A realistic approach to net zero by 2050: Circularity and resource efficiency are the keys to a decarbonization strategy

Global Sustainability Standards Board (GSSB) Board Member
GHG Protocol Technical Working Group (TWG) Members

Zeroboard Research Institute Director Tomoo Machiba

As Japan and individual companies aim to achieve the reduction target of net-zero greenhouse gas (GHG) emissions by 2050, it is relatively easy to achieve the first midpoint by 2030 (the national target is a 46% reduction compared to fiscal 2013) using current technology and low-carbon electricity, but after that, uncertainty will increase as it will depend heavily on the realization of innovative technologies in the future. However, if we look at it from the perspective of materials rather than Energy, we can see another way to achieve decarbonization while avoiding excessive reliance on future technologies.

GHG emissions from the production of materials essential to Industry and daily life, such as steel, non-ferrous metals such as aluminum and rare metals, wood, cement, ceramics, plastics, and glass, have rapidly increased over the past 20 years from 15 % (1995) of global emission amount to 23% (2015), and are said to be comparable to emission amount from agriculture and land use. Emissions from construction and product manufacturing account for approximately 8% of materials production * 1 .

It is not easy to electrify redox reactions in steel production, chemical reactions in cement production, and other heat demands, and the Issue is that it will result in large amounts of GHG emissions from the use of fossil fuels. For this reason, the government's decarbonization roadmap fully advocates accelerating innovation in Manufacturing processes such as hydrogen reduction steelmaking, hydrogenation of fuels for automobiles, factories, and homes (including methanation), and carbon removal technologies such as CCUS, DACCS, and BECCS, in addition to using renewable energy for electricity (Figure 1) * 2. However, it is highly unclear whether these "innovative technologies" will be realized by 2050, and even if they are realized, it is highly unclear whether the costs will be reduced and the infrastructure will be prepared by then, and whether they will be fully adopted in society.

Figure 1: The path to achieving net zero by 2050 outlined in the Green Growth Strategy (Source: Ministry of Economy, Trade and Industry)

Modeling recently published by the National Institute for Environmental Studies (April 2025) focuses on what changes are required in the consumption of various materials and their flow through their life cycles if the widespread adoption of these innovative technologies is not assumed. According to this study, even if electricity were 100% decarbonized, this alone would only reduce GHG emission amount in 2050 by 37% compared to 2015 levels, falling short of the country's 2030 target. However, the study concluded that if renewable energy is widely adopted and a steady 4% annual reduction in materials is achieved, GHG emission amount could be reduced by more than 8% by 2050, and net zero could be achieved without relying too much on the widespread adoption of innovative decarbonization technologies * 3 .

Figure 2: Changes in domestic GHG emission amount due to total material input reduction targets (Source: National Institute for Environmental Studies)

A 4% annual reduction in materials means limiting the total amount of usable materials to one - quarter of the current amount, in other words, a four-fold improvement in resource efficiency. As a means to achieve this, the United Nations International Resource Panel (IRP)'s material efficiency strategy lists the following measures: 1) introducing a material efficiency strategy for next-generation vehicles, 2) extending the lifespan of buildings, and 3) doubling the current recycling rate by 2050 * 4. The National Institute for Environmental Studies says that it is essential to achieve "rapid material efficiency" by changing the way Service necessary for daily life, such as transportation and housing, are provided by extending lifespans and shifting business models, thereby reducing the amount of materials such as steel and cement required * 5 .

Mitsubishi Research Institute also analyzed three scenarios for 2024: business as usual (BAU), carbon neutral (CN) where decarbonization-related technologies are put to practical use and costs are reduced, and CN×CE where carbon neutrality and a circular economy (in addition to the traditional 3Rs, recommerce, use of recycled materials and waste, use of biomass, and carbon circulation) are achieved. In the CN×CE scenario, the dependency on negative emission technologies such as DACCS is reduced, which leads to a reduction in the marginal abatement cost for achieving net zero in 2050. In addition, the use of domestic resources contributes to economic security of Energy and important metals and to increasing added value for domestic recycling-related Industry. In the CN×CE scenario, the Energy self-sufficiency rate increases to 64%, and as a result of eliminating the need to import resources and fuels for production, the import amount is said to decrease by about 1 trillion yen per year (Figure 3) * 6 .

Figure 3: Trends in GHG emission amount in the three scenarios BAU, CN, and CN+CE (Source: Mitsubishi Research Institute)

There is also a movement within the Industry world to see the fusion of decarbonization and circular economy policies as a business opportunity overseas. In January 2024, 13 companies, including Ajinomoto, Fujitsu, and Honda Motor Co., issued a joint statement stating, "The realization of a circular economy and carbon neutrality that not only reduces waste and maintains Manufacturing but also creates new value and markets could be the hope for ASEAN * 7 to achieve economic development and address global environmental Issue." * 8

The government is by no means sitting idly by in response to this movement. At the G7 Sapporo Climate, Energy and Environment Ministers' Meeting in 2023, the Circular Economy and Resource Efficiency Principles (CEREP) were developed and adopted under the leadership of the Japanese government. The principles advocate the integration of strategies and actions related to climate change, biodiversity and pollution reduction with circular economy and resource efficiency approaches, and call for companies to promote the transition to circular and resource efficient business, identify risks and opportunities, and monitor and disclose indicators * 9 .

However, the Fifth Fundamental Plan for Promoting the Creation of a Sound Material-Cycle Society, approved by the Cabinet in August 2024, Settings a target of improving resource productivity (output per unit of natural resource input) from 46 yen/t in 2020 to 600,000 yen/t in 2030. However, if this is simply extended to 2050, it will only be about 2 as high as in 2020, far from the 4 of resource efficiency called for by the National Institute for Environmental Studies. * 10 In order to accelerate circularity and resource efficiency, in addition to a fundamental review of the various existing recycling laws, which are an extension of waste policies, the keys will be to Settings resource efficiency targets that aim to achieve decarbonization at the same time, prioritize long life, resource reuse, and Service oriented solutions by taxing the use of virgin materials, and develop and utilize a data platform that can track the usage history of materials. * 11

Reducing resource dependence through circularization will require changes in business models and lifestyles, and will likely be fraught with the same difficulties as those involved in realizing innovative technology. However, in order to achieve net zero by 2050 and keep the global temperature rise to within 1.5°C above Industry revolution levels, we hope that governments and many companies will pay attention to this as one of the two essential measures that go beyond decarbonizing electricity and look to the medium to long term.

Recently, I had the opportunity to hear a lecture by Thomas Lau, a leading figure in circular architecture who was involved in the design of the Netherlands Pavilion at the Osaka-Kansai Expo, when he visited Japan for the Expo, where I learned about his groundbreaking initiative of reviving unnecessary buildings into new architecture without demolishing them. He rearranged 5 50 -year-old buildings of the Dutch Energy Company Leander, reusing more than 8% of the materials, and completed a completely different new building connected under one roof * 12 . The Netherlands Pavilion has also registered all of the building materials used in an online "material passport" with the aim of reusing them after the Expo closes * 13 . It gave me hope that this dreamlike idea has already become a reality, and I hope that various initiatives will be promoted in Japan as well.

Leander's old headquarters in 2011 (Credit: Cloudshots)

2015: New office building with over 8% recycled building materials (Credit: Marcel van den Burg)

Interior of the new building (Credit: Marcel van den Burg)

* 1 Edger G. Hertwich (2021), “Increased carbon footprint of materials production driven by rise in investments”, Nature Geoscience, Vol. 14, pp. 151-155. 8

* 2 Ministry of Economy, Trade and Industry, "Green Growth Strategy for Carbon Neutrality by 2050,"June 18, 2021 www.meti.go.jp/policy/energy_environment/global_warming/ggs/index.html

* 3 National Institute for Environmental Studies, "Achieving carbon neutrality by 2050 through 'advanced material efficiency' - aiming for 4 times the material utilization efficiency and 2 times the recycling rate," Press Release, April 21, 2025. www.nies.go.jp/whatsnew/2025/20250421/20250421.html

* 4 UNEP (2020), Resource Efficiency and Climate Change: Material efficiency strategies for a low-carbon future , International Resources Panel (IRP) report. www.resourcepanel.org/reports/resource-efficiency-and-climate-change

* 5 National Institute for Environmental Studies (2025)

* 6 Mitsubishi Research Institute, "Policy fusion of 'CN x CE' required in the 7th Basic Energy Plan - Aiming for 1 trillion yen in added value return from decarbonization investments," Mitsubishi Research Institute Research and Proposal Report, June 5, 2024 www.mri.co.jp/knowledge/insight/policy/20240605.html

* 7 Association of Southeast Asian Nations

* 8 Executive Sustainability Forum, "Joint Statement on Circular Economy and Carbon Neutrality,"January 2024 www.pwc.com/jp/ja/press-room/joint-statement240116.html

* 9 Ministry of the Environment, "overview of the Circular Economy and Resource Efficiency Principles (CEREP)," April 2023www.env.go.jp/content/000175154.pdf 

* 10 National Institute for Environmental Studies (2025)

* 11 Mitsubishi Research Institute (2024)

* 12 Arch Daily, Alliander HQ / RAU www.archdaily.com/777783/alliander-hq-rau-architects　

* 13 NL Platform, Osaka Kansai Expo page https://nlplatform.com/osaka-expo-japan