The Road to Tokyo Bay Restoration: Challenges of the Emissions Cap-and-Trade Program - December 2003

The Road to Tokyo Bay Restoration: Challenges of the Emissions Cap-and-Trade Program - December 2003

The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) considered the introduction of an emissions quota trading system for advanced sewage treatment in the Tokyo Bay watershed. Simulations were conducted for 77 sewage treatment plants in the Tokyo Bay watershed, assuming three levels of advanced treatment. As a result, it was estimated that the introduction of emissions quota trading would reduce costs by up to 10% compared to existing plans.

Based on the results of this study, the company plans to add Ise Bay to the list of target areas and proceed with the design of an emissions cap trading system more in line with actual conditions. In designing the system, the objective is to quantitatively grasp the expected effects and analyze the cost-effectiveness of the system. However, the specific timing of the introduction of the system has not yet been determined, and the system is expected to continue to be studied.

Meanwhile, the United Kingdom plans to introduce a new system in 2004 that will allow landfill permits to be traded among local governments. Under this system, when a municipality exceeds its allotted landfill permit, it can purchase one from another municipality, which is expected to have the effect of reducing the amount of landfill waste. This system is part of measures to control the amount of landfill waste that will continue to increase after the introduction of the landfill tax.

Both the Japanese sewerage project and the British system of regulating landfill disposal of waste will be watched closely as pioneering new trading systems to reduce the environmental burden.

--- (Japanese only)

Related information: 1.
1. 2003 Ministry of Land, Infrastructure, Transport and Tourism announcement
Start of consideration of an emission allowance trading system for advanced sewage treatment in the Tokyo Bay watershed.

2. report in June 2004
Results of Study of Emissions Cap-and-Trade System Model for Tokyo Bay Watershed: Potential for Cost Reduction of up to 30%.

3. 2005 revision of Sewerage Law
No examples of implementation.

4. landfill permit trading system in the U.K.
Introduced in 2004 to enable trading of landfill disposal volumes between municipalities.

This information will clarify how Japan's emissions cap and trade system is being considered and where the challenges lie in the future.