social implementation

43

3.

What future direction do you recommend for the working group for social implementation of CR that the
CRF organized as a venue for cross-sectional coordination in FY2022 in Takehara City, Hiroshima
Prefecture?

4

28

Conduct the workshop in
竹原市で、対象を広く見
Takehara City with a wideて進める
range of targets

Conduct the workshop in
竹原市で、対象を絞って
Takehara City with a進める
limited number of targets

49

13

Consider similar
他の地域でも同様の検workshops in other regions

討をする
as well

None of the above
いずれでもない

Figure 8 Future direction of the working group on social implementation of CR
Main comments
Opportunities for development can expand if this initiative is more widely known.



We expect the CRF to specify model cases and horizontally deploy this working group.

Unique CO2 value chains based on local production for local consumption led, in principle, bymunicipalities contribute to the achievement of CN.



We look forward to this initiative being widely deployed to many different regions.



Seamless coordination with Osaki CoolGen, NEDO, and projects on R＆D and Demonstration Base for
CR at Osaki-Kamijima.

CR verification at locations rich in renewable energies rather than high-concentration CO2 emissions
sources.

Municipalities with which members want to coordinate
Akita Prefecture (offshore wind power), Shunan City (Yamaguchi Prefecture), Nagasaki Prefecture, Hokkaido
Prefecture (offshore wind power, biomass), Okoppe Town (Hokkaido Prefecture) (waste biomass), Tomakomai
City (Hokkaido Prefecture), Niigata Prefecture (gas field), Kumamoto Prefecture, Miyagi Prefecture, Chiba
Prefecture, Ichihara City (Chiba Prefecture), Kitakyushu City (Fukuoka Prefecture), Tsukuba City, Hamamatsu
City (Shizuoka Prefecture)
4.

Desire to participate in government-led projects
Want to participate
Considering
Possibly participate

6
13
15

5.

Requests to industry and academic institutions

Advances in individual technologies and reliable LCA toward social implementation.



Development of required technologies, categorizing them not only according to the target and mode ofapplication but also according to the application times, that is, 2030 and 2050.



Educational activities in coordination with local universities.
44

Industry expects academic institutions to propose new ideas related to CR technologies, and is ready tosupport interesting ideas even if they are not yet elaborated.



People-to-people exchange system between industry and academia dedicated to the fields of CN and CR.

Energy is required to leverage energetically stable CO2. Catalysts and technology to convert CO2 efficiently
at low cost should be developed.

Further progress in basic research on the DAC technology, as well as presentation of coordination casesand sharing of coordination-related information
It would be desirable if there were places to discuss possibilities of scaling up and practical application
besides laboratories.

6.

Countries and regions that conduct or consider international coordination

10

13

Europe
欧州

2

11
7

U.S.
米国
Australia
豪州
China
中国

6

Southeast Asia
東南アジア

11

Others
その他

特になし
No international
coordination

Figure 8 State of international coordination
7.

How much demand is there among stakeholders such as investors, customers, general public, andgovernment for initiatives toward CR and CN?

5Strong demand 4
Some demand 3

2
Almost no demand
No demand

10a) Investorsa)投資家b)b)顧客Customersc) Generalpublicc)世論Figure 9 Demand from stakeholders

45d) d)政府
Government

8.

A Tree planting fund is planned to be established in FY2023. How can you participate in the fund?
(1) Initiatives for CO2 sinks
029Forestation
植林／林and forestryrelated
業関連

19

Internal
自社でinitiatives

実施
NPO or
NPO／

Crops
and
農作物／
agriculturerelated
農業関連

10

NGO

NGO
その他
Others19

ブルーカーボBlue
carbonン

Figure 10 Fields of initiative for CO2 sinks

Figure 11 Implementation modes of CO2 sinks(2) Possibility of participation in the Tree Planting fund to be establishedPossibility of participation in the forestation fund

0

5

10

15

20

25

30

Donation to or operating support for
植林ファンドへ寄付/運営支援
the forestation fund
植林イベントへの参加
Participation
in forestation events
Introduction of municipalities
植林に関心がある自治体の紹介
interested in forestation
Research and developmentof related
関連技術の研究開発
technologies
バイオマス利用
Use of biomass
ブルーカーボンBlue carbon
その他
OthersFigure 12 Possibility of future participation in the tree planting fund
9.

Policies and system design such as the emissions trading system(1) Effects of each policy on CR promotion
54Largely promotes CR
Promotes CR

3

Almost no demand 2
No demand

146f)f)規制緩和
Deregulation

Figure 13 Each policy and promotion of CRe)
Subsidiese)補助金

d)Tax benefitsd)税制優遇措置c) Introduction ofc)CP導入（石石CP(including coaland petroleum
税含む）
taxes)b) Introduction ofb)CP導入（石石CP(not including
coal 税含まず）
and petroleum
taxes)

a)排出量取引のa)
Introductionofemissionstrading
導入0(2) Regulatory reform (such as deregulation and tighter regulations)

Although in general we want the government to relax regulations, the government should clarify and tighten
the quantitative assessment of the amount of CO2 reduction throughout the whole lifecycle and eliminatephony CO2 reduction initiatives that do not have effective results.

Because current regulations do not sufficiently cover conversion to fuel and hydrogen handling, we expect
the government to take action.



It is important to increase the number of participating companies and make rules toward the second phasewith more stringent regulations.



We want the government to design the accounting system, pricing by emissions source, authentication
system, organization, etc. according to international standards so that all prices have high competitivenessand market versatility (in other words, so that they are not left isolated from the world).



Simple, clear rules, including those for an emissions trading system, are required. Ensuring the transparencyof emissions calculation is also important.

Quick action is needed to legislate and deregulate for the use of hydrogen, CCS, etc.



We should prioritize eliminating CO2 from power supplies at the lowest cost using conventional
technologies and making affordable CO2-free electricity available as of 2035. At the same time, we should
advance research to realize a carbon recycling society by 2050. We expect the government to encourage
the introduction of technologies with about 10,000 yen/t-CO2 in 2030 and prevent carbon prices that are
too low, which would make CO2 reduction costs an obstacle against social implementation, assuming ahigher carbon price for technologies toward 2040 to 2050.



It is desirable that various regulations on ocean tests be relaxed.

Such systems and regulations that allow carbon pricing, etc. work effectively in areas that do not advanceaccording to market principles.

A fair system is required so that specified businesses do not incur carbon loads (e.g. paying both the carbon
tax and the GX-ETS costs).

10. Institutionalization of CO2 valuation toward the social implementation of CRWe must establish a business environment where emitters can sell separated and captured CO2 as well as
systems such as the one for attributing value recognized as CO2 reduction by emitters.



We should establish a system to assess CO2 reduction effects properly so as to introduce carbon recycling
technologies that contribute to reduction effects in society. We must (1) set public assessment rules on CO2
reduction effects and (2) build a tracking and management system on the manufacturing process, including
the sources and amount of CO2.

Gradual development of GX-ETS is preferable. We should start the first phase as voluntary initiatives in
FY2023, and then tighten discipline such as by taking measures to increase the participation rate anddemanding private third-party authentication for goal setting in the second phase after 2026.

It would be desirable if CO2 reduction through material recycling is considered in valuation besides
emissions from fossil fuels.

47



Although it is easy to recognize CO2 as a valuable resource when it is used efficiently as a raw material, it
would be desirable to have an incentive system that allows CO2 capture technologies such as DAC standalone as viable businesses.



As a company that promotes CCS, a migration bond to introduce a CO2 separation and capture system(+CCS) into a coal thermal power plant is a possibility.



A market should be established where CO2 emitters and businesses that capture and use CO2 can trade CO2
emissions in order to reduce them.



Adequate operation of emissions trading, such as EU-ETS, will drive the popularization of CCS. Settinghigh values for DAC and biomass-derived CO2 will have a similar effect.

The government should revise the J-credit procedure and methodology.

The government should make it obligatory or a rule to display environmental value and give positive points
to adopters of CR materials at public works.



We desire system design that is compatible with economic growth, ensuring consistency with global
environmental valuation and trading rules for CO2.



We hope for a system that returns value to those that reduced CO2 properly and sufficiently.

11. Effective use of GX economy migration bonds


Although the introduction of carbon pricing is under consideration, whether it will cause product shift isunclear. Because it is important to reduce costs through a wider use of carbon recycling technologies,
support such as a system to compensate for price differences from existing products (like hydrogen value
difference compensation) can be effective in promoting widespread use of carbon recycling products.



We want the government to consider application methods such as adopting the stage gate method to ensurethat each developed technology leads to social implementation.

12. Challenges related to CCS in Japan

Demand needs to be stimulated to reduce CO2 through CCS. For this, we must build an appropriate businessenvironment and show an outlook for commercialization. For example, it is probably necessary to ensure
storage sites and establish a transport supply chain, laws and regulations, and business models to covertransport and storage costs.



Selecting storage sites is a major challenge in Japan. It is necessary to consider the CO2 separation andcapture procedures along with effective use of separated and captured CO2.



Local production for local consumption using blue carbon, carbon fixation to agricultural land, or othermeans in addition to building relationships with neighboring countries are factors to consider.



We must establish CCS technologies suitable for Japan (in terms of geographical features, culture, industry,and other aspects). Support for leveraging them industrially (in all industries) is also required. We recognizethat they have a large impact not only on a limited range of industrial fields mainly operated in Japan but
also international competitiveness of businesses that trade with foreign companies.



It is essential to establish rules on CO2 reduction assessment and environmental value trading in addition
to cost-related support in order to recycle separated and captured CO2 as fuel, chemical products, etc. A
system to increase business predictability is required.
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

Unlike the EOR in the U.S., because a large initial investment in storage infrastructure is required, thenational government must set up a promotion framework and assist businesses in this area.

In Europe, there are movements toward issuing credits for CO2 injected during CCS, regarding it as carbon
negative on the grounds of DAC. Systems and financial assistance are required so that processes including
amine or membrane separation can be performed as a set with DAC.



We should consider a CO2 storage framework by strengthening coordination with Asian countries rather
than limiting storage sites to domestic locations.



The government should obtain the understanding of fishery businesses in the surrounding sea early on, andinstitutionalize the limited liability of storage businesses to ensure storage sites. The legal system for land
storage must be established. In addition, initial investment support measures not associated with theintroduction of a carbon tax, a carbon trading system or increases in electricity utility rates, are importantfor encouraging the proactive involvement of electricity companies, which supply carbon sources.



It is necessary to determine who incurs CCS-related costs as social costs and how the costs are incurred,and gain national consensus about them.

13. Human resource development in the carbon recycling field, and other opinions
Human resource development and other opinions(1) Human resource development


Human resources for related technology development (such as chemical technology, plant development
technology, and LCA) should be strengthened.

In addition to the technological aspects, we think it is also important to provide education on what systemdesign must be.

Because commercialization of CR and CN is highly uncertain, those involved in it must be patient. Let’s
nurture people who have a strong sense of perseverance.

We expect educational institutions and the national government to expand support, such as by including
carbon recycling in textbooks or making it a required subject at university.

CR work-study institutions, where children who will take over from us can learn, would be useful.

(2) Other opinions


Although CR is a concept created to address fossil fuels, we should reconsider it as a carbon cycle in a
wider sense, along with the material cycle, and create initiatives where participants work with the METI
and the MOE in the future.



To promote the shift to carbon-free fuels such as hydrogen and ammonia, eliminating differences in value
from existing fuels is crucial. Although measures to compensate for value differences are currently being
considered, there will be no overall shift and the effects will be limited if only first movers are involved.
The government must support initiatives by private companies with value-difference compensation until
the supply chain equivalent to those for current fossil energies is completed.



We look forward to social implementation of negative emissions such as DAC in terms of offset in the near
future.

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14. Opinions and requests for the CRF
Services such as providing a range of information are very helpful.

Training for young employees at the Carbon Recycling University is a valuable opportunity. We hope that
the CRF will continue this educational program.



Since the concentration of CO2 in the air has largely fluctuated throughout the 4.6 billion years of the
Earth’s history, one idea to propose a view of the gas in the context of crustal and atmospheric cycles.

We expect the CRF to support the promotion of technologies, human resources, and achievements requiredfor implementing both CN and CR in society.



We want the CRF to summarize the technologies and initiative subjects of individual member companies
briefly and distribute the summary.



We expect the CRF to connect CR technologies.

We will continue to deploy “The Tale of Carbo and Risa” internally, Our employees look forward towatching the next episode, so we would like the series to continue.



We would like to use valuable information from the CRF because we are now gathering information onCR.

We expect strong lobbying activities in the public interest from the CRF.

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Attachment 3. Overview of the Carbon Recycling Fund Institute(1) Vision
We coordinate with the national government to provide support for the real-world implementation of carbon
recycling and the conduct of carbon recycling business by the private sector.

(2) Organization structure
Chairperson: Tugio MITSUOKA (Representative Director and Chairman of the Board, IHI Corporation)
Vice-Chairperson: Masayoshi KITAMURA (Special Counselor, Electric Power Development Co., Ltd.)
Vice-Chairperson: Kouji EGUCHI (Representative Corporate Executive Officer, Senior Vice President, Chief
Supply Chain Officer, Mitsubishi Chemical Group Corporation)(3) Activities① Public relations: Raising awareness regarding carbon recycling② Research grant: Offering grants to researchers, etc.
③ Tree planting: Supporting efforts to expand CO2 sinks(4) Members (as of 1st November, 2023)
128 corporate members, 26 individual members, 14 local government members, and 19 academic members

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