A goal we must achieve

Moving towards an emissions-free Japan


APRIL 2021 Industry Perspectives / Text by Toby Waters

Addressing the climate crisis is the greatest challenge of the 21st century, and Japan and the EU have both set themselves the ambitious goal of becoming carbon neutral by 2050. Achieving this goal will require a significant amount of investment, research, and cooperation between the EU, Japan, and other international partners. It will also require that businesses get even more serious about becoming sustainable.

Taking the first step

It can be hard to know where to start when making your business more environmentally friendly. Fortunately, companies such as SGS Japan can help you make all the necessary changes.

“We provide a wide range of services in the sustainability sector in Japan,” says certification and business enhancement director, Yuji Takeuchi. “These include greenhouse gas emissions verification and related advice; certification in Forest Stewardship Council chain of custody and forest management; social audits covering labour and human rights; management system certifications in environment, occupational health, and safety/business continuity; photovoltaic plant inspections; and solar panel testing.”

You can also take steps to reduce your carbon emissions at home — indeed, you can even reduce it with your home.

“An essential requirement for making Honka log houses energy efficient is the tightness of the wooden walls and frame,” says Kuniaki Hirai, general manager of Honka Japan. “When the building exterior is made airtight, there are no uncontrollable air leaks and there is no heat loss. Not only does this conserve energy, but it improves comfort by getting rid of drafts.”

From day one, renewables projects, specifically, face a number of practical challenges, as well as legal ones. Firms such as Orrick, Herrington & Sutcliffe LLP have the experience and expertise to help guide businesses in the renewables sector through both.

“We provide a true one-stop-shop service for all phases of a renewable project, from development, financing, and M&A to disputes and coordination with government agencies,” says Minako Wakabayashi, a partner at the firm. “By seamlessly working with our global energy and infrastructure teams, we provide creative and comprehensive solutions, including in new areas such as offshore wind, corporate power purchase agreements, and storage.”

Changing times

The announcement of the government’s ambitious carbon-neutral goal was notable, given Japan’s historically hesitant approach to energy transition. However, as Tsuyoshi Sakakida, general manager of business development at Total International S.A. Japan explains, there has been a significant shift over the past decade.

“The renewables market in Japan, especially solar photovoltaic power, has been buoyant since the Feed-in-Tariff [FIT] scheme launched in 2012,” he says. “Of the various renewable energy FIT schemes, Total has focused on solar power, successfully developing several utility-scale solar FIT projects, and continues to develop more.”

Orrick, Herrington & Sutcliffe LLP has been actively involved in advising the government on these issues, making it uniquely suited to helping clients in this space.

“Working with the Japanese government — both directly, by preparing model contracts for the Ministry of Economy, Trade and Industry’s FIT scheme, and by representing clients’ lobbying activities — we have helped shape the laws that promote renewables in Japan,” Wakabayashi explains. “We tap into Orrick’s global experience and adapt what we learn to help our clients overcome any perceived or potential problems.”

Windpal is a consortium of European experts who are actively helping businesses in Japan to achieve their own goals in renewable energy production.

“Right now, there is a real willingness in Japan to learn as quickly as possible about the construction of offshore wind parks so the country can meet its renewable energy goals, and we can provide the required education with consortium partners who have over 20 years of experience in the development of offshore wind parks in Europe,” says Andrey Kononchuk, managing director. “With a proven track record and strong management skills, we are helping to close the gaps in Japan’s knowledge by de-risking development of new projects.”

SGS is committed to seeing a high level of quality in the renewables sector in Japan.

“We support the quality control management of photovoltaic plant and wind farm construction, from conception to commission,” Takeuchi says. “We also provide the necessary expertise for the development of offshore wind farms.”

Hirai makes the case that Honka homes are not just examples of fine craftsmanship, but can also save their owners money without sacrificing comfort.

“The heating and cooling costs of our log-built houses are very reasonable compared to those of conventionally made buildings,” he says. “The thick wood retains warmth in the winter, yet keeps the house pleasantly cool in the summer. This shows that log houses are energy efficient buildings.”

Moving forwards

The road to an emissions-free 2050 is long, and the energy sector will need to change dramatically. Kononchuk predicts that the renewables market will go from strength to strength during this time.

“We expect to see the exponential growth in the renewable energy market continue over the next 20 to 30 years. Thanks to new, more efficient technology developments, we predict that off-grid floating wind parks with the ability to produce hydrogen will be invigorated,” he says. “This will be the next natural step for Japan to move towards a carbon neutral society.”

Total International is ready to leverage its experience to get the best results amid the changes taking place in the market.

“With the end of the FIT scheme, companies like ours are increasingly focusing on auctions and corporate power purchase agreements,” Sakakida says. “Total benefits from its proven worldwide expertise in these business models and long-term relationships with partners and stakeholders. Japan will continue to be a key market for Total.”

It’s not only businesses that are striving to reduce their environmental impact, it’s also European regions. NRW.Global Business’s Japan subsidiary highlights how North Rhine-Westphalia (NRW) in Germany has been taking steps to achieve this goal.

“NRW plans to end its use of coal-fired energy by 2038, and will replace it with a hydrogen energy economy. Germany’s leading industrial state also aims to achieve climate-neutral energy production by 2050,” says Georg K. Löer, the Japan branch’s representative director and president.

“NRW reached its climate targets for 2020 ahead of schedule, thanks to carbon-neutral energy production, renewables, and hydrogen energy. A study forecasts that between 4.9GW and 14GW of wind power can be produced in NRW annually,” he continues. “This will go a long way towards achieving our 2030 target of producing 10.5GW per year using wind energy, twice today’s amount. NRW.Global Business Japan supports NRW-based firms such as RWE Renewables, Next Kraftwerke, and others in their push for increased renewable output and sustainability.”

There’s no time to waste to prepare for a cleaner, more sustainable tomorrow.