Japan to spend at least $34bn on hydrogen-powered aviation over next decade

Industry news
22 August 2023
источник: Hydrogen Insight
Indications propose an initial allocation of $13.7 billion for the inaugural test flights set for 2030.

Japan's Ministry of Economy, Trade and Industry (METI) envisions an expenditure of ¥5 trillion ($34 billion) over the forthcoming decade to advance the development of hydrogen-powered aviation. According to financial publication Nikkei, the government aims to commit an initial ¥2 trillion ($13.7 billion) for the inaugural test flights projected for 2030.

This drive towards hydrogen-fueled aviation constitutes a fundamental component of Japan's broader "GX" energy transition initiative. This initiative intends to leverage green bonds to unlock a total of ¥150 trillion in combined public-private investments until 2033. Additionally, it plans to launch an emissions trading system, akin to the European Union's carbon market, commencing in 2026.

Approximately ¥4 trillion is earmarked for deployment in the coming decade to advance the development of "next generation aircraft." An added ¥1 trillion will be allocated towards the creation of synthetic sustainable aviation fuels (SAFs). The distribution of these funds between private and public investments remains uncertain. Nikkei's report suggests METI's intentions to provide subsidies to fuel cell manufacturers for aircraft application. Specifics, encompassing budget allocation details, are scheduled to be disclosed in the autumn.

Aviation has generally been regarded as a challenging sector to decarbonize. While efforts are underway to develop battery-electric aircraft, these designs tend to be geared towards short-haul flights due to battery weight constraints. Consequently, interest in green hydrogen has surged as a viable avenue to mitigate aviation emissions. This can be achieved through fuel cells powering propulsion, direct hydrogen combustion in engines, or as a raw material for synthetic SAFs.

In a report published in May, consulting firm McKinsey estimated that a capital investment ranging from $700 billion to $1.7 trillion would be necessary to finance the requisite green power and infrastructure. These investments are crucial to support even marginal adoption of alternative-propulsion aircraft predicted by 2050.