Japan plans to allocate US$1.34 billion in subsidies to support companies that rely entirely on decarbonized electricity, aiming to boost demand for renewable energy while anchoring new industrial investment in regional areas. The subsidy program will run for five years, starting in fiscal 2026, and will support companies that both use fully decarbonized power and contribute economically to the regions where that electricity is generated. Eligible firms will be able to receive subsidies covering up to half of their capital expenditure, according to Juntaro Shimizu, Director, Green Transformation (GX) policy group at the Ministry of Economy, Trade, and Industry (METI).
The measures fall under Japan’s “GX 2040 Vision,” a national strategy approved by the Cabinet earlier this year that integrates climate policy with industrial development. As part of the framework, the government plans to establish a “GX Strategy Region” system aimed at creating new industrial clusters in areas with access to decarbonized power.