A realistic approach to net zero by 2050: Circularity and resource efficiency are key to decarbonization strategies

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

Zeroboard Research Institute Director Tomoo Machiba

As Japan and its companies aim to achieve the goal of net-zero greenhouse gas (GHG) emissions by 2050, it is relatively easy to achieve the first halfway point, 2030 (the national target is a 46% reduction compared to fiscal 2013), using current technology and low-carbon electricity, but beyond that, uncertainty increases as the goal will depend heavily on the realization of innovative technologies in the future. However, by looking at the issue from the perspective of materials rather than Energy, another path becomes apparent that can 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) to 23% (2015) of global emission amount, rivaling emission amount from agriculture and land use. Emissions from construction and product manufacturing account for approximately 80% of materials production *1 .

Electrifying redox reactions in steel production, chemical reactions in cement production, and other heat demands is not easy, and the use of fossil fuels will Issue in large amounts of GHG emissions. For this reason, the government's decarbonization roadmap calls for accelerating innovation in Manufacturing processes such as hydrogen reduction steelmaking, hydrogenation of fuels (including methanation) for automobiles, factories, and homes, and carbon removal technologies such as CCUS, DACCS, and BECCS, in addition to the shift to renewable energy for electricity (Figure 1). *2 However, it is highly uncertain whether these "innovative technologies" will be realized by 2050, and even if they are realized, whether costs will be reduced, infrastructure will be prepared, and they will be sufficiently widespread 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 (NIES) in April 2025 focused on what changes would be required in the consumption of various materials and their flow through their life cycles if the widespread adoption of these innovative technologies were not assumed. According to this study, even if electricity were 100% decarbonized, this alone would only reduce GHG emission amount by 37% from 2015 levels in 2050, falling short of the national target for 2030. However, the study found that if renewable energy were adopted and a steady 4% annual reduction in materials emissions were achieved, GHG emission amount could be reduced by more than 80% by 2050, concluding that net-zero emissions could be achieved without relying too heavily 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 usage means limiting the total amount of usable materials to one-quarter of the current amount, in other words, requiring a four-fold improvement in resource efficiency. The United Nations International Resource Panel's (IRP) Material Efficiency Strategy calls for (1) introducing a materials 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 (NIES) states that "rapid, advanced material efficiency" is essential, which involves changing the way Service essential to daily life, such as transportation and housing, are provided by extending lifespans and shifting business models, thereby reducing the amount of materials needed, such as steel and cement *5 .

Mitsubishi Research Institute (MRI) also analyzed three scenarios for 2024: business as usual (BAU); carbon neutral (CN) with the practical application and cost reduction of decarbonization-related technologies; and CN×CE, which achieves carbon neutrality and a circular economy (advancing recommerce, recycled materials and waste utilization, biomass utilization, and carbon circulation in addition to the traditional 3Rs). The CN×CE scenario reduces reliance on negative emission technologies such as DACCS, thereby lowering the marginal abatement cost of achieving net zero by 2050. Furthermore, the use of domestic resources contributes to economic security for Energy and critical metals and increased added value for domestic recycling-related Industry. In the CN×CE scenario, Energy self-sufficiency increases to 64%, eliminating the need to import resources and fuels for production, resulting in an annual reduction of approximately 1 trillion yen in import costs (Figure 3) *6 .

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

Additionally, there is a movement within the Industry world to view 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, which 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 not sitting idly by in response to this trend. At the G7 Sapporo Climate, Energy and Environment Ministers' Meeting in 2023, the Circular Economy and Resource Efficiency Principles (CEREP) were formulated and adopted under the leadership of the Japanese government. The principles call for the integration of strategies and actions related to climate change, biodiversity and pollution reduction with circular economy and resource efficiency approaches, and require 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 natural resource input) from 460,000 yen/ton in 2020 to 600,000 yen/ton in 2030. However, simply extending this target to 2050 would result in only roughly double the 2020 level, far from the quadrupling of resource efficiency sought 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 that are an extension of waste policies, the key will be to Settings resource efficiency targets that aim to achieve decarbonization simultaneously, 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 pose the same difficulties as realizing innovative technology. However, in order to achieve net zero by 2050 and keep the rise in global temperature to within 1.5°C above the Industry revolution, 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 expert on circular architecture who was involved in the design of the Netherlands Pavilion at the Osaka-Kansai Expo. During his visit to Japan for the Expo, I learned about a groundbreaking initiative to revive unnecessary buildings into new architecture without demolishing them. Leander, a Dutch Energy Company, reassembled five 50-year-old buildings to create a completely different new building connected under a single roof, while still reusing over 80% of the materials. *12 The Netherlands Pavilion has also registered all of its building materials in an online "material passport," with the aim of reusing them after the Expo closes. *13 It gave me hope that this dreamlike idea is already becoming a reality, and I hope that various initiatives will be promoted in Japan as well.

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

2015: New office building with over 80% 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. www.nature.com/articles/s41561-021-00690-8

*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 a Quadruple Increase in Material Use Efficiency and a Double Increase in 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, "The Seventh Strategic Energy Plan Calls for 'CN x CE' Policy Fusion - Aiming for 1 Trillion Yen in Added Value Return from Decarbonization Investments," Mitsubishi Research Institute Research and Recommendation 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