Japan

The key policy updates that are expected to drive the transition to electric mobility in Japan are summarised in Table 2.8.

Vehicle policies

In March 2019, the Ministry of Economy, Trade and Industry (METI) and the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) introduced new fuel economy standards for heavy vehicles running on diesel, including trucks and buses (Government of Japan, 2019a).18 According to the regulation, new trucks and other heavy vehicles should have a fuel economy of 7.63 kilometres per litre (km/L) by 2025 (implying an efficiency improvement of 13.4% relative to the 2015 standards), and a level of 6.52 km/L for buses by 2025 (implying an efficiency improvement of 13.4% relative to the 2015 standards). The regulation has relevance for electric mobility due to its capacity to improve efficiency, but it does not have specific provisions for EVs.

Japan also updated its fuel economy standard for LDVs to align it with the 2030 next generation vehicle target. The update sets a limit of 25.4 km/L (3.9 L/100 km), calculated with the Worldwide harmonized Light-duty Test Cycle (WLTC) (Government of Japan, 2019b), tightening the 2020 limit of 19.4 km/L (5.2 L/100 km)19 and opening up the scope for increased vehicle electrification.20

Japan also uses tax incentives for the purchase of hybrid electric vehicles (depending on the degree of fuel economy improvements), PHEVs, BEVs and FCEVs. It exempts PHEVs, BEVs and FCEVs from purchase and weight taxes as part of the clean energy vehicle subsidies scheme.21

Charging infrastructure policies

Japan’s direct support for charging infrastructure has been decreasing in recent years. It allocated JPY 100.5 billion (Japanese yen, USD 1 billion) to charging infrastructure in the firsthalf of the last decade (Marchetti, 2013). The budget allocation fell to JPY 6.9 billion (USD 63 million) between 2016 and 2019.22 This is partly due to the fact that roughly a third of the 2013-15 budget was expended. In addition to the incentives, Japan’s New Era of Automobiles Strategy includes plans to harmonise future charging standards, which is fostering collaboration with China (Government of Japan, 2018). The New Era of Automobiles Strategy provides support to various R&D projects for the 2018-23 period that are assessing the feasibility of wireless charging and vehicle-to-grid applications.

Industrial policy

In April 2018, METI launched a strategic commission for a “new era of automobiles”, which is developing a long-term goal and strategy for the Japanese automotive industry to tackle climate change. An interim report of the strategic commission outlines a 2050 goal to reduce 80% of GHG emissions per vehicle produced by Japanese automakers (Government of Japan, 2018). For passenger vehicles, the ambition outlined in the interim report is more ambitious at 90% reduction of GHG emissions per vehicle to be achieved with a 100% market share of EVs (HEVs, PHEVs, BEVs or FCEVs). Importantly, METI’s strategic commission specifies that its goal is to realise well-to-wheel zero emissions, thus linking the strategy to its efforts to fully decarbonise the energy supply (electricity and hydrogen) (Government of Japan, 2018). The strategy also states the ambition to stimulate innovation in terms of “how vehicles are used”, for example looking into concepts such as mobility as a service (MaaS), and connected and autonomous driving.

Regarding batteries, the strategy makes explicit references to a co-operative approach across industrial stakeholders, to the formulation of policies on joint procurement and stock of resources (such as cobalt). Moreover, it includes elements related to research and innovation in “next generation electrification technology”, citing ambitious targets for automotive batteries, including a cost reduction target of JPY 10 000 per kilowatt-hour (kWh) (USD 90/kWh) for solid state batteries and an energy density objective of 500 watt-hour per kilogramme (W-h/kg). Fuel cell stacks are also covered, with a target of 75% price reduction for the stack by 2025. Altogether, this strategy provides a clear implicit signal of the ambition to phase out the production of ICE vehicles by Japanese automakers, and the vision of METI to fully transition passenger vehicles to a zero-emissions fleet.