Japanese Prime Minister Taro Aso’s government recently approved a voluntary carbon-trading trial. Unlike the cap-and-trade system now used in Europe, where governments impose a mandatory ceiling and companies must buy carbon credits for additional emissions, Japan is allowing companies to set their own emission-reduction targets, Bloomberg reports.
Participants in the trial can buy carbon credits from companies that emit less than their limit. They can also buy and sell U.N.-certified emission credits.
Nippon Steel Corp. and Tokyo Electric Power Co., Japan’s largest maker of alloy and biggest generator, respectively, have not decided whether they will join the trial. However, both companies are among more than 70 utilities and steel makers that have agreed to buy more U.N. carbon emission credits in order to help Japan meet its GHG goals.
Japanese heavy industries have already set voluntary targets for reducing emissions. Steel makers have pledged to cut emissions by at least 30 percent in 10 years, and power utilities have pledged to cut carbon emissions generated per kilowatt hour of by 20 percent from the 1990 level by 2012.