Japan Forsees Starting Carbon-Emissions Trading in 2013, Panel Reports

Japan plans to start emissions trading in 2013, as the government revived a climate-protection draft law that was scrapped earlier this year when then Prime Minister Yukio Hatoyama resigned.

A panel under the environment ministry recommended starting trading in two phases, one from April 2013 and the other three years later, according to a proposal circulated today in Tokyo.

Efforts to pass climate legislation in Australia and the U.S. have stalled over criticism of proposed emission-trading programs. In Japan, power utilities, steelmakers and other industry groups have said capping carbon emissions will hurt domestic companies as they compete with peers in China and India that won’t face the same pollution limits.

Hatoyamo’s government pledged to cut Japan’s emissions of greenhouse gases by 25 percent from 1990 levels by 2020 before his resignation in June ended deliberations on a climate bill that would have introduced a cap-and-trade system.

The trade ministry yesterday proposed an increase in fossil fuel taxes from April next year to help tackle global warming.

The government imposes a tax on imports of oil of 2,040 ($24.17) yen per kiloliter, while 1,080 yen is levied on every metric ton of liquefied natural gas, according to the trade ministry. A tax of 700 yen per ton is imposed on coal.

To contact the reporters on this story: Shigeru Sato in Tokyo at ssato10@bloomberg.net; Michio Nakayama in Tokyo at mnakayama4@bloomberg.net.

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