The Federation of Electric Power Companies of Japan: Submission of a Written Opinion to the United Nations Concerning the Bilateral Offset

We hereby report that Masataka Shimizu, Chairman of FEPC, has announced at the regular press conference today that he has submitted a written opinion (a copy of which is attached below) to the United Nations, requesting approval of "the bilateral offset", as a new post-Kyoto mechanism.

This statement was prepared by us because, as a part of the Cancun Agreement adopted by COP16 at the end of last year, it has become possible for UN-approved private organizations to submit written opinions concerning new mechanisms that promote the reduction of greenhouse gas (GHG) emissions.

Japan has been engaging in Clean Development Mechanism (CDM) projects and other initiatives to assist developing countries, which would make a contribution equivalent to the reduction of GHG emissions by 260 million tons in five years. However, we are facing various challenges in implementing such projects.

We believe that a "bilateral offset" mechanism for jointly pursuing global warming countermeasures by two countries will be a very effective complementary measure and help us overcome these challenges.

We sincerely hope that our proposal will be approved as a new mechanism, which, as described in the written opinion, encourages the active use of private investment, the distribution of decarbonization technologies and the promotion of human resource development. The full text of the written opinion appears below:

About FEPC

The Federation of Electric Power Companies of Japan (FEPC) is a voluntary organization of 10 general electric utilities (power companies) of Japan, with the objective of contributing to economic development and quality of life in Japan by promoting the sound development of the electric power industry. (URL: www.fepc.or.jp )

Submission to Paragraphs 82, 86 and 87 of the Outcome of the work of the Ad Hoc Working Group on long-term Cooperative Action under the Convention

The Federation of Electric Power Companies of Japan (hereinafter referred to as FEPC ) would like to take this opportunity to present the Ad Hoc Working Group on long-term Cooperative Action under the Convention (AWG/LCA) with its views pursuant to paragraphs 82, 86 and 87 of the "Outcome of the work of the Ad Hoc Working Group on long-term Cooperative Action under the Convention" concerning section D: "Various approaches, including opportunities for using markets, to enhance the cost-effectiveness of, and to promote, mitigation actions, bearing in mind different circumstances of developed and developing countries".

FEPC has been representing the Japanese electric power industry on behalf of its 10 member companies, whose supply areas cover all of Japan, at the international climate change talks since 1992. Electricity is key to a low-carbon society and plays an increasingly vital role as businesses, industries, and governments strive to reduce GHG emissions respectively.

GHG emissions from developing countries will continue to increase as their economies grow, especially in Asia. The Japanese electricity industry has been committed to supporting GHG emission reductions and sustainable development in the developing countries' electricity sectors through various approaches, including the use of Kyoto Mechanisms. Although we realize that the Clean Development Mechanism (CDM) has contributed to enhancing our efforts to some extent, in order to further promote developing countries' mitigation actions it is also essential that the mechanisms which support developing countries through multilateral and bilateral channels be recognized, while CDM needs to be reformed.

As indicated above, the deployment of low-carbon technologies and capacity building in the electricity sector would substantially contribute to the mitigation of climate change, and FEPC continues its support for national low-carbon strategies in developing countries. These efforts have resulted in the creation of valuable incentives for developed countries' businesses to invest in deploying the best available technologies and share best practices, and greater chances for developing countries to obtain support. The Japanese government and Japanese industries have been examining the feasibility of establishing a new bilateral mechanism with some developing countries in order to further enhance our cooperation. Ensuring the utmost environmental integrity and considering the different circumstances of each country are vital in this process. In this regard, we believe that the new mechanisms should incorporate project-based mechanisms, including cross-corporation programs, in which the contribution of each project can be fairly evaluated, thus providing proper incentives for participation.

FEPC therefore urges that various mechanisms, particularly project-based bilateral offset mechanisms, be fully recognized under the new framework to be established, based on the outcome of the work of the AWG/LCA.

Contact:

The Federation of Electric Power Companies of Japan
Kazufumi Tokumine, +81-3-5221-1440
Public Relations Department
webadmf1@fepc.or.jp