Japan’s Green Transformation (GX) program will soon enter its fifth year. Initially met with skepticism or ignored in a world where countries engaged in something like climate-target one-upmanship, Japan’s plan to wean its economy and industry off fossil fuels has remained remarkably steady.

That quality deserves more credit. Progress has been slow, and even a firm commitment to exit coal remains distant. Yet the pieces of the GX puzzle are starting to slot into place. This April marks the start of Japan’s first emissions trading scheme with mandatory participation by the top emitters. The state’s GX Economic Transition Bond issuance has stayed on track despite rising interest rates and the evaporation of greeniums. Multiple mechanisms are now in place to encourage demand for low-carbon fuels and the construction of clean generation. Meanwhile, the emerging GX Strategic Areas initiative promises a systematic greening of energy-intensive industries.

Taken together, GX is attempting something more ambitious than any single policy suggests. By pooling demand creation, supply-side support, financing and industrial geography, the program as a whole appeals to a broad set of stakeholders – developers, manufacturers, investors and local authorities, seeking to make decarbonization economically and politically durable. It also makes a case for policy consistency at a moment when other economies are debating whether to stick with green commitments or twist with the political currents flowing from President Trump’s White House.

Critics will question whether GX is more narrative than reality. At COP30, Japan declined to support a joint declaration calling for a just transition away from fossil fuels, even as nearly 80 countries endorsed it. Meanwhile, a 2025 report by Market Forces found that Japan’s five largest institutional investors hold nearly as much in companies pursuing aggressive fossil fuel expansion as those involved in renewables.

There are certainly legitimate questions about the strength and enforceability of the GX agenda. Yet focusing only on what GX has not yet delivered risks missing a more complex and potentially more consequential story: Japan’s transformation is in progress.