Japan starts carbon credit trading trial at TSE

JAPAN started trial trading of carbon credits on Thursday (Sep 22) at the Tokyo Stock Exchange (TSE) as the world’s fifth-largest carbon emitter aims to create a nationwide market mechanism to help achieve carbon neutrality by 2050.

The TSE, a unit of Japan Exchange Group, has been commissioned by the Ministry of Economy, Trade and Industry to conduct the pilot project as the ministry prepares to set up the first exchange-based market for trading carbon credits, to help participants offset their emissions or monetise reduced emissions.

Under the trial, registered members, numbering 145 as of Thursday, can trade existing carbon credits, known as J-Credits, certified by the government. They have been traded over the counter on a voluntary basis since 2013.

The J-Credit scheme is designed to certify as credits the holder’s emissions reductions of greenhouse gases such as carbon dioxide, as well as emissions prevention or removal through energy-saving devices, forest management and other methods.

At the TSE, trading hours are 9.00-11.29 am and 12.30-2.59 pm (12.00-2.29 am and 3.30-5.59 am GMT). Transaction prices are set twice a day and published after trading hours.

The trial will continue through the end of January, followed by a government review and possible improvements to the system before it is formally launched.

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“We want to go into full-scale operation as early as next April if all goes well,” an official at the industry ministry said. REUTERS