ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Energy

Japan to trade credits for carbon cut by individuals at home

Tepco and SoftBank among backers of blockchain system launching this month

Japan's feed-in tariff system will be phased out starting in November.

TOKYO -- Japanese consumers who power their homes with solar panels installed on their roofs will be able to sell credits for reducing carbon dioxide emissions under a framework set to launch this month, Nikkei has learned.

Companies backed by the likes of Tokyo Electric Power Co. Holdings and SoftBank Corp. will set up the online trading system, with the goal of further spreading renewable energy by assigning monetary value to carbon reductions.

Japan's feed-in tariff program -- through which power suppliers buy renewable energy produced by businesses and individuals at fixed rates -- is set to be phased out from November. As a result, home owners are expected to consume more of the energy themselves. By selling carbon credits, those consumers will be able to make up for the decline in sales to power utilities.

Partners in the project include a joint venture of Tepco and housing materials company Lixil Group; Ubiden, a SoftBank-backed energy company; and Denryoku Sharing, which brokers energy. The program has the backing of the Environment Ministry.

Smart meters will track how much of their solar-panel-generated energy households use. The resulting credits will be linked to users via blockchain, the technology underpinning such cryptocurrencies as bitcoin.

Carbon credits will be traded as equivalents of the amount of renewable energy needed to offset the global warming gas. If power is sold at about 5 yen (4.7 cents) per kilowatt-hour, a typical family of four would earn about 20,000 yen a year if it has storage batteries or about 4,000 yen a year if it does not. Retailers and electric-vehicle rental operators are envisioned as among the possible buyers.

Buyers and sellers will make deals through a dedicated smartphone app that will also show information on where the emissions offsets stem from. In 2020, the program's builders aim to get 10,000 users on the platform and to start collecting a roughly 10% fee on transactions.

A growing number of Japanese businesses, including retail giant Aeon and electronics maker Fujitsu, have begun aiming to go carbon-neutral by covering all their energy needs with renewables. Green power is generally costly, making it difficult for smaller businesses and sole proprietors to procure. If the concept of selling carbon offsets from home producers catches on, it could widen the use of and access to renewable energy.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media