Final energy of the industry sector in Japan
Figure 2 shows the key variable, final energy of the industry sector under two main scenarios, baseline (Baseline_Def) and NDC&MCS scenario (26% emissions reduction by 2030 and 80% emissions reduction by 2050, 26by30 + 80by50_Def).
Models show different industry shares even for the base year. This variation is partially explained by the difference in the industrial energy coverage, emission coverage, and their databases used. Models use both the energy balance of the International Energy Agency the comprehensive energy statistics compiled by METI. In fact, these databases disagree on the industry share of final energy (see Table ESM i in this paper, and Sugiyama et al. (2021) for more on this point).
Figure 2 shows the final energy of the industry sector from 2010 to 2050. Under the 80% reduction constraint, the long-term energy consumption varies among models, even among all PE models. A 47.8% decline in 2050 can be observed in IEEJ_Japan 2017 compared to the 2010 level, similarly a 32.2% decline in AIM/Enduse-Japan, and a 6.9% decline in TIMES-Japan. Such variation can be caused by the variation of these PE models in base years, in the treatment of external drivers, the coverage of industrial energy, and thus vary in the mitigation measures preferences in the 26by30 + 80by50_Def scenario results. However, all PE models show a similar small gap between the Baseline_Def and 26by30 + 80by50_Def. Extra cut down of energy consumption to achieve the NDC&MCS goal can be expected as limited.
The share of industry in Japan’s national final energy is shown in Fig. 3. According to all PE models, around half of the total final energy consumption will be contributed by the industry sector if NDC&MCS goal is achieved, which is a high number given the context that G7 average in 2016 was 19.7% and OECD 21.7% (IEA, 2016). Moreover, the share of the industry sector increases by 2050 in all PE models. In the GE model, this share decreases as the total final energy consumption does not reduce as much as other PE models.
To place Japan’s industry in a broader context, Fig. 4 presents the data from global models in the ADVANCE project (Advanced Model Development and Validation for the Improved Analysis of Costs and Impacts of Mitigation Policies) in addition to the EMF 35 JMIP results. The gray lines show the results of the industry’s share in final energy from global model teams. Although the ADVANCE Synthesis Scenario Database (version 1.0) was conducted earlier during 2013–2016, also the scenario 2030_Med2C is not perfectly comparable with EMF 35 JMIP scenarios, the results are still good references, as these models consider the position of Japan in the global economy, where less attention is paid in EMF 35 JMIP participating models. Based on the global emission restrictions, global models give a lower estimation of the final energy industry share. They reported the emission reduction rate in Japan’s industry sector in 2050 with a range of 35.6% (GCAM4.2_ADVANCEWP6) to 58.3% (IMAGE 3.0, see Fig. ESM iii) compared to the 2010 level, also less than the expectation of model teams from Japan (50.0% to 69.4% reduction). Given such conditions, the results from 3 of all 4 JMIP models show that the industry’s share in Japan will stay still after 2020 and reach around 40 percent by 2050 and, still higher than the estimation of the OECD average from IPCC AR5 (Sugiyama et al. 2019). Compared to these reference models from institutions other than Japan, JMIP PE models show higher results in the final energy industry share (among which the highest 59.5% under 26by30 + 80by50_Def, from TIMES-Japan), closer to the world average rather than OECD countries.
CO2 emissions generated from the industry sector in Japan
The corresponding CO2 emissions of the industry sector under the baseline and the 26by30 + 80by50_Def scenarios are shown in Fig. 5. The variable shows the sum emissions generated from the energy use in the industry sector and from industrial processes.
Compared to the final energy of the industry sector in Fig. 2, the variations in CO2 emissions among models are smaller. Under the 26by30 + 80by50_Def scenario, an 83.4% emission reduction in the industry sector in 2050 can be observed in AIM/Hub-Japan compared to the 2010 level, similarly a 69.4% decline in AIM/Enduse-Japan, a 60.8% decline in IEEJ_Japan 2017, and a 50.0% decline in TIMES-Japan. To reach an 80% emission reduction goal in total for all sectors, model teams have different expectations of the emissions reduction efforts of industries.
Similar to the structure of sectoral final energy, the industry sector occupies the largest share of demand-side total emissions in all PE models (See Fig. 6). The implementation of CCS in industry largely varies among models. The 80% emission reduction by 2050 will be contributed significantly by CCS, especially the CCS of fossil fuels according to the results from AIM/Hub-Japan and AIM/Enduse-Japan. On the other hand, more implementation of CCS does not seem very necessary to achieve the NDC-MCS goal according to the results from IEEJ_Japan 2017 and TIMES-Japan, among which a certain share of emissions generated from industry-related activities would be captured in TIMES-Japan.
Regarding which sector would cut down more emissions, in half of the participating models (AIM/Enduse-Japan and TIMES-Japan), the transportation sector shows a larger potential in the emission reduction with lower marginal costs, and its absolute number of reduction exceeds the industry sector. In the other half of the models (AIM/Hub-Japan and IEEJ_Japan 2017), a larger burden of emission mitigation will go to the industry sector, shown as a reduction in industry’s annual emissions overweighs others. No matter to which sector such priority of emission reduction burden would go, the results of JMIP suggest that annual CO2 emission in the industry sector should at least cut around 150 Mt in 2050 compared to the 2010 level. How such a cut will be achieved, namely to what extent fuel switching in industries works, which sub-sectors should decarbonize more, or other mitigation measures that have not been decently modeled in this project, would be investigated in the next sections. Among all participating models, the GE model shows the largest net emission reduction in the industry sectors.
Decomposition by source
The decomposition of the industry’s final energy by source is shown in Fig. 7, compared with the same decomposition in other sectors.
According to PE models, the industry sector may still rely on the energy consumption of solids in 2050, which is a relatively larger share compared to other sectors. Among such decomposition of consumption, only around 10% will be biomass, and the rest still coal. Moreover, all PE models report very similar results of the industrial electrification level. Under the NDC&MCS scenario, the share of electricity consumption in the industry sector will remain at a relatively low level and slightly increase during 2010–2050. Factors determining such an electrification rate are numerous and would need to be analyzed separately in each sector (Sakamoto et al. 2021). The modeling of electricity technologies in industries (e.g., electric arc furnaces in steelmaking, or more generally the use of electricity to meet industrial heat demands), as well as the price and changes in prices of such electricity technologies, may affect the result of electrification rate. Furthermore, the large-scale introduction of electricity-based facilities may sharply increase the industrial electricity consumption and exert more pressure on the electricity supply. However, the manner in which energy service demands react to such changes with respect to the availability of energy supply cannot be solved simultaneously in PE models with exogenous energy service demands. On the other hand, the switch from fossil fuels to hydrogen in industries is less costly in terms of system mortification, such as fewer changes in sensors, controls, and labor skills (ICEF, 2019). However, its introduction in the industry sector will be limited according to Fig. 7.
Overall, according to the results from PE models, the rise in the electrification rate and the introduction of biomass use in industries by 2050 will still be limited, suggesting a low possibility of large-scale fuel switching or end-use technology substitution in production processes in Japan. How industries can benefit from an increasingly low-carbon energy supply remains a pressing issue.
Decomposition by sub-sector
Cement, chemicals, pulp and paper, steel, the final energy and CO2 emissions of the four selected industry sub-sectors are shown in Fig. 8.
The gap of sub-sectoral final energy between NDC&MCS and baseline scenarios is small in all sub-sectors except steel, so is the gap of sub-sectoral CO2 emissions. The potentials of both emission reduction and energy conservation of these sub-sectors would be limited. On the other hand, sub-sectoral final energy and CO2 emissions do not share a similar structure. In the cement sub-sector, the high emission intensity and the large number of emissions would be generated from production processes, shown as a small share in final energy and a larger share in CO2 emissions. As mentioned in Fig. 9, annual CO2 emission in the industry sector should at least cut around 150 Mt in 2050, among which around 100 Mt cut would be the mission of the steel sub-sector. A large share in final energy and a larger share in CO2 emissions, together with such a large gap between emission levels in 2050 and 2010, again emphasized the key position of steelmaking decarbonization to the achievement of Japan’s NDC&MDS goal.
The sub-sectoral CO2 emissions under more scenarios also see Fig. ESM ii. The selected scenarios can examine the impacts of two mitigation measures in the industry sector, CCS and lower energy service demands. Both final energy and CO2 emissions are reported as the lowest value under LoDemInd scenarios among all scenarios in nearly all sub-sectors and models. In the steel sub-sector, around 50–60 Mt emissions will be reduced (compared to the baseline scenario) by halving steelmaking’s energy service demand.
The other mitigation measure, CCS, is modeled in the steel and cement sub-sectors in all participating models. In AIM/Enduse-Japan, the emission of steelmaking would be much higher under the 26by30 + 80by50_NoCCS scenario than under the 26by30 + 80by50_Def scenario, especially after 2030. Such a difference indicates the importance of CCS to the decarbonization of steelmaking in AIM/Enduse-Japan. In TIMES-Japan and IEEJ_Japan 2017, the emission of steelmaking under the 26by30 + 80by50_NoCCS scenario would be lower or nearly the same under the 26by30 + 80by50_Def scenario, indicating the limited contribution of CCS in steelmaking decarbonization in these two models. The emission reduction would be achieved by the introduction of hydrogen technologies in steelmaking in TIMES-Japan (after 2040, shown in Fig. 7). While in the cement sub-sector, a larger impact of CCS can be observed in TIMES-Japan.
Considering the key role of steelmaking, a decomposition considering more scenarios is conducted in this sub-sector, shown in Fig. 10. The decomposition reveals how much each factor, namely changes in final demands for industrial products, energy efficiency improvement, and emission intensity reduction, would contribute to the changes of sub-sectoral emission (results of all sub-sectors see Fig. ESM v). According to the results, the contribution of emission intensity (green bar) will overweigh the contribution of energy efficiency (blue bar) after 2030, especially in the steel and cement sub-sector.
From the temporal perspective, two of the three models report that significant emission reductions in the steel sector may occur from 2040 to 2050, instead of a continuous reduction after 2020. From the perspective of factors, the impact of emission intensity factor would concentrate in the period 2040–2050, while the energy efficiency factor would keep functioning from 2020, which is along with the decomposition result of all sub-sectors.
Regarding the contribution of energy efficiency improvement, its effect on emission reduction is significant during 2020–2040 in IEEJ_Japan 2017, while it is smaller, but still exists, in TIMES-Japan during the whole period. In AIM/Enduse-Japan, the contribution of would be lower in the period 2040–2050 due to the introduction of more CCS. Models hold different views but all agree that even if there is no CCS implemented, the steelmaking decarbonization cannot count on energy saving after 2040. Regarding the contribution of emission intensity reduction, it is reported in IEEJ_Japan 2017 that certain contributions would exist throughout the whole period, in TIMES-Japan mainly after 2030, and in AIM/Enduse-Japan huge contributions only concentrated in the period 2040–2050. As mentioned, this is a reflection of the CCS implementation in AIM/Enduse-Japan and the more introduction of hydrogen technologies after 2040 in TIMES-Japan.
Regarding the contribution of final product demand changes from 2010 to 2016, the decrease in production volume has not been as significant as other industrial materials such as non-ferrous metals and cement (Oda and Akimoto 2019).The long-term expectation of the production of steel also considers global assumptions (Nameki and Moriguchi 2014) that may affect total domestic production, as well as the potential of recyclable scraps (Kawase and Matsuoka 2015) that may affect the introduction of EAF capacity. The estimation of AIM/Enduse-Japan and TIMES-Japan shows that steel production may slightly but steadily increase, while this growth may cease in 2020, drop steadily afterward, and lead to the reduction in emissions in IEEJ_Japan 2017. All models report the largest emission mitigation led by a reduction in production under the low industry demand scenario in nearly all periods. Such reduction would ease the pressure of energy conservation, although TIMES-Japan reports that such a decrease in steel demand and the decarbonization by such lower demand would not continue after 2040. Moreover, the marginal abatement cost of CO2 emissions would be the lowest under the low industry demand scenario, followed by the building sector and the transportation sector (the results of carbon price see Fig. ESM vii).