The Paris Agreement requires all signatory countries to make the transition to a carbon neutral society by the early latter half of this century, which calls for fundamental changes in socio-economic systems and activities of all aspects of human life. This paper first examines the implications of the Paris Agreement and SDGs. Then, it reviews global trends of transition to a carbon neutral society as well as issues pertaining to “just transition,” particularly employment impact of phasing out of coal power plant, taking a look at Germany as a case study. The paper then discusses the challenges that the government of Japan is facing, by critically examining “The Long-term Strategy under the Paris Agreement”. Finally, it proposes various policy measures relevant to the transition to a carbon neutral society, in particular, building decentralized and independent locally-based energy systems through the promotion of renewable energy.