TOKYO—Japan aims to eliminate gasoline-powered vehicles in the next 15 years, the government said in late December, and reach net zero carbon emissions and generate nearly $2 trillion a year in green growth by 2050.  The country's green growth strategy, which targetisthe hydrogen and auto industries, is meant as an action plan to achieve Prime Minister Yoshihide Suga’s October 2020 pledge to eliminate carbon emissions on a net basis by mid-century.

Suga has made green investment a top priority to help revive the economy hit by the COVID-19 pandemic and to bring Japan into line with the European Union, China and other economies setting ambitious emissions targets.

The government will offer tax incentives and other financial support to companies, targeting 90 trillion yen ($870 billion) a year in additional economic growth through green investment and sales by 2030 and 190 trillion yen ($1.8 trillion) by 2050. A 2-trillion yen green fund will support corporate investment in green technology.

The plan seeks to replace the sale of new gasoline-powered vehicles with electric vehicles, including hybrid and fuel-cell vehicles, by the mid-2030s.To accelerate the spread of electric vehicles, the government targets slashing the cost of vehicle batteries by more than half to 10,000 yen or less per kilowatt hour by 2030.

It also aims to boost hydrogen consumption to 3 million tons by 2030, and to about 20 million tons by 2050 from 200 tonnes in 2017, in areas such as power generation and transportation.