He added that Japan would also push the use of renewable energy and nuclear power, stressing that safety would be a priority -- a key point in a country that suffered the Fukushima nuclear disaster nearly a decade ago.
Japan, a signatory to the Paris climate change agreement, was the sixth-biggest contributor to global greenhouse emissions in 2017, according to the International Energy Agency.
It has struggled to cut carbon emissions after shutting down nuclear reactors following the 2011 meltdown in Fukushima sparked by a devastating earthquake and tsunami, which in turn increased its reliance on fossil fuels such as coal.
Japan's 140 coal-fired power plants provide nearly a third of its total electricity generation, and coal is the second-biggest power-generation method behind LNG-fired plants.
- 'No escape route' -
"It is a very ambitious target," said Daisuke Tanaka, a specialist in socially responsible environmental, social and governance investments at Daiwa Research Institute.
"He made a clear statement. Now Japan has to keep the promise. There is no escape route," he told AFP.
Tanaka said the policy was likely to mean a boost for renewable energy in Japan, with a focus on being providing a consistent supply.
Japan's ministry of economy and trade will compile an action plan by the end of the year, offering tax incentives and other policies to encourage investment in new technologies, according to Jiji Press.
Takaharu Niimi, a climate change specialist at the Japan Research Institute, told AFP that Suga's announcement was in line with an international move towards stronger commitments on the environment.
In September, the world's largest greenhouse gas polluter, China, announced it would be carbon neutral by 2060, a goal hailed by climate activists as a major step forward.
"Considering the international trend, I think the time is right for Japan to declare the plan," Niimi told AFP.
Suga's announcement was welcomed by activist groups including Greenpeace, as well as world leaders, with the EU's Ursula von der Leyen tweeting praise for Japan on setting a goal "that all developed nations should set themselves to stop climate change".
"The world is coming together for the climate," she wrote.
The spokesman for UN Secretary General Antonio Guterres called the pledge a "very significant positive development", saying Japan had joined a "growing group of major economies committed to lead by example".
Some details on how the goal will be achieved are expected to be laid out in Japan's next energy plan, currently under discussion.
The most recent version, issued in 2018, aimed to have 22-24 percent of the country's energy needs met by renewable sources including wind and solar by 2030, a figure critics called unambitious based on current levels of around 17 percent.
That plan also called for nuclear to provide more than 20 percent of the country's energy needs by 2030.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.