Asako Toyozumi, Director of the Fluorocarbons Control Office, Global Environment Bureau at MOE
Asako Toyozumi, Director of the Fluorocarbons Control Office, Global Environment Bureau at Japanese Ministry of the Environment

Japan Extends Its Natural Refrigerant Subsidy Project to Fiscal Year 2027, with ¥7 Billion for Fiscal 2023

Relaxed rules make it easier for small- and medium-sized enterprises to take advantage of the project and cover up to half the construction costs.

The Japanese Ministry of the Environment (MOE) has declared it will continue its natural refrigeration equipment installation subsidy project through fiscal year 2027, with ¥7 billion (US$48.7 million) allocated for fiscal year 2023, which runs from June 1, 2023, to March 31, 2024.

MOE now calls the project “Promotion of HFC-Free and Decarbonization of Refrigeration Equipment Supporting the Cold Chain.”

Since 2005, Japan has offered similar subsidies through its MOE and Ministry of Economy, Trade and Industry. “We would like to continue to support the introduction of natural refrigeration equipment by Japanese companies through granting these subsidies,” said Asako Toyozumi, Director of the Fluorocarbons Control Office, Global Environment Bureau at MOE.

Of the 3,630 projects subsidized to date, the commercial refrigeration sector has accounted for 2,478; these include supermarkets and convenience stores, with the majority using CO2 (R744) systems, including air-cooled CO2 condensing units. However, Japanese food retail chain Aeon and convenience store chain Lawson have started using hydrocarbon (R290 and R600a) refrigerant showcases.

The remaining 1,152 have been for applications in the industrial refrigeration sector, with the majority of the systems using ammonia (R717)/CO2 systems like those produced by Japanese manufacturers Mayekawa and Mitsubishi Heavy Industries (MHI).

However, transcritical CO2 refrigeration systems are gaining traction in Japanese industrial applications, including warehouses, factories, distribution centers, etc. According to the 2022 edition of the “ATMO Report: State of the Industry,” Fukuoka-based cold storage operator Yoshio Ice Manufacturing & Refrigeration retrofitted a cold storage facility with a transcritical CO2 system in February 2020 based on energy savings seen at a new facility built in 2018.

Changes for small and medium-sized enterprises

In an effort to make the subsidy project more accessible, Toyozumi indicated that some changes made for the fiscal year 2023 benefit small and medium-sized enterprises, including making application easier with relaxed installation schedule and costs rules and raising the project reimbursement upper limit from one-third to one-half of the construction costs.

One rule change affects large corporations applying for subsidies. “They must announce a target for introducing natural refrigerant equipment,” Toyozumi said.

Since Japan’s initial introduction of subsidies in 2005 for the installation of natural refrigeration equipment, there has been an “almost 100% subsidy grant rate,” Toyozumi said, indicating that nearly all of the funds allotted by MOE each year were used.

From fiscal year 2018 to 2022, the subsidy project operated under the name “Project to Accelerate the Introduction of Energy-Saving Natural Refrigerant Equipment for the Early Realization of HFC-Free and Low-Carbon Society,” with an allocated budget for fiscal year 2019 of ¥7.4 billion (US$51.5 million) and ¥7.3 billion (US$50.9 million) each fiscal year from 2020 to 2022.

“I hope that leading natural refrigerant equipment technology will emerge as a result of the advancement of natural refrigerant equipment introduction in Japan,” Toyozumi said.

“We would like to continue to support the introduction of natural refrigeration equipment by Japanese companies through granting these subsidies.”

Asako Toyozumi, Director of the Fluorocarbons Control Office, Global Environment Bureau at MOE

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