1

2

3

Carbon Neutrality in China,
Japan and Korea
Current status and implications towards future trilateral cooperation

Project Manager

Dong Un Park (STEPI, dupark@stepi.re.kr)

Authors

Dong Un Park (STEPI)
Jieun Kim (STEPI)
Xunmin Ou (Tsinghua University)
Chao Wang (CASTED)Thi Nu Pham (JST)Mikkiko Azuma (JST)Junko Okayama (JST)
Chulho Park (GTC)
Mina Lee (GTC)
Jaemin Song (Seoul National University)

Publication Date
Publisher
Publishing Office
Address

October 31 , 2022
Mi Ock Mun
Science and Technology Policy Institute (STEPI)th
5~7 Fl, Building B, Sejong National Research Complex, 370 Sicheong-daero, Sejong, 30147,
Republic of Korea+82 44-287-2000+82 44-287-2068
www.stepi.re.kr

Tel
Fax
WebsiteDisclaimerst

The views and opinions expressed in this report are those of the authors listed
above and do not necessarily reflect the views or positions of any entities they
represent.

4

ALCA

Advanced Low Carbon Technology Research and Development ProgramBASIC

Brazil, South Africa, India, China

BRAIN

Bio-oriented technology Research Advancement INstitution

CAO

Cabinet Office

CCER

China Certified Emission Reduction

CCS

Carbon Capture and Storage

CCUS

Carbon dioxide Capture, Utilization and Storage

CDR

Carbon Dioxide Removal

CN

Carbon Neutrality

CPC

Communist Party of China

CPCN

Carbon Peak and Carbon Neutrality

CSTI

Council for Science, Technology and Innovation

ERCA

Environmental Restoration and Conservation Agency

GDP

Gross Domestic Product

JSPS

Japan Society for the Promotion of Science

JST

Japan Science and Technology Agency

MAFF

Ministry of Agriculture, Forestry and Fisheries of Japan

METI

Ministry of Economy, Trade and Industry

MEXT

Ministry of Education, Culture, Sports, Science and Education

MHLW

Ministry of Health, Labour and Welfare

MIC

Ministry of Internal Affairs and Communications

MLIT

Ministry of Land, Infrastructure, Transport and Tourism

MOE

Ministry of the Environment

MOD

Ministry of Defence

i

NARO

National Agriculture and Food Research Organization

NDCs

Nationally Determined Contributions

NEDO

New Energy and Industrial Technology Development Organization

NEV

New Energy Vehicle

STI

Science Technology and Innovation

PARMs

Provinces, Autonomous Regions, and Municipalities

R&D

Research and Development

UNFCCCii

United Nations Framework Convention on Climate Change

Ⅰ. Introduction ............................................................................ 1
Ⅱ. People’s Republic of China
1. Policy Reviews and Issues of Carbon Neutrality ...................................7
1.1 Review on Carbon Neutrality policy and scenarios (energy mix) ................................................... 7
1.2 Policy governance and institutional arrangement for implementation ...................................... 11
1.3 Major barriers and important issues................................................................................. 13

1.4 Approach to policy measures ............................................................................................. 17
1.5 International co-operations ................................................................................................ 20
1.6 Summary.......................................................................................................................... 22

2. Net-Zero R&D strategies .........................................................................23
2.1 R&D Management ............................................................................................................. 23
2.2 Key Strategic Programs ..................................................................................................... 26
2.3 Applications of Key Technologies ..................................................................................... 28
2.4 Recent R&D Achievements ............................................................................................... 30
2.5 Summary ............................................................................................................................ 33

Ⅲ. Japan
1. Policy Reviews and Issues of Carbon Neutrality .................................37
1.1 Background ........................................................................................................................ 37
1.2 Carbon Neutrality Policy and Governance System ............................................................ 38
1.3

Mid-to-long-term Strategies and Scenarios Related to Carbon Neutrality .............................. 46

1.4 Major Barriers and Important Issues .................................................................................. 50
1.5 Summary ............................................................................................................................ 51iii

2. Net-Zero R&D Strategies .........................................................................54
2.1 R&D Governance .............................................................................................................. 54
2.2 Key Technologies ............................................................................................................... 57
2.3 Key Strategic Programs ..................................................................................................... 58
2.4 Successes from Recent R&D Results ................................................................................ 65
2.5 Summary ............................................................................................................................ 68

Ⅳ. Republic of Korea
1. Policy Reviews and Issues of Carbon Neutrality ...............................75
1.1 Background ........................................................................................................................ 75
1.2 Carbon Neutrality National Policy and Institutional Framework .............................................. 75
1.3 GHGs Reduction Target vs. Progress .................................................................................. 83
1.4 Carbon Neutrality Strategy and Scenarios ........................................................................... 84
1.5 Major barriers and important issues ..................................................................................... 88
1.6 Summary ............................................................................................................................ 91

2. Net-Zero R&D Strategies .........................................................................93
2.1 R&D Policy..................................................................................................................... 93

2.2 R&D budget ....................................................................................................................... 96
2.3 Summary and Future Challenges ....................................................................................... 104

Ⅴ. Towards International Collaborations
1. Background ............................................................................................109
2. International collaboration towards carbon neutrality ......................111
3. Conclusion..............................................................................................118iv

Table of Contents[Table 1-1] Selected indicators of climate change in China, Japan, and Korea .............................................. 4[Table 2-1] Primary Energy Mix Outlook（in the scenario of medium GDP growth and high speed transition） ... 11[Table 3-1] Main policy means and contents of the green growth strategy for 2050 carbon neutrality ........ 39[Table 3-2] The policy direction towards 2030 for 2050 .............................................................................. 41[Table 3-3] Japan’s 2030 Energy Power Composition .................................................................................. 42[Table 3-4] Japan's Targets and Standards for Each Sector by Greenhouse Gas........................................... 43[Table 3-5] Main measures of Japan's global warming plan ......................................................................... 44[Table 3-6] Main measures of Japan's global warming plan ......................................................................... 46[Table 3-7] Key Technologies by target sector.............................................................................................. 57[Table 3-8] R&D projects in Moonshot Goal 4............................................................................................. 60[Table 3-9] NEDO’s energy conservation/environment projects .................................................................. 61[Table 3-10] Areas of Research for Zero-Emission Agriculture, Forestry and Fisheries (source: Prime
Minister of Japan Cabinet Office) ............................................................................................. 64[Table 4-1] Changes in Reduction Targets in Korea ..................................................................................... 77[Table 4-2] Carbon Neutrality Strategies by Sector (The Government of the Republic of Korea, 2021) ..... 85[Table 4-3] Energy Mix ................................................................................................................................. 87[Table 4-4] Areas of focus on carbon-neutral R&D by ministries ................................................................ 94[Table 4-5] Project main contents by technology of New and renewable energy core development project ofthe ministry of Industry ............................................................................................................. 99[Table 4-6] 2016-2020 budgets by technologies of New and renewable energy core development project ofthe ministry of Industry ........................................................................................................... 101[Table 4-7] Project main contents by technologies of Climate change response technology development
project of the Ministry of Science and ICT ............................................................................. 103[Table 4-8] 2016-2020 budgets by technologies of Climate change response technology development
project of the Ministry of Science and ICT ............................................................................. 103[Table 5-1] Energy mix in China, Japan, and Korea in 2021 .......................................................................111[Table 5-2] Matrix of international collaboration towards carbon neutrality .............................................. 112[Table 5-3] Revealed technological advantage by country in key climate technology fields ..................... 113[Table 5-4] (Potential) Partner country comparison between Japan and Korea .......................................... 118v

Figure of List
[Figure 2-1] Case: A new model of green poverty alleviation in “Photovoltaic Village” ............................. 31[Figure 3-1] Japan's Carbon Neutral Scenario............................................................................................... 49[Figure 3-2] The Ratio of STI Budget of Japanese Government by Ministry ............................................... 54[Figure 3-3] The structure of SIP .................................................................................................................. 58[Figure 3-4] The program Framework of Moonshot, source: Cabinet Office. .............................................. 59[Figure 3-5] Layered Structure of ALCA Technology Areas ........................................................................ 62[Figure 3-6] Layered Structure of ALCA-SPRING ...................................................................................... 63[Figure 3-7] (Left) Photograph of the new Mg -Ca alloy material, (Center) Observed microstructure of the
new material, (Right) Battery charge/discharge test results using pMg and Mg-Ca material as
the negative electrode................................................................................................................ 66[Figure 3-8] Paradigm Shift in energy Resources of Society ........................................................................ 67[Figure 4-1] Overview of Framework Act on Carbon Neutrality, Green Growth ......................................... 79[Figure 4-2] Institutional arrange for GHG reduction progress tracking and assessment ............................. 81[Figure 4-3] The structure of Carbon Neutrality Commission (The Government of the ROK, 2022).......... 82[Figure 4-4] Mitigation pathway in the roadmap vs. actual emission between 2018 and 2019 .................... 83[Figure 4-5] 2050 Carbon Neutrality Scenarios (Yoon, 2021) ...................................................................... 86[Figure 4-6] 10 key technologies in Carbon-neutral Technology Innovation Promotion Strategy ............... 94[Figure 4-7] 10 key technologies in Strategy for the Selection and Development of National Essential
Strategic Technologies .............................................................................................................. 95[Figure 4-8] Korean major national R&D budget allocation system ............................................................ 96[Figure 4-9] Government R&D Investment in Climate Technology in Korea .............................................. 97[Figure 4-10] Investment in Climate Technology R&D by Ministries in Korea ........................................... 98[Figure 4-11] 2020 Carbon Neutral Technology Level ............................................................................... 104[Figure 5- 1] Per capita CO2 emissions between 1980 and 2020 in EU, China, Japan, and Korea..............111[Figure 5-2] The JCM scheme between Japan and host country................................................................. 117

vi

1

In the midst of the global COVID-19 pandemic, all three North-East Asian countries, People’s
Republic of China (hereafter China), Japan, and the Republic of Korea (hereafter Korea),pledged a commitment to net-zero carbon emissions by the mid-century. Among three
countries, China, the world’s largest greenhouse gas (GHG) emission country, wassurprisingly the first promising to be carbon neutral until 2060 at the world leaders’ meetingof the United Nations General Assembly in September 2020. Then, Japan and Korea followed
China by making their pledges to carbon neutrality by 2050 in October 2022. Their pledge tocarbon neutrality has significant influence on the global efforts to tackle climate change.
China, Japan, and Korea combined consist of 20.5% of the world’s population as of 2020,
25.2% of the world’s GDP as of 2020, and 31.5% of the world’s GHG emissions as of 2019
(World Bank, 2022)1.
East Asian countries share several commonalities (or constraints) in achieving carbon
neutrality. As shown in Table 1-1, they are ranked 1th, 5th, and 7th in the world in terms of
the amount of GHG emissions. As of 2020, all three countries have more than 20% in termsof manufacturing value added as % of GDP with the strong presence of domestic heavy
industry (c.f. EU 15%, US 10%). They are required to not only transform their current carbon
intensive energy system to new low-carbon system but also decarbonize their industries.
Moreover, Japan and Korea reached their GHG emission peaking only recently in 2013 and2018, being late compared to other advanced countries due to their late industrialization. And
China has not even reached its peaking, being expected to reach by 2030 according to their
net-zero scenario. In this regard, all three countries may be able to attain their pledge tocarbon neutrality only through drastic measures within a relatively short period, whichemphasizes the importance of the role of science and technology in the carbon neutrality of
three East Asian countries.

1

World Bank Databank homepage (https://data.worldbank.org), accessed 12/10/2022*Author of Chapter Ⅰ and Ⅴ: Dong Un Park

3

[Table 1-1] Selected indicators of climate change in China, Japan, and Korea
Indicators

People’s Republic of Chia

Japan

Republic of Korea

GHG emissions(million ton-CO2 eq., 2019)10,661.7

1,071.0

593.7

GHG emissions per capita(ton-CO2 eq., 2019)

7.6

8.5

11.8

Ranking of GHG emissions

1th

5th

7th

Manufacturing value added(% of GDP, 2021)

27%

20%

25%

GHG emissions peaking year

2030 (expected)

2013

2018

Date of proclamation of carbon
neutrality

22nd September 2020

26th October 2020

28th October 2020

Target year of carbon
neutrality

2060

2050

2050

Source: https://kosis.kr/, https://data.worldbank.org/, accessed 14/07/2022, 12/10/2022

Therefore, this working paper attempts to present an overview of the policy and strategies oncarbon neutrality of three East Asian countries, China, Japan, and Korea, and identify key
issues and barriers in the respective country. Then, it aims to provide policy implications tofacilitate mitigation actions through international collaboration among these countries.
The structure of this report is following. After the introduction, Chapter II, III, and IV provide
an overview of national policies and corresponding R&D strategies on carbon neutrality in
China, Japan, and Korea respectively. Each country chapter delves into major barriers andcritical issues to achieve the strategy and scenarios of carbon neutrality in each country andthen, deep-dives into key technologies, key strategic programs, and early success examples
from the recent R&D programs. Drawing on the overview of national policies and R&D
strategies in each country, this working paper constructs a matrix with type of mechanism(multilateral or bilateral/trilateral) and type of cooperation (policy or project) and discusses
the potential mechanism of international collaboration among three East Asian countries
based on the current international institutions and programs. It concludes by briefly discussing
further research topics.

4

5

1. Policy Reviews and Issues of Carbon Neutrality

2

As a responsible country, China is committed to building a global climate governance systemthat is fair, rational, cooperative and beneficial to all, and makes its due contribution to
tackling climate change using its greatest strengths and most effective solutions. Confronted
by the challenges of climate change, China is willing to work together with the international
community to ensure the Paris Agreement delivers steady and lasting results, and makegreater contribution to the global response.
At the general debate of the 75th Session of the United Nations General Assembly on
September 22, 2020, President Xi Jinping announced that China would scale up its NDCs byadopting more vigorous policies and measures, strive to peak CO2 emissions before 2030, andachieve carbon neutrality before 2060. China is taking pragmatic actions towards these goals.

After Xi Jinping put forward the goal of carbon peaking and carbon neutrality, he quickly
made major strategic deployments, and various departments and fields have issued important
documents to actively build a "1 + N" policy system of carbon peak and carbon neutrality(CPCN), which has initially formed a good situation in which the whole society mobilizes
together.

1.1

Review on Carbon Neutrality policy and scenarios (energy mix)

1.1.1 Policy history
Why China is pledging for carbon neutrality by 2060? Some experts argue that: 1). To
present the image of a responsible major country, adhering to the principle of common but
differentiated responsibilities, and fulfill the principle of respective capabilities to tackle
global climate change; and 2). And take the goal of carbon neutrality as a strategic starting2

Author: Xunmin Ou (Tsinghua University)

7

point to promote a greener and lower carbon transformation of the domestic economic system
in China.
Climate change is a serious challenge for all of humanity. As a developing country with apopulation of 1.4 billion, China is facing multiple challenges such as developing its economy,
improving people's livelihood and protecting the environment. China is also one of thecountries most affected by climate change. China attaches great importance to addressing
climate change. President Xi Jinping has stressed many times that responding to climatechange is not what others want us to do, but what we ourselves want to do, which is an
inherent need for China's sustainable development and a responsibility to promote theconstruction of a community with a shared future for mankind.
To achieve the goals of peaking carbon emissions and subsequent carbon neutrality is one ofChina’s major strategies, defined after careful consideration. This is a must-do in order torelieve the serious constraints imposed by resources and the environment on China’s
economic growth, and to achieve sustainable development. It is also a solemn commitment
towards building a global community of shared future. China has incorporated this decision
into its overall economic and social development, adopting a holistic approach and balancing
the relationships between economic growth and emissions reduction, between overall andregional interests, and between short, medium, and long-term growth. Led by the green
economic and social transition, China is focusing on green and low-carbon development of
the energy sector, and accelerating the formation of industrial structures, production modes,
ways of work and life and spatial configurations that help to conserve resources and protect
the environment. It is fully committed to high-quality development that prioritize ecoenvironmental protection and green and low-carbon way of life.
In a speech at the UN General Assembly on September 22, 2020, President Xi Jinping
announced that China would peak carbon dioxide emissions before 2030 and achieve carbon
neutrality before 2060. China has issued a series of documents on the carbon peaking andneutrality goals, which have become hot issues in society.
China is continuing to update NDC targets. In 2015, China set its nationally determined action
objectives by 2030: to peak carbon dioxide emissions around 2030 at the latest and makeevery effort to peak early. By the end of 2019, China had delivered on its 2020 climate action
target ahead of schedule. In 2020, China announced new NDC targets and measures. China
aims to:Peak carbon dioxide emissions before 2030 and achieve carbon neutrality before 2060.

8

Lower its carbon intensity by over 65 percent by 2030 from the 2005 level.
Increase the share of non-fossil fuels in primary energy consumption to around 25 percent by 2030.
Increase the forest stock volume by 6 billion cubic meters by 2030 from the 2005 level.
Bring its total installed capacity of wind and solar power to over 1.2 billion kW by 2030.

Compared with the objectives set in 2015, the new targets are more ambitious in timeframe.
They involve a steeper cut in carbon intensity, an increase of another five percentage points inthe share of non-fossil fuels in primary energy consumption, a new target for installedcapacity of non-fossil fuels, an additional forest stock of 1.5 billion cubic meters, and a clear
announcement to aim for carbon neutrality before 2060. China has announced in 2021 a
decision to stop building new coal-fired power projects overseas, demonstrating its concrete
actions in response to climate change.
The carbon neutrality (CN) goal is feasible. From the expert’s view, China has a goodtradition of fulfilling its promises, and is willing to make painstaking efforts to fulfill its
promises. China has strong and centralized leadership institutions, long-term stable strategies
and policies and a rapidly rising public awareness of low carbon.

1.1.2 Impact outlook
The carbon neutrality target will have a profound impact, affecting economic development
models, energy systems, social consumption concepts and even public lifestyle habits.
CN goal will have a profound impact, affecting economic development mode, energy systems,social consumption concepts and even public living habits. There are some potential impacts
on the world for to fulfil this pledge.
1) Driving global climate action in practice, not just commitment;
2) Accelerating the rapid development of carbon-neutral related technologies such as energy
efficient, renewable energy, energy storage, hydrogen energy and CDR around the world;
and3) Promote the low-carbon development of the global energy system, industrial chain andeconomic pattern.
China is improving and adjusting the energy mix. The energy sector is a major source of GHG
emissions. China has continuously intensified its efforts in energy conservation and emissions

9

reduction and accelerated energy mix readjustment to build a clean, low-carbon, safe, andefficient energy system. To achieve this, it has:
Defined a new strategy for energy security that promotes a green revolution in energy consumption,
supply, technology, and systems, strengthens international cooperation in an all-round way,prioritizes the development of non-fossil fuels, promotes the green development of hydropower,
makes comprehensive and coordinated progress in wind and solar power development, pursues theorderly development of nuclear power under the precondition of guaranteed safety, develops
biomass energy, geothermal energy, and marine energy based on local conditions, comprehensively
increasing the rate of renewable energy use.
Driven the supply-side structural reform of coal by cutting overcapacity in coal, strengthening safe,
intelligent, green, and efficient exploitation and clean and efficient use of coal, promoting clean,efficient, and high-quality development of coal-fired power industries, reducing the consumption ofcoal and replacing it with other fuels, taking comprehensive measures to manage the use of coal in
non-industrial sectors, and promoting the substitution of coal and petroleum by electricity as enduse energy.
Expanded reform of the energy system, promoting efficient allocation of energy and resources.

The carbon neutrality target will have a significant impact on China's energy mix. China isstrengthening the dual control of energy consumption intensity and total amount, andpromoting a significant improvement in energy efficiency. China will strictly control fossil
energy consumption, vigorously develop non-fossil energy, non-fossil energy accounted forabout 25% of energy consumption, wind power, solar power total installed capacity of morethan 1.2 billion kilowatts by 2030. A clean, low-carbon, safe and efficient energy system will
be fully established, the energy utilization efficiency will reach the international advanced
level, and the proportion of non-fossil energy consumption will reach more than 80% by 2060.
Relevant studies have shown that China's energy structure needs to accelerate its
transformation under the CPCN target. Taking the research results of Wei Yiming's team as an
example (see Table 2-1), the proportion of non-fossil energy in China's primary energy
structure should be significantly increased, reaching 21% in 2025, and more than 25% in 2030,
and the proportion of non-fossil energy in primary energy consumption by 2060 will exceed
80%. The proportion of coal in primary energy has steadily declined, but in a long period oftime, China will still be a coal-based energy pattern, with coal accounting for about 44% in
2030, and coal will still play an important role in ensuring energy security in 2060. The shareof oil in primary energy by 2025 was stable and rising, and then began to decline gradually,
with an average annual decline rate of about 3% between 2025 and 2060. The proportion ofnatural gas shows a trend of first growing and then declining, and the proportion of natural
gas consumption will reach about 12% in 2035 and remain until 2050, after which with the10maturity of renewable energy technology and energy storage technology and the highproportion of application, the proportion of natural gas consumption will fall back to about
7%.
[Table 2-1] Primary Energy Mix Outlook（in the scenario of medium GDP growth and high speed transition）
2020

2025

2030

2035

2040

2045

2050

2055

2060

Coal

57%

50%

45%

41%

36%

30%

25%

15%

8%

Oil

19%

19%

18%

17%

15%

14%

12%

10%

5%

NG

9%

10%

11%

12%

12%

12%

12%

11%

7%

Non-fossil

16%

21%

26%

30%

37%

43%

50%

64%

80%

Source: Ref. Wei et al. (2022)

1.2

Policy governance and institutional arrangement for implementation

In order to do a good job in CPCN, China has formulated and issued relevant policy
documents to build a "1 + N" policy system for carbon peaking and carbon neutrality,
providing strong support for achieving carbon peaking and carbon neutrality goals onschedule; China has established corresponding governance mechanisms at the national andPARMs levels to promote the overall deployment and coordinated promotion of carbon
neutrality work.

1.2.1 Policy governance
China is accelerating work on 1+N policies for peaking carbon emissions and achievingcarbon neutrality. The country has formulated and released a top-level design document forpeaking carbon emissions and achieving carbon neutrality, and is working on an action planfor peaking carbon emissions before 2030, with implementation plans for fields and sectors
such as energy, industry, urban and rural construction, transport, and agriculture and rural
areas. Support plans are being created in areas such as science and technology, fiscal funding,finance, pricing, carbon sinks, energy transition and coordination of pollution reduction andcarbon emission reduction, with clearer timetables, roadmaps, and working plans. The country
is shaping policies and actions with clear objectives, reasonable assignment of labor, effective
measures, and sound coordination, ensuring that all efforts deliver positive results.

11

1.2.2 Institutional arrangement
In recent years, the State Council of China has twice adjusted and improved the members of
the National Leading Group for Combating Climate Change and Energy Conservation andEmission Reduction, with Premier Li Keqiang of the State Council as the leader. Each PARM
has set up a provincial-level leading group for climate change and energy conservation andemission reduction, as a cross-departmental comprehensive deliberative coordination body for
local efforts to deal with climate change and energy conservation and emission reduction. In
May 2021, the Leading Group for Carbon Neutrality work was established, with Vice Premier
Han Zheng of the State Council as the team leader, and the office was located in the National
Development and Reform Commission to further strengthen the overall deployment andcoordination of carbon peaking and carbon neutrality work. All PARMs have successively set
up carbon peaking and carbon neutrality work leading groups to strengthen the overallplanning of local carbon peaking and carbon neutrality work. At the same time, supporting
institutions such as the National Climate Change Expert Committee continue to play anadvisory role.
China is actively exploring new, low-carbon models of development. China has actively
explored low-carbon models of development. It has encouraged local governments, industries,and enterprises to explore low-carbon paths to development based on their individual
conditions, and launched pilots and demonstrations on green and low-carbon development infields such as energy, industry, construction, and transport, thus shaping a basic
comprehensive and multi-tiered system for low-carbon piloting. It has launched low-carbon
pilots in 10 provincial-level units and 77 cities, and explored low-carbon models ofdevelopment and institutional innovations in respects including organizational leadership,
support policies, market mechanisms, statistical systems, evaluation and assessment,
coordination and demonstration, and cooperation and exchanges. The carbon intensity ofthese pilot areas has fallen faster than the national average, and a number of low-carbon
models of development with distinctive features have emerged.

12

1.3

Major barriers and important issues

There are some main challenges to fulfil this pledge, including the following aspects:
1) An economic system focused on achieving long-term low-carbon development could leadto a slowdown in economic growth rates in the near and medium term;2) Coal phase-down and oil use control in the energy system will impact the economic andsocial system, and whether the problems of asset stranded and employment transfer can behandled in place;3) Whether the import pressure of low-carbon energy sources such as natural gas and thedevelopment rate of renewable energy can meet high expectations; and
4) Whether the rapid R&D of hydrogen, energy storage and CDR technologies required for
low-carbon development can meet high expectations, whether the huge cumulative capital
investment demand of over 100 trillion $ can be met, and whether the cost of carbon
reduction can be rapidly reduced in several decades.
However, the revolutionary changes in the energy system will also face a number ofchallenges, in the short term: the traditional fossil energy industry has suffered a huge impact,
the non-technical cost of renewable energy has risen rapidly, the economy of zero-carbon
technology is insufficient, the resistance to the reform of the whole social system is large, andthe energy security problem is more complex.

1.3.1 The time period from peak to neutralization is extremely short
It will not be easy for China to achieve its new NDC targets including the goal of CN; it willtake approximately 30 years of painstaking effort to transit from peak carbon emissions toachieving carbon neutrality and the largest reduction in carbon dioxide emissions per unit of
GDP (“carbon intensity”) in the world.
China is still a developing country, facing multiple challenges such as developing the
economy, improving people's livelihood, and controlling pollution, and it is facing greaterdifficulties and challenges than some developed countries in achieving a comprehensive green
and low-carbon transformation in a relatively short period of time. Walking the talk, China
has already begun to implement positive and effective moves in its strategy to peak carbon
emissions and achieve carbon neutrality.

13

1.3.2 The task of transforming the energy system is arduous
Forcing the energy system to accelerate the low-carbon transition is the core support for
ensuring carbon neutrality by 2060. About 90% of China's emissions come from the energy
system, and the core to achieve carbon neutrality is to force energy acceleration from thewhole chain of supply, conversion and demand, build a clean, low-carbon, safe and efficientmodern energy system, and decouple economic growth from fossil energy consumption.
Some experts argue that China's fossil energy consumption should reach the peak as soon as
possible, in addition to coal to reach the peak immediately, strive to reach the peak of oil
before 2030, natural gas before 2040, and the proportion of non-fossil energy in primaryenergy consumption will increase to 70% in 2050.
China is a country rich in coal, poor in oil and gas, and is in a critical period of changing themode of development, optimizing the economic structure, and transforming the driving forceof growth; the process of industrialization and urbanization continues to advance, energy
demand will still grow, the coal-based energy structure will be difficult to fundamentallychange in the short term, and the adjustment of the energy structure requires a process.

1.3.3 Traditional energy systems will be severely impacted
The rapid transformation of China's energy system will have a serious impact on the
traditional energy system. To achieve the 2060 carbon neutrality target, the proportion offossil energy needs to drop by an average annual of 1.6 percentage points in the next 40 years,
which is about 2 times the average annual decline in the proportion of fossil energy during the"13th Five-Year (2016-2020) Plan" period, which is very difficult. The fossil energy system
has been highly integrated into all aspects of the production and life of the national economy,
from upstream exploration and development, midstream storage and transportation to
downstream consumption, as well as the layout of import and export trade networks andoverseas assets, involving tens of trillions of assets, millions of employees employment,
military diplomacy, and international energy cooperation. Changing the trajectory of fossil
energy development in a short period of time, in a centralized manner, and on a large scale has
a huge impact on China's economy and society, and it is necessary to make overallarrangements and systematic planning at the national level.

141.3.4 The large-scale development of renewable energy is facing the problem of
increasing non-technical costs
The large-scale development of renewable energy is facing the problem of increasing nontechnical costs. At present, the installed capacity of intermittent renewable energy sources
such as wind and solar power is relatively large (accounting for 20.3%), but the proportion ofgrid-connected power generation is relatively small (less than 10%)。Under the carbon
neutrality target, the proportion of renewable energy generation such as wind and solar power
will rise rapidly, and it is expected to reach about 80% by 2060. The increase in the proportionof intermittent power supply makes the difficulty of stable operation and adjustability of thepower system significantly increase, and the contradiction between the stability and thesatisfaction of user needs will be highlighted, and it is necessary to be equipped with flexible
adjustment of the power supply, but this will significantly increase the operating cost or nontechnical cost of the power system. In addition, the rapid expansion of the installed capacityof renewable energy will increase the occupied area of land, oceans and other areas, and thenegative impact on the ecosystem will also be highlighted.

1.3.5 Carbon-neutral related core technologies require long-term development
Key low-carbon zero-carbon technologies do not have large-scale layout conditions in thenear and medium terms in China.
It is much more difficult to achieve China's carbon neutrality goal than that of developed
countries judging from the existing technology reserves and the trend of deep decarbonization
technology. While keeping up with the trend of world technological development, Chinaneeds to overcome many challenges such as intellectual property rights and capital needs,
improve its independent innovation capabilities, tackle core technologies, and strive to grasp
the future international climate discourse.
The following three areas of work need to be carried out by China:
1) Identify the needs of difficult emission reduction sectors and deep decarbonization
technologies under the carbon neutrality target.
Organize research to identify the main difficulties and obstacles to China's carbon
neutrality goals, and the difficult sectors and areas of emission reduction, and then give an
important basis for the reserve and deployment of deep decarbonization technologies.
2) Carry out the exploration, research and promotion of key technologies for deep
decarbonization in different fields.

15

Combined with the characteristics of China's energy endowment and social and economic
development, the research and development and promotion of deep decarbonization
technology are carried out in different fields.
3) Form a guarantee mechanism for the development of deep decarbonization technology.
Deploy special scientific and technological plans in the field of medium- and long-term
response to climate change, increase capital investment dedicated to the research anddevelopment of deep decarbonization technologies, and organize forces to actively
promote the development and application of new technologies.

1.3.6 Production and lifestyles are facing systemic changes
Production lifestyles require systemic change. Achieving carbon neutrality not only depends
on profound changes in the energy system, but also needs to change from the "energy enduser", such as economic structure, production mode, consumption habits, etc., so as to reducethe intensity of energy demand and create conditions for the large-scale application ofrenewable energy power generation as the main body of electricity. However, at present, thecontinuous and rapid decline in energy intensity faces two challenges: Firstly, the marginal
effect of energy conservation brought about by industrial restructuring is getting narrower andnarrower, and the future needs to rely more on technological progress and innovation to lead,which is more difficult; Secondly, with the increase in the proportion of energy consumption
on the consumption side, energy conservation needs to cover a wider range of fields, which
involves hundreds of millions of consumers, which is related to the transfer of consumer
behavior preferences, which is very difficult. It is so necessary to build a low-carbon circulargreen economic system as soon as possible, shape a lifestyle that saves energy and energy,
and cultivate a new trend of green and low-carbon consumption.

1.3.7 The management system requires revolutionary change
The management system and mechanism need to be revolutionized. For a long time, China's
energy has mainly been based on guaranteed supply, and the management model has shown
the characteristics of fragmentation and fragmentation. In the new journey of achieving thegoal of carbon neutrality, the boundaries between energy production and consumption will be
increasingly blurred, and the centralized supply of energy will gradually shift to centralized +decentralized complementarity, which requires strengthening management innovation on the
demand side, guiding and promoting energy conservation throughout society, andfundamentally realizing the integration of energy production and consumption. In particular,
the reform of the power system has become the key, mainly the issue of how to divide the16responsibility for power safety and supply, that is, how to divide the responsibility between
the power supply and the power grid, between different power sources, and between the
power grid and the consumer. In addition, consumers are also required to respond toscheduling arrangements, which are in conflict with long-term user energy habits.

1.4

Approach to policy measures

1.4.1 Strengthen detailed management
China is improving overall planning and coordination in response to climate change. The
response to climate change covers a wide range of areas; therefore, to improve coordinationand pool strengths, China has set up a national leading group headed by Premier of the StateCouncil and with officials from 30 ministries and commissions as members. Its remit is
responding to climate change, conserving energy, and reducing emissions, and all provinces,autonomous regions, and municipalities (PARMs) directly under the central government have
set up corresponding groups. In April 2018, China adjusted the functions of relevant
government departments, and put the newly established Ministry of Ecology and Environment
in charge of responding to climate change, thus reinforcing the coordination between
responding to climate change and protecting the eco-environment. In 2021, China set up a
special leading group to guide and coordinate the work related to peaking carbon emissions
and achieving carbon neutrality. All PARMs have established leading groups for peaking
carbon emissions and achieving carbon neutrality, so as to strengthen the coordination of theirefforts.
China is incorporating the response to climate change into national economic and social
development plans. Starting from the 12th Five-year Plan period (2011-2015), China has
incorporated reducing carbon intensity into the outline of the plans for national economic andsocial development as binding targets, and defined key tasks, priority areas, and major
projects. China’s Outline of the 14th Five-Year Plan (2021-2025) for National Economic andSocial Development and the Long-Range Objectives Through the Year 2035 sets a binding
target of slashing carbon intensity by 18 percent from 2020 to 2025. All PARMs have takenon the response to climate change as an important part of the 14th Five-year Plan, and set
themselves specific targets and tasks.
China is establishing a mechanism of breaking down and meeting the targets for responding
to climate change. To meet its targets, China has set tiered provincial-level carbon emission
caps for its PARMs based on factors such as their development stage, resource endowment,

17

strategic positioning, and eco-environmental protection. It has assessed the performance of therelevant governments in meeting the targets and fulfilling the responsibilities for controlling
GHG emissions, and uses the results as an important reference for the comprehensive
performance assessment and appraisal of officials holding principal posts and leadershipteams in the PARMs, as well as for the appointment, reward, sanction, and removal of
officials. PARM governments have also assessed the performance of administrative divisions
at lower levels in meeting their targets and fulfilling their responsibilities for controlling GHG
emissions, thus ensuring that the effort is coordinated and effective.

1.4.2 Implement the ETS system
The carbon market provides an effective approach to managing the relationship between
economic development and carbon emissions reduction. China is pushing ETS as a tool for
carbon emissions reduction. he national carbon emissions trading market (national carbon
market) is a major institutional innovation that uses market mechanisms to control and reduce
GHG emissions and promote green and low-carbon development. It is also an important
policy tool for China to reach peak carbon emissions by 2030 and achieve carbon neutrality
by 2060.
China is carrying out pilot programs on carbon emissions trading. The carbon market
institutions motivate companies to commit to curbing their emissions and use market-based
instruments to price carbon reasonably, thus better allocating carbon emission resources.
Starting from October 2011, seven provinces and municipalities – Beijing, Chongqing,
Guangdong, Hubei, Shanghai, Shenzhen, and Tianjin – were selected to pilot projects forcarbon emissions trading. Since 2013, seven local-level pilot carbon markets have beenlaunched, covering nearly 3,000 key emissions companies in more than 20 industries,
including power, steel, and cement. As of September 30, 2021, the total trading volume of theseven pilot carbon markets had reached 495 million tons of carbon dioxide equivalent,
representing a value of approximately RMB12 billion. Major emitters in the pilot carbon
markets have maintained a relatively high level of compliance rate, with both volume andintensity of carbon emissions within the market coverage maintaining a downward trend. Thishas given a significant boost to enterprises’ contribution to emissions reduction, and raised theawareness of low-carbon development in all sectors of society. The local-level pilot projects
have accumulated valuable experience for the launch of the national carbon market in terms
of providing institutional references and training personnel.

18China is building a national carbon market system. Systems are key in advancing carbon
market development. To better regulate the carbon market, the Chinese government
promulgated the National Carbon Emissions Trading Market Construction Plan (Power
Generation Industry), Measures for the Administration of Carbon Emissions Trading (for Trial
Implementation), and a quota allocation plan for the national carbon market in the firstcompliance period. In 2021, with the release of guidelines for accounting and reporting
corporate GHG emissions and three sets of management rules for carbon emission rights
regarding registration, trading, and settlement, a basic national carbon market system wasestablished. The legislative process has moved forward on the Interim Rules on the
Administration of Carbon Emissions Trading, which consolidated the legal basis for carbon
emissions trading, and ensured standardized operation and management in the key links of thenational carbon market.
China has launched the national carbon market. On July 16, 2021, the national carbon market
started online trading. A total of 2,162 power generation companies were involved,
representing 4.5 billion tonnes of carbon dioxide emissions, making this the world’s largest
emissions trading system. The launch attracted great attention and positive comments in
China and elsewhere. As of September 30, 2021, the total trading volume in the market hadreached 17.65 million tonnes, with turnover of RMB801 million. In general, the operation of
the market has been stable and orderly.
China has established a GHG voluntary emission reduction program. The China Greenhouse
Gas Voluntary Emission Reduction Program was established in 2012. Its goals are toencourage the whole of society to participate in emissions reduction activities, ensure that thetransaction entities fulfill their social responsibilities, pursue a low-carbon development path,and promote a low-carbon industrial structure and low-carbon energy consumption. As of
September 30, 2021, the total trading volume of GHG voluntary emission reduction had
exceeded 334 million tonnes of carbon dioxide equivalent, with turnover approaching RMB3
billion. China Certified Emission Reduction (CCER) has been introduced to pilot markets inoffsetting carbon emissions, or writing off emissions occurred for public welfare purposes,
effectively optimizing China’s national energy mix and its compensation mechanism for ecoenvironmental conservation.

19

1.5

International co-operations

China will honor its promises and continue to support multilateralism, however the global
situation changes. It will work with other parties to achieve the full, balanced, effective andsustained implementation of the United Nations Framework Convention on Climate Change
and the Paris Agreement, to fulfill its NDC goals, to control GHG emissions, and to increase
its ability to adapt to climate change. It will redouble its efforts to promote a global
community of shared future, and make a greater contribution to a better home planet for all
humanity.

1.5.1 Participate in the construction of a fair and reasonable global climate
governance system with win-win cooperation
China calls on the international community to take immediate action, strengthen solidarity
and cooperation, and remain committed to multilateralism, and build a fair and rational global
climate governance system for win-win results.
China has been an active and constructive participant in international climate talks. It iscommitted to the principles of equity, common but differentiated responsibilities, andrespective capabilities, and maintains that negotiations should be open, transparent, inclusive,
party-driven and consensus-based. It played a leading role in and pressed ahead with theconclusion of key documents including the Paris Agreement. China initiated the establishmentof multilateral negotiation mechanisms such as the BASIC Ministerial Meeting on Climate
Change and the Ministerial on Climate Action. It actively coordinates the positions ofcountries within climate negotiation blocs such as the BASIC countries, the Like-Minded
Developing Countries, and the Group of 77 and China, playing an important role inmaintaining the unity of developing countries and defending their common interests. China
actively participates in climate negotiations through the Group of 20, the International Civil
Aviation Organization, the International Maritime Organization, the BRICS meetings and soforth, promoting the synergy of multiple channels and multilateral processes.
China will continue to actively participate in global climate governance. Multilateralism andthe principle of common but differentiated responsibilities will be upheld in the fundamental
position of global climate governance. As the world's largest developing country, China firmly
supports addressing climate change based on multilateralism, adheres to the core and main
channels of the UNFCCC, its Kyoto Protocol and the Paris Agreement, and is committed topromoting the construction of a fair, reasonable, and win-win global climate governancesystem on the basis of common but differentiated principles of responsibility, fairness and20respective capabilities. China will Adhere to the full and effective implementation of the
UNFCCC and its Paris Agreement. On the basis of the principles of common but
differentiated responsibilities, fairness and respective capabilities, China will solidly
implement China's Nationally Determined Contribution and work with all parties to promote
mitigation and adaptation actions.

1.5.2 Deepen South-South cooperation on climate change
China has actively carried out South-South cooperation with the vast number of developing
countries in addressing climate change.
China provides assistance and support within its means to other developing countries to tackle
climate change. China engages in South-South cooperation on climate change with otherdeveloping countries. It has done its best to help those countries – in particular small islandstates, the least developed countries, and African countries – to build capacity to fight climatechange and reduce the adverse impact of climate change. This cooperation has yielded real,
tangible and solid results. Since 2011, China has allocated about RMB1.2 billion for SouthSouth climate cooperation and signed 40 cooperation documents with 35 countries. It hashelped countries to build low-carbon demonstration zones and provided them with climaterelated supplies such as meteorological satellites, PV power generation and lighting
equipment, NEVs, environmental monitoring devices, and clean cookstoves. It has trained
about 2,000 officials and professionals in the field of climate change for nearly 120
developing countries.
On September 21, 2021, President Xi Jinping announced at the general debate of the 76th
Session of the United Nations General Assembly that China will vigorously support the green
and low-carbon development of energy in developing countries and will no longer build new
offshore coal power projects.

1.5.3 Strengthen international cooperation in science, technology and industry
in addressing climate change
China is strengthening international cooperation in science, technology and industry inaddressing climate change. China will promote technological breakthroughs in renewableenergy, hydrogen energy, smart grid and energy storage, carbon capture utilization and storage(CCUS), circular economy, low-carbon transportation and smart cities, climate change
impacts and risk assessment to support the green and low-carbon transition. China advocatesthat all countries adhere to multilateralism, strengthen technological and industrial21

cooperation, establish international cooperation platforms, cooperation centers andcooperation networks for advanced technology research and development and technology
transfer, jointly carry out breakthrough technology research, promote the mature applicationof advanced technologies, and carry out the international promotion of applicabletechnologies.

1.6

Summary

China's CPCN goals are major strategies, and also highlight China's image as a responsible
major country. China's CPCN target strategy will have a significant impact on China's
domestic and foreign affairs. China is accelerating the construction of a CPCN "1+N" policy
system and establishing a mechanism for implementing targets that are broken down to local
levels.
In the process of implementing the dual carbon target, a series of challenges will be
encountered, such as macroeconomic impacts, energy supply security risks, and weaktechnical support.
China has actively intensified its efforts to control emissions and played the role of the ETS
market mechanism to promote the process of low-carbon development.
China, Japan, the ROK and other countries need to cooperate in the full implementation of theParis Agreement and adhere to win-win cooperation; It is also possible to cooperate in theconstructionofregional

industrialization application.

22

ETS

system,low-carbon

technology

development

and2. Net-Zero R&D strategies

3

2.1

R&D Management

Climate change is a common challenge for all mankind. Coping with climate change is related
to the sustainable development of the Chinese nation and the future and destiny of mankind.
China attaches great importance to addressing climate change. As the largest developing
country in the world, China has overcome its own economic and social difficulties,
implemented a series of strategies, measures and actions to address climate change,
participated in global climate governance, and achieved positive results.
As a responsible country, China actively promotes the joint construction of a fair, reasonable,
cooperative and win-win global climate governance system, and contributes China’s wisdomand strength to tackling climate change. Facing the severe challenge of climate change, China
is willing to work together with the international community to promote steady and long-term
progress of the Paris Agreement and make greater contributions to the global effort on
addressing climate change.
Carbon peaking and carbon neutrality will bring about a technological revolution which willcause a major change in the economic and social environment. Technology will be the key torealizing carbon peaking and carbon neutrality, and achieving economic and social
development. In this process, it is necessary to give full play to the supporting and leadingrole of scientific and technological innovation, improve the system and mechanism ofscientific and technological innovation, strengthen innovation capabilities, and accelerate thegreen and low-carbon scientific and technological revolution.

2.1.1 Improve the innovation system and mechanism
China formulated The Action Plan for S&T-based Carbon Neutrality (2022-2030) to support
carbon peaking and carbon neutrality with science and technology, launched S&T projects
under the National Key R&D Program, such as the study and demonstration of key
technologies for carbon peaking and carbon neutrality, and adopted mechanisms, such as theopen competition mechanism, to select the best candidates to develop key and coretechnologies for low-carbon, zero-carbon, and negative-carbon development. Colleges anduniversities, research institutions and state-owned enterprises incorporated innovation
3

Author: Chao Wang (Chinese Academy of Science and Technology for Development, CASTED)

23

achievements of green and low-carbon technologies into their performance assessments.
China strengthened the dominant position of enterprises in green technology innovation,
improved the guiding mechanism for green technology innovation, supported enterprises toundertake major national green and low-carbon S&T projects. A national green technology
trading center was built to accelerate the transformation of innovation achievements. In
addition, China strengthened the protection of intellectual property rights of green and lowcarbon technologies and products, and improved testing, evaluation and certification systemsof such technologies and products.

2.1.2 Increase R&D investment
The Special Plan on Science and Technology Innovation of Climate Change during the 13thFive-Year Plan Period was released in 2017 to comprehensively deploy science andtechnology works on climate change. The National Key R&D Program has become the main
channel for S&T investment on climate change. From 2016 to 2018, 11 projects in priority
areas, including “Global Changes and Responses” “Clean and Efficient Coal Utilization and
New Energy-saving Technology”, as well as 2 National Major S&T Projects, namely“Development of Large Oil and Gas Field and Coalbed Methane” and “Large Advanced
Pressurized Water Reactor Nuclear Power Plant” have been carried out to support therealization of carbon peaking and carbon neutrality. The R&D results provided important
support to deal with climate change. Since 2018, the Chinese Academy of Sciences (CAS) has
deployed strategic S&T pilot projects such as “Key Technologies and Demonstrations ofTransformative Clean Energy” “Earth Big Data S&T Project” “Pan-Third Pole Environmental
Change and Green Silk Road Construction” and “S&T Project for Beautiful China Ecological
Civilization Construction”.

2.1.3 Strengthening innovation capacity building and talent training
China established national key laboratories and national technology innovation centers oncarbon peaking and carbon neutrality, and moderately deploy in advance some major national
S&T infrastructure, and guide enterprises, colleges and universities and research institutions
to jointly build a number of national green and low-carbon industry innovation centers. China
innovated the talent training model, encouraged colleges and universities to speed up theconstruction of disciplines and personnel trainings in new energy, energy storage, hydrogenenergy, carbon emission reduction, carbon sink, carbon emission trading, and built a numberof future technical colleges, modern industrial colleges and exemplary energy academies ingreen and low-carbon technology. China deepened the integration of industry and education,24

encouraged schools and enterprises to jointly carry out industry-academia cooperation andcollaborative education projects, formed an industry-education development alliance, andbuilt a number of industry-education-integrated national innovation platforms for energy
storage technology.

2.1.4 Strengthen applied research and basic research
China implemented a number of forward-looking and strategic National Major Cuttingedge
S&T Programs, and promoted breakthroughs in the R&D of low-carbon, zero-carbon andnegative-carbon equipment. It focused on green and intelligent development and clean andlow-carbon utilization of fossil energy, large-scale utilization of renewable energy, new powersystems, energy conservation, hydrogen energy, energy storage, power batteries, as well as
capture, utilization and storage of carbon dioxide, and deepened applied and basic research.
China actively developed advanced nuclear power technologies, and strengthened research on
cutting-edge disruptive technologies such as controllable nuclear fusion. It also strengthened
basic theoretical and methodological research on the causes and impacts of climate change
and carbon sinks of ecosystem.

2.1.5 Accelerate the R&D, promotion and application of advanced andapplicable technologies
China concentrated on technological innovations such as safe and stable operation and control
of complex and large power grids, large-capacity wind power, high-efficiency photovoltaics,
high-power LNG engines, large-capacity energy storage, low-cost renewable energy hydrogenproduction, and low-cost carbon dioxide capture, utilization and storage, etc. While at thesame time, it accelerated the R&D of basic materials such as carbon fiber, aerogel, and special
steel, and made up for shortcomings in key components, components and software. It also
promoted advanced and mature green and low-carbon technologies and carried out
demonstrative applications. In 2016, China released the second batch of Transformation andPromotion List of Energy Conservation, Emission Reduction and Low-Carbon Technology
Achievements, and in 2017 released the Promotion Catalog of National Key Energy-Saving
and Low-Carbon Technology" to speed up the transformation, application and promotion ofachievements with good demonstration performance and great potential on emission reduction.
It guided enterprises to adopt advanced and applicable energy-saving and low-carbon
technologies. These have provided an important reference for upgrading low-carbon
transformation of related industries.

25

2.2

Key Strategic Programs

In order to realize S&T-supported carbon neutrality, the Ministry of Science and Technology,
the National Natural Science Foundation of China, the Chinese Academy of Sciences havesuccessively issued special research projects in the field of carbon neutrality tocomprehensively promote basic theoretical research and key technology R&D.

2.2.1 Ministry of Science and Technology (MoST)In 2022, the Ministry of Science and Technology (MoST) helped promote the National Key
R&D Program: Research and Demonstration of Key Technologies for Carbon Peaking andCarbon Neutrality. According to the program, it is expected that by the end of the14th FiveYear Plan, China will make key breakthroughs in R&D in key technologies, and willcomplement key special projects in other fields to provide important technical support for
carbon peaking by 2030 and to provide technical reserves for carbon neutrality by 2060,
giving technical contributions and system solutions for global climate governance.
“Research and Demonstration of Key Technologies for Carbon Peaking and Carbon Neutrality”
is based on the complexity and urgency of carbon peaking and carbon neutrality andhighlights the comprehensive cross-field major S&T innovations. It focuses on the R&D offour key areas, including the research and demonstration of common supporting technologies
for carbon neutrality; technology and demonstration of low-carbon/zero-carbon reengineeringof industrial process; frontier and disruptive technology innovation and R&D for carbon
neutrality; and innovation system for carbon neutrality and technology for global climate
governance.
In addition, MoST has deployed special R&D projects such on new energy vehicles, energy
storage and smart grid, and hydrogen energy technology during the 14th Five-Year Plan period,
focusing on the key areas of carbon peaking and carbon neutrality, to promote R&D andcommercial application of key technologies in key areas.

2.2.2 National Natural Science Foundation of China (NSFC)
In order to meet the needs for basic scientific research in implementing the carbon neutrality
strategy, and give full play to the basic, scientific and forward-looking advantages of the
National Natural Science Foundation of China, NFSF launched in 2021 a special program
named “Major Basic Scientific Issues and Countermeasures for National Carbon Neutrality”.

26

Focusing on “reduction” and “accumulation increase” – the two fundamental paths to achieve
the national carbon neutrality strategy, the program aims to systematically reveal the ocean
and terrestrial carbon sink patterns, process mechanisms, evolution trends and their interaction
with the climate system. It aims to clarify the mechanism of geological carbon sequestration
process, carbon sequestration efficiency, sink increase potential, technical risks andmanagement models, and to analyze management and policy problems in carbon neutrality
process, such as economic transformation, path optimization, climate governance, andinternational cooperation. Through interdisciplinary research, they aim to condense key basic
scientific problems, propose solutions, and serve the national carbon neutrality strategy.

2.2.3 Chinese Academy of Sciences (CAS)
Based on the strategic goals of carbon peaking and carbon neutrality, the Chinese Academy of
Sciences (CAS) innovated the system and mechanism, coordinated resources and advantages,
clarified the division of tasks, organized a multidisciplinary strategic research team, andsystematically carried out research on key issues in the field. In March 2022, CAS officiallyreleased the “Action Plan for Supporting Carbon Peaking and Carbon Neutrality Strategy by
S&T”. The Plan focuses on solving key and core S&T problems, promotes the construction ofa green, low-carbon and cyclical economic system and a clean, low-carbon, safe and efficientenergy system. At the same time, it promotes the energy revolution and industrial
optimization and upgrading, and accelerates the green and low-carbon technologicalrevolution. It supports China to participate in and lead global climate governance, andprovides strong S&T support for the country to achieve the strategic goal of carbon peaking
and carbon neutrality. The Plan systematically lays out eight major actions: S&T strategic
research, basic frontier cross-field innovation, key and core technology breakthrough,comprehensive demonstration of new technologies, talent support and cultivation,international cooperation support, innovation system capability improvement, and science
popularization. Facing the major S&T needs of the carbon peaking and carbon neutrality
strategy, the Plan regards S&T innovation as the core task, and deploys a whole chain layout
in the fields of energy and carbon sinks, from basic research, key and core technology
breakthroughs to comprehensive demonstration. It also focuses on the tasks of S&T
innovation, and guarantees an all-round support in the construction of talent teams,
international cooperation, platform condition building, and science popularization anddissemination.

27

2.3

Applications of Key Technologies

Energy is an important material basis for economic and social development and the mostimportant source of carbon emissions. The R&D of key technologies in the energy field andthe development of the clean energy industry are important guarantees for China to achieve
the strategic goal of carbon peaking and carbon neutrality. The world today is undergoingprofound changes unseen in a century. A new round of S&T revolution and industrial
transformation has formed a historic intersection with the requirements for high-quality
economic development. The hydrogen energy development and utilization technology
represented by fuel cells has made major breakthroughs, providing important solutions for therealization of zero-emission energy utilization. We should firmly grasp the trends andopportunities of global energy revolution and development, accelerate the cultivation anddevelopment of the hydrogen energy industry, and speed up the clean and low-carbon
transition of the energy industry in China.
Hydrogen energy is a kind of secondary energy which is abundant, green and low carbon, andis widely applied. It is gradually becoming one of the important carriers of global energy
transformation and development. Major developed countries in the world highly valued thedevelopment of the hydrogen energy industry, and hydrogen energy has become an important
strategic choice for accelerating energy transformation and upgrading, and cultivating new
economic growth points. The key and core technologies of the global hydrogen energy
industry chain are maturing. Fuel cell shipments are growing rapidly with continuous
declining costs. The construction of hydrogen energy infrastructure has accelerated
significantly, and a regional hydrogen energy supply network is being formed. China is thelargest hydrogen producer in the world, with an annual hydrogen production output of about
33 million tons. The installed capacity of renewable energy ranks first in the world, and it has
a great potential for clean and low carbon hydrogen energy supply.

2.3.1 Development goals of hydrogen energy industry
By 2025, the demonstration application of hydrogen energy will achieve obvious results.
Great progress will be made in clean energy hydrogen production and hydrogen energy
storage and transportation technology, and the market competitiveness will be greatly
improved. A hydrogen energy supply system based on industrial by-product hydrogen andfocuses on utilization of hydrogen produced from renewable energy will be preliminary
established.

28

By 2030, a relatively complete technology innovation system of hydrogen energy, and a
production and supply system of clean energy hydrogen will be formed. The industrial layout
will be reasonable and orderly, and the renewable energy hydrogen production will be widelyused, which will strongly support the realization of the carbon peaking goal.
By 2035, a hydrogen energy industry system will be formed, and a diversified hydrogenenergy application ecology covering transportation, energy storage, industry and other fields
will be built. The proportion of renewable energy hydrogen production in terminal energy
consumption will increase significantly, which plays an important supporting role in thedevelopment of green energy transformation.

2.3.2 Diversified demonstration application of hydrogen energy
Transportation
Based on the local hydrogen energy supply capacity, industrial environment and market space,and combined with the development characteristics of the transportation industry, China will
focus on promoting the application of hydrogen fuel cells in medium and heavy vehicles, andorderly expand the application space of hydrogen fuel cells and other new energy vehicle
markets. A complementary development model of fuel cell electric vehicles and lithium
battery pure electric vehicles will be gradually established.
China will actively explore the application of fuel cells in ships, aircraft and other fields, andcontinuously increase the market size of hydrogen energy applications in the transportation
field.

Energy conservation
China will give full play to the advantages of hydrogen energy which is known for its longadjustment period and large energy storage capacity, and carry out demonstrations ofhydrogen energy storage in renewable energy consumption, power grid peak regulation andother application scenarios. It will explore and cultivate a new integrated application model of“wind-solar power generation + hydrogen energy storage”, and gradually form an energy
storage system that integrates various energy storage technologies such as pumped storage,electrochemical energy storage, and hydrogen energy storage. China will explore the potential
for synergistic optimization of hydrogen energy across energy networks, and promote theinterconnection of heterogeneous energy sources such as electricity, heat and fuel.

29

Electricity Generation
According to the existing energy infrastructure conditions and economic affordability indifferent places, distributed cogeneration facilities with hydrogen fuel cells will be deployedaccording to local conditions, and the demonstration of comprehensive utilization of hydrogenenergy in communities, parks, mining areas, ports and other areas will be promoted. Bybuilding infrastructure projects such as communication base stations, data centers, railway
communication stations, power grid substations, etc., China will promote the market
application of hydrogen fuel cells in the field of backup power. In the renewable energy base,
China will explore the R&D and demonstration of technology for regulating power generation
with fuel cells during peak times.
Combined with the electricity demand in remote areas and islands, the demonstration
application of fuel cell distributed power generation will be carried out.

Industry
China will continuously improve the economy of hydrogen energy utilization, and expand thespace of application of clean and low-carbon hydrogen energy in the chemical industry. It will
carry out the R&D and application of hydrogen metallurgy technology using hydrogen as a
reducing agent, and explore the application of hydrogen energy as a high-quality heat source
in industrial production. China will expand the application scale of hydrogen energy toreplace fossil energy in the industrial field, actively guide the transformation of ammonia,
methanol, refining, coal-to-gas and other industries from high-carbon processes to low-carbon
processes, and promote the green and low-carbon development of high-energy-consuming
industries.

2.4

Recent R&D Achievements

After two Five-year Plan periods, China has initially established a “four-in-one” energy S&T
innovation system, incorporating R&D of major technologies, R&D of major equipment,
major demonstration projects, and technological innovation platforms. It supports theconstruction of major energy projects and plays an important role in ensuring energy security
and promoting industrial transformation and upgrading.

30

2.4.1 High proportion renewable energy system technology
The rapid development of wind power and photovoltaic technology has strongly supported theoutput and installed capacity of China’s wind turbines and photovoltaic cells, which ranks
first in the world. The 10-megawatt offshore wind turbine has been hoisted. The average
conversion efficiencies of mass-produced single-polycrystalline cells reached 22.8% and 20.8%
respectively. The solar thermal power generation technology has entered the commercial
demonstration stage. China masters the electricity transmission technology of 1000 kV AC,±1100 kV DC and below. A breakthrough has been made in flexible DC transmission
technology. The Zhangbei ±500 kV flexible DC power grid demonstration project and theWudongde demonstration project of ±800 kV UHV multi-terminal hydropower transmission
have been put into operation.
[Figure 2-1] Case: A new model of green poverty alleviation in “Photovoltaic Village”

Liangshan, Ganzi and Aba in the western part of Sichuan Province are relatively backward
regions in China, but are rich in renewable energy resources such as solar energy. In February
2018, when General Secretary Xi Jinping inspected the hinterland of Daliangshan, he said weshould push forward poverty alleviation and let the common people live a good life. Throughimplementing photovoltaic poverty alleviation projects, Sichuan Province organicallycombines poverty alleviation with green transformation, and explores new paths for targetedpoverty alleviation, improvement of human settlements, increase of farmers’ income andconstruction of new village. By June 2020, 18 centralized photovoltaic poverty alleviation
projects with an installed capacity of 450,000 kilowatts have been built, covering more than
20,000 poor households in 17 counties; 70 grid-connected village-level photovoltaic poverty
alleviation power stations with an installed capacity of 31,000 kilowatts have been built,
covering 20 counties 3553 poor households. The accumulative power generation income was
44.69 million yuan, and 6,187 public welfare jobs were created. Photovoltaic poverty
alleviation has driven the poor households to increase their income, transformed employment,31and achieved a win-win situation for poverty alleviation and ecology through preferential ongrid tariffs for power generation, reasonable distribution of income, and innovative operationand maintenance business models. (Image source: China News Service)

2.4.2 Technology for safe supply of oil and gas
Great progress has been made in unconventional oil and gas exploration and development
technology. The annual output of shale gas exceeds 20 billion cubic meters, and the “Shenhai
No. 1”, a 100,000-ton deepwater semi-submersible production and storage platform, has been
put into operation. In terms of long-distance oil and gas pipeline technology, major
breakthroughs have been made in core equipment and materials such as electric-driven
compressor units, fuel-driven compressor units, large ball valves and high-grade pipeline steel.

2.4.3 Nuclear power technology
The main technical and safety performance indicators of "Hualong No. 1" and "Guohe No. 1"
million kilowatt-class third-generation nuclear power have reached the expected goals. The
commercial demonstration reactor of high temperature gas-cooled reactor with thecharacteristics of the fourth generation has been put into operation to generate electricity, andthe construction of the fast neutron reactor demonstration project has started. Advanced
nuclear reactor technologies such as modular small reactors and marine nuclear power
platforms are stepping up efforts to tackle key problems and demonstrate them.

2.4.4 Clean and efficient development and utilization technology of fossil energy
Coal development and utilization technology and equipment, including coal caving mining
equipment with an annual output of more than 10 million tons of ultra-thick coal seams anddense medium coal preparation technology have achieved large-scale application. The
technical level of gas control and disaster prevention and control in coal mines has beensignificantly improved, and the death rate per million tons has continued to decline. A numberof major demonstration projects for deep processing of coal, including Shenhuaningmei’s 4million tons/year indirect coal liquefaction, were completed and put into operation. 1.35
million kilowatts of ultra-supercritical secondary reheat units arranged in high and low
positions have been put into operation, and the 50MW gas turbine has achieved stable
operation at full load.

32

2.4.5 New energy technologies, new models, new formats
Electrochemical energy storage and compressed air energy storage technologies have entered
the commercial demonstration stage. The iterative upgrade of hydrogen energy and fuel cell
technology has promoted the hydrogen energy industry to move forward from model
exploration to multiple demonstrations. Continuous innovation in areas such as intelligent
energy infrastructure, energy big data, multi-energy complementarity, energy storage andelectric vehicle applications, utilization of smart energy and value-added services arecontinuously upgrading.

2.5

Summary

Since its pledge to carbon neutrality by 2060, Chinese government has actively implemented
its efforts to promote scientific and technological innovations to realize carbon peaking andcarbon neutrality by improving the system and mechanism of scientific and technologicalinnovation, strengthening innovation capabilities, and accelerating the green and low-carbon
scientific and technological revolution. In this regard, China formulated The Action Plan for
S&T-based Carbon Neutrality (2022-2030) in order to improve the innovation system andmechanism. It also increased R&D investment on climate change, supported by the Special
Plan on Science and Technology Innovation of Climate Change. This led to the strengthened
basic and applied research and talent training to accelerate the application of technologies totackle climate change.
The key players to deliver national level research activities are the Ministry of Science andTechnology (MoST), the National Natural Science Foundation of China (NSFC), the Chinese
Academy of Sciences (CAS). They have successively initiated special research projects in thefield of carbon neutrality to comprehensively promote basic theoretical research and key
technology R&D. One of important key technologies identified includes hydrogen energy,
which will be used for transportation, energy conservation, electricity generation, and industry.
Some of recent R&D achievements were presented.
As a responsible country, Chinese government will continue its efforts to give full play to the
supporting and leading role of scientific and technological innovation so that China candeliver its pledge to carbon neutrality by 2060.

33

REFERENCESIn English:
The State Council Information Office of the People’s Republic of China (2021. 10. 27.), “Responding to Climate
Change: China’s Policies and Actions”, http://english.scio.gov.cn/whitepapers/202110/27/content_77836502_2.htm
Andy Tay (2022. 4. 5.). “By the numbers: China’s net-zero ambitions”. Nature, https://doi.org/10.1038/d41586022-00802-3

In Chinese:
中国《联合国气候变化框架公约》国家联络人 （2021）. 中国落实国家自主贡献成效和新目标新举措.
https://content-static.cctvnews.cctv.com/snowbook/index.html?item_id=5920724862663069138&toc_style_id=feeds_default.
陈迎 . 碳中和概念再辨析［J］. 中国人口·资源与环境，2022，32（4）：1-12.［CHEN Ying. A
re-analysis of the concept of carbon neutrality ［J］. China population，resources andenvironment，2022，32（4）：1-12.
魏一鸣，余碧莹，唐葆君，刘兰翠，廖华，陈景明，孙飞虎，安润颖，吴郧，谭锦潇，邹颖，赵子豪
（2022）．中国碳达峰碳中和时间表与路线图研究[J/OL]．北京理工大学学报(社会科学版) 24（4）.
doi: 10.15918/j.jbitss1009-3370.2022.1165.
欧训民等（2021）. 全球深度脱碳技术发展趋势及对中国的启示.国参建言. 2021 年 3 月出版.
潘勋章等（2021）. 关于努力争取 2060 年前实现碳中和的思考.国参建言. 2021 年 3 月出版.
王利宁等（2021）. 我国实现碳中和目标面临的挑战及对策建议.国参建言. 2021 年 3 月出版.
中华人民共和国中央人民政府 (2021. 1. 26.)《2030 年前碳达峰行动方案》,
http://www.gov.cn/xinwen/2021-10/26/content_5645001.htm__________________________(2021.10.24.),《中共中央 国务院关于完整准确全面贯彻新发展理念做好碳达峰碳中和工作的意见》, http://www.gov.cn/zhengce/2021-10/24/content_5644613.htm__________________________(2021.10.26.),《中国应对气候变化的政策与行动》,
http://www.gov.cn/zhengce/2021-10/27/content_5646697.htm
能源局 科技部 (2021.11.29.),《“十四五”能源领域科技创新规划》
国家发展改革委(2022.3.23.)《氢能产业发展中长期规划（2021-2035 年）》

34Ⅲ - 35

36

1. Policy Reviews and Issues of Carbon Neutrality
1.1

4

Background

After the Paris Agreement was adopted at the 21st United Nations Framework Convention on
Climate Change (UNFCCC) Conference of the Parties in December 2015, countries aroundthe world have set voluntary GHG reduction goals (National Determined Contribution,
hereafter referred to as NDC) and presented Long-term Low Greenhouse Gas Emission
Development Strategies (LEDS) by December 2020.
After Sweden and Norway declared carbon neutrality for the first time in the world in 2017,as of December 2020, a total of 128 countries declared carbon neutrality. In the case of Japan,
in October 2020, Prime Minister Yoshihide Suga announced that it would achieve carbon
neutrality by 2050, and Prime Minister Fumio Kisida, newly elected in October 2021, will
reduce GHG emissions to 46% of the 2013 level by 2030 and achive carbon neutral by 2050
in his speech and pledged a total of $100 billion to support carbon neutrality of developing
countries. The Japanese government established a global warming countermeasure plan and agovernment action plan to reduce GHG emissions in accordance with the Act on the
Promotion of Global Warming Countermeasures. The law was amended to explicitly stipulate
the transition to a decarbonized society. As part of this, Japan is actively promoting relatedplans, such as digitizing corporate emission information and making it open data to revitalize
carbon-neutral management.5
In addition, the Japanese government recently recognized the situation of the climate crisisand strengthened the redesign and response of the economy and society in Japan to overcome
it and Recognizing the challenge of achieving carbon neutrality in 2050 as a momentum for a

4

Author: Chulho Park(Green Technology Center, GTC)

5

Asia VOA News, Japan “Achieving carbon neutrality by 2050”, 2021.11.3

37

new growth strategy, we are accelerating investment in the environment sector, introductionof new technologies in the energy industry, and R&D.6
Therefore, this study examines Japan's carbon neutral-related policies and governance system
in stages, and comprehensively analyzes Japan's mid-to-long-term strategies and scenarios
related to carbon neutrality, and identifies major obstacles and major issues for Japan's
implementation of carbon neutrality. On the other hand, policy implications and major
implications for achieving 2050 carbon neutrality in Korea will be drawn.

1.2

Carbon Neutrality Policy and Governance System

1.2.1 Carbon Neutrality Policy
Japan's carbon-neutral policies include “Green Growth Strategy for 2050 Carbon Neutrality”,“6th Basic Energy Plan”, and “Global Warming Countermeasure Plan”.

Green Growth Strategy for 2050 Carbon Neutrality7
Japan's Ministry of Economy, the relevant ministries of Japan jointly announced on December
25, 2020, to achieve 2050 carbon neutrality, "Green Growth Strategy for 2050 Carbon
Neutrality” was announced and on June 18, 2021, this strategy was embodied with detailed
promotion strategies and an emphasis on benefits for the people's lives.
The goal of this strategy is to pursue sustainable growth and innovation, and to increase thepotential for realizing a carbon-neutral society in 2050. This strategy includes in five maincontents such as “Green growth strategy based on carbon neutrality in 2050”, “Realization ofcarbon neutrality in 2050”, “Framework of green growth strategy”, “Main policy means bysector”, “Sectoral action plan (tasks and responses, roadmap)”.
As shown in Table 3-1, this strategy describe, to achieve carbon neutrality in 2050, policies by
eight main policy means such as “Budget (Green Innovation Fund)”, “Tax”, “Finance”,“Regulatory reform standardization” , “International cooperation”.

6

World Legislation Information Center, Greenhouse Gas Reduction Goals and Related Laws of Countries around the World,
2022.04.21

72050 年カーボンニュートラルに伴うグリーン成長戦略, 経済産業省, 2021.6.18

38

[Table 3-1] Main policy means and contents of the green growth strategy for 2050 carbon neutrality
Main policy means

Major contents

 Continuous support is provided from technology development to demonstration andcommercialization for companies that have agreed to achieve the goal of an important projectfor realizing carbon neutrality → (NEDO) 2 trillion yen fund raising over 10 years
 Essential for realizing a carbon-neutral society and is linked with the implementation
plan of the green growth strategy targeting key areas such as capacitors, offshore wind
power, next-generation solar cells, hydrogen, and carbon recycling, which are thefoundation of industrial competitiveness.
Budget By setting up evaluation standard of “Level of contribution about "CO2 reduction and(Green Innovation
economic ripple effect etc.”, “Necessity of policy support based on technologicalFund)difficulty and practical application potential”, “Potential market growth potential,
international competitiveness,” etc., and focused support on high-priority projects.
 Promoting the participation of "small and medium-sized enterprises (SMEs) andventure companies" in charge of new business creation, etc.
 Promoting ambitious innovation by inducing R&D and facility investment for privatecompanies worth 15 trillion yen based on the government’s 2 trillion won budget by
establishing a system to induce company manager participation

Tax

 Active tax support suitable for achieving the challenging goal of achieving carbon neutrality
in 2050 (expected to create about 1.7 trillion yen of private investment over 10 years)
 In the case of companies that have continuously increased their test and researchexpenses despite a decrease in sales of 2% or more compared to pre-COVID-19 toexpand innovation creation, which is the basis for the continuous development of theJapanese economy, including the realization of carbon neutrality in 2050, the upper
limit of the deduction for the R&D tax increase from 25% to 30% of corporate tax.
 Attracting private investment based on government funds
 Supporting policies that pursue green, change and innovation
 Creating an environment for the smooth issuance of social bonds (bonds issued tofinance projects that contribute to solving social problems) Establishment of Green International Financial Center and active participation inInternational Accounting Standards (IFRS) Foundation

 In the demonstration phase, ① strengthening regulations that create demand for new
technologies, ② reorganizing domestic regulations and systems such as alleviating
Regulatory reform
standardization
unreasonable regulations that do not assume new technologies, and ③ actively
participating in international standardization to facilitate the use of new technologies in
the world Promote mass production and cost reduction by expanding demand and green
investment by improving domestic and international institutional environment
 The purpose of standardization is to promote standardization for market formation,such as ① market expansion, ② new market formation or differentiation, ③ safety,
convenience, and regulations or standards about environmental impact
 Reinforcing the competitiveness of the domestic industry by reducing costs bypioneering overseas markets
International
cooperation

 Innovative policy alliances with the US and Europe, promoting individual projects
including support for third countries, strengthening alliances such as standardization ofelement technologies, and promoting bilateral and multilateral cooperation in terms ofmarket development
 Leading international discussions and collaborations on hydrogen, carbon recycling,
and fossil fuel decarbonization

Source: written by the author referring to 2050 年カーボンニュートラルに伴うグリーン成長戦略

39

In addition, this strategy selects 14 key areas in three industrial sectors: “energy-relatedindustries”, “transportation/manufacturing-related industries”, and “home/office-relatedindustries” for the realization of carbon neutrality. And the goals, detailed strategies, androadmaps were presented by dividing them into “R&D”, “demonstration stage”, “introduction
expansion stage” and “independent commercialization stage” for each key field.

6th Basic Energy Plan8
As the need to present a new policy direction has been greatly emphasized in accordance withthe strengthening of global decarbonization response and changes in the energy-related
domestic and foreign environment, the Japanese government has implemented The draft of
the 6th Energy Basic Plan was announced, and the finalized plan was announced on October22, 2021.
In this plan, In order to achieve carbon neutrality and NDC by 2050, the plan includes thegoal of reducing GHG by 46% compared to 2013 in 2030 and 50% by 2050, as well as energy
supply and demand forecast in 2030 and "policy direction for achieving carbon neutrality in
2050" was presented.
And, this plan, as shown in Table 3-2, “Basic Policy”, “Response to Demand”, “Renewable
Energy”, “Nuclear Power”, “Thermal Power”, “The Reform of Power System”,"Hydrogen/Ammonia”, " Resources/Fuel”, "Focus of the Outlook for Energy Supply and
Demand in 2030” etc.

Policy directions for 2030 considering carbon neutrality in 2050 were

presented.

8

第6次エネルギー基本計画が閣議決定されました, 経済産業省, 2021.10.22

40

[Table 3-2] The policy direction towards 2030 for 2050
Classification

Policy Direction

Basic Policy

 The basic policy of energy policy is to put safety as a major premise, then put a toppriority on stable energy supply, and respond to the realization of S+3E, which promotes
environmental compatibility while supplying low-cost energy through improvement of
economic efficiency“Response to
Demand Pursuing thorough energy conservation in the industrial, commercial, home, andtransportation sectors
 Review of amendments to the Energy Conservation Act to support the energy transition
 Advancement of secondary energy fields such as the use of distributed energy resources

Renewable
Energy S+3E as the main premise, make renewable energy the main power supply, andintroduce renewable energy as the top priority, suppressing the burden on the people andpromoting symbiosis with the local community

Nuclear Power Under the premise that stability and resolving public concerns are the top priority, thenuclear power plant is restarted when it is recognized that it meets the world's moststringent regulatory standards through the Nuclear Regulatory Commission. And efforts
will be to gain the understanding and cooperation of stakeholders, such as local
governments, led by the government ① Safety-first restart, ② Spent fuel measures, ③ Nuclear fuel cycle, ④ Finaldisposal, ⑤ Coping about various tasks for securing safety and long-term operation, ⑥
Public sympathy, ⑦ Building trust with local governments, ⑧ Promotion of R&D

 Under the safety as a major premise, Reducing the proportion of thermal power
generation in the power supply configuration while securing facility capacity that can
respond to a decrease in the temporary and continuous power generation strategy ofrenewable energy
Thermal Power In the case of coal-fired power plants that do not have measures to reduce emissions
through government development assistance, export finance, investment, financial/tradepromotion support, etc., the government will stop supporting new exports.

The Reform of Establishing a power system for stable supply in terms of decarbonization
Power System
 Accelerate hydrogen supply by utilizing hydrogen as a new resource

Hydrogen/Ammonia Securing the basis for hydrogen production using domestic resources and utilizing cheap
overseas hydrogen to provide stable and large quantities of cheap hydrogen andammonia in the long term Expanding hydrogen utilization on the demand side (power generation, transportation,industry, household sector)

Resources/ Fuel

 Securing resources and fuels that are constantly needed in the future while proceedingwith the smooth implementation of carbon neutrality
 We plan to strengthen the fuel supply system so that we can respond to emergencies aswell as usual, and to respond to decarbonization

Outlook for Based on the new reduction target for 2030, we present the composition of the power
Energy Supply
supply in 2030 to overcome various challenges in promoting thorough energy
and Demand inconservation and expansion of non-fossil energy ([Table I1-3])
2030
Source: written by the author referring to 第6次エネルギー基本計画が閣議決定されました, 経済産業省

41

[Table 3-3] Japan’s 2030 Energy Power Composition
2019→

Previous 2030
Power Mix→

2030 Power Mix(Ambitious Outlook)

Energy Saving

16.55 million kl→

50.3 million kl→

62 million kl

Final energy consumption(before energy saving)

35 million kl→

377 million kl→

35 million kl

36~38%
Renewable Energy

18%→

22~24%(Set a target of 38% or higher→ if the current R&D results in

the renewable energy field are
utilized and demonstrated)Power
configuration(Powergeneration: 1065
billion kWh →about 934 billion
kWh)Solar Power

6.7%

→

7.0%

→

14~16%

Wind Power

0.7%

→

1.7%

→

5%

Geothermal
Power

0.3%

→

1.0~1.1%→

1%

Hydro Power

7.8%

→

8.8~9.2%→

11%

Biomass

2.6%→

3.7~4.6%→

5%

Hydrogen/Ammonia

0%

→

0%

→

1%

Nuclear Power

6%→

20~22%→

20~22%

LNG

37%

→

27%

→

20%

Coal

32%

→

26%

→

19%

Petroleum etc.

7%

→

3%

→

2%

→

26%

→

46%
(50% reduction target
challenge)(+ non-energy based gas and absorption source)

Greenhouse gas reduction rate

14%

Source: written by the author referring to 第6次エネルギー基本計画が閣議決定されました, 経済産業省

Global Warming Countermeasure Plan9
The Global Warming Countermeasure Plan was approved by the Cabinet on October 22, 2021.
This plan is the government's comprehensive plan based on the Global Warming Measure
Promotion Act, and the previous plan approved by the Cabinet on May 13, 2016 was revisedfor the first time in five years. Japan declared “carbon neutrality by 2050” and set a goal of
reducing GHG emissions by 46% by fiscal 2030 compared to fiscal 2013, in addition, it
announced that it would continue the challenge to achieve above 50%. The global warming
9 地球温暖化対策計画, 閣議決定, 2021.10.22, https://www.env.go.jp/earth/ondanka/keikaku/211022.html,

環境省

42

countermeasure plan formulated based on these new reduction targets deals with reduction
targets and reduction measures and measures for all GHGs, including non-CO2. And Actions
to support the new fiscal year 2030 goals was described and pathways to achieve the newgoals was suggested.
Looking at the reduction targets for each sector in Japan, as shown in Table 3-4, compared to2013, the target was set to reduce carbon dioxide from energy sources by 45% in 2030 andreduce carbon dioxide from non-energy sources by 15%. In the case of methane and nitrous
oxide, reduction targets of 11% and 17% compared to 2013 were presented, respectively, andreduction targets of 4 gases including freon were set as reduction targets of 44%.
In the case of GHG sinks, forest sinks will secure an absorption of about 38 million t-CO2 in
2030, and plan to secure an absorption of about 9.7 million t-CO2 by promoting measures forcarbon sinks in farmland and soil and urban greening. And. by establishing and implementing
JCM to secure overseas reductions, such as distributing excellent carbon technology, productservices, and infrastructure to developing countries, we aim to reduce and secure absorptionof 100 million t-CO2 by 2030.

[Table 3-4] Japan's Targets and Standards for Each Sector by Greenhouse Gas(Unit: million t-CO2)
2013
Performance
Greenhouse gas emissions and absorption
rate2013 Performance
2030 Goals and(Compared toStandards* (Compared2013)
to 2013)

1,408

1,166** (▲17%)760 (▲46%***)

Energy source carbon dioxide

1,235

1,029 (▲17%)677 (▲45%)

Industrial sector463

384 (▲17%)289 (▲38%)

Business Others sector

238

193 (▲19%)116 (▲51%)

Household sector208

159 (▲23%)70 (▲66%)

Transport sector224

206 (▲8%)146 (▲35%)

Energy conversion sector ****

106

89.3 (▲16%)56 (▲47%)

Carbon dioxide from non-energy
sources

82.3

79.2 (▲4%)

70.0 (▲15%)

Methane (CH4)

30.0

28.4 (▲5%)

26.7 (▲11%)

Nitrous oxide (N2O)

21.4

19.8 (▲8%)

17.8 (▲17%)

43

2013
Performance2013 Performance
2030 Goals and(Compared toStandards* (Compared2013)
to 2013)

4 gases including alternative Freon

39.1

55.4 (+42%)

21.8 (▲44%)

Hydrofluorocarbons (HFCs)

32.1

49.7 (+55%)

14.5 (▲55%)

Perfluorocarbons (PFCs)

3.3

3.4 (+4%)

4.2 (+26%)

Sulfur Hexafluoride (SF6)2.1

2.0 (▲4%)2.7 (+27%)

Nitrogen trifluoride (NF3)

1.6

0.26 (▲84%)

0.5 (▲70%)

Greenhouse gas absorption source

-

▲45.9

▲47.7

Bilateral Credit System (JCM)

Aiming to reduce and absorb cumulative global emissions ofabout 100 million tCO2 by 2030 through public-private
partnership, and properly calculate domestic credits to achieve
national NDC* Total GHG emissions minus the amount absorbed by GHG sinks** Each sector of energy source carbon dioxide is the value of the standard*** Continue to challenge for further 50% reduction target**** Since the statistical error of electricity heat distribution is excluded, the sum of the performance of each sector and theemission of carbon dioxide from energy do not match
Source: 地球温暖化対策計画, 閣議決定, 2021.10.22

In addition, the plan proposed three major global warming countermeasures and policies suchas “Measures and measures for GHG emission reduction and absorption”, “Cross-sector
countermeasures”, and “Basic measures”.
To summarize the major measures and policies that are positioned in the global warming
countermeasure plan, as shown in Table 3-5, there are divided in three major categories suchas “renewable energy/energy saving”, “industry/transportation, etc.”, and “cross-sector
countermeasures”.
[Table 3-5] Main measures of Japan's global warming plan
Classification

Main Measures Set local governments as promotion areas and expand renewable energy suitable for the
Renewable energy area (solar power, etc.)
and energy saving  Expansion of mandatory compliance with energy saving standards for houses andbuildings
 Supporting innovation for 2050
Industry/transportation, etc.  Support for R&D and demonstration to save more than 30% of energy in data centers Build more than 100 “decarbonization leading areas” by 2030
cross-sector
countermeasures  Reduction of emissions in developing countries using excellent decarbonization
technology, etc.
Source: written by the author referring to 地球温暖化対策計画, 閣議決定, 2021.10.22

44

In the case of carbon dioxide origined energy, reduction measures and measures for each of
the five sectors were presented such as “industry,” “work, etc.,” “home,” “transport,” and“energy conversion.”

1.2.2 Governance System Related to Carbon Neutrality
Japan established the “Global Warming Countermeasures Promotion Headquarters(地球温暖化対策推進本部)” in the Cabinet on December 19, 1997 to comprehensively
promote concrete and effective measures for the implementation of the Kyoto Protocol
adopted at the 3rd Conference of the Parties to the Convention on Climate Change (COP3).
In 1998, the 「Global Warming Measures Promotion Act」 was enacted to prepare the basic
framework for policies to respond to climate change. The 「Global Warming Measure
Promotion Act」 was amended based on the Kyoto Protocol that came into effect in 2005, andthe tasks, organization, and management of the “Global Warming Countermeasures
Promotion Headquarters” were specifically stipulated according to the revised contents.
Afterwards, Japan's transition plan to a low-carbon society began to be accelerated by thegovernment through the 「Fukuda Vision」 announced by Prime Minister Fukuda in June of
the same year as 「Cool Earth 50」 announced by former Prime Minister Abe at the Davos
Forum in January 2008. Japan's transition to a low-carbon society led to the transition to a decarbon society in line with each country's declaration of carbon neutrality. To this end, in
September 2020, the Japanese government held “the 1st Central Environment Council Global
Environment Subcommittee Medium- to Long-term Climate Change Countermeasures
Subcommittee Industrial Structure Council Industrial Technology and Environment
Subcommittee Global Environment Subcommittee Global Warming Countermeasures
Working Group Joint Meeting”10. Here, future "climate change measures", "energy policies","initiatives for other climate change measures by the Ministry of Environment" and"initiatives according to changes in the industrial structure" were discussed.
Meanwhile, Prime Minister Yoshihide Suga, at the G20 Summit in November 2020, clarified
Japan's goal to achieve zero real GHG emissions by 2050, and reviewed the implementationof carbon neutrality by the central government and local governments, and the “National andRegional Decarbonization Realization Meeting (国・地方脱 炭素実現会議)” was held on
December 25th of the same year, chaired by the Cabinet Secretariat for the establishment ofphased implementation goals and cooperation between the central and local governments, and10

https://www.meti.go.jp/shingikai/sankoshin/sangyo_gijutsu/chikyu_kankyo/ondanka_wg/001.html

45

On June 9, 2021, the “Local Decarbonization Roadmap(地域脱炭素ロードマップ)” closely
related to regional initiatives was announced. As a result, decarbonization plans according tolocal governments are taking shape.

1.3

Mid-to-long-term Strategies and Scenarios Related to Carbon Neutrality

1.3.1 Mid-to-Long-Term Strategies for Carbon Neutrality
In this section, we would like to introduce detailed strategies for each industry in detail basedon the aforementioned “Green Growth Strategy for 2050 Carbon Neutrality”. As shown in
Table 3-6, Japan’s carbon neutrality-related strategy is divided into three major categories
such as “energy-related industries,” “transportation/manufacturing-related industries,” and“home/workplace-related industries", and composed a total of 14 industries.
Table 3-6 summarizes detailed strategies for each technology sector in the industrial sector.
[Table 3-6] Main measures of Japan's global warming plan
Classification

Energy-relatedindustries

46

Industry Field

Technology
Field

Offshore wind
power, solar
power,
geothermal
industry (nextgeneration
renewableenergy) By creating an attractive domestic market, it invites
domestic and foreign investment and builds acompetitive and strong supply chain
Offshore wind  Creating next-generation industries that leadinternational competition through international
partnerships and development of next-generation
technologies that are expected to advance into Asia
 Through the technological development of nextgeneration solar cells, achieving the transition to
the supply stage by 2030, and realize the expansion
and marketization of installations in houses andbuildings, which are difficult to install with existing
solar cells
Solar power Re-establishment of related industries andexpansion by "introduction of FIP system" or"promoting of aggregation business by using
distributed energy sources" etc.
 To promote the use of renewable energy in theregion and to expand the farming type, etc.
 Aiming for widespread adoption by supplying riskmoney, promoting local understanding, andreviewing the operation of related laws andregulations
Geothermal In 2050, entire geothermal power generationindustrysystem as a package enters overseas markets
throught the world's only innovative geothermal
power generation technology realization

Detailed strategy

Classification

Industry Field

Technology
Field

Detailed strategy

 Reduce the cost of hydrogen power generation(hydrogen cost: about 20 yen/Nm3 or less) to lessthan gas-fired power by increasing the amountintroduced, and enhance competitiveness compared
Hydrogento fossil fuels by 2050
 The amount introduced is aims to reach a maximum
Hydrogen andof 3 million tons by 2030 and about 20 million tons
fuel ammonia
by 2050
industry
 Established co-firing technology early and exported
to Southeast Asia
Fuel ammonia  Secure an initiative in the global ammonia supply
and use industry by quickly establishing aninternational supply chain
 Facilitate the transition to a comprehensive energy
services company
Next-generation thermal energy  Realize decarbonization by converting fuels
through improved methanation efficiency, largeindustry
scale demonstration, and innovative technology
development
 Progress in the steady, safety-first restart in the
country while reducing possible dependence In cooperation with Japanese companies with highmanufacturing capacity, in the development of
Nuclear industry
next-generation nuclear reactors such as SMR(Small Modular Reactor) conducted overseas(USA, UK, Canada, etc.), various nuclear
technology innovations will be accelerated
 Aiming to be carbon neutral throughout the
lifecycle of automobiles by 2050, while at the same
Automotive and battery industry
time strengthening the competitiveness of thebattery industry as a new energy base
 Efficiency energy demand through digitalization
Semiconductor and informationand promote energy saving and greening of digitalcommunication industry
devices and information communication
 Establish a production base by securing technology
related to the development of gas fuel vessels suchas LNG, hydrogen, and ammonia, which areessential for achieving zero emission
Ship industry
 Leading the modification of international standards,
strengthening the international competitiveness ofTransportation andJapan's shipbuilding and shipping industries, andmanufacturingpromoting carbon neutrality in maritime transport
related industries
 Comprehensively promoting of "Formation ofcarbon-neutral ports", "Introduction of smart
transportation", "Promotion of adoption of bicycle
Logistics, human resource
movement", "Promotion of efficiency and low
movement, civil engineering
carbonization of transportation networks, bases,
infrastructure industry
and transportation", "Zero emission in
infrastructure and urban space, etc.", "Realizing
Carbon Neutrality in Construction"
 Actively promote measures such as zero emission
through accelerated demonstration, reduction ofFood, agriculture and forestry,
GHG emissions in agriculture and livestock, carbon
and fishing industry
dioxide absorption and long-term and mass storage47

Classification

Industry Field

Technology
Field

Detailed strategy

in farmland, forest, timber, and ocean, andimprovement of productivity. Realizing theinnovatively balance of productivity improvement
and sustainability in the food, agriculture, forestry
and fishery industry
 In the midst of rapidly increasing low-carbon
demand in international aviation, the International
Civil Aviation Organization (ICAO) is
institutionalizing not to increase CO2 emissions
compared to 2019. Using these changes in
Aircraft industry
environment and technology as an opportunity todramatically strengthen the competitiveness of theJapanese aircraft industry, secure technologicalsuperiority in various factors such as composites,
electrification, hydrogen and alternative fuels.
 Contribution of carbon neutrality through "costreduction and expansion of supply through largescale demonstration", "support for large-scale andtechnological development of synthetic fuel", "costCarbonreduction and supply expansion throughrecycling
establishment of an overseas supply chain", and"development of technology to convert waste
plastic, waste rubber or CO2 into plastic raw
Carbonmaterials", etc.
recycling/Materia
l industry
 By promoting decarbonization and low CO2
emissions at the manufacturing stage, such as
decarbonization of heat sources or changes in theentire manufacturing process, and resource saving
Materialand energy saving at the distribution and retailstages, the supply of materials with highenvironmental performance is expanded and newmarkets are created As a sector that has a major impact on energy
saving in the private sector, it is carbon neutral andcreates an environment in which cutting-edge
Housing/buildin
technologies that contribute to economic growth are
g industry
disseminated in Korea to promote overseas
Housing/building
expansion by improving living conditions andindustry/nextcarbon neutralization of cities
generation power
management
 By consolidating the value of variable andindustry
renewable energy and distributed energy resources
next-generation
through the advancement of data utilization
power
technology, we promote aggregation business that
Home/work related
management
is used in digital control and market transactions,industryand build a next-generation grid Support for technology development anddemonstration by reorganizing regulations andplans for Reduce, Reuse, Recycle, and Renewable In the future, based on discussions at the “National
Resource circulation relatedand Local Decarbonization Realization Meetings”,
Industryetc., technology advancement and efficiency
enhancement, facility maintenance, cost reduction,
digitalization, etc. will be strengthened in the
future.

48

Classification

Industry Field

Technology
Field

Lifestyle related industries

Detailed strategy
 Based on the “National and Local Decarbonization
Realization Meeting”, promotion of “technology
development and demonstration”, "support for
introduction", and "system construction", etc.
related to Crediting of CO2 reduction by total
management and digital technology

Source: written by the author referring to 2050 年カーボンニュートラルに伴うグリーン成長戦略

1.3.2 Scenarios for Carbon Neutrality
Japan will reduce carbon emissions by about 560 million tons in 2030 in non-power andpower sectors such as “livelihood”, “industry”, “transport” and “power” compared to 1.03
billion tons in 2019 as shown in Figure 3-1. And Japan is making various efforts under theambitious goal of reducing to 520 million tons, and further plans to realize carbon neutrality
in which the sum of emissions and absorption will be zero by 2050.

Source: 2050 年カーボンニュートラルに伴うグリーン成長戦略[Figure 3-1] Japan's Carbon Neutral Scenario

In the case of the non-power sector, significantly reduce carbon dioxide emissions by 2030 byreinforcing efforts towards the realization of a hydrogen society and thorough energy
conservation efforts in the “livelihood”, “industry” and “transportation” sectors. And In 2050,

49we plan to achieve the carbon neutral goal by applying new technologies such as
decarbonization electrification, hydrogen, ammonia, and CCUS/carbon recycling, andintroducing carbon removal technologies such as forestry, DACCS and BECCS. In the case ofexisting fossil fuels, carbon-neutral support is planned by utilizing carbon removal
technologies such as forest absorption and DACCS.
In the electricity sector, in the “livelihood” section, by 2030, deal with the main power sourceof renewable energy, reorganize the nuclear power policy, reduce the rate of thermal power
generation, and significantly reduce carbon dioxide emissions by using hydrogen andammonia power generation, and by 2050, it plans to achieve non-carbon power supply byapplying new technologies such as expansion of new and renewable energy, use of nuclear
power, hydrogen, ammonia, and CCUS/carbon recycling.

1.4

Major Barriers and Important Issues

Although Japan is one of the countries that has a huge impact on climate change, ranking 5th
in carbon dioxide emissions as of 2019, it is evaluated that the specificity of its move toward
carbon neutrality is somewhat lacking. For example, the “Green Growth Strategy for 2050
Carbon Neutrality” announced by the Ministry of Economy, Trade and Industry in December
2020 is offshore wind power, ammonia, hydrogen, nuclear power, automobiles,
semiconductors, ships, logistics, food, aircraft, carbon recycling, and next-generation solar
power. A total of 14 key areas such as mining and lifestyle-related industries are selected, andthese are materialized as carbon-neutral implementation measures. However, unlike the goalof carbon neutrality, there is lack of plan for major carbon dioxide emission sources such as
steel and cement. Because it excludes the consideration of major industries that have led thecarbon society and the perspective of restructuring, it is inevitable to question whether Japan's
carbon-neutral implementation strategy and goal have been achieved.
In addition, it is understood that there are many voices expressing negative opinions from theinternational community in connection with the carbon tax for carbon neutrality and theemission trading system, etc. For example, in July 2018, the Japanese Ministry ofEnvironment installed a review meeting to introduce carbon pricing, but the review meeting
was canceled after 2019 due to concerns and conflicts of opinion with members who wereconcerned about slowing economic growth 11 . In addition, there are conflicting opinions
regarding carbon neutrality. The economic and industry has taken positive steps toward
carbon neutrality. For instance, the president of the Federation of Economic Organizations

11

World Energy Market Insight No. 21-4, 2021.2.22.

50

announced that it is inevitable to discuss the introduction of a carbon pricing system.
Furthermore, the Japan Steel Federation confirmed achieving carbon neutrality by 2050 in thesteel industry. On the other hand, there are conspiracy theories about carbon-neutral
implementation measures that are being formed in European Union, such as the Carbon
Border Adjustment Mechanism (CBAM) recently announced by the European Union. They
insist that the implementation of carbon neutrality in terms of enhancing the competitivenessof the European Union and promoting protectionism12.
As mentioned above, the absence of measures to reduce GHG emissions, difficulties insecuring financial resources for the implementation of carbon neutrality, and internal conflicts
are likely to become obstacles in achieving carbon neutrality in 2050.

1.5

Summary

Recognizing the seriousness of the climate crisis, Japan set a carbon-neutral goal for 2050,
and announced three policies related to carbon neutrality such as "Green Growth Strategy for2050 Carbon Neutrality", "6th Basic Energy Plan", and "Global Warming Countermeasure Plan".
In the case of “Green Growth Strategy for 2050 Carbon Neutrality”, it was jointly announcedon December 25, 2020 by the relevant ministries, and on June 18, 2021, this strategy wasmaterialized with an emphasis on detailed implementation strategies and benefits to people’s
lives. In order to achieve carbon neutrality in 2050, this strategy proposes policies for each of
the eight major policy means, including “budget (Green Innovation Fund),” “tax,” “finance,”“regulatory reform standardization,” and “international cooperation.” 14 key areas of threeindustrial sectors, including “energy-related industries”, “transportation/manufacturing-relatedindustries”, and “home/office-related industries” were selected and goals for each key field
were presented.
The “6th Basic Energy Plan” announced the finalized plan on October 22, 2021 based on the「Framework Act on Energy Policy」. The plan suggested the policy direction in the energy
sector to reduce GHGs by 46% in 2030 compared to 2013 and achieve carbon neutrality in
2050. In this plan, various scenarios and response strategies were presented for realize carbon
neutrality in 2050, such as making renewable energy the main power source, introducing

12

World Energy Market Insight No. 21-4, 2021.2.22.; Gyu-Pan Kim, Japan's 2050 Carbon Neutrality and Green Growth
Strategy, 2021.3.30, Korea Institute for International Economic Policy, p. 15.

51

renewable energy as the top priority, and reducing the burden on the people and promoting
symbiosis with the local community.
The “Global Warming Countermeasure Plan” is a comprehensive plan of the government
based on the Global Warming Countermeasure Promotion Act, and was decided by the
Cabinet on October 22, 2021. This plan was prepared major countermeasures and policies
divided into three major categories such as “renewable energy/energy saving”,“industry/transportation, etc.”, and “cross-sector countermeasures”. In the case of energyoriginating carbon dioxide, it presented reduction countermeasures and policies for each of thefive sectors, such as “industry,” “work, etc.,” “household,” “transport,” and “energy conversion”.
Looking at Japan's carbon-neutral governance system, basic framework for policies to
respond to climate change was prepared through enacting 「Global Warming Measure
Promotion Act」 in 1998. Based on the Kyoto Protocol that took effect, the 「Act on the
Promotion of Global Warming Measures」 was amended. The tasks, organization, andmanagement of the “Global Warming Countermeasures Promotion Headquarters”, which isthe core organization for the comprehensive and systematic implementation of the abovementioned global warming countermeasures, are specifically stipulated in Article 10 and
below of the same law. Meanwhile, the 「National and Regional Decarbonization Realization
Meeting」 chaired by the Cabinet Secretariat was held in 22 December 2020 for "checking theimplementation of carbon neutrality of the central government and each local government","establishing step-by-step implementation goals", and "cooperating between the central and
l
o
c
a
l
g
o
v
e
r
n
m
e
n
t
s
"
.
In the aforementioned “Green Growth Strategy for 2050 Carbon Neutrality”, detailed
strategies and roadmaps for each of the 14 key areas are presented, and Reduce carbon
emissions to about 560 million tons in 2030 in non-electric power and power sectors such as“people’s livelihood”, “industry”, “transport” and “electricity” compared to 1.03 billion tons
in 2019, a carbon-neutral scenario for 2050 is presented, including setting a challenging target
and proposing a means to reduce up to 520 million tons.
In the aforementioned “Green Growth Strategy for 2050 Carbon Neutrality”, detailed
strategies and roadmaps for each of the 14 key areas are presented, and Japan suggests
carbon-neutral scenario for 2050, which aims to reduce carbon emission about 560 million ton
by 2030 in the non-electric power sector such as “people’s livelihood”, “industry”,“transportation” and “electricity”, compared to 1.03 billion tons in 2019. In addition, it sets
the challenging target to reduce carbon emission about 520 million tons by 2030 and suggests
potential methods to achieve it.

52

Finally, when analyzing the major barriers and important issues for Japan's carbon neutrality,
it shows that two potential obstacles should be considered as major issues. Japan selected 14
key areas in "Green Growth Strategy for 2050 Carbon Neutrality" and presented specificcarbon neutral implementation plans. However, there is lack of plan for major carbon dioxide
emission sources, such as steel and cement. Also, the consideration of the existing majorindustries that have led the carbon society and the viewpoint of restructuring are excluded.
Hence, these are highly likely to become major obstacles in achieving carbon neutrality in
2050.

53

2. Net-Zero R&D Strategies

13

2.1

R&D Governance2.1.1 Government R&D Implementation Structure
The Government science, technology and innovation (STI) budget of Japan in FY2020 was
9.2 trillion yen14 including supplemental budgets, comprising 2 trillion yen for the Green
Innovation Fund15. This amount was significant as the STI budget before FY2019 had been in
the range of 4.0 trillion yen to 5.7 trillion yen since 2001. Figure 3-2 shows each relevant
ministry's spending as a ratio of the STI budget, where the Ministry of Economy, Trade andIndustry (METI) and the Ministry of Education, Culture, Sports, Science and Technology(MEXT) are significant players contributing over 70% of the total budget.

Source: Modified by JST/APRC from NISTEP “Japanese Science and Technology Indicators 2021”[Figure 3-2] The Ratio of STI Budget of Japanese Government by Ministry

In regard to governmental policy implementation, the Council for Science, Technology, andInnovation (CSTI) acts as the control tower of STI policy in Japan. CSTI is one of the Cabinet
Office's essential policy councils and is comprised of the Prime Minister, relevant Ministers,
and experts. CSTI formulates significant STI policies, including the "Science, Technology andInnovation Basic Plan" (hereafter referred to as "Basic Plan") and "Integrated Innovation
13

Authors: Thi Nu Pham, Mikkiko Azuma and Junko Okayama (Japan Science and Technology Agency, JST)14

Sum of central and local governments.

15

National Institute of Science and Technology Policy (NISTEP), STI Budget (Accessed 1 June 2022)

54

Strategy," which are described in the next section. Based on direction from CSTI, eachministry implements STI policy including R&D activities. Moreover, cross-ministry activities
are undertaken occasionally. In terms of carbon neutrality policy implementation, crossministry meetings for Green Innovation Strategy16 have been held under the leadership of
METI since 2020, acting as a command tower for implementing the related policies in linewith the "Integrated Innovation Strategy."
Most public R&D competitive funds are allocated to researchers via funding agencies. The
major funding agencies in Japan supporting energy and environmental research are the Japan
Society for the Promotion of Science (JSPS), the New Energy and Industrial Technology
Development Organization (NEDO), and the Japan Science and Technology Agency (JST).
Among them, JSPS, which is affiliated with MEXT, is providing bottom-up funding based on
the curiosity of scientists, and the others are providing top-down funding based on
government policy. Among the top-down funding agencies, NEDO, which is affiliated with
METI, focuses on promoting industrial technology and commercialization, including theGreen Innovation Fund. JST, which is affiliated with MEXT, promotes top-down, strategic
basic research. This report will look in detail at the activities of NEDO and JST in a later
section. There are also other institutions conducting funding programs related to carbon
neutrality, such as the National Agriculture and Food Research Organization (NARO) and theEnvironmental Restoration and Conservation Agency (ERCA). NARO is a research
institution focused on the agricultural field, which also has a top-down funding body named
the Bio-oriented Technology Research Advancement Institution (BRAIN). ERCA is an
institution with several functions, such as compensation and prevention of health hazards
caused by pollution and providing grants for environmental conservation, including researchfor carbon neutrality.

2.1.2 STI Policies under the Science, Technology and Innovation Basic Plan
In Japan, the Science, Technology and Innovation Basic Plan (hereafter referred to as the"Basic Plan") is the primary policy for STI. The "Basic Plan" has been formulated every five
years since FY1996 based on the Science, Technology and Innovation Basic Law (formerly
Science and Technology Basic Law). The latest Basic Plan is the "6th Science, Technology
and Innovation Basic Plan" (hereafter referred to as "Sixth Basic Plan") started in FY2021.
The core concept of the Sixth Basic Plan is the realization of "Society 5.0", a human-centeredsociety that balances economic advancement with the resolution of social problems through a

16

METI, Japan’s Roadmap to “Beyond -Zero” Carbon, July 07, 2020.

55

system that highly integrates cyberspace and physical space, which was first presented in theformer Basic Plan. The plan includes steps towards promoting social change anddiscontinuous innovation to overcome global issues, including implementing the Paris
Agreement.17
As an action plan of the Basic Plan, the "Integrated Innovation Strategy" (formerly"Comprehensive Strategy on Science, Technology and Innovation") has been formulated
every fiscal year since 2015. Under the vision of Society 5.0, the latest strategy18 formulated
in June 2022 emphasizes addressing the climate change issue, including contributions toachieving carbon neutrality. From the standpoint of innovation, the promotion of energy
conservation, through electrification, and the decarbonization of electric power (accelerated
diffusion of technology for maximum levels of introduction of renewable energy and use of
nuclear energy with top priority on safety) are mentioned. Along with this, the development of
next-generation solar cells, CCUS/carbon recycling, and hydrogen-based technologies arealso stated. At the same time, to promote the introduction of technologies and their practicalapplication, the government will promote the decarbonization of people's lifestyles, realize
and expand zero-carbon cities, foster public understanding, and consider the systems,
standards, and other mechanisms critical to implementation.
There are many policies affiliated with the “Integrated Innovation Strategy,” and among them,
the “Environment Innovation Strategy19”, formulated in January 2020, is the most importantfor promoting innovation. The Basic Plan also refers to the “Basic Energy Plan” concerning
R&D and international cooperation.
Besides these policies, the “Growth Strategy” of the Cabinet Secretariat is closely related to
STI. The latest action plan of the Growth Strategy was approved on June 18, 2021,
emphasizing green growth associated with carbon neutrality. This policy was decided by thecommittee on the Growth Strategy, which was taken over by the Council of New Form of
Capitalism Realization as of October 15, 2021. Concerning carbon neutrality, the “Sixth BasicPlan” and “Integrated Innovation Strategy” both refer to the “Green Growth Strategy ThroughAchieving Carbon Neutrality in 205020” which was formulated as an industrial policy aiming
to contribute to the “Growth Strategy.”

17

Government of Japan, Science, Technology and Innovation Basic Plan, March 26, 2021.

18

Prime Minister Cabinet Office, Integrated Innovation Strategy, June 3, 2022.

19

Prime Minister Cabinet Office, Environment Innovation Strategy, January 21, 2020.

20

METI, Green Growth Strategy (provisional translation), December 25, 2020.

56

2.2

Key Technologies

Key technologies required to realize carbon neutrality are described in the “Environment
Innovation Strategy.” Five target sectors noted in this strategy are (1) energy, (2)transportation, (3) industry, (4) business, household and cross-sectoral, and (5) agriculture,
forestry and fisheries/ carbon sinks. Table 3-7 shows the key technology described in the“Environment Innovation Strategy” by these sectors.
Among the five target sectors, the transformation of the energy sector is the most important
issue in achieving carbon neutrality since more than 80 percent of Japan's GHG emissions arederived from this sector. Among these, technologies to maximize the introduction ofrenewable energy and promotion of innovation in the field of next-generation solar cells,
CCUS/carbon recycling, and hydrogen are especially highlighted, referred to both in the"Sixth Basic Plan" and "Integrated Innovation Strategy." Furthermore, next-generation
batteries, which are needed to realize a resilient energy network with renewable resources as aprime force, are referred to as a key technology in the "Growth Strategy."[Table 3-7] Key Technologies by target sector
Target Sector

Key Technologies(1) Energy Technologies to maximize the introduction of renewable energy (next-generation
solar cells etc.).
 Technologies to realize a resilient energy network with renewable resources as aprime force (next-generation batteries etc.).
 Technologies to realize a low-cost hydrogen supply chain.
 Nuclear and fusion technology.
 Technologies for low-cost CO2 separation and capture (CCUS/carbon recycling).

(2) Transportation

 Green mobility (high efficiency battery, fuel cell, utilization of fuel derived fromcarbon recycling etc.).

(3) Industry

 Technologies to break dependence on resources based on fossil fuels (hydrogen
reduction ironmaking).
 Carbon recycling technologies to utilize CO2 as a raw material.

 Utilization of cutting-edge Greenhouse Gas (GHG) reduction technology.
 Transformative technology utilizing bigdata, AI or distributed control systems forurban management.
(4) Business, household, crosssectoral Energy reduction by promoting sharing economy, telework, behavioral
transformation etc.
 Fulfill the scientific knowledge for verification of GHG reduction effect.
(5) Agriculture, forestry andfisheries / Carbon sinks

 CO2 capture and storage by utilizing cutting-edge biotechnology etc. (bluecarbon, smart agriculture, forestry and fisheries, etc.)
 Reduction of CH4, N2O emission from agriculture sector.
 DAC (direct air capture) technology.

Source: Extracted by APRC/JST from Environment Innovation Strategy (2020)

57

2.3

Key Strategic Programs

Key strategic programs of the Japanese government related to carbon neutrality are
undertaken by CSTI, METI, MEXT, MOE and MAFF as mentioned above. In this section,
several of the government’s top-down funding projects and carbon-neutral related R&D
programs are introduced.

2.3.1 CSTI: SIP, Moonshot
Cross-ministerial Strategic Innovation Promotion Program (SIP)21
SIP is a national project established by CSTI
to realize science and technology innovation
by functioning as a control tower andproviding management across the boundaries
of ministries, agencies, and traditional fields
as shown in Figure 3-3.
SIP undertook eleven projects in its first phase
in FY2014 and twelve projects in its second
phase, which began in FY 2018 (August
FY2018). Each subject has a Program Director(PD) who can reliably link industry, academia,
and government. The Cabinet Office itself
secures the budget and transfers it to eachministry and agency for implementation,
creating an unprecedented and revolutionary

Source: Cabinet Office[Figure 3-3] The structure of SIP

mechanism.
Carbon-neutral related projects in the first phase included the "Energy Carriers" project which
had the three research and development topics of: "develop energy carriers and identify
promising candidates," "develop peripheral technologies supporting a low-cost, highly
efficient hydrogen value chain," and "conduct research and development linked to safety
standards deregulation for hydrogen transportation and use."22.

21

Prime Minister of Japan Cabinet Office, Brochure SIP " Pioneering the Future: Japanese Science, Technology andInnovation 2021", January 2022.

22

Prime Minister of Japan Cabinet Office, Brochure SIP page 22-25, Energy Carriers, January 2022.

58

In the second phase (2018-2022), the carbon-neutral related project is the “energy system forand IoE society23” project directed by Prof. KASHIWAGI Takao at Tokyo Tech. The researchand development topics include "Design and energy system for an IoE society," "IoE common
platform technology," and "R&D for an application/practical implementation of IoE."

Moonshot Research & Development Program
The Moonshot Program was established in December 2018 by CSTI, with a maximum of 10
years’ support (budget: 115 billion JPY). The Moonshot Research and Development Program,launched by the Cabinet Office (CAO), promotes high-risk, high-impact R&D aiming toachieve ambitious ‘Moonshot’ goals and solve issues facing future society such as super-aging
populations and global warming. As shown in Figure 3-4, CSTI, MEXT, METI, MAFF andMHLW formulated the R&D concept. By June 2022 (present), a total of 66 Project Managers(PMs) have been selected to carry out R&D projects related to the nine Moonshot Goals24.
The Moonshot Goal most focused on carbon neutrality is Goal 4, being promoted by NEDO,"Realization of sustainable resource circulation to recover the global environment by 2050,"
which aims to contribute to solving the global warming problem (Cool Earth) and theenvironmental pollution problem (Clean Earth) while accounting for continued industrial andconsumer activity. The R&D projects in Moonshot Goal 4 are presented in Table 3-8.

Source: Cabinet Office.

[Figure 3-4] The program Framework of Moonshot

23

Prime Minister of Japan Cabinet Office, Brochure SIP page 8-9, Energy system for and IoE society, January 2022.

24

Prime Minister of Japan Cabinet Office, Moonshot R&D Projects, (Accessed 1 June 2022).

59

[Table 3-8] R&D projects in Moonshot Goal 425(1) Development of technologies to recover greenhouse gases ("GHGs") and convert
them into valuable materials
 Development of a Bioprocess That Uses Electrical Energy to Fix Atmospheric CO 2
 Development of Highly Efficient Direct Air Capture (DAC) and Carbon Recycling Technologies
 Integrated Electrochemical Systems for Scalable CO2 Conversion to Chemical Feedstocks
 C4S* Research and Development Project * C4S: Calcium Carbonate Circulation System for Construction
 Research and development toward saving energy for direct air capture with available cold energy
 Development of Combined Carbon Capture and Conversion (quad-C) Systems for the Utilization of
Atmospheric CO2
 Development of Global CO2 Recycling Technology towards "Beyond-Zero" Emission
 Mitigation of GHG emissions from agricultural lands by optimizing nitrogen and carbon cycles(2) Development of technologies to recover nitrogen compounds and convert them into
harmless or useful materials
 Innovative Circular Technologies for Harmful Nitrogen Compounds/ To Solve Planetary Boundary Issues
 Development of recovery and removal techniques of dilute reactive nitrogen to realize nitrogen circulating
society(3) Development of marine biodegradable plastics which can control the timing and speedof their degradability
 Development of Multi-lock Biopolymers Degradable in Ocean from Non-food Biomasses
 Research and development of marine biodegradable plastics with degradation initiation switch function
 Development of photoswitching ocean-degradable plastics with edibility

2.3.2 METI/New Energy and Industrial Technology Development Organization(NEDO)NEDO is one of Japan's largest public funding agencies. As one part of the government’s
economic and industrial administration, its two missions are to address energy and global
environmental problems and enhance industrial technology. NEDO promotes four technology
development fields, include “Energy Systems”, “Energy Conservation and Environment”,“Industrial Technology”, and “New Industry Creation and Discovery of Technology Seeds”.
The “Energy Conservation and Environment” projects are shown in Table 3-9. Apart from its
energy conservation/environment projects, NEDO also has some projects related to the energy
system 26 , where the areas of focus are “system provision technology”, “energy storage
technology such as batteries”, “technology related to hydrogen production, storage, transport,
and use”, and “renewable energy technology”.

25

Prime Minister of Japan Cabinet Office, Moonshot Goal #4 R&D Projects, (Accessed 1 June 2022).

26

NEDO, Energy System, (Accessed 1 June 2022).

60

[Table 3-9] NEDO’s energy conservation/environment projects
Project’s nameType

National
Projects

 Research and Development Project on Innovative Thermal Management
 Materials and Technologies
 Development of Environmental Technology for Steelmaking Process Development of Technologies for Carbon Recycling and Next Generation Thermal
Power Generation
 Research and Development of Recycling Technologies for Establishing a High Efficiency Resource Circulation System Development of Technology and Assessment Techniques for Next
 Generation Refrigerants with a Low GWP Value Development of Zero-Carbon Steel Technologies
 Development of Carbon Circulation Technology for the Cement Industry
 Innovative Plastic Resource Circulation Process Technology Development
 Research, Development and Demonstration of CCUS Technology
 Development of advanced circulation technology for aluminum materials

 Strategic Innovation Program for Energy Conservation Technologies
Proposal – Based  Program to Develop and Promote the Commercialization of Energy Conservation
Technologies to Realize a Decarbonized Society
Activities
 NEDO Feasibility Study Program

International
Demonstration
and Joint
Projects

 Demonstration Project for Introducing an Energy-Saving Resource Circulation System
in Asia Project for International Promotion and Dissemination of Carbon Recycling andAdvanced Thermal Power Generation Technologies
 International Demonstration Project on Japan's Energy Efficiency Technologies
 Program to Facilitate Private-Sector-Led Promotion of Low Carbon
 International Research and Development Co-Funding Project Research and Development Program for Promoting Innovative Clean Energy
Technologies Through International Collaboration

Specified
Proposal-Based
Research andDevelopment

 Moonshot Research and Development
 Green Innovation Funding Program

METI, assigned a Green Innovation Fund of approximately 2 trillion yen to NEDO toaccelerate their current initiatives, such as structural and demand transformation in the energy
and industrial sectors, as well as innovation through bold investment, to achieve the goal of"Carbon Neutrality by 2050." For ten years, the fund will provide funding to firms andorganizations that approach these goals as business problems, from research and development
through to social implementation.

61

2.3.3 MEXT/Japan Science and Technology Agency (JST): Advanced Low Carbon
Technology Research and Development Program (ALCA) - Specially
Promoted Research for Innovative Next Generation Batteries (SPRING)MEXT promotes research and development from fundamental research to advanced
technologies to transform the nation into a “low-carbon society” through cutting GHG
emissions while enabling sustainable development. This section introduces the ALCA and
ALCA-SPRING programs, which are operated by JST under MEXT.
As shown in Figure 3-5, ALCA aims to promote research and development to createtechnologies with great potential for reducing GHG emissions based on new scientific andtechnological knowledge under the research and development strategy formulated by MEXT.
The objective is to achieve R&D results that will lead to the creation of green innovation. The
FY2022 budget allocation for ALCA is approximately 2,173 million yen.

Source: ALCA

[Figure 3-5] Layered Structure of ALCA Technology Areas

62

As a Special Priority Research Area of ALCA with the aim of accelerating research anddevelopment of high-capacity secondary batteries, the next generation of the existing lithium
ion batteries, ALCA-SPRING was launched in 2013. As shown in Figure 3-6, the project aims
to accelerate research and development of high-capacity secondary batteries, the next
generation of the existing lithium ion batteries, and develop revolutionary secondary battery
technology that is far superior in performance compared to existing secondary batteries,
accelerating basic/ fundamental research toward practical applications.

Source: ALCA

[Figure 3-6] Layered Structure of ALCA-SPRING

Besides ALCA, there are also other programs that focus on carbon neutrality such as JSTMirai "Low Carbon Society" mission area (FY2017-) and some research areas in the Strategic
Basic Research Programs27.

27

JST, Mirai "Low Carbon Society" mission area and the Strategic Basic Research Programs., (Accessed 1 June 2022)

63

2.3.4 MAFF/The Bio-oriented Technology Research Advancement Institution(BRAIN)BRAIN supports basic research and development based on research strategies concerning thedevelopment of bio-oriented technologies stipulated by MAFF, including the "Basic Plan for
Agricultural and Fishery Researches," and commissions this to universities, national collegesof technology, and private sector companies. BRAIN was assigned the Moonshot Goal 5“Creation of the industry that enables sustainable global food supply by exploiting unused
biological resources by 2050”.
Besides BRAIN, MAFF also has some projects related to agricultural and forestry climatechange research initiatives. MAFF’s main research projects focus on the topics of “Observedand Predicted Effects of Climate Change on Japanese Agriculture”, “Sustainable Food System
Research (MeaDRI)”, and “Government of Japan Environment Innovation Strategy”. The“Zero-Emission Agriculture, Forestry and Fisheries” component aims to avoid and/or
sequester more than the equivalent of 15 billion MT of CO2 through four areas of research,
consisting of 10 specific programs, see Table 3-10.
[Table 3-10] Areas of Research for Zero-Emission Agriculture, Forestry and Fisheries (source: Prime
Minister of Japan Cabinet Office) Genome editing technology and other applied biotechnology
CO2 absorption andfixation in the ocean,
farmland, forest withadvanced biotechnology

 Development of alternative raw material using biomass
 Carbon sequestration in farmland using biochar Wooden high-rise buildings and wood-based bioplastics
 Smart forestry and fast-growing trees
 Blue carbon (carbon sequestration in the marine ecosystems)

Reduction of CH4 and N2O
 Breeding new varieties of crops and livestock as well as development of newfrom agriculture andfarm and livestock management to acclimate to climate change
livestock industry
 Building a new energy system based on local production and consumption
Smart agriculture, forestry, (best suited for rural areas)
and fisheries Reduction of fossil fuel usage in agricultural sectors by introducing moreenergy efficient machinery and/or optimizing practices.
Capturing CO2 in the Air  Development of Direct Air Capture technology

642.3.5 MOE/ Environmental Restoration and Conservation Agency of Japan (ERCA)
To achieve a decarbonized society, the MOE supports many funds that are critical to foster
innovation in order to further cut CO2 emissions in all sectors and promote implementation insociety at an early stage, such as the “Environment Research and Technology Development
Fund (ERTDF)28”through ERCA, the “Low Carbon Technology Research and Development
Energy Program29” among others. The main areas of the “Low Carbon Technology Researchand Development Energy Program” are: Low Carbon Transportation, Low Carbon Buildings,
Low Carbon Renewable Energy, Low Carbon Biomass and Recyclable Resources andInnovations for Decarbonization of Social Infrastructure.

2.4

Successes from Recent R&D Results

With the support of R&D funding programs from government organizations, research on
carbon neutrality in Japan has achieved many excellent results. In this section, some of thesuccessful results in fundamental research and their applications are introduced.

2.4.1 Higher performance of magnesium metal batteries30
The "Next Generation Battery Team" (2013-2022), ALCA, which is led by KANAMURA
Kiyoshi, Professor at the Graduate School of Urban Environmental Sciences, Tokyo
Metropolitan University has significantly improved the cycle characteristics and capacity ofmagnesium metal batteries. As shown in Figure 3-7, a prototype battery was manufactured
using an alloy material (Mg-Ca) with the positive electrodes made from ZnMnO3, a Zn-Mnbased defect spinel-type oxide, and calcium (Ca) was added as the negative electrode. This
research is the world's first achievement to improve battery characteristics by alloying
magnesium metal and controlling the structure.

28

MoE, Environment Research and Technology Development Fund, (Accessed 1 June 2022)

29

MoE, Pamphlets for Low Carbon Technology Research and Development Program, (Accessed 1 June 2022)

30

JST, Higher performance of magnesium metal batteries achieved, May 2022.

65source: JST[Figure 3-7] (Left) Photograph of the new Mg -Ca alloy material, (Center) Observed microstructureof the new material, (Right) Battery charge/discharge test results using pMg and Mg-Ca material as
the negative electrode2.4.2 Development of a new method of ammonia synthesis31
Professor NISHIBAYASHI Yoshiaki, Research Director of CREST32 and Professor, Graduate
School of Engineering, the University of Tokyo, was the first in the world to develop an
innovative method for synthesizing large amounts of ammonia from nitrogen gas and water atroom temperature and atmospheric pressure. The study's findings were published in Nature(online) in April 2019. Professor Nishibayashi identified a phenomenon whereby ammonia
synthesis proceeds at room temperature and atmospheric pressure at a rate comparable tonitrogenase by employing samarium diiodide, one of the significant achievements madepossible by this synthesis process. For a long time, the combination of samarium diiodide andwater has been utilized as a reducing reagent for the carbon-oxygen double bond (C=O) in
organic synthesis. Professor Nishibayashi realized that this chemical could also be used todisrupt the nitrogen-nitrogen triple bond (N≡N). This approach is supposed to take the placeof the traditional "Haber-Bosch process," lowering the energy required and the amount of CO2
generated during ammonia synthesis.

31

JST, Innovative “Method of Ammonia Synthesis”, April 2019.

32

Core Research for Evolutional Science and Technology (CREST) is a program under the Strategic Basic Research Progra
ms. of JST.

66

Source: JST[Figure 3-8] Paradigm Shift in energy Resources of Society

2.4.3

Mitsubishi Heavy Industries (MIH) Engineering – Development of LowCost CO₂ Separation and Recovery Technology33

As a program supported by NEDO, more than 90% of the CO2 from factories and power
plants may be recovered using the exhaust gas CO2 recovery technology created by MIH
Engineering.
Sixteen units have already been delivered by the company to destinations all around the world.
This equipment provides operators with significant cost savings due to its strong energy
saving performance and durability. In Tomakai City, Hokkaido, Japan, a refinery has started ajoint research program with MHI Engineering and Mitsubishi Gas Chemical to test
technologies for the efficient recycling of CO2 emissions as well as the production of
methanol from captured CO2 emissions.

2.4.4 Application of autonomous battery-powered vehicles34
Toyota Motor Corporation unveiled plans to build a prototype city of the future at the base of
Mt. Fuji in early 2020. The autonomous battery-powered Toyota e-Palette cars will be the33

NEDO, Report ofTomakomai CCS Demonstration Project at 300 thousand tonnes cumulative injection, May 2020.

34

METI, Tapping Hydrogen’s Energy Potential, (Accessed 1 June 2022).

67

main mode of transportation as the corporation tested mobility-as-a-service and other cuttingedge technology. Toyota has helped fuel the growth of the fuel cell vehicle market by making
the Mirai passenger car widely available. They intend to increase the variety of long-distancebuses, trucks, and other heavy vehicles available. The firm is also putting an emphasis onelectric vehicles and plans to develop batteries and use materials informatics in the next years.

2.5

Summary

A public-private sector effort is currently underway in Japan following the Prime Minister’s
carbon neutrality declaration in October 2020. The Science, Technology, and Innovation (STI)
Basic Plan is addressing climate change and carbon neutrality, promoting energy conservationand the decarbonization of electric power through the development of next-generation solar cells,
CCUS/carbon recycling, and hydrogen-based technologies. The government will also promote thedecarbonization of people's lifestyles, realize and expand zero-carbon cities, foster public
understanding, and consider the systems, standards, and other mechanisms critical to
implementation.
The establishment of the Green Innovation Fund in 2020 has become a major topic ofdiscussion, providing 2 trillion yen in R&D funding for carbon neutrality over 10 years andpositioned as a catalyst for R&D investment in the private sector. Considering that the
government’s annual STI budget has ranged from an approximate annual 4.0 to 5.7 trillion
over the past two decades, the new 2 trillion fund represents a significant investment.
A variety of large-scale basic research programs such as Moonshot Research & Development
and ALCA-SPRING are also promoting projects that contribute to carbon neutrality, withresults including: higher performance magnesium metal batteries; a method for synthesizing
large amounts of ammonia from nitrogen gas and water at room temperature and atmosphericpressure; technology that can recover up to 90% of the CO2 emitted by factories and power
plants.
In response to the global movement to curb global warming, a public-private sector effort isunderway following the carbon neutrality declaration by the Prime Minister in October 2020.
However, the goal is extremely lofty: to reduce GHG emissions to 54% of the fiscal 2013
level by 2030, and to reduce overall GHG emissions to zero by 2050. So, what is Japan's
science and technology doing to meet this challenging goal, and how can we achieve acarbon-neutral society?

68

The majority of the R&D activities undertaken in Japan are carried out in the private sector,
with a greater than 80% share of expenditure. Despite this, most basic and applied research
conducted in universities and public research institutions is performed using public funds.
This chapter focuses on the activities of the Japanese government and the structure of R&D
governance, key technologies, key strategic programs, and some recent R&D results.

69

REFERENCESIn English:
World Legislation Information Center (2022.04.21), “Greenhouse Gas Reduction Goals and Related
Laws of Countries around the World”
KIER(2021.12.), “Climate Change Response Policy Trends in Major Countries”, Technology Policy
Focus, 15(3), KIER
KEEI(2021. 1. 11.), “World Energy Market Insight No.21-1”_____(2021. 2. 22.), “World Energy Market Insight No. 21-4”_____(2021. 8. 16.), “World Energy Market Insight No. 21-16”_____(2021. 11. 15.), “World Energy Market Insight No. 21-22”
M. Lee and G. Lee(2021), “Carbon-neutral Technology Policy Trends in Major Countries (Ⅱ):
Analysis of G7 National Technology Policy Trends and Suggestions for Domestic Policy
Directions after the Climate Summit”, GTC Focus, 2(5), Green Technology Center______(2021. 3. 30.), “Japan's 2050 Carbon Neutrality and Green Growth Strategy, Geoeconomics
and Geopolitics and Future Tasks of the RCEP Expert Meeting of the Korea Institute forInternational Economic Policy”, Presentation of Japan's Green Growth Strategy
Korea Institute for Advancement of Technology(2021. 8.), “Status and Implications of Industrial
Policies for Carbon Neutrality in Major Countries”, Global Issues Special 2, KIAT

In Japanese:
経済産業省(2021. 6. 18.), 2050 年カーボンニュートラルに伴うグリーン成長戦略____________(2021. 10. 22.), 第6次エネルギー基本計画が閣議決定されました
環境省(2021. 10. 22.) 地球温暖化対策計画, 閣議決定
内閣官房 (2021.6.18), 経済財政運営と改革の基本方針 2021, 内閣官房成長戦略会議.
内閣府 (2020.1.21), 革新的環境イノベーション戦略, 内閣府統合イノベーション戦略推進会議.
経済産業省 (2020. 12.25), 2050 年カーボンニュートラルに伴うグリーン成長戦略
内閣府 (2021.3.26), 第6期科学技術・イノベーション基本計画
内閣府 (2022. 6), 統合イノベーション戦略2022
文部科学省 科学技術・学術政策研究所 (2021. 8.) ,科学技術指標2021（調査資料-311）.

70

Website:
Asia VOA News(2021. 11. 3.), “Japan “Achieving carbon neutrality by 2050””,https://www.voakorea.com/a/6297953.html
CAO(year unknown), “Moonshot Goals for the Moonshot Research and Development Program”,
https://www8.cao.go.jp/cstp/english/moonshot/outline_en.pdf
JST(2019. 4.), “Innovative “Method of Ammonia Synthesis””,
https://www.jst.go.jp/EN/achievements/research/bt2020-04.html___(2022. 5.), “Higher performance of magnesium metal batteries achieved”,
https://www.jst.go.jp/EN/achievements/research/bt2022-05.html___(year unknown), “Strategic Basic Research Programs”,
https://www.jst.go.jp/kisoken/en/index.html
JST Mirai(year unknown), “"Low Carbon Society" mission area”,
https://www.jst.go.jp/mirai/en/program/lowcarbon/index.html
METI(2020. 7. 7.), “METI Hosts the First Green Innovation Strategy Meeting”,
https://www.meti.go.jp/english/policy/energy_environment/global_warming/roadmap/report/
20200707.html_____(year unknown), “Tapping Hydrogen’s Energy Potential”,
https://www.meti.go.jp/english/policy/energy_environment/global_warming/roadmap/innovation/
thep.html
MoE(year unknown), “Environment Research and Technology Development Fund”,
https://www.env.go.jp/policy/kenkyu/suishin/english/gaiyou/gaiyou_6.html____(year unknown), “Pamphlets for Low Carbon Technology Research and Development Program”,
https://www.env.go.jp/earth/ondanka/cpttv_funds/pamphlet_e.html
NEDO(2020. 5.), “Report of Tomakomai CCS Demonstration Project at 300 thousand tonnes
cumulative injection”, https://www.meti.go.jp/english/press/2020/pdf/0515_004a.pdf______(2022. 7. 12.), “NEDO Technology Development Fields(Energy System)”,https://www.nedo.go.jp/english/introducing/introducing_tdf1.html
Prime Minister of Japan Cabinet Office(2022.1.), Brochure SIP " Pioneering the Future: Japanese
Science, Technology and Innovation 2021",
https://www8.cao.go.jp/cstp/panhu/sip_english/sip_en.html__________________________________(2022. 1.), “Energy Carriers”, Brochure SIP page 22-25,
https://www8.cao.go.jp/cstp/panhu/sip_english/p22-25.pdf__________________________________ (2022.1.), “Energy system for and IoE society”, Brochure
SIP page 8-9, https://www8.cao.go.jp/cstp/panhu/sip_english/p38-39.pdf__________________________________(year unknown), “Moonshot R&D Projects”,
https://www8.cao.go.jp/cstp/english/moonshot/project_en.html__________________________________(year unknown), “Moonshot Goal #4 R&D Projects”,
https://www8.cao.go.jp/cstp/english/moonshot/project_en.html#a4

71

72

73

74

1. Policy Reviews and Issues of Carbon Neutrality
1.1

35

Background

Korea is the eleventh-largest emitter of GHGs in the world, having constantly increasing
GHG emissions. As of 2018, the total GHG emissions of Korea were 727.6 million tons ofCO2eq, or around 1.51% of the global total. By sector, energy, industrial processes, Agriculture,
LULUCF and waste sector emit 632.4, 57.0, 21.2, -41.3, 17.1 million tons of CO2eq,
respectively (The Government of the ROK, 2022). In the past three decades, overall emissions
have climbed by 149%, from 292,2 million tons in 1990 to 736,6 million tons in 2018. The
high level of GHG emissions is attributable to the heavy reliance of the national economic
structure on manufacturing and exports (The Government of the ROK, 2022). Despite being alarge emitter of GHGs, Korea actively participates in the international community's efforts tocombat climate change by ratifying the Paris Convention in 2016 and announcing the 2050
carbon neutrality target in October 2020. This article introduces Korea’s carbon neutrality
policy, objectives, governance, and major challenges in achieving carbon neutrality.

1.2

Carbon Neutrality National Policy and Institutional Framework

1.2.1 Overview
The ROK established green growth as the main pillar of its policy in the late 2000s and has
played a leading role in establishing national climate change policies. The ROK voluntarily
set a national GHG reduction target for 2020, which is a 30% reduction compared to BAU(Business-as-Usual), in November 2009. In response, the country established the Framework
35

Author: Jaemin Song (Seoul National University)

75

Act on Low Carbon, Green Growth (Green Growth Act) in January 2010, the nation's first law
with a GHG emission reduction goal. The Act established the fundamental principles forencouraging green growth, as well as national policies, implementation plans, and theoperations of the Green Growth Committee. Furthermore, in order to achieve the goal of
reducing GHG emissions in a cost-effective manner, a national emission trading system has
been in place since 2015.
The ROK's efforts to reduce GHG emissions were accelerated in June 2015 when its Intended
Nationally Determined Contribution (INDC) was submitted in accordance with the Paris
Convention. The INDC proposed reducing the country’s emissions by 37% below the BAUlevel by 2030 as shown in Table 4-1. The 2030 National Greenhouse Gas Reduction Roadmap
was introduced in the following year as a sectorial implementation plan to lay out detailed
implementation plans to achieve a total reduction of 37%, with Korea reducing 25.7% andother countries reducing 11.3%. In 2019, the county updated the Enforcement Decree of the
Framework Act on Low Carbon, Green Growth in 2019 to strengthen its reduction goal of a
24.4% reduction from the 2017 level, utilizing an absolute-quantity-based target (TheGovernment of the ROK, 2022). Additionally, the government has revised and supplemented
the existing road map to achieve the 2030 national GHG reduction target. Accordingly, the 2nd
National Emissions Allocation Plan (2018-2020) for the national emission trading scheme
reflected the revised roadmap and established the total emission allowance of 591 companies
subject to the emission trading scheme, expanding the permitted facilities and increasing theemission coefficient relative to the 1st. As the gravity of the climate change agenda has grown,
the country has shifted its position from low carbon to carbon neutrality, declared its
commitment for carbon neutrality by 2050. Accordingly, in the most recent NDC submitted
December 2021, the country set an updated and enhanced target to reduce GHG emissions by
40% from the 2018 level, which is 727.6 MtCO2eq, by 2030. The country has implemented
new legal and institutional frameworks to further the agenda. In fact, it is the fourteenthcountry to legislate the 2050 carbon neutrality vision. The subsequent section will provide a
concise summary of the country's legal and institutional framework initiatives.

76

[Table 4-1] Changes in Reduction Targets in Korea
2020 Roadmap(Jan. 2014)

2030 Roadmap(Dec. 2016)

2030 Roadmap revised(Jul. 2018)7 sectors(25 sub-sectors)

8 sectors(31 sub-sectors)

8 sectors

Goal30%↓from 2020 BAU

37%↓from 2030 BAU(domestic: 25.7%
International: 11.3%)

37%↓from 2030 BAU(domestic: 32.5%
others: 4.5%)

Mitigation Pathway

Mitigation pathway between
2014 and 2020

Amount of emissions to be
reduced in 2030

Every three year emission
reduction target until 2030

Updated National GHG
Reduction Target for 2030
(NDC)
(Dec. 2020)

Revised GHG Reduction
Target for 2030
(Oct. 2021)

8 sector

8 sector

Sector

SectorGoal
Mitigation Pathway

24.4%↓from 2017 level (709.1 40%↓from 2018 level (727.6
MtCO2-eq) by 2030
MtCO2-eq) by 2030
Every three year emission
reduction target until 2030

Amount of emissions to be
reduced in 2030

Source: Ministry of Environment(2020); The Government of the Republic of Korea(2022b)

1.2.2 Framework Act on Carbon Neutrality, Green Growth36
The ROK abolished the Green Growth Act and enacted the Framework Act on Carbon
Neutrality, Green Growth (Carbon Neutrality Act) in August 2021 as a “legal foundation to
respond to the climate crisis and to achieve carbon neutrality” (The Government of the ROK,
2022). The Carbon Neutrality Act outlines national vision and strategy, mid- to long-term
NDC reduction goals, and programs for domestic carbon neutrality by 2050. The Act also
provides major concepts and procedures for the transition to a carbon-neutral society andgreen growth. It established a strong foundation for carbon neutrality by significantly
increasing the GHG reduction target to 40% by 2030. While this is a difficult target to attaingiven the country's high concentration of manufacturing, it indicates the government's strong
desire to achieve carbon neutrality and reduce GHG emissions (Office of Government Policy
Coordination, 2022). In addition, it presented an opportunity to create a new governancestructure, Carbon Neutrality Commission, involving all social classes, including central-local,
industrial, future generations, and workers. The Act emphasizes a comprehensive andbalanced approach to future and current generations, climate crisis adaptation and GHG

36This section is a summary of the Office for Government Policy Coordination's press release on 22 March, 2022 (Office ofGovernment Policy Coordination, 2022), https://www.opm.go.kr/opm/news/press1.do?mode=view&articleNo=144090

77

reduction, and all sectors and sectors of society (Article 3 of the Carbon Neutrality Act). The
Carbon Neutrality Act recognizes the following four sectors as the primary pillars of carbon
neutrality and green growth: GHG mitigation, climate crisis adaptation, just transition, andgreen growth.

GHG mitigation
The Act introduces a variety number of measures for GHG mitigation. First, it establishes the'Greenhouse Gas Reduction Awareness Budget', which examines the national budget's
influence on GHG reduction, incorporates it into the budget composition, and assesses if it isproperly performed at the time of settlement. Second, the Climate Change Impact Assessment
has been introduced to assess the impact of climate change on large-scale development plansand projects that produce high volumes of GHGs or are vulnerable to climate crisis, will be
implemented in stages after pilot projects in September 2022. Third, the Ministries ofEnvironment and Land, Infrastructure, and Transport will work together to disseminate a"carbon neutral city" model and develop strategy for building a carbon-neutral city bydiagnosing the region's carbon-neutral level. In the transportation sector, relevant ministries
such as the Ministry of Trade, Industry, and Energy, the Ministry of Land, Infrastructure, andTransport, and the Ministry of Oceans and Fisheries will collaborate to set GHG reduction
targets, revitalize public transportation, convert electric and hydrogen vehicles, and build ecofriendly railways. In addition, carbon sinks will be expanded through sustainable forest
management. Lastly, in accordance with Article 6 of the Paris Agreement, the Act has alsolaid the groundwork for encouraging worldwide GHG reduction projects that each country or
business operator can undertake and employ to meet national objectives.

78

[Figure 4-1] Overview of Framework Act on Carbon Neutrality, Green Growth

Climate Crisis Adaptation
The Carbon Neutrality Act has enhanced policies to proactively prepare for intensifying
climatic disasters and adapt to the climate crisis. To measure, analyze, and report changes in
the concentration of GHGs in the atmosphere, and to improve the precision of climate crisis
monitoring and forecasting, a meteorological information management system has been
established. In addition, a climate crisis adaptation information management system will be
operated to explore and assess the effects of the climate crisis on the environment. And,
Climate Crisis Adaptation Measures will be established and monitored every five years at thenational level, including vulnerable groups and catastrophe prevention, and then expanded toprovinces, cities, counties, and districts.

79Just Transition
Measures on just transition have been introduced in the Act to protect and assist regions andgroups harmed by the transition to carbon neutrality. The Ministry of Trade, Industry, andEnergy and the Ministry of Employment and Labor will collaborate to reinforce the climate
crisis social safety net and develop comprehensive support measures, such as employment
stability, unemployment assistance, and business conversion assistance. The government will
identify and support vulnerable places significantly impacted by the rapid implementation ofcarbon neutrality, operating a "just transition support center" as a support organization.

Green Growth
As one of the primary carbon neutrality implementation strategy, green growth measures arealso developed to implement a green economy and promote and support green industries.
Technical assistance and financial support to reform the system, as well as policies such as thecreation of financial products to combat the climate issue have been included in the Act tostimulate the development and commercialization of green management and green technology.
In addition, green transformation of the entire society and economy will be strongly supportedwith standardization of green technologies and industries, creating green jobs.

Climate Change Response Fund
In January 2022, the Climate Response Fund was established to support the long-term
development of carbon-neutral policy and industrial restructuring. The fund this year has atotal budget of 2.4 trillion won, focusing on four main areas: (1) GHG reduction, (2) the
development of a new promising and low-carbon industry ecosystem, (3) fair transformation,and (4) institutional and infrastructural construction. It intends to give top priority assistancefor reduction initiatives that maximize GHG reduction impacts in the future, as well as toconstantly increase the size of investment in green finance and technology development
projects.

1.2.3 Emission Trading Scheme
Greenhouse gas emission trading scheme was first introduced in Korea in 2015. Aftercompleting the first (2015-2017) and the second planning period (2018-2020), it is now in thethird planning period (2021-2125). Despite the fact that its emission trading system is still in
its early phases of implementation, it has two significant advantages (Song, 2021). First, thescope of GHGs susceptible to the emission trading scheme is broader in comparison to large
countries. Korea has six of the seven GHGs defined by the international community, while
EU ETS covers three GHGs and RGGI and China covers only one. Second, the share ofemissions that are subject to the emission trading scheme is very high, at 73%, which is far

80

higher than other countries. However, most allocation systems are free of charge, andallowances are relatively generous. The greater the share of free allocation, the lessmotivation there is for enterprises to sell emissions rights. For the second planning period, theproportion of paid allocation was 3%, and it is expected to be 10% during the third planning
period. The carbon-neutral scenario emphasizes the establishment of a virtuous cycle in whichcarbon costs are reflected in power generation costs by strictly managing the total emission
allowance of the emission trading system and raising the paid allocation ratio as Korea's
carbon reduction target is strengthened (Cooperation of related ministries, 2021).

1.2.4 GHG Target Management System
The Target Management System (TMS) is a regulation program that manages the emissions ofsmall and medium-sized businesses whose emissions are relatively low and not covered by
the emission trading scheme. A corporation subject to the TMS is obligated to make voluntary
efforts not to exceed a quota on GHG emissions or energy consumption determined by thegovernment in cooperation with the company. If a corporation falls short of the goal, it will
receive an improvement order or be penalized. Since the TMS was initially implemented in
2010, the emissions and energy consumption thresholds above which enterprises must comply
have been reduced three times. Based on the latest three-year average GHG emissions, thecurrent criteria for an entity and a business site are 50,000 tons CO2eq (energy consumptionof 200TJ) and 15,000 tons CO2eq (energy consumption of 80TJ) respectively.

1.2.5 Institutional Framework
Carbon Neutrality can be achieved only though collaboration across sectors. To ensuretransparent and effective implementation of GHG emission reduction in Korea, the Office forGovernment Policy Coordination and the Ministry of Environment takes a lead incoordinating and managing the tracking and assessment process, while each sector is managed
by relevant government ministry and office. Ministry taking in charge of each sector shalldevelop appropriate performance index, set goals and collect relevant data for tracking andevaluation.

Source: The Government of the ROK(2022b)[Figure 4-2] Institutional arrange for GHG reduction progress tracking and assessment81

In the meantime, Korea has launched the 2050 Carbon Neutrality Commission, the key
governance to support its carbon-neutrality transition in May 2021. The Commission is cochaired by the Prime Minister and a representative from the private sector, and its
membership is broad from cabinet members to businesses, experts, the youth and civil society
from the private sector. The main responsibility of the Commission includes reviewing
carbon-neutrality policies and taking stock of the NDC implementation. Furthermore, in order
to directly hear the views of the general public, region, and field, industry, labor, civil society,youth, and local governments develop and communicate a "Consultative Group," and a"Citizen Participation Group" is formed and run (Yoon, 2021).

Source: The Government of the ROK (2022a)[Figure 4-3] The structure of Carbon Neutrality Commission

82

1.3

GHGs Reduction Target vs. Progress37

Although Korea made an early commitment to reduce its GHG emissions in 2014, the country
has not been very effective at monitoring and analyzing the GHG reduction progress. By
concentrating mainly on qualitative indicators, the first official evaluation of 2020 roadmap
implementation failed to adequately represent the implementation performance. Accordingly,
the total GHG emissions exceeded the initial emission target by 5.0% and 8.6% for the years
2014 and 2015, respectively, even though the evaluation report estimated that theimplementation goals had been met by 92% and 98%, respectively (Ministry of Environment,2020). In order to address the issues with the existing evaluation method and to analyze thesector-specific reduction initiatives, the target emissions or unit emissions established by
sector were compared with actual emissions performance in the 2030 updated roadmap review.

Source: The Ministry of Environment (2020).

[Figure 4-4] Mitigation pathway in the roadmap vs. actual emission between 2018 and 2019

The most current official assessment report, which examined GHG reduction efforts in 2018and 2019, was published in 2021. According to the report's key findings, Korea still needs toexert effort in a variety of sectors to meet its GHG reduction target. The target of 690.9
million tons of CO2e was exceeded by an average of 24.4 million tons of CO2e, or 3.5%,
between 2018 and 2019. The energy intensity effect and the carbon intensity effect are the key
contributing factors, hence it is necessary to increase energy efficiency and switch to low-37

This section is a summary of “Evaluation of Greenhouse Gas Reduction Implementation Performance (2018-2019)” by the
Ministry of Environment (2020).

83

carbon energy sources. To reduce energy intensity, the government must maintain andincrease consistent long-term policies and expenditures in energy efficiency, the supply of
renewable energy, and the replacement of high-carbon energy sources (Ministry ofEnvironment, 2020).
The performance results for each key sector are specifically as follows. First off, the energy
sector's average CO2 emissions from 2018 to 2019 were 260.4 million tons, or around 6.7%
above than the target level. Continuous energy reduction and demand management activities
in the electricity and heating are necessary to meet the reduction target. As of 2019, theindustrial sector accounted for 55.6% of the national emissions, making it the greatest
contributor of GHG emissions. The average industrial sector emissions between 2018 and2019 were 398.0 million tons CO2e, or roughly 1.7% less than the target. However, it was due
to a decrease in industrial activity that the emission target was successfully met. Therefore,
efforts should be made to reduce energy and carbon intensity continuously. 153.0 million tonsof CO2e were released in the building sector, which was 5.0% more than the target level.
Energy intensity is the primary culprit, hence it is essential to increase renewable energy
production while also enhancing building energy efficiency. The average emission in thetransportation sector was 100.4 million tons CO2e, or around 7.3% more than the target
emission. In the medium to long term, it is urgent to increase the average fuel efficiency ofcars and supply eco-friendly cars to reduce GHGs in the road sector, which accounts for 97%
of GHG emissions in the transportation sector.

1.4

Carbon Neutrality Strategy and Scenarios

1.4.1 Long-term Low Greenhouse Gas Emission Development Strategy38
The ROK submitted 2050 Carbon Neutral Strategy, so called Long-term Low GHG emission
development strategy (LT-LEDS) in December 2020. In the LEDS, the country envisions toachieve carbon neutrality by 2050, using the Korean New Deal, specifically the Green New
Deal and the Digital New Deal, to harness green innovations and advanced digitaltechnologies. The strategy has been developed through active consultations with various
groups. The initial draft proposal was prepared by 2050 Low-Carbon Vision Forum in which
academia, industry, and civil society participated, followed by online survey, expert
consultation and public discussion. There are five key elements for the national carbon
neutrality: 1) Increasing the use of renewable energy and hydrogen in all industries; 2)38

Joint Relevant ministries of the Republic of Korea (2020)84

significantly enhancing the energy efficiency of buildings; 3) implementation of carbon
removal and other future technologies on a commercial scale; 4) expanding the circular
economy to strengthen industrial sustainability; and 5) increasing carbon sinks. The strategy
also presents key strategies for each sector as shown in Table 4-2.
[Table 4-2] Carbon Neutrality Strategies by Sector (The Government of the Republic of Korea, 2021)
SectorMajor Strategies

EnergyThe government will develop an accurate power demand and supply forecasting system andprovide enhanced support for future innovative technologies, e.g., Energy Storage System(ESS) for reliable power supply, and hydrogen fuel cells for auxiliary power sources. Korea
plans to phase out coal power plants or convert them into LNG power plants. In addition,
Carbon Capture, Utilization and Storage (CCUS) technology will be applied to coal-fired
power plants to minimize GHG emissions.

Industry

The government plans to: i) facilitate the industry sector’s transition to a high-value-added
structure by combining ICT to the existing industries; ii) use regulatory measures incombination with incentives to improve energy efficiency; and iii) strengthen policies andtechnology developments for reusing wastes as resources that could dramatically reduce theuse of raw materials and fuels for the purpose of efficient use of resources.
The government plans to: i) promote the use of public transportation; ii) expand sharedmobility; iii) build systems for traffic demand management and intelligent transportation;

Transportationiv) reduce energy consumption by promoting commercial use of autonomous vehicles; andv) promote the modal shift from road to rail or shipping, the low-carbon modes oftransportation.

Building

The government plans to use a combination of regulatory measures and incentives in twotrack approaches for: i) newly-built buildings and ii) old buildings. Starting from 2020, all
new public buildings to be built will be subject to the zero-energy building standards, andfrom 2030, all new public and private buildings (with gross floor area of 5 million ㎡ orlarger) will be subject to the standards. Old buildings, if they adopt green remodelingsolutions, will be eligible for government incentives such as tax cuts and grants for interest
expenses. Along with improving energy efficiency, using low-carbon energy sources isanother important mitigation strategy.

Waste

The waste sector’s strategy seeks to identify ways to convert wastes into useful materials
and reuse them as energy sources. Any unrecycled wastes left should be disposed of in an
eco-friendly manner. Plastics are one of the most serious problems in this sector that should
be dealt with urgently, and measures to phase out plastics need to be established for aplastic-free society.

Agriculture

ICT-enabled smart farming could minimize inputs (i.e., energy sources, fertilizers, water,etc.), and farm automation could further improve productivity. Therefore, the government
plans to scale up the deployment of smart technologies on farms. To reduce GHG
emissions originating from crop cultivation and livestock farming, it is essential to develop
and deploy low-carbon farming practices and replace fossil fuels used on farms with clean
energy sources.

Carbon Sinks

Innovative forest management is a key to improving the aging forest structure, promoting
the use of wood products/timber and increasing carbon stocks. The government plans toincrease carbon sinks by creating urban green spaces for recreational use, restoring
degraded forestlands and tree-planting in underutilized lands. It will continue its forest
management to maintain the forest carbon removals at the highest level possible bychanging tree species and implementing programs to keep the forests healthy.

85

1.4.2 Carbon Neutrality Scenarios39
The carbon neutrality scenario is the subsequent response to the 2050 goal of carbon
neutrality. As depicted in Figure 5, its creation involves active consultations with diverse
groups of professionals, residents, and economic sectors. Based on the principles of
Responsibility, Inclusiveness, Fairness, and Competition, the carbon-neutral scenario wasformed from the vision "As a safe and sustainable carbon-neutral society protected from theimpact of the claim." Ultimately, two scenarios were accepted, and both intended to attain net
zero in Korea by 2050 without the use of foreign reduction credit.

[Figure 4-5] 2050 Carbon Neutrality Scenarios (Yoon, 2021) 40

The only areas in which the two scenarios differ are energy conversion and transport,hydrogen, and evasion. Assuming that the remaining emissions (80,4 million tons in A and
108,3 million tons in B) are absorbed and eliminated by carbon reduction technologies suchas forests and CCUS, the net emissions are estimated to be zero. In the first scenario (A plan),fossil fuel power generation is supposed to be completely eliminated in the energy sector toachieve zero emissions, while electric and hydrogen vehicles are to be expanded to 97% in thetransportation sector, and only green hydrogen is to be used in order to minimize emissions.
39

Joint Relevant Ministries of the Republic of Korea(2021a)(https://www.2050cnc.go.kr/eng/board/read?boardManagementNo=28&boardNo=608&searchCategory=&page=1&search
Type=&searchWord=&menuLevel=2&menuNo=65)40

윤순진(2021)

86

In the second scenario (proposal B), coal power is projected to cease, as in proposal A, but apart of LNG power generation is supposed to remain for flexible power usage. In addition,some internal combustion locomotives are assumed to continue to operate due to thedevelopment of alternative fuels (e-fuels, etc.) in the transportation industry. Plan B releases
more emissions than Plan A, but the final net emission in Plan B is also zero by using carbon
absorption and removal technologies such as CCUS more aggressively.
Despite disparities between Plan A and B, the increase of renewable energy is crucial as
shown in Table 4-3. The proportion of renewable energy in the energy sector is assumed toclimb to 70.7% in Plan A and 60.9% in Plan B, respectively. A specific level of power
generation is maintained due to the slow reduction of nuclear power during operation during
the design life. The discrepancy between the proportion of nuclear power plants in Plans A
and B is related to the difference in usage rate, which is 77% of the world's average utilization
rate over the past decade and 87% of Plan B, which is based on enhancing safety measures. In
addition, although not yet marketed, hydrogen-based fuel cells and carbon-free new power
turbines are also responsible for the creation of electricity.
[Table 4-3] Energy Mix
Scenario

Nuclear
Power

Coal

LNG

Renewable

Fuel
Cell

NEA
Grid

CarbonFree gas
turbineByproduct
Gas

Total

A

76.9

0.0

0.0

889.8

17.1

0.0

270.0

3.9

1257.7

B

86.9

0.0

61.0

736.0

121.4

33.1

166.5

3.9

1208.8Energy conversion is critical to achieving carbon neutrality. However, simply altering theenergy sector will not result in carbon neutrality. It is particularly critical to cut emissions in
the industrial sector as well, which is responsible for 36% of GHG emissions (54% including
indirect emissions). In all A and B plans, the 2050 carbon neutral scenario cuts industrial
sector emissions by 80.4%, from 260.5 million tons CO2eq in 2018 to 51.1 million tons CO2eq.
However, in Plan A and B, industrial sector emissions account for 63.6% and 47.2% of total
emissions, respectively, up from 35.8% in 2018. In the building sector, consumption is
expected to fall by nearly 23% in 2018, from 46.9 million TOE to 36.0 million TOE, while
GHG emissions are expected to fall by 88.1%, from 52.1 million tons CO2eq to 6.2 million
tons CO2eq. Furthermore, the agriculture and livestock sectors should lower their CO2
emissions by 37.7%, from 24.7 million tons CO2eq to 15.4 million tons CO2eq, and the garbage
sector should reduce their CO2 emissions by 74.3%, from 17.1 million tons CO2eq to 4.4
million tons CO2eq.

87

1.5

Major barriers and important issues

1.5.1 Energy Intensive Economy
The ROK has a very high manufacturing-to-GDP ratio of 26.1% as of 2020, compared toJapan (19.5%), the EU (14.0%), and the United States (14.0%). In particular, six industries,
including steel, petrochemical, cement, oil refining, displays, and semiconductors, account for
79% of the total industrial GHG emissions. The steel industry is the largest emission sourcesamong the six. While the manufacturing sector has been a major contributor to Korea's
economic growth, its expansion ultimately led to a rise in energy consumption and GHG
emissions. Thus, carbon neutrality is a difficult goal to achieve in the country, as the industrial
structure is heavily energy dependent. Despite the fact that GHG emissions per GDP havedecreased due to industrial efforts, particularly greater energy efficiency, total emissions
continue to climb. The elimination of GHGs implies an increase in costs for businesses, which
is closely related to corporate competitiveness; hence, industrial opposition to strong carbon
neutrality policies is still strong. Nonetheless, the reduction of GHGs is also crucial forbusiness competitiveness, given the recent international demand for RE100 and thestrengthening of ESG (Environment, Social and Governance) standards. To promoteindustry’s engagement in carbon-neutral activities, it is necessary to combine regulation withincentives rather than relying solely on regulation alone. Under appropriate and effective
regulations and incentives, the industrial sector should restructure its sector to be moreenvironmentally friendly, create novel process technologies, and expand resource circulation.

1.5.2 A politically and ideologically motivated energy policy41
In the Republic of Korea, energy policy has become a political agenda that is heavily
influenced by the political party in power. While the energy plan must be long-term andconsistent for efficiency and stability, the major direction of the national energy basic planvaried from administration to administration. This is partially attributed to the regularity withwhich laws are altered, as the national energy plan is typically revised every five years, thesame as the presidential system. When a new president is installed, a new energy plan isestablished as a result of the five-year presidential system. The 1st National Energy Basic
Plan (2008–2030) prepared by the government of Lee Myung Bak in August 2008 recognized
nuclear power as a major low-carbon energy source, planning to operating 41% of its
41에너지신문(2022. 3. 4.), 『[사설] 이념∙정치화 않는 에너지정책
news.co.kr/news/articleView.html?idxno=81129 (accessed on 15 June 2022)

88

바란다』,

https://www.energy-electrical facilities as nuclear power. In January 2014, the government of Park Geun Hyeannounced the 2nd National Energy Basic Plan (2011-2035), which included a drastic
reduction in the proportion of nuclear power plants in consideration of changes in power
demand, transmission system conditions, and national water solubility since the first plan. In
June 2019, the next administration of Moon Jae-In stated in the 3rd National Energy Basic
Plan (2019-2040) that the life of outdated nuclear power plants will not be extended andprevious plans to build further nuclear power plants are not to be proceeded. Consequently,
the target share of new and renewable energy needed to be increased to 30 - 35% by 2040,
while nuclear power and coal power would need to be reduced progressively. However, theadministration of the newly elected president Yoon Seok Yeol supports the expansion of
nuclear energy, which would need the modification of the current carbon neutrality scenarios.
The course of the country's nuclear policy has been continuously altered. Energy policies,
which play a crucial role in the state's foundation, have been formed not in a consistent way,
depending on which political party becomes the dominant party. As energy plans have been
politicized, an "opposite extremes" policy has been adopted and implemented. We need along-term and consistent energy policy that fit for our condition.

1.5.3 Need for appropriate monitoring and evaluation framework
For GHG reduction to be effective, it is required to build a monitoring and evaluation
framework capable of measuring the efficacy of relevant policies and programs. Numerous
indicators and quantitative target indicators were added to the most recent implementation
evaluation report for 2018-2019 in order to compensate for the flaws in the existing
monitoring and evaluation system. However, there is a drawback in that it is not stated thatmonitoring and evaluation results can be incorporated in each sector's policy. To achievecarbon neutrality, it is required to construct a system to design and monitor indicators capableof evaluating the efficacy and level of implementation of policies, and to feed the evaluation
results back into policymaking.

1.5.4 Difficulties in the Expansion of Renewable Energy
As of 2018, the energy sector accounts for 86.9% of the country's total GHG emissions.
Therefore, energy conversion is the most crucial aspect of carbon neutrality in Korea.
Nevertheless, the country's share of (new and) renewable energy generation in 2020 is only
7.43%, the lowest among OECD member states (OECD, 2022)42. This indicates that the42

OECD (2022), “Renewable energy (indicator),” https://doi.org/10.1787/aac7c3f1-en, (accessed on 15 June 2022)89expansion of renewable energy is not rapid enough to achieve carbon neutrality. Since thepassage of the Alternative Energy Development Promotion Act in December 1987, thecountry has promoted the development of renewable energy at the national level. It hasestablished a new and renewable energy facility certification system, a roadmap for mid- tolong-term new and renewable energy supply and promotion strategies, and a system topromote related industries as major industries. Additionally, it has designated specialized
institutions to strengthen support for the commercialization of renewable energy. Large-scale
projects are subject to an environmental impact assessment, and environmental evaluation
rules, which are the nature of renewable energy site guidelines, are designed to encourage
environmentally responsible facility locations. Moreover, local inhabitants are urged toengage in the project through the promotion of benefit sharing and lending programs (Korea
Energy Corporation New and Renewable Energy Center, 2021a). The Ministry of Trade,Industry, and Energy and Korea Electric Power Corporation are attempting to expand thesystem connection for renewable energy. It ensures unrestricted system access for small firms,
assists with building expenses, temporarily raises the standard for linked capacity pertransformer, and discloses system network information. However, this resulted in a time lag as
it took time to expand the requisite distribution lines or transformers. As a result, due to ashortage of power substations or distribution line capacity, system connection is notcompleted properly when it is necessary, and there are a great number of renewable energy
facilities waiting to be connected. Moreover, as renewable energy sources with variablecharacteristics proliferate, the complexity of system management increases. In the case ofrenewable energy, it is first purchased in the power market without participating in pricebidding; therefore, there is no market mechanism to improve renewable energy prediction
because there is no incentive or punishment system for prediction.
Finding an adequate location and increasing local support for the power system infrastructure
are additional barriers for renewable energy. Regional conflicts in Korea are intensifying as aresult of damage to mountainous regions and the influence of solar and wind power
development on physical built environment. Since 2015, when its yearly installation capacity
surpassed 1 GW for the first time, solar power in the country has been growing at an
exponential rate. Solar power on the mountain has frequently been achieved by chopping
down trees that act as carbon sinks, which is undesirable from a climate change standpoint.
Consequently, local governments have developed their own regulations to restrict the site ofsolar and wind power installations. In addition, licensing procedures and regulations
pertaining to renewable energy have been tightened, making it more challenging to secure
permits for renewable energy projects. The proliferation of renewable energy installations is90

causing an increase in the number of cases in which a project is terminated during theenvironmental impact assessment procedure.

1.5.5 Population Decline and Urban Decline
As a result of the country's relatively low fertility rate, its population is fast declining. Anothercause for concern is the high population density in the Seoul Metropolitan Area (SMA). As of
2019, more than fifty% of the nation's population resides within the SMA. Future projections
indicate that the demographic difference between SMA and Non-SMA will continue to widely
expand. This change in population distribution is closely related to the demand fortransportation and building energy, as the declining population in the Non-SMA will lead toinefficient land use, an increase in traffic demand, and an increase in GHG emissions.
Moreover, the current population decline in nonmetropolitan cities is tied to the regional
industrial structure. Specifically, manufacturing-based cities experience population andeconomic competitiveness declines. As the carbon neutrality policy is implemented, theattractiveness and competitiveness of the region are expected to deteriorate even further due
to a lack of human capital and financial resources, resulting in an even faster decline.
Therefore, a regional strategy for an inclusive and equitable energy transition is necessary.
Diverse support measures are necessary not only for process conversion programs forindustries and people as a result of energy conversion, but also for place-based energy process
conversion that takes into consideration regional characteristics.

1.6

Summary

With its manufacturing-based, energy-intensive industrial structure, Korea ranks as the 11th
highest emitter of GHGs globally, making carbon neutrality challenging. Future changes inthe demographic structure, geographical decline, and industrial structure as a result oftechnological advancement will present both opportunities and obstacles for carbon neutrality.
Nonetheless, with a strong desire to achieve carbon neutrality by 2050, the government set an
ambitious GHG reduction target to reduce by 40% from the 2018 level by 2030 and has
introduced various policy and institutional measures. The Framework of Carbon Neutrality,
Green Growth is at the center of the legal framework for carbon neutrality policy, and theCarbon Neutrality Commission has been established to facilitate participatory governance. In
addition, since 2015, the emission trading system has been in place to reduce GHG emissions
in a cost-effective manner. However, the country is facing many challenges. First, energy
transition, which is the most critical component for carbon neutrality, has been beset by91

technical, economic and social reasons, such as technical difficulties and low social
acceptability for expanding renewable energy. Second, due to the energy and economic natureof Korea's manufacturing sector, achieving carbon neutrality will be challenging without
innovative and systematic approaches across all industry sectors. Furthermore, proper policies
for a just transition should be in place during the carbon neutrality policy implementation
process, so that disparities in negative consequences between regions or industrial sectors canbe reduced. Carbon neutrality is no longer a question of choice but a necessary obligation thatmust be met despite these obstacles. Through a combination of appropriate legislation andincentives, education, and social consensus-building, the government should continue toadvance its efforts to achieve carbon neutrality.

92

2. Net-Zero R&D Strategies

43

2.1

R&D Policy

2.1.1 2050 Carbon neutral Promotion Strategy(2020)
After declaring 2050 carbon neutral in October 2020, Korea presented the 3+1 policy
direction and 10 key tasks to promote carbon neutral through the establishment of the '2050
Carbon neutral Promotion Strategy' in December of the same year. The 3+1 policy directionsof the carbon-neutral strategy for 2050 are presented as low-carbon economic structure,creation of a promising low-carbon industrial ecosystem, process transition to a carbonneutral society, and strengthening of the carbon-neutral institutional foundation.
The 10 key tasks are energy conversion, high-carbon industry, future mobility, cities and land,
promising industries, innovative ecosystem, circular economy, incorporation into newindustrial system, regional focus, public awareness, emission trading system, green finance,
R&D, international offer cooperation.
Research and development (R&D) is one of the key tasks for strengthening the carbon-neutral
institutional foundation, and the Ministry of Science and ICT establishes a carbon-neutral
R&D strategy as the lead ministry, and the National Science and Technology Advisory
Committee appoints a special committee for carbon-neutral R&D.

2.1.2 Carbon-neutral Technology Innovation Promotion Strategy (2021)
Therefore, at the 16th Science and Technology Ministerial Meeting on March 31, 2021, the'Carbon neutral Technology Innovation Promotion Strategy' and 'Carbon-neutral R&D
Investment Strategy' were discussed and finalized for the realization of the 2050 carbonneutral goal. 'Carbon neutral technological innovation promotion strategy' presents detailed
implementation plans for each of the five strategies for technological innovation, along withgoals and strategies to achieve by 2050 for each of the 10 core technologies.
The 10 core technologies considering the long-term low-carbon power generation strategy(LEDS) and the reduction contribution of technologies are solar power/wind power, hydrogen,bio energy, steel/cement, petrochemical, industrial process, transportation, Buildings,
Digitization, and CCUS.

43

Author: Mina Lee(Green Technology Center, GTC)

93

Source: Joint Relevant Ministries of the Republic of Korea (2021b)[Figure 4-6] 10 key technologies in Carbon-neutral Technology Innovation Promotion Strategy

2.1.3 Carbon-neutral R&D Investment Strategy (2021)「Carbon-neutral R&D investment strategy」 suggests investment directions for all carbonneutral R&D fields, from resource circulation and adaptation to climate change, so that theeffect of reducing carbon dioxide is large and the R&D needed immediately in the field can beurgently carried out. Therefore, the government plans to expand investment continuously,
focusing on areas with high GHG reduction effects, such as investing 1.59 trillion won in
2021 in renewable energy, industrial processes, and energy efficiency. In addition, according
to this strategy, each ministry agreed to plan and promote R&D projects aimed at application
to industrial sites by sector as shown in Table 4-4.
[Table 4-4] Areas of focus on carbon-neutral R&D by ministries
Ministries

Areas of focus on carbon-neutral R&D by ministries

Ministry of Science and  Securing source technology for carbon-neutral core fields and enhancing energy
efficiency using ICT
ICTMinistry of Trade,Industry and Energy Industrial process improvement to reduce GHG emissions for industries with highcarbon emissions
 Technology for revitalization of renewable energy and hydrogen economy, systemstabilization, and consumption efficiency

Ministry of Land,
Infrastructure andTransport Strengthening technology development for zero-energy buildings, eco-friendly
transportation, and hydrogen infrastructure

Ministry ofEnvironment Reinforcement of resource recycling technology such as plastic removal
technology, carbon absorption, and climate adaptation technology

Ministry of Oceans and  Enhanced carbon absorption and storage based on marine energy and marine
ecosystems
Fisheries
Source: : Joint Relevant Ministires of the Republic of Korea (2021c)

94

2.1.4 Strategy for the Selection and Development of National Essential
Strategic Technologies (2021)
As for 「Strategy for the Selection and Development of National Essential Strategic
Technologies」, the government selects technologies that Korea must take the lead in from an
integrated perspective, such as supply chain and commerce (economic security), national
security (diplomacy and defense), and new industries (future innovation). Accordingly, thefinal 10 technologies, including artificial intelligence, 5th generation (5G) and 6th generation(6G), advanced biotechnology, semiconductor/display, secondary battery, hydrogen, advanced
robot/manufacturing, quantum, space/aerospace, and cybersecurity, are listed as worldtechnologies. From the point of view of hegemony, it was selected as a 'necessary national
strategic technology' that should be intensively fostered and protected.
For technologies directly related to carbon neutrality, secondary batteries and hydrogen wereselected. In the case of secondary batteries, they are important as eco-friendly energy sources
such as eco-friendly and electric vehicles. In the case of hydrogen, which is expected toaccount for about 30% of energy sources in 2050, it is necessary to secure technologicalcompetitiveness throughout the entire cycle, from clean hydrogen production to transport,
storage and utilization.

Source: : Joint Relevant Ministires of the Republic of Korea (2021d)[Figure 4-7] 10 key technologies in Strategy for the Selection and Development of National
Essential Strategic Technologies

95

2.2

R&D budget

2.2.1 Government R&D budget system
Government R&D projects in Korea can be broadly divided into major national R&D projects
and general national R&D projects. Major national R&D projects refer to R&D in science andtechnology fields such as mid- to long-term large-scale R&D for more than 5 years and basic
science R&D. The major national R&D projects accounts for about 75% of the total R&D
budget. General national R&D projects are national R&D projects in the humanities andsocial fields and R&D projects that require high security. The authority to allocate and adjust
the R&D budget is held by the Ministry of Science and ICT for major national R&D projects
and the Ministry of Strategy and Finance for general national R&D projects.
Carbon-neutral R&D budgeting is carried out in the same process as other R&D projects. In
the case of major national R&D, each ministry first submits a request for national R&D forthe next year, and the Ministry of Science and ICT allocates and adjusts the budget for R&D
investment together with the Presidential Advisory Council on Science & Technology(PACST). PACST is the presidential continuation agency and serves as the highest leveladvisory and deliberation body for Korea's science and technology policy. After that, theMinistry of Economy and Finance submits the government R&D budget (2nd draft) to the
National Assembly, and the R&D budget is finally decided after deliberation by the National
Assembly.

Source: KISTEP (2019)[Figure 4-8] Korean major national R&D budget allocation system

96

2.2.2 Government and Private R&D Investment
In Korea’s climate technology R&D, 2659.7 billion won was invested in 10,767 projects in
2019, which accounts for 12.9% of the total national R&D projects. Climate technology canbe largely summarized into mitigation technology that reduces GHG emissions, carbon
utilization technology, and climate change adaptation technology. The climate technology
R&D budget and the number of tasks have been steadily increasing at an average annual
growth rate of 1.30% and 7.44%, respectively, since 2016. Of the climate technology R&D
budget as of 2019, the GHG reduction sector was KRW 1.780.3 trillion (66.9%), theadaptation sector was KRW 766.3 billion (28.8%), and the convergence sector was KRW
113.1 billion (4.3%). Therefore, the proportion of R&D in the field of GHG reduction is high.

Source: 2019 Climate Technology R&D Investment & Performance Analysis (2021)[Figure 4-9] Government R&D Investment in Climate Technology in Korea

According to the 2019 national R&D project standards, there are 396 projects that include
climate technology, and 110 of them have climate projects accounting for more than 60% of
the total project weight. The Ministry of Trade, Industry and Energy has 33 tasks, the Ministryof Science and ICT 14 tasks, the Ministry of Oceans and Fisheries and the Ministry ofEnvironment 12 and 10 each.

97

1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000

Office of Government Policy Coordination

National Police Agency

Coast Guard

Defense Acquisition Program Administration

Ministry of Food and Drug Safety

Ministry of Public Administration and Security

Nuclear Safety Committee

Ministry of Health and W elfare

Ministry of Agriculture, Food and Rural Affairs

Meteorological Agency

Korea Forest Service

Ministry of Education

multi-ministerial

Ministry of Land, Infrastructure and Transport

Rural Development Administration

Ministry of SMEs and Startups

Ministry of Oceans and Fisheries

Ministry of Environment

Ministry of Science and ICT

Ministry of Trade, Industry and Energy-

Source: 2019 Climate Technology R&D Investment & Performance Analysis (2021)[Figure 4-10] Investment in Climate Technology R&D by Ministries in Korea

For private R&D, there are 7,648 companies holding climate technology-related patents, andtheir sales volume is 168.68 trillion won as of December 2020. The size of private R&D
investment in climate technology in 2020 is 7.29 trillion won. By sector, energy demand is thehighest at 2.29 trillion won (27.8%), followed by energy storage with 1.89 trillion won(26.0%) and renewable energy with 1.423.1 trillion won (19.5%).

2.2.3 Government R&D Project
There are 24 projects worth 10 billion won or more, including the new and renewable energy
core development project of the Ministry of Industry, the climate change response technology
development project of the Ministry of Science and Technology, and the global top
environmental technology development project of the Ministry of Environment.

98New and renewable energy core development project of the ministry of Ministry ofTrade, Industry and Energy
The purpose of this R&D program is to secure global competitiveness in renewable energy
such as solar and wind power systems to achieve 20% of the proportion of renewable energy
generation in 2030, and to develop core parts localization technology as shown in Table 4-5.
In addition, green hydrogen production for building a hydrogen industry ecosystem,
localization of hydrogen charging stations, securing the safety of hydrogen life cycle, anddevelopment of high-efficiency fuel cell technology are also included.
[Table 4-5] Project main contents by technology of New and renewable energy core development project ofthe ministry of Industry
Technology

Project Main Contents
 Crystalline silicon solar cell unit cost reduction, high efficiency, and technology
development for each supply chain

photovoltaic

 Development and demonstration of high-value-added market expansion technology to
expand domestic distribution and enter overseas markets
 Mid-to-long-term promotion of next-generation solar cell technology development topreoccupy new markets
 Promoting technology development for large offshore wind power generation systems topreoccupy the wind power export market

wind power Technology development and demonstration to reduce wind farm LCOE such as
installation, construction, and grid connection
 Focus on technology development to improve fuel cell performance, durability, and pricereduction

fuel cell Securing a business model for the commercialization of fuel cells and promoting
technology developmenthydrogen Technology development for hydrogen production, hydrogen storage and transportation,
infrastructure construction and safety establishment for the creation and reinforcement of
the hydrogen industry ecosystem

bio energy

 Focus on developing technologies to improve bioenergy productivity and securing urbanfriendly production technologies using various raw materialswaste Development of retrofit technology and export-linked technology to improve the energy
conversion efficiency of various wastes

solar thermal Large-scale solar system design and operation technology, development of solar thermal
application industry technology
 Development of technologies such as geothermal resource exploration and evaluation
techniques to secure the economic feasibility of geothermal energy

geothermal Technology development such as high-efficiency heat pumps and cooling/heating systems
using alternative refrigerants99

Technology

Project Main Contentshydrothermal Development of core element technology related to hydrothermal energy to maximize
utilization of seawater thermal energy such as hot water from power plant and minimize
operation/maintenance Localization of major parts such as water wheel and development of technology to
improve the efficiency of water turbine generator

waterpower Development of technology for localization of large-scale hydroelectric power generation
systems targeting old hydroelectric power generation/replacement markets

ocean power Development of source technologies for using marine energy such as tidal power, tidal
current, wave power, and ocean temperature difference, and promotion of real-sea
empirical research projects

coal use Design technology independence and Korean standard model development through300MW class IGCC demonstration plantrenewable
fusion Development of fusion technology between new and renewable energy sources or withheterogeneous technologies to improve new and renewable energy efficiency, reduce
power generation cost, and provide stable energy

Hydrogenfusion charging  Development of hydrogen production technology using biogas and demonstration bystation pilot
building a charging station
project using
biogasThe project period of this program is from 2006 to 2025, and KRW 2.79 trillion was executedby 2020. The budget for each technology for the period 2016-2020 is detailed in Table 4-6.

100

[Table 4-6] 2016-2020 budgets by technologies of New and renewable energy core development project of theministry of Industry(million won)Technology

2016∼2020

2016

2017

2018

2019

2020

Photovoltaic

56,99758,76061,80872,53369,404

5.3

wind power

33,98427,96634,23560,27984,94630.4

fuel cell

30,76027,681

28,146

21,456

31,2853.4

bio energy

20,763

20,413

21,625

16,14625,407

9.1

Hydrogen

8,892

12,37012,7508,271

16,00325.1

waste energy

9,600

8,600

2,270

549

-

△65.0

renewable fusion

15,64818,03019,575

16,652

16,3481.8

Geothermal

5,500

3,236

4,805

612

-

△45.0

water power

7,675

5,970

4,525

2,618

683

△40.6

coal use

4,572

4,328

3,928

2,090

330

△36.4

Ocean

7,187

4,062

3,082

2,457

1,642

△30.3

solar thermal

4,805

3,215

2,260

2,812

1,110

△24.7

Hydrothermal

2,500

2,065

1,500

-

-

△48.3

IGCC

-

-

-

-

-

-

Hydrogen fusion charging station
pilot project using biogas

-

-

-

1,500

4,000

166.7

Planning and evaluation cost

7,405

7,081

7,432

7,457

8,321

3.1

Total

216,288 203,777 207,941 215,432 259,479

5.1

average growth rate(%)

101

Representative performance of New and renewable energy core development project<Achieved the world's highest perovskite solar cell efficiency of 25.2%>
 Developers are Korea Chemical Research Institute and MIT Successfully developed a new concept perovskite thin film technology (DHA:
Double-layered Halide Architecture) for the commercialization of perovskite solar
cells and achieved the world's highest efficiency of 25.2% (September 2019) Securing overseas competitiveness through publication in the world-class academic
journal Nature (mrnIF 100)
 Nature 2019 567, 511. "Efficient, stable and scalable perovskite solar cells using
poly(3-hexylthiophene)“

Climate change response technology development project of the Ministry of Scienceand ICT
The purpose of this project is to support the creation of future growth engines and secureworld-leading source technologies in the fields of GHG reduction and resource conversion
and adaptation to climate change in response to the climate change crisis as shown in Table 47 and 4-8. In other words, in response to the climate change crisis, it is to secure world-classsource technologies in the fields of GHG reduction and resource conversion and climatechange adaptation, and to support research and build a foundation to create future growthengines.

102

[Table 4-7] Project main contents by technologies of Climate change response technology development
project of the Ministry of Science and ICT
Technology

Project Main Contents

Solar cell Support for the development of non-silicon next-generation source technology toovercome the economic and technological limitations of silicon solar cells

Fuel cell Support for the development of next-generation fuel cell source technology to secure
fuel cell price competitiveness and overcome the limitations of commercial technology

Bio energy Artificial photosynthesis, biorefinery, biomass-crude oil refinery support

Secondarybattery

 Support for next-generation secondary battery development, such as large-capacity
charging system development and rapid charging EV secondary battery development

Ccs

 Development of source technology for carbon dioxide capture, storage and conversion

Hybrid energy

 Development of future energy storage technology using renewable hybrid

Next-generation  Support for the development of next-generation innovative technologies for by-productcarbon resources gas and carbon waste resource conversion and CO2 conversion
C1 gas refinery Development of core catalysts for C1 biocatalyst and C1 chemical catalyst, developmentof core materials for C1 refinery[Table 4-8] 2016-2020 budgets by technologies of Climate change response technology development projectof the Ministry of Science and ICT(million won)Technology

20202016∼2020

2016

2017

2018

2019

Solar cell

4,940

7,696

9,534

11,243 14,829

31.6

Fuel cell

4,570

6,185

8,127

10,774 12,760

29.3

Bioenergy

6,300

8,259

9,844

7,883

10,085

12.5

Secondary battery

2,010

3,974

6,047

6,464

6,923

36.2

Korea CCS 2020

23,000 19,167 17,331 17,431

6,671

△26.6

Development of energy environment
basic source technology to respond to
global warming

6,716

5,685

5,596

5,596

-

△5.9

Next-generation carbon resources

-

6,246

6,423

6,506

7,805

7.7

Support for global local
commercialization of climate
technology

-

2,475

780

780

-

△43.9

Basic technology research

3,050

3,988

5,453

14,068 22,800

65.4

Planning evaluation and evaluation
fee

200

170

170

175

300

10.7

Multi-ministerial joint research

2,000

2,000

2,000

2,400

2,400

4.7

C1 Gas Refinery

14,000 13,142 15,278 16,278 17,800

6.2

Total

66,786 78,987 86,583 99,598 102,373

11.3

average growth rate(%)

103

2.3

Summary and Future Challenges

In the case of Korea, after declaring carbon neutrality in October 2020, many policy proposals
such as '2050 Carbon Neutral Promotion Strategy', 'Carbon Neutral Technology Innovation
Promotion Strategy', and 'Carbon Neutral Research and Development Investment Strategy' arebeing established. However, it is disappointing that the investment in carbon-neutral
technology development was not made immediately. On the other hand, major countries haverecently declared carbon neutrality and are actively presenting plans to expand investment in
the development of innovative low-carbon technologies to achieve carbon neutrality. Major
countries' R&D investment for carbon neutrality is about $35 billion in the US, 2 trillion yen
in Japan, and 8 billion euros in Germany, and is currently in progress.

Source: * KISTEP (2021), ** GTC (2021)[Figure 4-11] 2020 Carbon Neutral Technology Level

Korea's carbon-neutral technology development is at a level that is chasing leading countries,
and it can be said that it is highly dependent on other countries for core parts due to the lackof source technology. In the case of solar power and secondary batteries, it is judged that they
have a certain share in the global market by securing source technologies. It can be seen that
there is a difficult competition in the global market as it is only at the level of assembling by
introducing technology. Therefore, in order to properly implement the carbon-neutral scenario
in 2050, it is necessary to secure the source technology for key technologies throughcontinuous mid- to long-term investment support for carbon-neutral R&D by the government
and then make efforts to commercialize them. Therefore, there is a need to secure national
technological and industrial competitiveness to achieve national carbon neutrality by 2050 by
rapidly expanding investment in carbon-neutral technology development.

104

REFERENCESIn English:

GTC (2021a), “2019 Climate Technology R&D Investment & Performance Analysis”____ (2021b), “GTC 2020 Climate Technology Level Survey”
Joint Relevant Ministries of the Republic of Korea (2020), “2050 Carbon neutral Promotion Strategy”______________________________________ (2021a), “2050 Carbon Neutrality Scenarios”______________________________________ (2021b), “Carbon-neutral Technology Innovation Promotion
Strategy”______________________________________ (2021c), “Carbon-neutral R&D Investment Strategy”______________________________________ (2021d), “Strategy for the Selection and Development of
National Essential Strategic Technologies”
KISTEP (2019), “Study on improvement plan for government R&D project budget structure and budget
allocation adjustment system”_______ (2021), “KISTEP 2020 Technology Level Assessment”
Ministry of Environment (2020), “Evaluation of Greenhouse Gas Reduction Implementation Performance (20182019)”
Ministry of Science and ICT (2021), “Climate Change Response Technology Development Project Selfevaluation Report”
Ministry of Trade, Industry and Energy (2021), “Renewable Energy Core Technology Development Project SelfEvaluation Report”
Office for Government Policy Coordination’s press release (2022. 3. 22.), “Enforcement of the Framework
Act on Carbon Neutrality and Green Growth to Respond to the Climate Crisis”
The Government of the ROK. (2020), “2050 Carbon Neutral Strategy of the Republic of Korea – Towards
a Sustainable and Green Society”________________________ (2022a), “Submission under the Paris Agreement The Republic of Korea’s
Enhanced Update of its First Nationally Determined Contribution.”________________________ (2022b), “Fourth Biennial Update Report of the Republic of Korea under theUnited Nations Framework Convention on Climate Change”

105

In Korean:과학기술정보통신부 (2021), 『기후변화대응기술개발사업 자체평가 보고서』관계부처 합동 (2020), 『2050 탄소중립 추진전략』_____________ (2021a) 『2050 탄소중립 시나리오 안』_____________ (2021b), 『탄소중립 기술혁신 추진전략』_____________ (2021c), 『탄소중립 연구개발 투자전략』_____________ (2021d), 『국가필수전략기술 선정 및 육성 보호전략』국무조정실 보도자료(2022. 3. 22.), 「탄소중립기본법 시행」,https://www.opm.go.kr/opm/news/press1.do?mode=view&articleNo=144090
산업통상자원부 (2021), 『신재생에너지핵심기술개발사업 자체평가 보고서』송홍선 (2021) 『2050 탄소중립과 배출권 거래제의 활성화』, 자본시장연구원 보고서.
윤순진(2021.6.17), 「2050 탄소중립위원회 출범의 의미와 역할」, 『2021 년 상반기 학술대회초청강연』 한국기후변화협회
______ (2021) 「2050 탄소중립 시나리오: 내용과 과제」, 『Energy Focus』, 18(4), pp.18-32
환경부 (2020) 『2018~2019 년 온실가스 감축 이행실적 평가- 2030 온실가스 감축로드맵 수정안이행 점검』GTC (2021a), 『2019 기후기술 투자 및 성과분석』____ (2021b), 『GTC 2020 년 기후기술 수준조사』KISTEP (2019), 『정부 R&D 사업예산구조 및 예산배분조정체계 개선방안 연구』_______ (2021), 『KISTEP 2020 년 기술수준평가』Website:에너지신문(2022. 3. 4.), 『[사설] 이념∙정치화 않는 에너지정책 바란다』, https://www.energynews.co.kr/news/articleView.html?idxno=81129
OECD, “Renewable energy (indicator),” https://doi.org/10.1787/aac7c3f1-en,

106

107

108

As shown in the previous sections, China, Japan, and Korea are all endeavoring to derive
technological, economic, and policy measures to facilitate GHG emissions reduction after
their pledge to carbon neutrality. As much as it is important for each country to work hard, it
is also important for neighboring countries as an international community to work together
toward the common global challenge, climate change. And the measures to promoteinternational cooperation should be carefully coordinated so that it is sustainable. However,efforts to collaborate among three countries so far seem to be negligible at best. This isastonishing considering the transboundary nature of climate and environment and theinterdependence of their economies among the three neighboring countries. For instance,
China and Japan are ranked 1st and 5th respectively in terms of the size of exports and also 1st
and 3rd in terms of the size of imports in Korea. In this regard, this section begins by looking
at the urgency of GHG emissions reduction in three countries and explores the opportunities
of international collaboration among the three countries, focusing on the institutionalarrangements, both previously established and newly emerging.

1. Background
China, Japan, and Korea influence and pressure each other on related decisions. It is evident
when we look at the timing of their pledge to carbon neutrality, which took roughly one
month, starting from China (22 September), Japan (26 October), and lastly Korea (28 October)in 2020. Their decisions were all considered as a surprise and bold considering theirdependence on energy-intensive industries which are extremely difficult to decarbonize.
Similar instance occurred when China announced its decision not to invest and build overseas
coal-fired power plants in September 2021. This move prompted similar decisions in April
and May 2021 by Korea and Japan respectively. Whether they are virtuous or vicious, it isclear that they affect each other on this global challenge.

109

As neighboring countries, China, Japan, and Korea also share commonalities regarding theurgency of climate response. According to each country’s scenario of carbon neutrality, thetime given to achieve carbon neutrality for North-East Asian countries is short compared toother advanced countries. As shown in Figure V-1, for example, Japan, Korea, and China needto reach carbon neutrality 37, 32 and 30 years after carbon peaking respectively, compared to
EU which has 60 years. All three countries also have high share of coal-fired power
generation compared to EU and US as shown Table V-1. In particular, the dependence on
coal-fired power plant in China is significantly higher than in other countries with 63.2%.
Korea has also high share of nuclear energy in its energy mix with 27.9%. In addition, theratio of renewables and hydropower in Korea is significantly lower than other countries,
lagging behind China and Japan. To this end, Korea44 will be the country which will be
influenced the most by the introduction of EU’s Carbon Border Adjustment Mechanism(CBAM).
To make matters worse, both Japan and Korea lack the potential of renewables in their territory
and require more cost than the EU or the US, even their neighbor China due to high density of
population and mountain area. This is the reason why both Japan and Korea are eager to pursue adecarbonization pathway with the help of countries which have abundant resources to produce
low (or zero) carbon energy such as ammonia or hydrogen. They make efforts to establish a
global value chain of low-carbon energy such as blue ammonia or blue/green hydrogen, importingthem from Australia or Middle East countries such as Saudi Arabia. To this end, it is imperative topromote international collaboration as a mechanism to compensate for the lack of potential of the
production of low carbon energy and decarbonization of industry.

44

Trade openness (measured as share of exports and imports per GDP) of the Korea is 80%, compared to 37% of PRC and
31% of Japan as of 2021 (World Bank, https://data.worldbank.org/indicator/NE.TRD.GNFS.ZS?locations= CN-JP-KR,
accessed 14/07/2022).

110

Source: Our world in data, https://ourworldindata.org/co2-emissions, accessed 14/07/2022[Figure 5-1] Per capita CO2 emissions between 1980 and 2020 in EU, China, Japan, and Korea[Table 5- 1] Energy mix in China, Japan, and Korea in 2021
Coal

Oil

Naturalgas

Nuclear Hydropower Renewables

Biofuels andwaste

China*

63.2%

0.1%

3.2%

4.7%

17.0%

11.1%

0.7%

Japan

29.7%

4.1%

35.2%

4.3%

7.7%

12.5%

6.4%

Korea

36.3%

1.2%

26.7%

27.9%

0.7%

6.5%

0.7%

US

19.7%

0.4%

40.6%

19.4%

6.7%

12.9%

0.3%

EU

12.9%

1.6%

22.3%

22.4%

12.5%

26.6%

1.8%

*2019 data
Source: compiled by author from https://www.iea.org/countries, accessed 14/07/2022

2. International collaboration towards carbon neutrality
In order to explore the opportunities of international collaboration among China, Japan, andKorea, we here focus on the previously established and newly emerging institutionalarrangements. For systematic discussion, we adopt a matrix of international collaboration
based on types of mechanism (multi-lateral vs bi-lateral or multi bi tri) and types ofcooperation (policy vs project) as shown in Table V-2. Here, bi-lateral or tr-lateral means
collaboration between two or among three countries within the group of the three North-East
Asian countries. The main logic is that in each category, it is reviewed the potential of111

previously established mechanisms (e.g. CTCN under the UNFCCC and Joint Crediting
Mechanism) or newly emerging mechanisms (e.g. Climate Club). And the objective of thismatrix is not exhaustive but provides ground for discussion.
[Table 5-2] Matrix of international collaboration towards carbon neutrality
Type of mechanism
Multi bi tri
Type ofcooperation

Bi-lateral or Tri-lateral

PolicyProject

Source: Authors based on the forum discussion

We first look at policy level cooperation from the matrix. The United Nations Framework
Convention on Climate Change (UNFCCC) is undoubtedly the most important official multilateral cooperation mechanism on climate change in a global scale of 198 parties, since it
became effective March 1994. Apart from the UNFCCC where all parties gather and negotiate
terms and conditions of how we mitigate and adapt to accelerating climate change, a newvoluntary initiative among like-minded countries such as ‘the Climate Club’ is emerging.
The concept of the Climate Club was originally conceived and put forward by Olaf Scholz in
2021, then finance minister of Germany. The initiative can be explained as a group of likeminded countries which are ‘Ambitious’, ‘Bold’, and ‘Cooperative’ to respond to climatechange, shortly ‘ABC’. It mainly targets countries “with large amounts of emissions,
important EU trade partners, countries with a price on CO2 emissions, and those with a large
industrial sector”45. Olaf Scholz, now the federal chancellor of Germany, put forward theinitiative as a key discussion topic of the G7 summit in June 2022, taking advantage of his
presidency. The G7 leaders from Canada, France, Germany, Italy, Japan, the UK, and the US
have endorsed and agreed to establish the Climate Club by the end of 2022.
This kind of an open and collaborative initiative can be emerging in many ways. Although
there is only Japan included in the G7, China and Korea also belong to the Climate Club’s
exact targeted countries “with large amounts of emissions, important EU trade partners,
countries with a price on CO2 emissions, and those with a large industrial sector”
Three main pillars of the initiative are 1) sophisticating climate mitigation policies throughexplicit carbon pricing, other carbon mitigation approaches and carbon intensities to facilitate45

https://www.euractiv.com/section/energy-environment/news/germanys-scholz-rallies-g7-countries-behind-climate-clubidea/, accessed 25/09/2022112the pathway towards climate neutrality in addition to sharing best practices, 2) transforming
industries into decarbonization through new emerging industrial agenda such as hydrogen, 3)
promoting international partnerships and cooperation to encourage climate action and justenergy transition (G7 Statement on Climate Club, 2022).
So far, three North-East Asian countries are considered rather passive in response to theglobal climate change regime due to the concerns on their industrial competitiveness.
However, now the global direction toward net-zero emission seems irreversible and all three
countries have industrial competitiveness in technologies related with carbon neutrality.
According to Harrison (2022), for example, China, Japan, and Korea have strong presence inthe global green technology patent landscape as shown in Table V-3. Therefore, it isrecommended that they participate in this kind of an open and cooperative initiative forclimate change in the early stage and actively get involved in detailing terms and conditions
within the initiative. Strategy to become a late entrant in this kind initiative can make them agood rule-abiding country at best.
[Table 5- 3] Revealed technological advantage by country in key climate technology fields
CarbonRelative
LowFlood andOffshore
Nuclear Greener Greener Capture,
Specialization
carboncoastalWind
Power
Vehicles Building Usage andIndex Ranking
Hydrogen
defences
Storage
1

UK

Australia

FranceGermany

UK

Australia

Korea

2

FranceCanadaUK

FranceFranceCanadaAustralia

3

Korea

USA

CanadaUK

Australia

India

Canada4

India

FranceKorea

USA

Canada

UK

Japan

5

Australia

GermanyJapan

CanadaGermany

Korea

China

6

China

Japan

USA

India

India

USA

France7

Germany

UK

China

Korea

USA

France

UK

8

USA

Korea

Australia

China

Korea

China

India

9

Canada

India

India

Australia

China

Japan

USA

10

Japan

China

Germany

Japan

Japan

Germany

Germany

Note: Rankings calculated using the Relative Specialisation Index, and limited to comparing the top 10
patenting countries worldwide
Source: Harrison (2022, p.6)

113

Similar to the policy level, there are international mechanisms both at the UNFCCC and theinitiative that the North-East Asian countries can engage more actively at the project level, forinstance, the Climate Technology Centre and Network (CTCN) and the Partnering for Green
Growth and the Global Goals 2030 (P4G). In 2010, the UNFCCC established the Technology
Mechanism in order to facilitate climate technology development and transfer. It consists of
the Technology Executive Committee (TEC) and the CTCN. While the TEC as a policy arm
concerns policy issues and provides recommendations on accelerating and enhancing climate
technology development and transfer, the CTCN, which is an implementation arm and our
focus of discussion, comprises a network of more than 150 National Designated Entities(NDEs) and international and public/private sector entities specialized in climate technology
and policy, which is the key asset of the institution. The main task of the CTCN is theimplementation of technology assistance (TA) projects and capacity building programs on
climate technologies between developed and developing countries. All the TA projects arecarried out through a demand-driven approach at the requests of developing countries. While
the CTCN TA projects are financially supported mainly from different sources, anothercategory of ‘pro bono’ in TA was created in 2017 by CTCN in a way to secure additional
financing. Between 2017 and 2020, total 18 pro bono TA projects were implemented by Japan,
Belgium, Germany, the US, and Korea which dominated with 13 projects. This institutional
addition of pro bono can provide a donor country with the opportunity to focus on where thecountry has competitiveness.
The P4G is a market-based public-private partnership aiming to deliver inclusive and tangible
technical solutions to build sustainable and resilient economies and meet the global goals suchas the United Nations Sustainable Development Goals and the Paris Agreement. It was mainly
led by Denmark since its inception in 2017 and has 12 member countries as of October 2022.
They include both developed and developing countries as member countries. They are Korea,
Denmark, Netherland, Viet Nam, Mexico, Chile, Ethiopia, Kenya, Bangladesh, Indonesia,
South Africa, and Colombia. It supports transformative solutions to tackle challenges in water(SDG 6), food and agriculture (SDG 2), energy (SDG 7), city (SDG 11), and circular
economy (SDG 12) through two kinds of partnership: start-up and scale-up depending on thestage of commercialization. It is more focused on pioneering market-based solutions with
their economic viability. Korea became a strong supporter of P4G by hosting the P4G summit
in 2020.
The CTCN and P4G are notable examples of recently established and actively operatinginternational mechanism related with carbon neutrality. Currently, Korea is actively engaging
in both CTCN and P4G and Japan is intermittently engaging in the CTCN TA program. These114

mechanisms can provide room for North-East Asian countries’ collaboration based on theearly participant’s experience.
In regards to bi- or tri-lateral regional mechanism for policy sharing, three countries currently
do not have a meaningful collaborative mechanism. However, considering the potential as an
official platform to conceive and launch such mechanisms, they have regular ministerial
meetings that can play role of a stepping stone. Currently, three North-East Asian countries
have two official meetings at the ministerial level in regards to climate response46. They are‘Tripartite Environment Ministers Meeting (TEMM)’47 and ‘Trilateral Ministerial Meeting on
Science and Technology (TMMST)’48. Since its first meeting in 1999, TEMM has been held
annually until 2019 and the last TEMM (22nd) was held in December 2021 online after two
years of TEMM21 due to the global COVID-19 pandemic. The main topic of TEMM22 wascarbon neutrality as it was the first TEMM since three countries’ pledge to carbon neutrality
in 2020. On the other hand, TMMST has been held intermittently since its first meeting inJanuary 2007. There were four additional meeting held so far: 2nd in 2009, 3rd in 2021, 4th in
2019. Since then, there was no meeting due to the COVID-19 pandemic. As we consider thecharacteristics of roles and responsibilities of a ministry for environment and a ministry for
science and technology, both mechanisms derived from these meetings should be science- andevidence-based. While TEMM may focus on a mechanism collecting and analyzing data
related with climate change and carbon emissions, TMMST can focus on applications of
newly emerging technologies to tackle these issues.
Despite bumpy relationships among three countries on the way of how they collectively work
together, TEMM has been highly important and one of few formal mechanisms that so far
successfully launched a trilateral collaborative program tackling transboundary issues such as
air pollution among the North-East Asian countries. The North-East Asia Clean Air
Partnership (NEACAP) is a science-based and policy-oriented collaboration scheme run by
UNESCAP that aims to collect and share information and experience of good policy examples
on air pollution in the region. NEACAP originated from the UNESCAP’s mechanism
focusing on coal-fired power plant, NEASPEC (North-East Asian Subregional Programme forEnvironmental Cooperation) which was launched in 1993 by six North-East Asian countries,
Mongolia, DPR Korea, and Russia as well as China, Japan, and Korea. And it was launched at
SOM (Senior Official Meeting)-22 in 2018. There is also a mechanism on modeling of
46

There are 12 different meetings at the ministerial level in total.

47

Ministry of Environment (Korea and Japan) and Ministry of Ecology and Environment (China)

48

Ministry of Science and Technology (China), Ministry of Science and ICT (Korea), Ministry of Education, Culture, Sports,
Science and Technology (Japan)

115

source-receptor relationship, Long-range Transboundary Pollutants in North-East Asia (LTP –China, Japan and Korea). What matters here is not whether these collaborative schemes are
success or failure but what we can learn from these schemes in order to strengthen theregional collaboration on tackling climate change and achieving carbon neutrality. What waseach country’s initial stance on the program? What were the initial concerns that did notencourage them to participate if any? How could those concerns be accommodated andresolved under the program? What have been main issues and barriers during the program
implementation? These are the questions that we have to have and draw implications andlessons learnt from the previous and ongoing mechanisms. In that regard, NEACAP isextremely valuable and important program in regards to enhanced future collaboration.
Regarding bi- or tri-lateral mechanisms on carbon neutrality at the project level, Japan isahead of other two countries. Since 2013, Japan has been implementing a project-based
bilateral offset crediting mechanism, namely Joint Crediting Mechanism (JCM), with partner
developing countries. Through the bilateral agreement with a partner developing country,
Japan can utilize the amounts of GHG emission reduction from mitigation projects to its own
national reduction target under the UNFCCC. This can be applied by Article 6.2 of the Paris
Agreement to achieve Japan’s NDC as shown in Figure 1. And therefore, the JCM by Japan
can contribute to the goal of the UNFCCC by facilitating bilateral mechanism on the global
GHG emission reductions. As of February 2022, total 205 projects in 17 different countries
have been implemented. In addition, five additional countries are added to the list of JCM
host countries in 2022. They are Senegal, Tunisia, Azerbaijan, Moldova, and Georgia.
Benchmarking Japan’s JCM, Korea began to implement a similar bilateral scheme bydesignating 18 different countries as a key cooperation country for bilateral crediting
mechanism. Viet Nam signed the agreement with Korea in May 2021 and remains as the only
country for the Korean JCM.

116

Source: JCM homepage (https://www.jcm.go.jp/, accessed on 13/10/2022)[Figure 5-2] The JCM scheme between Japan and host country

With its experience more than 10 years, Japan can be an anchor country to promote a JCMkind cooperative approach in collaboration with China and Korea. In case of Korea, there are
11 countries in common as partner countries as shown in Table V-4 from the (potential)
partner country list of two countries. Under the JCM scheme of both countries, we canconceive a diverse set of forms of GHG emissions reduction projects between two or eventhree countries if China is also willing to create a similar mechanism. They may share a
project site and apply their own climate change mitigating technologies. Or they can create aconsortium in providing a set of technologies across the value chain required where eachcountry provides related technologies in its competitive area. For example, Japan has beenstrong in materials and key components compared to China and Korea. Japan can also shareits best project practice and the Measurement, Reporting, and Verification (MRV)
methodologies that have been developed with China and Korea.

117

[Table 5-4] (Potential) Partner country comparison between Japan and Korea

Partnercountries

RegionJapan

Korea*

AfricaEthiopia, Kenya, Senegal,
Maldives-

Asia and PacificIslands

Mongolia, Bangladesh, Viet
Mongolia, Bangladesh, Viet Nam,
Nam, Lao PDR, Indonesia,
Lao PDR, Indonesia, Cambodia,
Myanmar, Thailand,
Myanmar, Thailand, Philippines,
Philippines, India, Sri Lanka,
Palau
Uzbekistan

Central Europe and Saudi Arabia, Tunisia, Azerbaijan,
Saudi Arabia, UAE, Morocco
Moldova, Georgia
Middle East
Latin America
Total

Chile, Costa Rica, Mexico

Chile, Colombia, Peru, Brazil

22 countries

18 country*Only Vietnam signed with Korea for bilateral crediting mechanism so far.
Source: compiled by author from the JCM homepage and Korea

As summary of this section, we adopted a matrix of international collaboration based on typesof mechanism (multi-lateral vs bi-lateral or multi bi tri) and types of cooperation (policy vsproject) as presented in Table V-2. According the matrix, we then reviewed the potential ofpreviously established mechanisms or newly emerging mechanisms where North-East Asian
countries can make space to get involved or already got engaged. The CTCN, P4G,
UNESCAP’s NEACAP from TEMM, and JCM are briefly discussed in the perspective ofenhancing international collaboration. The corollary of the discussion is that confronting theurgency of carbon neutrality on all three countries, it is time to actively engage in a diverse setof mechanisms and in particular, three countries should learn from each other as they sharemany commonalities in response to their pledge to carbon neutrality.

3. Conclusion
Since the pledges to carbon neutrality by mid-century, key policy measures and R&D
strategies have been promoted in China, Japan, and Korea as presented in Chapter II, III and
IV. Due to the COVID-19, however, economic activities and people’s movements
significantly decreased. As a result, the national GHG emissions have decreased in majority of
economies. This somewhat helped China, Japan, and Korea with the burden of urgent actions
towards their pledge of NDC by 2030 during the pandemic.

118

Although the economic recovery has begun from the global pandemic, we are still confronting
uncertainties at both global and national levels. For example, the US-China conflicts in the
global power competition that began since the Trump’s administration do not seem to bereconciled in near future and political and economic blocks among like-minded countries are
rapidly emerging. At the national level, the consistency of the policy on carbon neutrality canbe an issue in Korea for instance. Korea has a presidential election every five years anddepending on which side takes power, details in a decarbonization path can change
significantly. For example, how Korea should use nuclear energy in its energy mix for carbon
neutrality has always been a public controversy.
Nevertheless, the global actions and coalitions towards carbon neutrality will continue withthe full support of the global community. Even the research collaboration in carbon neutrality
between the US and China survived in the midst of the US-China conflicts. Sharing thecommonalities in terms of the urgency to obtain carbon neutrality, all three countries mustreconsider their strategies for international and regional collaboration on carbon neutrality.
In this regard, China, Japan, and Korea should make their best to come up with collective
measures among three countries, considering not only regional urgency on climate response
but also the importance of three countries in the global climate change landscape. While
chapter V of this working paper discussed the opportunities to promote and expand trilateralcollaboration based on established or emerging international mechanisms on climate change,
it may be easier to take advantage of already established but less actively utilized programs,
one of which is Joint Research Collaboration Program among young scientists from three
countries. During the Trilateral Ministerial Meeting on Environment or Science andTechnology, the young scientists’ trilateral policy dialogue on carbon neutrality is proposed asa main pillar of the Joint Research Collaboration Program where early career scientists share
best practices and their creative policy ideas to accelerate the speed of efforts to achievecarbon neutrality. As mentioned earlier, three countries face similar economic, technological,
and social context in terms of carbon-intensive economic structure and therefore, can learn a
lot from each other. With overcoming the global pandemic but confronting new challenges, it
is high time for the North-East Asia to take collective actions.

119