Japan's Voluntary Emissions Trading Scheme Surpasses Reduction Target

On September 11, 2007, Japan's Ministry of the Environment (MOE) released the results of the first phase of Japan's Voluntary Emissions Trading Scheme (J-VETS) for emissions reductions and emissions trading of carbon dioxide (CO2). Thirty-eight companies or corporate groups participated in this phase, started in fiscal 2005, comprised of 31 "participants with commitments" and seven "participants for trading." Each of the former, who committed to a certain amount of emissions reduction, was subsidized to introduce facilities for curbing CO2 emissions and was allocated an emissions allowance by the MOE, whereas the latter engaged exclusively in emissions trading without subsidization or initial issue of any allowances.

All 31 participants with commitments met their reduction targets by making the most of their emissions reduction facilities, as well as using the emissions trading system (when necessary), which resulted in a total annual emissions reduction of 377,056 tons of CO2. This is equivalent to a 29 percent reduction of total base-year emissions from designated factories and offices. Base-year emissions are defined as mean values of total emissions during the past three years immediately before the first phase (i.e., 2002, 2003, and 2004). The estimated total amount of emissions reductions committed to by the participants at the beginning of the phase corresponded to 21 percent of total base-year emissions, suggesting a successful overachievement in emission reductions of 8 percentage points.

The emissions trading system was available to participants from April 2006 to August 31, 2007. Some of them, when necessary, purchased emissions credits from others that had surpluses to compensate for deficits in their own emissions allowances. In 24 cases, a total of 82,624 tons of CO2 was traded during this period.

The J-VETS supports enterprises enthusiastic about making efforts to reduce their greenhouse gas emissions by subsidizing the installation cost of their facilities for curbing CO2 emissions through measures such as energy saving, etc., in return for their commitment to certain amounts of emissions reduction. The MOE has engaged in its second and third phases independently since 2006 and 2007, respectively.

http://www.et.chikyukankyo.com/english/
- Environment Ministry Panel Proposes Voluntary Domestic Emissions Trading (Related JFS article)
http://www.japanfs.org/db/14-e
- About 30 Companies in Mie Prefecture To Join Emissions Trading Simulation (Related JFS article)
http://www.japanfs.org/db/157-e
- Japan's Voluntary Emissions Trading Scheme Starts (Related JFS article)
http://www.japanfs.org/db/1108-e
- First Case of Domestic CO2 Emissions Trading in Japan (Related JFS article)
http://www.japanfs.org/db/1686-e

Posted: 2008/01/28 03:31:59 PM
Japanese version