Posted on September, 28 2004

Tokyo, Japan - Japan should adopt an emissions trading scheme in order to meet its international targets for reducing greenhouse gases.

A new WWF report, commissioned by the German think-tank Oeko Institute, proposes an emissions trading scheme that would help Japan cut its CO2 emissions by 168 millions tons and help reach its Kyoto Protocol target of reducing greenhouse gas emissions by 6 per cent below 1990 levels by 2012,

Currently Japan is 7.6 per cent over its 1990 levels of greenhouse gas emissions, with two thirds of its emissions coming from its energy and industrial sector.

"The answer to Japan's climate pollution problem is a mix of policy measures, yet this should include an emissions trading system," said Yurika Ayukawa, head of the WWF- Japan's Climate Change Programme. "It is essential that we internalize pollution costs so that they become a factor in company accounts."

While Japanese industry has been opposed to other CO2 emission strategies such as a carbon tax, WWF-Japan believes that emissions trading could be more attractive.

"Through the trading scheme, innovative companies will be rewarded and laggards will be punished," Ayukawa added. "It's a fair, market-driven system that can obtain astonishing results when handled in the right way." 
 
According to the WWF report, an emissions trading scheme is the most flexible tool to identify cost effective measures for emission reductions and help Japan's competitiveness. If designed to be compatible with other emerging markets such as the EU Emissions Trading System, it will offer even more cost reduction advantages while remaining environmentally credible and effective. 
 
The world's first emissions trading scheme will enter into force in January 2005 between EU member states. A number of states in the US also plan to set up a joint emission trading system. The national systems will eventually be linked to a global trading scheme if and when the Kyoto Protocol enters into force. 
 
WWF would like to see the Japanese government state its aim of introducing a domestic emissions trading scheme by 2008, and start preparations in 2005 and a pilot phase in 2006. 

Notes:
• Under an emissions trading scheme, power stations and large energy-intensive steel, cement, chemical, and iron manufacturers match their CO2 emissions with permits issued by governments. Any companies exceeding these allowances have to buy spare ones from firms which have found ways of keeping greenhouse gases out of the atmosphere. 
 
• The EU Emissions Trading Scheme will come into force in January 2005. The EU has apportioned its target of emission reductions under the Kyoto Protocol to each member state. Each government has drawn up national allocation plans for installations of the industry sectors concerned. The scheme will at first run for a three-year trial period. WWF has criticized the National Allocation Plans as too weak for the system to reduce emissions sufficiently. 
 
• In Japan, the Guidelines for Measures to Prevent Global Warming are currently being reviewed for its first step (2002-2004). If current measures are found to be not enough to meet the Kyoto target, new and additional measures need to be introduced for the second step (2005-2007). 

For further information: 
Hiroko Sakuma
Press Officer, WWF-Japan
Tel: +81 3 3769 1713 
 
Yurika Ayukawa
Climate Change Programme Officer, WWF-Japan
Tel: +81 3 3769 3509
E-mail: yurika@wwf.or.jp