Nishida TokyoCapandTradeProgram ERIMarketMechanismsWorkshop Beijing 2011-05-25

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Tokyo Metropolitan GovernmentClimate Change Measures

Tokyo Cap and Trade Program

Yuko Nishida

Bureau of Environment



Tokyo’s GHG Emission Reduction Target

25% below 2000 levels by 2020

2020 2000 25%



Tokyo Carbon Dioxide Footprint

Total CO 2 Emissions: 65 million tons (FY2007)6,500 2007

Residential

27%

Trans-Portation

22%

Commercial &Industrial

49%

Large CO 2 emittingfacilities

CO 2

approx.40%

approx.60%

Small to medium sized CO 2 emittingfacilities

CO 2

TOKYOMETROPOLITANGOVERNMENT

3





Program Development

2002 2005 2008 2010

Mandatory reporting program(Voluntary reductions program)

--require to report yearly emissions

----require to establish reduction plansfor 3yr-terms

----advise energy saving measures--

■ 2008 Enacted2008

● 2005 Revised2005


● 2002 voluntaryprogram started2002

■ 2010 mandatoryprogram started2010

MandatoryProgram: Tokyo

Cap-and-TradeProgram

5

Tokyo Cap-and-Trade



2007~8 Consultation Process2007 2008

June 2008 Unanimous approvalin the Metropolitan Assembly

2008 6

Public comments

Stakeholder

Meetings


Introduction

6

Tokyo Cap-and-Trade



The world’s first urban cap and trade

program to cover office buildings

40% of commercial and industrial

sectors’ emissions 40%

1,300 facili ties 1,3001,100 Commercial & institutional buildings1,100

200 Industrial facilities 200


Target: Facilities with annual energy consumption of1,500 kl or more (crude oil equivalent)

1,500 kl

Tokyo Cap-and-Trade



Current estimation. Fix by the end of the 1 st compliance period1*

1 st compliance period2010-2014

12010 -2014

2nd compliance period2015-2019

22015 - 2019

*

Base-year Emission

6% reduction(5 year average)

6%5

17% reduction(5 year average)

17%5

Cap Setting

8

Tokyo Cap-and-Trade



Based on historic emissionsBase-yr emission (1-Compliance factor) 5yrs

1 – 5

Allowance46,000 = 9,200 × 5yrs

10,000×8%

Total 5 yrs Emissions5Method 1 Self reduction

Method 2: Emission t rading12

reduction

2010 ’11 ’12 ’13 ’14 2010 ’11 ’12 ’13 ’14

Example

● Base year emissions: 10,000 tons 10,000● Compliance factor for 1 st compliance period 8% reduction

1 8%

Penalty fornon- compliance

Ordered to reduce 1.3 times the shortfall1.3

If order is violated:Monetary fine, surcharge, publi c announcement,etc.

Allowance Allocation

9

Tokyo Cap-and-Trade



Trading & CreditsEmissions trading Trading Amount:

Reduction exceeding the obligationEmission reduction exceeding the yearly obligation is allowed to betraded from the 2nd year.

Offsets

--Credits

1. Emission reductions from small and midsize

facilities within the Tokyo area* Emission reduction by energy-saving measures*

2. Renewable Energy Certificates* Solar (heat and light) energy, wind energy, etc.in Japan*

3. Emission reductions outside the Tokyo area* Sellers will be assumed to be covered under the

Tokyo Cap-and-Trade Program, and reduction exceeding thereduction obligation would be counted as offset credit

*

* Can only buy up to 1/3 of the reduction obligation* 1/3

10

Tokyo Cap-and-Trade



Key PointsUrban cap and trade program is asextremely effective to lower CO 2 emissionsfrom new and existing buildings in cities

Trading is crucial for an entire scheme

Careful design of a local carbon market isimportant to facilitate retrofit programs inTokyo

TOKYOMETROPOLITANGOVERNMENT 11



Key barriers and challenges

Failure story in 20052005Tried introducing mandatory emission reductionsprogram without trading

--lack of sufficient data----lack of knowledge (esp.building side)----insufficient communications with stakeholders,--

Lack of support from national level policyTOKYOMETROPOLITANGOVERNMENT 12



ExpansionTokyo’s Proposal on Nationwide Introductionof cap and trade program (Sept.2009)

2009 9

--Two-tier (national level and

regional level) cap and tradeprograms covers entire Japan

Expansion to the GreaterTokyo Region

TOKYOMETROPOLITANGOVERNMENT 13





Green Building Era in Tokyo

High performance buildings in progress 1

1● Energy efficiency, Low energy:

LED lights, Energy efficient air conditioning,Double glazed windows, Natural lightingNatural ventilation

LED

(Eco-Office Project, SHIMIZU CORPORATION)

● Renewable energy use:PV panels in system walls

15





Green Building Era in Tokyo

Retrofit Projects

Installing highly efficient air conditioning & lighting system.Improve district heating system …

(Mitsui Sumitomo Marine and Fire Insurance Co.Ltd.)

17



Use 100% renewable energy for the electricity consumptionin the high-rise energy efficient building

100%

(New Marunouchi Building, Mitsubishi Estate Co. Ltd.)

(Futamata Wind Power Development Corporation,

Aomori Prefecture)

Futamata

Progressive Actions

A New Scheme of Renewable Energy Use

18

ro ec s n sma an m s e ngs an



ro ec s n sma an m s ze u ngs ancorporations

Various improvement efforts for

energy efficiency are activelytaken

Install energy effic iency lights,reflecting devices, and managementsystems

Install high efficiency boilers

Thermal insulatingmaterials to cover

heat sources and bulbs

FY

27383

56

2

3

4

5

6

2 8 2 9 2

Energy assessment programfor small businesses are grown



Tokyo Climate Change Strategy

http://www.kankyo.metro.tokyo.jp/en/climate/index.htmlContact us: [email protected]

tokyoets@kankyo metro tokyo jp

Nishida TokyoCapandTradeProgram ERIMarketMechanismsWorkshop Beijing 2011-05-25

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