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Decarbonisation gains momentum as Tokyo Stock Exchange launches carbon trading

In a bid to expedite decarbonisation in the private sector, the Tokyo Stock Exchange Inc (TSE) unveiled a new platform for trading carbon credits. This innovative exchange enables companies to purchase and sell J-Credits, which are government-certified credits awarded to organisations that reduce carbon emissions through sustainable practices like renewable energy adoption and tree planting.

Tokyo Stock Exchange carbon trading_bamboo fields_Visual1Detail of Arashiyama’s bamboo forest from Kyoto, Japan.

Companies planning to meet emissions targets fully can offset their hard-to-abate emissions by purchasing credits, while those who surpass their reduction goals can profit by selling surplus credits. Over 180 organisations, including oil companies and regional banks, have joined this platform, with an expected annual trading volume of 500,000 tonnes of CO2 credits.

Traditionally, carbon credits in Japan were negotiated privately. The TSE's new open market system aims to enhance transparency in trading and aligns with the growing momentum in the private sector to utilise exchange systems for emissions reduction.

Read more: The power of sustainability: Why investing in sustainability drives faster company growth

Japan's commitment to cut emissions by 46% from 2013 levels by 2030 and achieve net zero by 2050 is being reinforced with the launch of the TSE carbon credits trading platform. 188 entities have already registered to participate, engaging in the trade of J-Credits representing carbon emissions reductions through renewable energy and forest management. On the first trading day, 3,689 tonnes of CO2 credits were exchanged.

Furthermore, Japan will introduce an emissions trading system (ETS) in 2024, with approximately 680 companies, accounting for over 40% of Japan's emissions, receiving emissions allowances and emission-cutting targets. By 2026, guidelines for the ETS and third-party certification mechanisms for companies' targets will be established, paving the way for emission allowance auctions for power producers starting from 2033 to 2034.

Read more: Singapore unveils its own carbon credit guidelines

The Japanese government anticipates investments exceeding $1,000 billion in decarbonisation over the next decade, significantly advancing its carbon reduction efforts.

In the evolving landscape of a decarbonised economy, it becomes crucial to foster broad participation in carbon offset endeavours. Championing renowned and impactful carbon projects, particularly those rooted in nature, such as those developed by DGB Group, empowers individuals and organisations alike to contribute to a more environmentally sustainable world.

DGB is committed to supporting businesses, investors, and individuals in reducing their carbon footprint and contributing to nature. We offer top-tier, industry-standard verified carbon credits derived from projects that yield numerous additional benefits alongside carbon mitigation. Our mission is to accompany your enterprise on its sustainability voyage, facilitating your transformation into a force for positive change in nature.

Take action for nature with DGB

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