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METI to establish decarbonization fund to support corporate projects

  • February 23, 2021
  • , Nikkei , p. 5
  • JMH Translation

On Feb. 22, the Ministry of Economy, Trade and Industry (METI) released the operation policy for a 2-trillion-yen fund to support corporate research and development for a decarbonized society. The fund will increase its contribution according to the achievement level of project objectives, and request a reversion of funds if the level is insufficient. The fund will accelerate in a controlled manner development toward the government’s goal to reduce greenhouse gas emissions to zero by 2050.

 

The draft policy was released at a METI expert meeting on Feb. 22. The funding will target the fourteen priority fields in the government’s “Green Growth Strategy” released at the end of 2020. The priority fields include hydrogen, offshore wind power, batteries, and solar power. Benchmarks, such as the cost and effect of carbon reduction and project costs, are set for each field. To meet their goals, companies are required to have active management engagement and an organizational framework for development. Companies may be funded for a maximum of ten years.

 

If companies fail to meet their goals, the government may revoke part of their funding. The decision to revoke funding would be made on a case-by-case basis. It is anticipated that such cases would be projects in which the management does not show eagerness for their continuance or projects with rapid cutbacks to their development posture. The fund will target projects worth over 20 billion yen, which is more than the average budget of conventional research projects.

 

The fund’s contribution may be increased according to the degree of achievement of development goals. Companies will be required to submit the finished product or a distribution date for the technology and names of organizations that installed the technology. The fund will be established within the New Energy and Industrial Technology Development Organization (NEDO), which will be the secretariat for the fund. METI will make a decision on the management policy by the end of March 2021, and will start to invite applications from April 2021 onward.

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