The Japanese government decided to develop an even more fuel-efficient electric vehicle in alliance with such leading companies as Toyota Motors, Mitsubishi Electric, and Nippon Steel. Loading the next-generation power semiconductor, the projected EV can travel 10% longer than the existing EV. The government plans to launch a trial EV toward 2014 and put the technology into practical use in 2018. Nippon Steel and Denso will develop the substrate material, electric appliance companies like Mitsubishi Electric and Toshiba will develop an inverter using the next-generation power semiconductor, and Toyoda and Honda will mount the converter on its cars. The projected EV will be priced between three and four million yen. The next-generation power semiconductor uses silicon carbide excellent in power control. If it is mounted on an EV, power loss will be one third of the present level. It is also strong against intense heat and high voltage. Large equipment using water is needed to cool the inverter, but small equipment using wind is enough to cool the inverter should the projected inverter be employed, allowing for weight saving. The power semiconductor will be used in household air-conditioner and industrial motors. In the future, the government expects it to be used in railways and electric power cables. If it grows widespread, some estimate that about 2,300,000, about 0.2% of Japan’s annual carbon dioxide missions, can be reduced in 2020.