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- GX Acceleration Declaration Framework Newly Launched as Effort to Encourage Companies Proactively Engaging in Creation of a Market for GX
GX Acceleration Declaration Framework Newly Launched as Effort to Encourage Companies Proactively Engaging in Creation of a Market for GX
December 6, 2024
The Ministry of Economy, Trade and Industry (METI) has launched a new framework called the GX Acceleration Declaration. As an outcome of the discussions in the GX League, this framework aims to encourage companies on the demand side that proactively intend to make efforts that are essential for creating a market for green transformation (GX). Going forward, METI will strive to encourage a wide variety of industries and companies to make declarations, help the companies that have made declarations to be more positively evaluated in markets, and accelerate the creation of a market for GX, thereby promoting GX in Japan.
1. Outline of the GX League
The GX League is a consortium in which a group of internationally competitive companies that boldly take on the challenge of the transition to carbon neutrality will drive GX. Currently, over 700 companies have joined the league.
These companies have been making significant efforts to reduce emissions, upholding their own targets of emission reductions not only for FY2030 but also for FY2025, and have also decided to participate in an emissions trading system currently being operated on a trial basis. Moreover, they have been proactively holding discussions and making suggestions about rulemaking, which is difficult for individual companies to undertake, for reducing emissions and introducing green products throughout supply chains.
2. Background to the launch of the GX Acceleration Declaration
GX is an initiative to strike a balance between decarbonization and economic growth. To achieve this throughout the country, it is indispensable for Japan to encourage a wide variety of industries to make efforts and it is also important to promote decarbonization throughout supply chains.
To this end, all industries, regardless of the type, need to manufacture lower-carbon products brought about by GX investment (products that effectively contribute to significant emission reductions in the manufacturing process or help others reduce emissions) and ensure that such products are positively evaluated in markets so as to increase demand for them.
Meanwhile, the nature of these products, particularly when they are similar in function or shape to the existing non-green products of their competitors but have higher production costs, makes it difficult for these industries to increase demand on an independent basis. To overcome this, the government has been providing medium- to long-term support measures involving the products for the supply side necessary for introducing GX throughout society and promoting the social implementation of the products. In addition to this, it is indispensable for the demand side as well to engage in efforts to create a market for GX.
Against this backdrop, METI launched a GX Acceleration Declaration framework as an outcome of the discussions at the GX League, aiming not only to provide government support to the supply side but also to encourage the demand side to accelerate efforts for creating a market for GX.
The framework will contribute to visualizing a group of companies engaging not only in proactively reducing their emissions but also in tackling GX throughout supply chains by making GX Acceleration Declarations and will help the companies to be positively evaluated in markets, thereby promoting the creation of a market for GX products.
3. Details of the declarations
In the declarations, targeting green products and services for which it is difficult to attract autonomous demand, companies will select some of the products or services that they intend to proactively adopt and show a policy for advancing related efforts. The declarations are expected to contribute to enhancing the predictability of demand for green products and services.
In the early phase after the launch of the framework, the framework will target products and services currently subject to the government’s support measures, including green steel, green chemicals, hydrogen, SAF and so on. Following that phase, it will expand the scope of such products and services sequentially as described below.
The framework also provides some grades set by the degree of specificity of the efforts that participating companies uphold in their declarations. This design allows companies to choose the grade of their declaration in accordance with their situation, thereby encouraging a wide variety of industries and companies to smoothly make declarations. By increasing the number of companies that make declarations and disclosing the situation of their efforts, the framework will contribute to raising momentum for the use of green products and services throughout society.
4. Future schedule
The GX League will accept GX Acceleration Declarations throughout the year. If you have any questions about the practical procedures for making a declaration, contact the GX League Secretariat.
In addition, the framework is scheduled to expand the range of products covered by the declaration in the future. In FY2025, the GX League intends to continuously establish working groups where companies willing to engage in market creation will participate and continue discussions.
Related Materials
- Sample forms of the declaration (in Japanese)(Excel:118KB)
- Summary of the declaration (in Japanese)(PDF:1,422KB)
Related Link
Division in Charge
Environmental Economy Office, GX Policy Group