From: Reuters
Published November 12, 2008 08:59 AM

Japan utility exchange to begin green power trade

The Japan Electric Power Exchange (JEPX) said on Tuesday it would launch trading of green power and U.N. carbon offsets from Nov. 17 on a trial basis.

The electric power industry accounts for about a third of Japan's total greenhouse gas emissions, and the new trading scheme will provide another venue for those utilities struggling to meet the industry's voluntary emissions reduction goals under the Kyoto Protocol.

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Green power includes power originating from nuclear, hydro and solar power plants.

The exchange will begin offering trading of carbon-neutral power generated from fossil fuels but offset by U.N. carbon credits from April, Japan's trade ministry said separately.

The Japanese government and big corporations have been active in buying U.N. carbon offsets to help the world's fifth-biggest polluter meet its greenhouse gas emissions reduction target under the United Nations' Kyoto Protocol.

The JEPX, for spot and forward electricity transactions, has 40 member companies. They range from utility, oil and manufacturing companies to independent power producers.

The state-backed Japan Bank for International Cooperation launched a similar system for trading Certified Emission Reductions (CERs) in November 2007.

The Tokyo Stock Exchange, Japan's biggest bourse, is set to end a feasibility study on CERs by the end of this year and is awaiting a clear policy on emissions caps and trading from the Japanese government.

Japanese electric power companies are major buyers of U.N. carbon offsets. They either buy offsets from other holders or receive them in exchange for investing in U.N.-approved clean energy projects in developing countries.

The electric power sector as a whole held 190 million tonnes of such offsets for delivery between 2008 and 2012, the Federation of Electric Power Companies of Japan has said. (Reporting by Osamu Tsukimori; Editing by Chris Gallagher)

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