Japan finds itself at an inflection point for hydrogen, according to a World Economic Forum paper.
Given its structural reliance on imported fuels and exposure to energy security and decarbonisation imperatives, hydrogen provides an industrial and strategic pathway.
But progress is not without friction, it finds. Infrastructure remains incomplete across production, transport and end-use sectors, green hydrogen and its derivatives still entail cost premiums and long-term offtakes, essential to investment clarity, have not materialised at the scale required.
That’s despite policy direction and mobilised funds thanks to the country’s updated Basic Hydrogen Strategy and Hydrogen Society Promotion Act. It still requires “coordinated, system-wide progress,” according to the report.
Encouragingly, it possesses the industrial depth, engineering capability and end-user demand profile to play a distinctive role in shaping how hydrogen ecosystems mature globally, it adds.
Hydrogen initiatives are moving beyond early demonstrations towards commercially relevant activity. With policy frameworks and investment platforms now in place, clearer pathways to scale are emerging.
Policy mechanisms such as Japan’s emerging contracts-for-difference and long-term low-carbon power auctions can help bridge early cost gaps and accelerate capital deployment.
“Delivering a hydrogen society will require sustained leadership, investment and cross-border cooperation,” it concluded. “Japan’s early progress indicates how these elements can converge and how a more resilient, diversified and sustainable energy system can begin to take shape – offering a pathway the international community can advance together.”
Japan has been increasing its focus on building up a supply of domestic and imported clean hydrogen to meet power and industrial decarbonisation goals.
Energy company Inpex Corporation opened a blue hydrogen and ammonia plant in Japan, with annual ammonia production expected to reach around 700 tonnes.
Earlier this month, Kawasaki Heavy Industries said it would build the “world’s largest” liquefied hydrogen carrier vessel to supply its under-construction import terminal in Ogishima.
It is also seen as a key demand driver for global projects. The Hydrogen Council’s 2025 report grouped the country’s CfD and auction schemes as mechanisms that could help drive up to eight million tonnes of annual hydrogen demand by 2030.
