Leading Global Warming Countermeasures at the Regional Level: From the Tokyo and Hiroshima City Cases

Tokyo’s Case

The Ordinance on Environmental Preservation makes the roughly 1,300 business facilities that use the crude oil equivalent of over 1,500 kl/year of crude oil the target of mandatory reductions starting in FY2010. The emission baseline and mandatory reduction rate are expected to be set within FY2008.

The first period for mandatory reductions will be the five years from FY2010 to FY2014. In the event that businesses are unable to meet the mandatory reduction targets through their own initiatives such as energy-saving, it is possible to offset over-emissions by acquiring reduction credits made by other businesses as part of their reduction measures. Applicable offset methods include obtaining reduction credits made by other target business facilities, credits made through energy efficiency by business facilities (small and medium-sized) not targeted by the ordinance, credits made by business facilities outside of the city, and the purchase of green power certificates (environmental value of the renewable energy produced). In addition, the “Green Heat Certification System”, which recognizes and purchases as environmental value the amount of solar heat used by families with installed solar heaters and boilers, is expected to be introduced in 2009. Obtaining these green heat certificates is also expected to provide a method for obtaining reductions made by business facilities not subject to the ordinance.

A measure to ensure effectiveness was also provided. Businesses showing outstanding efforts are to be recognized and awarded. If mandatory reductions are not met, an order is issued requiring a reduction measure of as much as 1.3 times the amount of emissions they have fallen short. Failure to comply brings a fine of up to JPY 500,000 and a charge for the costs for procuring the unmet amount. The remaining parts of the ordinance revision are centered on strengthening measures for the commercial and household sectors. Examples include a voluntary system of submitting reports on global warming countermeasures by small and mid-sized business facilities, mandatory effective energy-use planning for larges-scale urban development projects, strengthening standards for environmental consideration at buildings, and providing and selling energy-saving home appliances.

In this way, Tokyo’s efforts have preceded those of the national government. In terms of mid-range reduction goals, a numerical target of 25% reduction of greenhouse gas emission from 2000 levels by 2020 was set in January 2007. Reduction targets were specified among the industry, commercial, household and transportation sectors in the revision of the Basic Environmental Plan in March 2008.

International collaboration is also being aggressively pursued. Tokyo was the only city from Japan to participate in the Large Cities Climate Leadership Group (C40) comprised of 40 member cities, and hosted the C40 Tokyo Conference on Climate Change in October 2008. In addition to cooperating with the overseas transfer of environmental technology by Tokyo enterprises and concluding a memorandum with the Japan Bank for International Cooperation to promote global climate change measures, Tokyo has also shown a willingness to participate in the International Carbon Action Partnership (ICAP) which strives to build a global platform for emission trading.

In the background of Tokyo’s proactive stance is the necessity, as the largest metropolis in Japan, to take the initiative in addressing environmental problems particular to urban areas such as the worsening “heat island” phenomenon. There is also the desire to exercise its domestic leadership with regards to climate change measures. Moreover, recognition as an “environmentally advanced city” is critical from the perspective of attracting the Olympic Games.

Hiroshima City’s Case

Hiroshima City is also promoting its own unique efforts. In addition to a 6% emission reduction target by 2010 from 1990 levels, ambitious mid- to long-term goals of 50% reduction by 2030 and 70% reduction by 2050 have been set. There is also a plan to introduce its own emission trading scheme. Though not the kind of emission quota regulation found in Tokyo, large scale business facilities are required to come up with reduction plans. In addition to tree planting, buying green electricity, buying credit from CDM and other such methods for accomplishing these plans, Hiroshima City also recognizes the buying and selling of emission allowances in trading markets established by the city.

Citizen participation is a groundbreaking element of Hiroshima City’s emission trading scheme. Specifically, third parties can purchase emission reduction credits made by households and participate in emission trading on behalf of households. Third party organizations are assumed to be neighborhood associations and so on, and decisions regarding the use and distribution method for profits are entrusted to these associations. A detailed system design for the establishment of a trading market is currently underway, and trial runs are expected in 2009. To facilitate citizen participation, a point-based system has already been implemented where points, based on CO2 reduction ratios, are redeemable for discounts and services at participating stores. Feedback for this system has been favorable among participants.

Significance of Regional Leading Efforts

Leading regional efforts pursued independently are significant as opportunities for experimentation and demonstration. For example, proposals and arguments made by each EU member country help produce advanced environmental policy and serve to stimulate global discussion. Even in the US, where federal global warming countermeasures stagnated under the Bush Administration, leading efforts in California and northeastern states such as plans to implement regional emission trading are expected to aid the Obama Administration and its efforts to tackle global warming.

The implementation of appropriate measures tailored to characteristics of the region is also part of the significance of independent efforts. In particular, in the future the importance of global warming countermeasures will shift from the industrial sector to the commercial and household sectors. The experience developed by specific regions will be helpful in terms of designing more detailed frameworks.

There is a view among business facilities within these regions that leading regional efforts represent an added burden. However, when considering that global warming countermeasures will be strengthened in the long-run, building experience in the carbon market such as emission trading and minimizing one’s own carbon emission will help to avoid risks in the future. Acquiring low-carbon operational know-how ahead of the game should lead to effective business development. Experiences from leading efforts should be effectively reflected in national policies at a time when there is a need to transition to a low-carbon society.