The Reuters news
agency is reporting that a compulsory emissions trading scheme is
set to start in Japan in April 2013. The scheme will cover large
CO2 emitting companies.

Many details have yet to be worked out according to a draft of
the government’s proposals obtained by Reuters, which will be
presented to an expert committee at the Environment Ministry this
week.

That Committee will finalize proposal for Japan’s cap-and-trade
scheme by the end of this year.

Issues to be discussed include how CO2 emission quotas should be
allocated, how big they should be,  CO2 emissions from
electric power generation, and whether to link the scheme with
similar ones abroad according to Reuters.

While heavy emitters will bear the brunt of the new
regulations,  some concessions will be made to
carbon-intensive industries that face stiff international
competition.

Low-carbon sectors, such as solar panel manufacturing, that help
to curb greenhouse gas emissions will also be given some
latitude.

Japan’s parliament considered various policy initiatives in a
draft Bill earlier this year designed to cut greenhouse gas
emissions by 25 percent by 2020 from 1990 levels. No decisions were
reached at that time.

It is not yet certain if Prime Minister Naoto Kan’s
administration will present the same bill later this year.

The draft proposals suggest starting trading in two phases, one
from April 2013 and the other three years later.

“It is in the Environment Ministry’s interest to present the
same bill at an extraordinary parliament session and help to have
it passed smoothly, so that we will have domestic measures ready
and be accountable in international climate talks,” a government
official told Reuters.

Japan, the world’s fifth-biggest emitter of greenhouse
gases.