New research report on pathways and strategies to achieve net zero greenhouse gas emissions for the Japanese chemical industry released
This research report integrates both academic and industrial perspectives, and considers sustainability challenges beyond climate change, such as plastic pollution. The findings may also be applicable to other countries with limited renewable resources.
Key points
- Achieving net zero greenhouse gas emissions in the chemical industry is considered challenging, categorizing it as one of the hard-to-abate industries. This research report outlines pathways and strategies for the Japanese chemical industry to achieve this goal by 2050, while taking into account Japan’s strengths and weaknesses.
- These pathways and strategies are based on a peer-reviewed academic paper, and are considered applicable to chemical industries in other countries and regions under similar constraints, such as limited access to renewable resources.
- The Japanese chemical industry should maximize plastic recycling and secure access to bio-based raw materials and carbon capture and storage (CCS) sites. This is because access to these resources will determine the supply limit for chemical products under net zero.
- Although the cost of producing net-zero chemicals will rise significantly due to additional capital expenditures and the use of new raw materials, the impact on the manufacturing cost of consumer products is expected to be minimal.
Introduction
The chemical industry is integral to our modern life, providing essential materials for healthcare, food packaging, and other industries. However, it is the second-largest source of greenhouse gas emissions in Japan after the steel sector. Although Japan has implemented laws and policies aimed at achieving net zero emissions, this goal is particularly challenging for the chemical industry, primarily due to the carbon content in many of its raw materials and products. In addition to climate change, the industry faces other sustainability challenges in the Planetary Boundaries*1, such as plastic pollution and biodiversity loss, and must address these issues without shifting the burden from one challenge to another.
In 2022, the Center for Global Commons and Systemiq proposed pathways to achieve net zero for the global chemical industry. Today, we are launching a new report that outlines specific pathways to net zero for the Japanese chemical industry, addressing scope 1, 2, and 3 emissions*2. This report integrates insights from recent academic studies*3 and Japan-specific industry information, aiming to act as a bridge between the present state of Japan’s chemical industry and a desirable future.
Details
- Future demand for chemical products: Japan’s population is expected to decrease by around 20% by 2050, which could reduce the demand for chemical products. Furthermore, circular economy initiatives in downstream supply chains could further reduce the demand. Although our pathways are not forecasts, Japan’s chemical industry will need to explore new business opportunities in light of these trends.
- Transformation of production processes: By 2050, the chemical industry’s production processes and raw materials will undergo significant changes, leading to a substantial cost increase for producing net zero chemicals. However, the impact on the production cost of consumer products is expected to be minimal due to the specific characteristics of chemical supply chains.
- Secure access to key resources and future demand in preparation for transformation: The Japanese chemical industry must maximize recycling, while securing access to bio-based raw materials and CCS, as they will determine the total supply capacity of chemical products for individual chemical companies or Japan as a whole under net zero. Furthermore, the industry must establish coalitions with customers in downstream supply chains to secure future demand, as it exercises leadership in investing in commercial-scale production plants.
- Learning from past lessons: The Japanese chemical industry should draw on lessons from other sectors’ experiences with investments in large-scale manufacturing facilities and the expansion of “green” markets. Based on these lessons, an industry reorganization within the upstream basic chemicals divisions would help accelerate the net zero transition.
- Future role of the chemical industry: The future role of the chemical industry will shift towards reducing greenhouse gas emissions, helping society adapt to climate change, and preventing plastic pollution, rather than focusing on improving product performance. As many customer industries move from hardware-based solutions to software-based value propositions, this shift will become even more critical for the chemical industry.
Project page
The role of the chemical industry in safeguarding the Global Commons
Report
- Full report “Planet Positive Chemicals in Japan: Unlocking new roles of the Japanese chemical industry in achieving scope 1–3 net zero and safeguarding the Global Commons” (PDF, 5 MB)
- One-page summary (PDF, 3MB)
References
*1 Planetary Boundaries: The nine processes that stabilize the global environmental system (climate change, biodiversity, nitrogen and phosphorus cycles, etc.), in which thresholds that must not be crossed for humanity to develop sustainably are defined. Crossing these thresholds increases the risk of large-scale and irreversible environmental change.
*2 Scope 1, 2, and 3 emissions are defined by the GHG Protocol.
*3 Kanazawa D. et al., Scope 1, 2, and 3 Net Zero Pathways for the Chemical Industry in Japan, Journal of Chemical Engineering of Japan, 57, 2360900 (2024), https://doi.org/10.1080/00219592.2024.2360900