May 27th, 2015

Hiroki Mitsumata

Deputy Director-General for Environmental Affairs

Ministry of Economy, Trade and Industry

Japan's policy to promote innovation

in low-carbon technologies

Role of Innovation for low-carbon world

1

The new international framework on climate change to be

agreed upon in COP21 must be fair, effective and

applicable to all Parties.

Major part of GHG emissions are attributed to CO2 from

energy use. (In Japan, it occupies more than 90% of GHG

emissions.)

The key word of energy policy : ”3E+S”

• Safety

• Energy Security

• Economic Efficiency

• Environment

→ Innovation is the key solution.

Japan has improved energy efficiency by approx. 40% after the oil crises

in the 1970s primarily as a result of positive actions by industrial sector.

Japanese companies intensively introduced energy management system

based on the Energy Conservation Law, then Japan achieved the lowest

level of energy consumption per GDP in the world.

Japan’s Energy Conservation Efforts after the Oil Crises

Source）Total Energy Statistics by ANRE/METI

Primary energy use per real GDP of Japan

（Oil converted Mt /1 trillion yen）

Approx. 40% improvement

Calculated according to IEA statistics

Primary energy supply per GDP unit of each

country（2011） （Index : Japan=1.0）

2

Industry’s CO2 emissions reduction targets

3

○ Based upon “KEIDANREN's Commitment to a Low Carbon Society,” industrial organizations have set up action plans including emission reduction targets for 2030 and promoted efforts for their achievement.

○ The action plan-based approach have made a substantial contribution to achievement of Kyoto Protocol. ○ The action plans are subject to PDCA cycle through annual evaluations and verifications by the government’s

relevant advisory councils. ○ 83 industries have already set targets, covering approx. 75% of CO2 emissions from the industrial and energy

conversion sectors, and approx. 44% of such emissions from all sectors.

Target indicator Target level

(2008-2012 average) (against 1990 levels)

Average annual performance for 2008-

2012 (against 1990 levels)

Federation of Electric Power Companies of Japan

CO2 emission intensity approx. -20% -2.6%

The Japan Iron and Steel Federation Energy consumption -10% -10.7%

Japan Chemical Industry Association Energy intensity -13% -15%

Petroleum Association of Japan Energy intensity -13% -15%

Japan Paper Association Energy intensity -20% -24.8%

CO2 emission intensity -16% -21.7%

Japan Cement Association Energy intensity -3.8% -4.4%

4 Electrical and Electronics Associations CO2 emission intensity -35% -48%

Japan Automobile Manufacturers Association/

Japan Auto-Body Industries Association CO2 emissions -25% -40%

Examples of industry’s action plans for the Kyoto Protocol first commitment period (The following 8 industries account for approximately 90% of the industrial and energy conversion sectors)

Top Runner Program

4

“Top Runner Program” comprises energy conservation

standards for equipments considering for future prospects

of the peformances and technological developments.

31 sorts of equipments are subject to these standards.

Those equipments include automobiles, home appliences,

office equipments, etc.

Stipulating performance of currently commercialized

products with most superior energy consumption

efficiencies (Top Runner products)

Examples of Innovative Technologies

Example-1: CO2 emission from steel

manufacturing

ISO 14404 is the standard for calculating

the amount of energy consumption and

CO2 emissions from the steel

manufacturing processes (Proposed by

Japan)

Any world steel manufacturers can use

this standard. This standard would

contribute to the reduction of CO2

emissions.

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Example-2: Innovative structural materials

Drastically improve the fuel efficiency of

transportation equipment through light-

weighting of structural materials. For

instance, use of carbon fiber composite

materials in vehicles reduces the weight of

the vehicles by 60%.

Comprehensive fuel conservation including

light weighting has a large potential to

reduce the global GHG emissions of

transportation equipment by about 4.7 billion

tons in 2050. (estimation by IEA).

Carbon Fiber Filament

and its application

CO2 emissions from fuel combustions in 2030 (forecast)

In 2035, global CO2 emissions from fuel combustions will increase by 120% compared to 2011.

While emissions from OECD countries will decrease, those from non-OECD countries will be more than

70% of the total emissions.

6 【Source】IEA World Energy Outlook 2013

49 53 45

11 12 9

40 37 29

12 20

19

22 16

18

23

80 102

6

17 39

6

16

24

5

10

14

6

11

16

25

28

43

0

50

100

150

200

250

300

350

400

1990年 2011年 2035年

その他（非OECD）

中南米（非OECD）

アフリカ

中東

インド

中国

ロシア

OECD(日米欧除く）

欧州（OECD）

日本

米国

20 billion tons

100 million tons

30 billion tons

36 billion tons

Japan 1.1 times

Japan 0.8 times

China 3.5 times

China 1.3 times

India 3.0 times

India 1.9 times

World 1.5 times

World 1.2 times

Non-OECD

World CO2 Emissions Outlook (by region)

Other (non-

OECD)

Latin America

(non-OECD)

Africa

Middle East

India

China

Russia

OECD (except for Japan,

US and Europe)

Europe (OECD)

Japan

US

(5.4%) (4.0%) (2.5%)

(3.0%)

(11.3%)

(5.7%)

(26.7%)

(10.9%)

(28.6%)

OECD : non-OECD

= 55.2% : 44.8% 40.7% : 59.3%

28.6% : 71.4%

China 22.2%

US 13.8%

EU-28 10,2% India

5.8%

Russia 5.1%

Indonesia 3.9%

Brazil 3.3%

Japan 2.8%

Congo 2.3%

Canada 1.5%

Iran 1.4%

Corea 1.3%

Other Annex I Parties

3.6%

Other Non-Annex I Parties 22.8%

【Source】CO2 EMISSIONS FROM FUEL COMBUSTION, IEA

World CO2 Emissions Share

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Japan’s Potential Contribution by diffusing Technologies

Potential reduction of CO2 by applying BAT（Best Available Technology）

Po

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ou

nt o

f

red

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illio

n t C

O2

)

Po

ten

tia

l a

mo

un

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f re

du

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n(t

CO

2 /

cru

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World China UA India Brazil Russia SA CA OECD US Korea Other

By applying the best practice of iron and steel plants in Japan to that of the world’s plants, it is estimated to be reduced 300 million tons of CO2 which is equivalent to Japan’s 20% emission.

By applying the best practice of coal-fired power plants in Japan to that of the US, China and India, it is estimated to be reduced 1.46billon tons of CO2 which

is equivalent to Japan’s total emission.

Iron and Steel Coal-fired Power Generation

Japan

Source: IEA Energy Technology Perspective 2008

Ukraine

By globally diffusing best available low carbon technologies in various sectors, significant GHG reduction

would be realized in the world.

Japan US China India

＋▲380 (Mt)

＋▲765 (Mt)

＋▲311 (Mt)

approx. 1.46 (Gt)

Source: " IEA World Energy Outlook 2012 “

" Ecofys International Comparison of Fossil Power Efficiency and CO2 Intensity 2013 "

Actual CO2 Emissions from Coal Thermal Power Generation (2010) and Case of Adopting currently Most Advanced Technology

South

Africa

Canada

JAPAN

Host Country

Low carbon technologies

MRV

JCM Projects

GHG emission

reductions

Joint Committee

Used to achieve Japan’s emission reduction target

Credits

■ Bilateral mechanism for effective transfer of low carbon technologies

e.g. ・ Waste heat recovery in energy-intensive

industry

・ Energy-saving electricity transmission

Joint Crediting Mechanism (JCM)

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Ethiopia

Kenya

Viet Nam

Indonesia

Lao PDR

Palau

Maldives

Bangladesh

(As of May, 2015)

Costa Rica

Mexico

Cambodia

＜ JCM Host Countries : 13 ＞

Mongolia

Saudi Arabia

It is important to ensure that the proper linkage between the financial mechanism such as GCF and the technology mechanism will be established so that the finance will be utilized for developing countries’ climate change measures in efficient and effective manner.

9

Linkage between Financial Mechanism and Technology Mechanism

Green Climate Fund (GCF)

NDA, IE, EE NDE

Climate Technology Centre and Network

(CTCN)

Developing Countries

COP (Conference of Parties)

Financial Mechanism

Technology Mechanism

Financial

Support Financial

Needs

Technological

Needs

Project Proposal Request for

Technological

Support

Technological

Support

Guidance Guidance

Proper

linkage is

needed.

Innovation for Cool Earth Forum(ICEF)

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• Annual conference established by the initiative of Prime Minister Shinzo Abe (2014～)

• Providing a global platform for cooperation among business leaders, academia and

policymakers in order to address climate change through innovations

• Administered by the international Steering Committee

• Hosted by Ministry of Economy, Trade and Indusary (METI) and New Energy and industrial

Technology Development Organization (NEDO)

Yoichi Kaya

(Chair) President, Research Institute of Innovative Technology for the Earth, Japan

Sally M.

Benson Professor, Department of Energy Resources Engineering, School of Earth Sciences, Stanford University, United States

Zhou Dadi The Director General (Emeritus) of the Energy Research Institute (ERI) of the National Development and Reform Commission, China

Ogunlade R.

Davidson Dean of Post-Graduate Studies at University of Sierra Leone Former Minister of Energy and Water Resources, Sierra Leone

Georg

Erdmann Professor, Berlin University of Technology, Germany

José María

Figueres President of Carbon War Room (NGO) Co-Chair, Global Ocean Commission, Costa Rica

Adam Heller Research Professor, McKetta Department of Chemical Engineering, The University of Texas, Austin TX, United States

Yoriko

Kawaguchi Professor of Meiji Institute for Global Affairs, Meiji University Former Minister for Foreign Affairs and Minister of the Environment, Japan

Hoesung Lee Professor at Korea University Graduate School of Energy and Environment

Nebojsa Nakicenovic Deputy Director General and Deputy CEO, International Institute for Applied Systems Analysis

Gwythian

Prins Emeritus Research Professor, London School of Economics Convenor of the Hartwell Group, United Kingdom

David

Sandalow Inaugural Fellow, Center on Global Energy Policy, Columbia University, United States

Ismail

Serageldin Director, Library of Alexandria, Egypt

Susan Solomon Professor, Massachusetts Institute of Technology (MIT) Former IPCC WGI Co-Chair, United States

Laurence Tubiana Special Representative for COP21 and French Ambassador for Climate Negotiation.

Itaru Yasui Emeritus President, National Institute of Technology and Evaluation(NITE)

ICEF Steering Committee Members

◆ICEF2014(The First Annual Conference)◆

Date, Venue：October 8th, Tokyo

Participants： About 800 business leaders, academia and policymakers from as many as 80 countries and

regions participated.

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◆Plan for ICEF2015(The Second Annual Conference)◆ Date, Venue：October 7-8th, Tokyo

Program

Opening Session

Plenary Sessions

– Principal Issues in the Future

GHG reduction

– Future Strategy for Climate

Change

Concurrent Session

Closing Session

Innovation for Cool Earth Forum(ICEF)

11

4 Cross-sectional sessions • Energy Systems • International

framework for complementing UN

• Role of public funding for Research, Development and Demonstration

• Technology transfer to developing countries and investment promotion

Concurrent sessions Sessions for 14 Technological Fields • Solar (PV and CSP) • Electricity storage • Smart grids • CCS • Advanced liquid biofuels • Low-carbon mobility • Energy efficiency in

buildings • Materials1: Iron and

Steel • Materials2: Cement • Artificial Photosynthesis • Geothermal Power • Hydrogen • Nuclear Energy • Wind Power