Introduction
POINT
The Tokyo Stock Exchange launched a carbon credit demonstration project last month, which has the potential to shake up emissions trading in Japan. It allows companies to trade carbon dioxide emission reductions as a commodity. The aim of the system is for companies to be further incentivized to meet the larger carbon reduction goals that are part of a country’s mandated GHG reduction goals, and the ultimate goal of the demonstration project is to enlarge its scale to move carbon trading to a more open market. Besides, to promote the reduction of greenhouse gas emissions from small and medium-sized companies, the Japanese Ministry of the Environment will begin to develop a qualification system for staff in financial institutions, whereby qualified practitioners can provide analysis and advice based on carbon emission calculations. The Ministry of the Environment of Japan is considering a method to create a guideline (guideline) that indicates the calculation standards for emissions, etc., and to certify or register private-sector qualifications that conform to the guideline from next year onward.
News
Energy Conservation of Buildings
Taisei Construction Corporation is promoting zero-carbon buildings, that emit almost no greenhouse gases during their life cycle. In addition, the company has developed a system to thoroughly and visually evaluate a building’s decarbonization system so that designers, builders, operators and users can understand and reduce CO2 emissions over the building’s life cycle.
【VIEW】
https://www.taisei.co.jp/about_us/wn/2022/220909_8933.html
Green Finance
To promote the reduction of greenhouse gas emissions from small and medium-sized companies, the Japanese Ministry of the Environment will begin to develop a qualification system for staff in financial institutions, whereby qualified practitioners can provide analysis and advice based on carbon emission calculations. The Ministry of the Environment of Japan is considering a method to create a guideline (guideline) that indicates the calculation standards for emissions, etc., and to certify or register private-sector qualifications that conform to the guideline from next year onward.
【VIEW】
https://www.sankei.com/article/20220910-VJNJBT5MFNN4ZAIPY63CAJXS4I/
Energy-saving Technology
Honda has announced their aim of “achieving carbon neutrality in all of their motorcycle products by 2040”. Honda will accelerate the electrification of its motorcycles while continuing to work on the renewal of its internal combustion engines. Honda’s initial goal is to sell one million electric motorcycles in the next five years and reach an annual sales volume of 3.5 million by 2030.
【VIEW】
https://news.webike.net/raceinfo/247680/
Energy Conservation of Buildings
Starting in April 2025, the Tokyo Metropolitan Government will be the first city in Japan to require the installation of solar panels on newly built houses. Tokyo’s land condition is not ideal for the development of renewable energy. Thus, the government’s determination to undertake such a policy further reflects the importance that the government places on renewable energy. Each district in Tokyo has set standards for installation based on the amount of sunlight it receives, and about 50 major house builders will be obligated to install these solar systems.
【VIEW】
https://business.nikkei.com/atcl/gen/19/00332/092900051/
Energy & Tech
China is not satisfied with being the world leader in terms of electric vehicles, and the Chinese government is accelerating the development and application of methanol vehicles. Methanol as a fuel is more environmentally friendly than traditional fuels while having the comparable calorific value. Methanol cars can increase 21% more energy efficient compared to cars using gasoline, in the meanwhile, reducing CO2 emissions by 26%. Just like electric vehicles, it is highly likely that Chinese automakers will once again be commercially successful in the area of methanol cars and politically drive China’s ambitions for climate-related technologies.
Carbon Neutrality
Malaysia’s national energy company Petronas has signed a memorandum of cooperation with the Ministry of Economy, Trade and Industry of Japan (METI) as well as a memorandum of understanding with Japan Bank for International Cooperation (JBIC). The parties signed the documents on 26 September 2022, seeking to collaboratively pursue mutual sustainability goals of achieving carbon neutrality by 2050. The agreements are expected to facilitate investment and financing, and also enhance technical collaboration and competencies in low-carbon technologies in the region.
【VIEW】
https://www.offshore-energy.biz/petronas-bolsters-ties-with-japan-to-work-toward-carbon-neutrality/
Perspectives
Carbon Market 【Eric Johnston】
The Tokyo Stock Exchange launched a carbon credit demonstration project last month, which has the potential to shake up emissions trading in Japan. It allows companies to trade carbon dioxide emission reductions as a commodity. The aim of the system is for companies to be further incentivized to meet the larger carbon reduction goals that are part of a country’s mandated GHG reduction goals, and the ultimate goal of the demonstration project is to enlarge its scale to move carbon trading to a more open market.
【VIEW】
https://www.japantimes.co.jp/news/2022/10/04/business/tokyo-stock-exchange-carbon-trading/
Carbon Capture 【Shoko Oda】
Japan’s Mitsubishi Heavy Industries Ltd. plans to start introducing a line-up of small to medium-sized carbon capture systems next year, which is estimated to have the ability to sequester up to 95% of CO2 emitted from small polluters like municipal waste incinerators, cement plants or ships. Companies like Mitsubishi Heavy are racing to develop capture, storage and utilization technology.
Energy & Tech 【Scott Foster】
Ebara, the Japanese industrial machinery and plant engineering company, is working on technology to produce environmentally friendly turquoise hydrogen. “Turquoise” hydrogen is created using methane pyrolysis, the thermal decomposition of natural gas into hydrogen and solid carbon that can be sold rather than sequestered. No carbon dioxide is released during methane pyrolysis itself. Products derived from solid carbon include carbon black, carbon fiber and carbon nanotubes.
【VIEW】
https://asiatimes.com/2022/09/the-future-of-turquoise-hydrogen-is-japanese/
Climate & Life
A study has found that the cost inflicted on the world by carbon pollution may be nearly four times higher than recent estimates, highlighting how much climate action could save this and future generations. The calculation of the cost of GHG emissions had been underestimated in previous methodologies in a variety of ways, but none more so than in the excess mortality carbon pollution causes, and on crop losses. Some climate and economic experts created a tool to estimate the true cost of carbon pollution using the latest research on socioeconomic projections, climate modeling, climate impact assessments, and economic discounting.
【VIEW】
https://www.japantimes.co.jp/news/2022/09/05/world/carbon-emissions-cost-study/
Interpretations
【Carbon Accounting】The key of supply chain decarbonizing: The calculation steps and case studies of “Scope3 emissions”
“Scope3 emissions” refers to GHG emissions generated from a series of processes including raw material procurement, manufacturing, logistics, sales, and waste disposal. The article introduces the four calculation steps of Scope3 emissions – determining the purpose of the calculation, confirming the scope of the calculation object, classifying the categories, and calculation of each category. By measuring Scope3, one can have an intuitive understanding of the carbon emissions of the whole supply chain, so the companies can choose suitable emission reduction measures in each part of the product supply chain and accelerate the speed of emission reduction in order to build a strong supply chain.
【VIEW】
https://www.itmedia.co.jp/smartjapan/articles/2210/06/news033.html
【Renewable Energy】Renewables see growth amid effort to meet global electricity demands
In a new analysis released by energy think tank Ember, researchers have found that global electricity demand grew by 389 terawatt hours in the first half of 2022, while together wind, solar and hydro increased by 416 TWh. This prevented a possible 4% increase in power generation from polluting fossil fuels, while avoiding $40 billion in fuel costs and 230 megatons in carbon dioxide emissions. It is believed that the tipping point where renewables are able to meet that increase in global electricity demand is coming closer to us.
【VIEW】
https://www.japantimes.co.jp/news/2022/10/05/business/renewables-electricity-demand/
【Energy & Tech】Japan Wants To Decarbonize With The Help Of Ammonia
Ammonia has long been considered as a potential way to store hydrogen, however, more recently, ammonia is being considered as a clean fuel in its own right. Ammonia has much better energy content by volume, almost double that of hydrogen. It doesn’t share the same storage problem as hydrogen. What’s more, Green ammonia can solve the long-standing problem of the traditional way of producing ammonia, from which process emits a significant amount of CO2. Ammonia also has the potency of replacing diesel as the fuel for ships. Other than that, Japan is exploring the use of ammonia as a co-burning fuel for coal power plants in order to reduce the GHG emissions.
【VIEW】
https://hackaday.com/2022/09/27/japan-wants-to-decarbonize-with-the-help-of-ammonia/
Other resources
Development Report for Green Transition in the Steel Industry from Ernst & Young
2022 UN Framework Convention on Climate Change – UNFCCC
Forecasting and Prospects Research Report
Events
Upcoming Events
Oct.26 – Oct.28 Energy Strategies in a Time of Upheaval – What is the new path towards a decarbonised world?
【DETAIL】
https://business.nikkei.com/atcl/gen/19/00503/093000001/
Nov.27 Opportunities in Transformation: How to Approach Companies with a Low ESG Score
Nov. 29 Responsible Investing today – and tomorrow
Recordings
Sept 29 Portfolio Transformation: Aligning with Net Zero
【DETAIL】
https://www.brighttalk.com/webcast/18673/553288