9th IEEJ/APERC International Energy Symposium

NEDO’s Activities toward building
Sustainable Society
Apr. 19 th, 2023
Tsutomu Nakamura
Director General
Environment and Green Chemistry Unit
Technology Strategy Center (TSC)
New Energy and Industrial Technology
Development Organization （NEDO)IEEJ: April 2024 ©IEEJ2024©NEDO2023

What is NEDO?
TSC Environment & Green Chemistry Unit

 New Energy and Industrial Technology Development Organization (NEDO)
Organization
MissionEstablished
BudgetEmployees

National Research and Development Agency
1. Addressing energy and global environmental problems
2. Enhancing industrial technology
1980
1.01 billion US dollars (FY2023)+ additional “funds”
1,464 (as of Apr. 1, 2023)

Main Roles of the TSC
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Comprehensive R&D Principle for Sustainable Society
TSC Environment & Green Chemistry Unit

 NEDO published the 2nd edition of “Comprehensive R&D Principle for
Sustainable Society” in 2023.
“Objective of Comprehensive R&D Principle 2023”
 The purpose of Comprehensive R&D Principle 2023 is to identify andoverlook of key technologies for achieving carbon neutrality basedon the latest social and technological trends, and to advocate for thecomprehensive and objective evaluation of the CO2 reduction ofthese technologies.
 Additionally, NEDO expects to provide specific calculations for several
key technologies to assist evaluating the technologies you should focus
on for development and demonstration.

https://www.nedo.go.jp/content/100964787.pdf

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Social systems considered from the Carbon Cycle
TSC Environment & Green Chemistry Unit

 CO2 emissions in the "demand" category shown in blue are reduced throughenergy conservation and substitution with renewable energy, hydrogen, andbiomass, as well as through recycling and sharing to reduce the demand forenergy and materials themselves.
 Emitted CO2 is separated and recovered, stored in CCS, and partially used in CCU.
 Atmospheric CO2 is fixed in biomass through afforestation, etc., and separated
and recovered using DAC.
Direct Air Capture（DAC）

Released intoatmosphereCO2

3 Essential Social Systems
for Sustainable society

Carbon fixation

Carbonfixation

CCS・EOR

Bioeconomy

Storage
Source：NEDO Technology Strategy Center(2019)

Energyconservation

Sustainable energy

CCU

DemandRenewable energy
and hydrogen

Circulareconomy

Fossil resources

Biomass

CO2IEEJ: April 2024 ©IEEJ20244

Key Initiatives to Achieve Carbon Neutrality
TSC Environment & Green Chemistry Unit Limiting warming to 1.5℃, rapid and significant GHG emission reductions
have illustrated in the scenarios(IMPs) by IPCC AR6 WG3.
 Efforts to decarbonize energy supplied, reduce final energy
consumption, and introduce negative emission technologies (NETs)
are the key initiatives in each 4 scenario.
 In addition, GHG reduction from non-energy sources, such as utilizing
CO2 and biomass as raw materials, are also important.
The trend of world primary energy supply in each of the illustrative pathways

Reference pathways

1000

1000

800

800

EJ/yr

600

1000
800

150EJ

CurPol

600

400

400

200

200

350EJ

300EJ

Shifting global pathways
Efficient resource
towards sustainable
use and shifts indevelopment
consumption patterns■Renewables(IMP-SP)(IMP-LD)
1000

1000

800

800

600

600

400

400

400

200200■Biomass■Nuclear■Fossil

Reduction of350EJ final energy

600

500EJ

consumption

300EJ

400EJ

2020

2040

2060

2080

2100

Gt-CO20

Greater emphasis
on renewables(IMP-Ren)

Deployment of carbon
dioxide removal(IMP-Neg)

Current Policies(CurPol)

EJ/yr

Illustrative mitigation pathways（IMPs）

0200

2020

2040

2060

2080

02020

2040

2060

2080

2100

02020

2040

2060

2080

2100

02020

2040

2060

Decarbonizationof Energy

CO2 reduction by NETs in 2050

60

2100

250EJ

IMP-NegN

IMP-RenR

IMP-LD
LD

Source：Prepared by Technology Strategy Center, NEDO, 2023, based on IPCC AR6 Figure 3.7, 12.3

2080

2100

Introductionof NETsIMP-SPSPIEEJ: April 2024 ©IEEJ2024

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Overview of Key Technologies
TSC Environment & Green Chemistry Unit The figure below shows key technologies that contribute to the "Key Initiatives" forcarbon neutrality.
 It is important to promote "Key Initiatives" through collaboration and synergy
among the three social systems.

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Fund Project for Carbon Neutrality
Green Innovation Fund Projects

TSC Environment & Green Chemistry Unit(converted at the exchange of 1 USD = 150 yen) To achieve carbon neutrality by 2050, Government of Japan established a fund of
about 18B USD (2.7T JPY) as part of NEDO. The fund will be executed over a tenyear period.
 METI/NEDO seeks the commitment of the company managers to persevere inchallenging these goals.
 Currently 20 projects are underway

Project cases (For more information, please check https://green-innovation.nedo.go.jp/en/ )Cost Reduction for Offshore windPower Generation

Development of Technology for
CO2 Separation, Capture, etc.

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Hydrogen Production through Water
Electrolysis Using Power from Renewables

Large-scale Hydrogen Supply Chain
Establishment

Development of Technology for
Producing Fuel Using CO2, etc.

Hydrogen Utilization in Iron andSteelmaking Processes
7Negative Emission Technologies(Cost, Potential, TRL)TSC Environment & Green Chemistry Unit

 Most of the NETs are expected to achieve abatement cost of less than $200/tCO2in 2050, although some technologies, such as ocean-related, enhanced-weathering,DACCS, and biochar, are in development.
 DACCS and BECCS have definite CO2 removal effect, but costs need to be reduced.
 NETs, which accelerates natural phenomena, has excellent features for low-cost CO2
removal, but they are need to evaluate scientifically the CO2 removal effect andenvironmental impacts, co-benefits.
 NEDO is developing technologies for DAC, blue carbon, biochar and enhanced
weathering in the moonshot project and GI-fund project.
Ocean
Alkalinization
11.0* The area of the circle and the value inside the circle indicate the reduction
potential in 2050 in GtCO2/year. In addition, the values of TRL, abatement cost,and abatement potential are the average values of the obtained information.

Blue carbon
management
in coastal
Enhancedecosystems
weathering
0.5
2.0
Ocean
fertilization
4.4

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Carbon price assumption at 2050(IEA/NZE)

DACCS2.9

Biochar
2.0

BECCS
5.0

Soil carbon
Sequestration
2.7

Afforestation,
Reforestation
4.18

Marginal abatement cost
TSC Environment & Green Chemistry Unit The marginal abatement cost ※ under the 1.5℃ scenario in IPCC AR6 (2022)
can reach $200～700/tCO2 in 2050. It tends to decrease compared with thevalue in the IPCC special report, Global Warming of 1.5℃.
 The costs of technologies for carbon neutrality such as PV, wind power andbattery storage have been continuously reduced. However, disruptive
innovation is necessary in various technological fields in order to reduce themarginal abatement cost further to the value that the world can accept.

Marginal abatement cost, $/t-CO2※the cost incurred to reduce an additional 1 ton of CO2 emissions
Marginal abatement cost in 2050
Cost and installation of Key Technologies

SR1.5

AR6Source：Prepared by Technology Strategy Center, NEDO,2023, based on IAMC 1.5°C Scenario Explorer hosted by IIASA、
AR6 Scenario Explorer and Database hosted by IIASA

Source：IPCC AR6 Figure SPM.3

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9Reduction of abatement cost by acceleration oftechnology development

TSC Environment & Green Chemistry Unit

 Progress in the R&D of an innovative technology (e.g. PV, wind, battery,etc.) lowers the CO2 abatement cost (red).
 Assuming that the rapid social implementation starts at the intersection of
CO2 abatement cost and marginal CO2 abatement cost, the social
implementation cuts down the marginal CO2 abatement cost significantly,
leading to dramatic reduction of countermeasures.

CO2 abatement cost

CO2 marginal abatement cost,

CO2 marginal
abatement costbased on the costof current technologies

implementation
lower the CO2marginal abatement
cost①Cut down CO2abatement cost by
acceleration ofinnovative technology

2020
IEEJ: April 2024 ©IEEJ2024② Social2050
10Importance of early start of innovative technology
development

TSC Environment & Green Chemistry Unit It is important to start technology development as early as possible and toaccelerate innovation since it takes about 20 years until the beginning ofthe product sales in the filed of energy and environment according to theNEDO’s analysis on the previous projects.
Average period forNEDO investment

Energy and environment

17 years

Industrial technologies

20 years(6～34 years)(6～34 years)

6 years

7 years(1～15 years)

NEDO investment (billion yen)

Average period fromdevelopment to sale

(3～14 years)

11 products, including solar power generation, wind power
generation, and residential heat pump water heaters, whichstarted development between 1980 and 1987
29 products, including continuously variable transmission
for automobile、power semiconductors, which started
development between 1998 and 2002

Technologies for energy and environment(development projects started in 1980-1987,
11 products)(Year)

Sales / sales forecast (billion yen)Technology field

Source：”Investigation on the outcome of mid- and long- term projects for research and development: Analysis based on the data in follow-up research by NEDO” (NEDO)IEEJ: April 2024 ©IEEJ2024

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SummaryTSC Environment & Green Chemistry Unit

 According to IPCC AR6, the CO2 abatement cost in 1.5℃ scenario canreach approximately $200～700/tCO2 in 2050. Disruptive innovation isessential to reduce the cost to levels acceptable to the world.
 To achieve carbon neutrality, innovation is necessary in key technologies
such as decarbonization of energy supplied (renewable energy, hydrogen,etc.), reduction of final energy consumption (energy-efficient technologies,recycling technologies), and introduction of negative emission technologies.
Additionally, non-energy-related GHG reduction sources such as rawmaterial conversion are also crucial.
 Since technologies in the energy and environmental sectors often take along time to be implemented in society, it's crucial to initiate them early,
accelerate their development, and promote their social implementation.
 The issue of global warming cannot be solved by Japan alone; it is a criticalchallenge that requires international collaboration and rule-making toaddress collectively on a global scale.

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Thank you for your attention!

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Contact: report@tky.ieej.or.jp

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