The Economy, Trade and Industry Ministry has announced a strategy that calls for boosting eco-friendly vehicles' share of domestic new car sales to as high as 50 percent by 2020, from the current 9 percent.
The ministry also aims to install 2 million chargers in ordinary households for electric, hybrid and other eco cars.
As measures to help achieve the targets, it intends to consider offering support, including tax breaks and subsidies for people who buy such vehicles.
In the strategy unveiled Monday, the ministry said prices of lithium ion batteries used in next-generation vehicles should be reduced to one-seventh of 2006 prices by 2015, and to one-fortieth by 2030.
It also referred to a need to secure rare metals used for batteries and to develop infrastructure such as by building facilities where drivers can recharge their vehicles.
The ministry believes the widespread use of next-generation vehicles will help reduce greenhouse gas emissions and increase the global competitiveness of domestic automakers.
The government is expected to incorporate this next-generation car strategy into its economic growth plan, which will be unveiled in June.
The ministry's strategy, which sets making Japan a global base for developing and producing next-generation vehicles as its overall goal, focuses on six areas.
It also sets a target to raise the proportion of next-generation vehicles to up to 70 percent of new cars sold in Japan by 2030.
Under the strategy, support will be extended to gasoline-fueled vehicles with eco-friendly features.
The ministry aims to increase the combined market share of such gasoline vehicles and next-generation vehicles to as high as 80 percent over the next decade.