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Voluntary approaches on the environment: the Voluntary Action Plan on the Environment / Commitment to a Low Carbon Society August 2014 Environmental Economy Office Industrial Science and Technology Policy and Environment Bureau Ministry of Economy, Trade and Industry

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Page 1: Voluntary approaches on the environment: the Voluntary ... · Voluntary approaches on the environment: ... Labour and Welfare (MHLW) 3 (MAFF) ... measures . Voluntary action plans

Voluntary approaches on the environment: the Voluntary Action Plan on the Environment /

Commitment to a Low Carbon Society

August 2014 Environmental Economy Office

Industrial Science and Technology Policy and Environment Bureau Ministry of Economy, Trade and Industry

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*1 Amortization of emission credits issued under the Kyoto Protocol were considered in calculating CO2 emissions and CO2 emission intensity for 2009 and 2010. *2 Abovementioned 8 industries account for approximately 90% of total emissions from participating industries in the industrial and energy conversion sectors (54 industries)

○ After the announcement of the Keidanren Voluntary Action Plan on the Environment in 1997, industrial organizations voluntarily set up emission reduction targets and promoted efforts for their achievement. The Government conducted annual evaluation and verification of the progress made in relevant advisory councils, etc.

○ Industries chose emission reduction targets from among CO2 emissions, CO2 intensity, energy consumption, and energy intensity, in accordance with industries’ characteristics and potential for technology introduction, etc.

○ Under the Plan, 114 industries have already set emission reduction targets, covering approximately 80% of CO2 emissions from the industrial and energy conversion sectors (90% of which are under the jurisdiction of METI), or approximately 50% of such emissions from all sectors.

Target indicator Target level

(2008-2012 average) (against 1990 levels)

Average annual performance for

2008-2012 (against 1990

levels) Federation of Electric

Power Companies of Japan CO2 emission

intensity approx. -20% -2.6%

The Japan Iron and Steel Federation Energy consumption -10% -10.7%

Japan Chemical Industry Association Energy intensity -13% -15%

Petroleum Association of Japan Energy intensity -13% -15%

Japan Paper Association Energy intensity -20% -24.8%

CO2 emission intensity -16% -21.7%

Japan Cement Association Energy intensity -3.8% -4.4% 4 Electrical and Electronics

Associations CO2 emission

intensity -35% -48%

Japan Automobile Manufacturers Association/ Japan Auto-Body Industries

Association

CO2 emissions -25% -40%

Voluntary approaches in the business community (Voluntary Action Plan)

○ July 1996 Keidanren Appeal on Environment

Declaration on Voluntary Action of Japanese Industry Directed at Conservation of Global Environment in the 21st Century

○ June 1997 Announcement of Keidanren Voluntary Action Plan on the Environment 36 industries formulated voluntary action plans, widely ranging from

manufacturing to energy, distribution, transport, finance, construction and foreign trade.

Aimed to “reduce CO2 emissions from participating industries in the industrial and energy conversion sectors in fiscal 2010 to below the levels of fiscal 1990.”

*In 2006, the original single-year target was changed to a five-year average target for 2008-2012, in accordance with the first commitment period under the Kyoto Protocol.

Formulation of the Keidanren Voluntary Action Plan on the Environment

○ Kyoto Protocol Target Achievement Plan (entirely revised in Mar 2008)

“These voluntary action plans by business operators have thus far produced results and the voluntary action plans of Nippon Keidanren are, in particular, playing a central role in countermeasures in the industrial community. […] In order to improve the transparency, credibility and probability of targets achievement with regards to these voluntary action plans, the Government will promote periodic follow-ups by concerned councils to assess and verify these plans.”

Evaluation in Cabinet decision documents, etc.

Examples of action plans

1

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Category Industry Sector Energy Conversion Sector Business/Commercial Sector Transport Sector

Voluntary Action Plan

+ Keidanren member

(61 associations and companies)

(incl. household/office and transport sectors)

34 industry / energy conversion sector

associations (contributing associations to Keidanren±0% target)

1 Resource: Japan Mining Industry Association Resource: Federation of Electric Power Companies of Japan (FEPC) Retail: Japan Chain Stores Association MLIT: The Japan Shipowners’ Association (JSA)

2 Resource: Limestone Association of Japan Resource: Petroleum Association of Japan Retail: Japan Franchise Association MLIT: Japan Trucking Association 3 Resource: Japan Petroleum Development Association (JPDA) Resource: The Japan Gas Association (JGA) Retail: Japan Department Stores Association MLIT: The Scheduled Airlines Associations of Japan 4 Steel: The Japan Iron and Steel Federation (JISF) Retail: Japan Foreign Trade Council, Inc. (JFTC) MLIT: Japan Federation of Coastal Shipping Associations

5 Chemical: Japan Chemical Industry Association (JCIA) Resource: Japan LP Gas Association MLIT: The Association of Japanese Private Railways 6 Chemical: Japan Lime Association FSA: Japanese Bankers Association JBA) MLIT: East Japan Railway Company (JR-East) 7 Chemical: The Japan Rubber Manufacturers Association (JRMA) FSA: The Life Insurance Association of Japan MLIT: West Japan Railway Company (JR-West) 8 Chemical: The Japanese Electric Wire & Cable Makers’ Association (JCMA) FSA: The General Insurance Association of Japan MLIT: Central Japan Railway Company (JR-Central) 9 Chemical: Japan Aluminum Association MLIT: Japan Association of Refrigerated Warehouses (JRAW) MLIT: Japan Freight Railway Company

10 Chemical: Japan Copper and Brass Association MLIT: Japan Hotel Association MLIT: Kyushu Railway Company 11 Paper: Japan Paper Association (JPA) MLTI: The Real Estate Companies Association of Japan (RECAJ) MLIT: Hokkaido Railway Company 12 Paper: Japan Cement Association (JCA) MIC: NTT group MLIT: All Japan Freight Forwarders Association 13 Paper: Flat Glass Manufacturers Association of Japan MIC* KDDI MLIT: Shikoku Railway Company 14 Paper: Japan Sanitary Equipment Industry Association 15 Electronics: 4 Electrical & Electronics Associations (*1) 16 Electronics: The Japan Bearing Industry Association (JBIA) 17 Electronics: The Japan Society of Industrial Machinery Manufacturers 18 Electronics: Japan Machine Tool Builders’ Association (JMBTA) 19 Automobile: Japan Auto Parts Industries Association

20 Automobile: Japan Automobile Manufacturers Association (JAMA) / Japan Auto-Body Industries Association (JABIA)

21 Automobile: Japan Industrial Vehicles Association 22 MOF: Brewers Association of Japan (BAJ)

23 MHLW: The Federation of Pharmaceutical Manufacturers’ Associations of Japan (FPMAJ) / Japan Pharmaceutical Manufacturers Association (JPMA)

24 MAFF: Japan Dairy Industry Association 25 MAFF: Japan Soft Drink Association 26 MAFF: Japan Sugar Refiners’ Association 27 MAFF: Flour Millers Association 28 MLIT: Japan Federation of Construction Contractors 29 MLIT: Japan Federation of Housing Organizations

30 MLIT: The Shipbuilders’ Association of Japan(SAJN) / The Cooperative Association of Japan Shipbuilders (CAJS)

31 MLIT: Japan Association of Rolling Stock Industries (JARi) 32 Paper: Japan Federation of Printing Industries (*2)

Voluntary Action Plan

+ non-Keidanren member

1 Paper: Japan Textile Finishers’ Association Resource: Power Producers and Suppliers Retail: Ote Kaden Ryutsu Kondankai (home appliances retail) MLIT: Japan Passengerboat Association 2 Paper: Japan Glass Bottle Association Retail: Japan DIY Industry Association MLIT: Japan Federation of Hire-Taxi Associations (*5) 3 Paper: Japan Prefabricated Construction Suppliers & Manufacturers Association Retail: Japan Information Technology Services Industry Association MLIT: Nihon Bus Association 4 Electronics: Japan Construction Equipment Manufacturers Association Retail: Japan Association of Chain Drug Stores (JACDS) MLIT: The Japan Harbor Transportation Association

(JHTA) 5 MOF: Japan Tobacco Inc. Retail: Japan Leasing Association 6 MAFF: Japan Starch and Saccharification Association Retail: Japan Council of Shopping Centers (JCSC) 7 MAFF: Japan Bread Industry Association MoE: National Federation of Industrial Waste Management Associations 8 MAFF: Japan Beet Sugar Association MoE: The Japan Newspaper Publishers & Editors Associations 9 MAFF: Japan Frozen Food Association MoE: Zenkoku Pet Kyoukai (pet retail)

10 MAFF: Japan Oilseed Processors Association FSA: National Association of Shinkin Banks 11 MAFF: All Nippon Kashi Association (ANKA) (snack food) FSA: Community Bank Shinyo Kumiai 12 MAFF: Japan Ham & Sausage Processors Cooperative Association FSA: Japan Securities Dealers Association (JSDA) 13 MAFF: All Japan Coffee Association MHLW: Japanese Consumers Co-operative Union (JCCU) 14 MAFF: Japan Instant Food Industry Association MHLW: Japan Medical Association 15 MAFF: Japan Soy-sauce Brewers’ Association MIC: Telecommunications Carriers Association (TAC) 16 MAFF: Japan Canners Association MIC: Telecom Services Association (TELESA) 17 MAFF: National Association of class mayonnaise dressing MIC: The Japan Commercial Broadcasters Association 18 MAFF: Nihon Hamburg & Hamburger Association MIC: Japan Broadcasting Corporation (NHK) 19 MAFF: Japan Rice Millers Association MIC: Japan Cable and Telecommunications Association (JCTA) 20 MLIT: Japan Ship Machinery and Equipment Association MIC: Japan Satellite Broadcasting Association 21 MLIT: Japan Marine Industry Association (*3) MIC: Japan Internet Providers Association (JAIPA) 22 MEXT: The Federation of All Japan Private Schools’ Associations 23 MAFF: Japan Foodservice Association 24 MAFF: Japan Processed Foods Wholesalers Association 25 MLIT: The Japan Warehousing Association Inc. 26 MLIT: Japan Ryokan & Hotel Association (*4) 27 MLIT: Japan Automobile Service Promotion Association (JASPA) 28 NPA: All Japan Pachinko Association 29 NPA All Nippon Amusement Machine Operators’ Union (AOU)

(Reference) 114 participating industries of the Voluntary Action Plan

2 Legend: Supervising Working Groups Resources: Natural Resources and Energy WG; Chemical: Chemical and Nonferrous Metals WG; Electronics: WG on Electronics, Electric appliances and Industrial Machinery; Steel: Iron and Steel WG; Paper: WG on Paper Manufacturing, Panel Glass and Cement; Automobile: WG on Automobiles, Auto Components and Auto Bodies; Retail: Distribution and Services WG (*1) Japan Electrical Manufacturers' Association (JEMA), Japan Electronics and Information Technology Industries Association (JEITA), Japan Business Machine and Information System Industries Association (JBMIA), Communications and Information Network Association of Japan (CIAJ); (*2) The Japan Federation of Printing Industries is excluded from the Keidanren target (±0%); (*3) Formerly, Japan Boating Industry Association (JBIA); (*4) Formerly, The Japan Ryokan Association (Kokkanren) and Japan Tourist Hotel Association (Nikkanren); (*5) Formerly, Japan Federation of Taxicab Associations

Legend: Governing Ministries and Agencies

Ministry of Economy, Trade and Industry (METI)

41 (associations and companies)

Ministry of the Environment (MoE) 3

Financial Services Agency (FSA) 6

Ministry of Internal Affairs and Communications (MIC) 7 (NTT group and KDDI included in TAC)

Ministry of Finance (MOF) 2

Ministry of Education, Culture, Sports, Science and Technology (MEXT)

1

Ministry of Health, Labour and Welfare (MHLW) 3

Ministry of Fisheries, Forestry and Agriculture (MAFF) 20

Ministry of Land, Infrastructure, Transport and Tourism (MLIT)

29

National Police Agency (NPA) 2

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Stipulates the measures that need to be taken in order to ensure compliance with the commitment under the Kyoto Protocol to reduce emissions by 6%, pursuant to the Act on Promotion of Global Warming Countermeasures. Formulated in 2005 (by Cabinet Decision) and entirely amended in 2008 prior to the first commitment period under the Kyoto Protocol. States that targets can be achieved if all actors in each sector are fully committed to implementing policy measures.

*Difference between estimates for BAU emissions and emissions that would occur with the implementation of measures in 2010.

Forest sink measures

Measures to reduce HFCs,

PFCs, SF6

Utilization of the Kyoto

Mechanisms ・・・

<Examples of measures provided in the Kyoto Protocol Target Achievement Plan and respective potential emission reductions.

6.53 Mil tons (Industrial sector)

2.47 Mil tons 3.8 Mil tons 6.44 Mil tons 4.767 Mil tons 2.00 Mil tons (equivalent to credits annually obtained by the Government)

Potential emission

reductions*

Introduction of “new energy”

Auto- mobile

measures

Voluntary action plans in the business community

Japan: internationally committed to reduce emissions by 6% relevant to 1990 levels over the 2008-2012 period. (adopted in 1997, ratified in 2002)

Law stipulating the basic framework for Japan to address global warming, given the adoption of the Kyoto Protocol. (enacted in 1998, most recently amended in 2013) Stipulates the responsibilities of the national and local governments, business operators and the general public and provides for the formulation of the Kyoto Protocol Target Achievement Plan. Also stipulates the organizational structure of the Government and Kyoto Protocol-related matters (emission credits issued under the Kyoto Protocol and forest sinks).

Kyoto Protocol

Act on Promotion of Global Warming Countermeasures

Kyoto Protocol Target Achievement Plan

(Reference) Framework of Japan’s global warming countermeasures in view of achieving Kyoto Protocol targets

3

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○ The Kyoto Protocol Target Achievement Plan (entirely revised on March 28, 2008) provides that in order to improve the transparency, credibility and probability of target achievement with regards to these voluntary action plans, the Government will conduct periodic follow-ups in concerned advisory councils.

○ The action plans of the 41 industries under the jurisdiction of METI were evaluated and verified in 7 industry-specific WGs under the Industrial Structure Council’s Global Environment Subcommittee. 2 expert committee members from the Central Environment Council also participated in each WG.

○ The outcomes of deliberations conducted in each WG were reported at the Joint Conference of the Industrial Structure Council's Global Environmental Subcommittee and the. Central Environment Council's Expert Committee for Follow-up to the Voluntary Action Plan, where the evaluation and verification results of the Voluntary Action Plan on the Environment and future challenges were sorted out.

(1) Natural Resources and Energy WG [Chair: Kenji Yamaji, Director-General, Research Institute of Innovative Technology for the Earth]

(2) Distribution and Services WG [Chair: Hidetoshi Nakagami, President, Jukankyo Research Institute]

(3) Chemicals and Nonferrous Metals WG [Chair: Takeshi Kikkawa, Professor, Graduate School of Commerce and Management, Hitotsubashi University

(4) Electronics, Electrical Equipment, and Industrial Machinery WG [Chair: Takeshi Kikkawa, Professor, Graduate School of Commerce and Management, Hitotsubashi University

(5) Iron and Steel WG [Chair: Taketo Sakuma, Vice President, Kochi University of Technology]

(6) Automobiles, Auto Parts and Auto Body WG [Chair: Ryuj Matsuhashi, Professor, Graduate School of Engineering, University of Tokyo]

(7) Paper, Flat Glass, and Cement WG [Chair: Hidetoshi Nakagami, President, Jukankyo Research Institute]

November 29, 2013 December 2, 2013

December 3, 2013 December 10, 2013 December 13, 2013 December 18, 2013 December 20, 2013

Joint Conference of the Industrial Structure Council‘s Global Environmental Subcommittee and the. Central Environment Council’s Expert Committee for Follow-up to the Voluntary Action Plan <May 28, 2014>

Industry-specific WGs Evaluation and verification schedule for fiscal 2013

Evaluation and verification of the Voluntary Action Plan

4

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WG

Natural Resources and Energy WG

(8 industries)

Iron and Steel WG

(1 industry)

Chemical and Nonferrous Metals WG

(6 industries)

WG on Paper Manufacturing, Panel Glass and Cement

(8 industries)

WG on Electronics, Electric appliances and Industrial Machinery

(5 industries)

Distribution and Services WG

(10 industries)

WG on Automobiles, Auto Components and Auto Bodies

(3 industries)

Industry Federation of Electric Power Companies of Japan

The Japan Iron and Steel Federation

Japan Chemical Industry Association

Japan Paper Association

4 Electrical & Electronics Associations

Japan Chain Stores Association

Japan Auto Parts Industries Association

Petroleum Association of Japan

Japan Lime Association Japan Cement Association

The Japan Bearing Industry Association

Japan Franchise Association

Japan Automobile Manufacturers Association / Japan Auto-Body Industries Association

Power Producers and Suppliers

The Japan Rubber Manufacturers Association

Japan Federation of Printing Industries

The Japan Society of Industrial Machinery Manufacturers

Japan Council of Shopping Centers

Japan Industrial Vehicles Association

The Japan Gas Association

Japan Aluminum Association

Japan Textile Finishers’ Association

Japan Construction Equipment Manufacturers Association

Japan Department Stores Association

Japan Mining Industry Association

The Japan Electric Wire & Cable Makers’ Association

Flat Glass Manufactures Association of Japan

Japan Machine Tool Builders’ Association

Ote Kaden Ryutsu Kondankai (home appliances retail)

Limestone Association of Japan

Japan Copper and Brass Association

Japan Glass Bottle Association

Japan Information Technology Services Industry Association

Japan Petroleum Development Association

Japan Sanitary Equipment Industry Association

Japan Association of Chain Drug Stores

Japan LP Gas Association

Japan Prefabricated Construction Suppliers& Manufacturers Association

Japan DIY Industry Association

Japan Foreign Trade Council, Inc.

Japan Leasing Association

* Industrial organizations are listed in the order of CO2 emissions (not GHGs) in fiscal 2011. The first four industries listed under the Natural Resources and Energy WG represent the energy conversion sector, in the order of CO2 emissions. Working Groups are listed in the order of CO2 emissions collectively covered, from left to right. Emissions basically include Indirect emissions (with the exception of electric power companies for which only direct emissions are counted).

(Reference) 41 participating industries under METI jurisdiction

5

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6

Status of target achievement under the Voluntary Action Plan (114 industries)

○ Targets were achieved by 84 industries of the 114 industries that formulated action plans. ○ One-third of participating industries (38 industries) enhanced their targets, responding to encouragement in

follow-ups. ○ Targets were slightly overachieved (achievement rate of 100-150%) in 52/114 industries, 26 industries of which

had enhanced their targets in the follow-up process.

Notes: 1) Achievement rates were calculated using the following formula (100% = achievement of pledged reductions in no more or no less than target level): 𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝑟𝑟𝐴𝐴 = 1 −𝑎𝑎𝑎𝑎𝑎𝑎 𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑎𝑝𝑎𝑝 𝑎𝑝𝑙𝑝𝑎

1−𝑎𝑎𝑝𝑡𝑝𝑎 𝑎𝑝𝑙𝑝𝑎

2) For industries adopting more than one indicator, the indicator with a lower achievement rate was counted,. 3) For industries which have achieved targets which sought to maintain baseline levels (±0) are counted among industries with achievement rates of 300+, as their achievement rates would be infinite.

Source: Compiled by IEEJ based on responses from industrial organizations to FY2012 questionnaire survey, FY2013 Government follow-up material

0 5 10 15 20 25 30 35 40

-50%

50%-100%

100%-110%

110%-150%

150%-300%

300%+

Status of target achievement by indicator (114 industries)

CO2 emissions CO2 emission intensity energy consumption energy intensity

52 industries

84 industries

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7

Committee for the Comprehensive Review of the Voluntary Action Plan on the Environment

Members

○ Experts reviewed the Voluntary Action Plan on the Environment in meetings held from June 2013 to identify unresolved challenges embraced by it and enhance the effectiveness of the Commitment to a Low Carbon Society to be implemented in the business community from 2013, as well as to conduct a comprehensive review of the accomplishments of the Plan and contribute to future domestic and overseas studies and analyses on it.

○ Welcoming Yoichi Kaya, President of RITE (former Chairman, Global Environmental Subcommittee, Environmental Committee, Industrial Structure Council) as Chair, the Committee comprised current and former Chairs of industry-specific WGs under the Industrial Structure Council and the Chairman of the Expert Committee for Follow-Up to the Voluntary Action Plan on the Environment, Global Environment Committee, Central Environment Council. Research institutions with insight on the Voluntary Action Plan, the Ministry of the Environment and the Keidanren secretariat also joined discussions.

First meeting: June 17, 2013; Second meeting: February 10, 2014; Third meeting: February 24, 2014; Fourth meeting: March 17, 2014; Publication of report: April 25, 2014 Meetings

Observers Keigo Akimoto Group Leader, System Research, Research Institute of Innovative Technology for the Earth Hiroki Kudo Senior Research Fellow, Global Environment & Sustainable Development Unit, Institute of Energy Economics, Japan Taishi Sugiyama Senior Researcher, Central Research Institute of Electric Power Industry Junichi Fujino Senior Researcher, Social and Environmental Systems Division, National Institute for Environmental Studies Climate Change Policy Division, Global Environment Bureau, Ministry of the Environnment Environmental Policy Bureau, Keidanren

Chair Yoichi Kaya President, Research Institute of Innovative Technology for the Earth (former Chairman, Global Environmental Subcommittee, Environmental Committee, Industrial Structure Council)

Members Hisashi Ishitani Professor emeritus, University of Tokyo (former Chair, Electronics, Electrical Equipment, and Industrial Machinery WG; former Chair, Automobiles, Auto Parts and Auto Body WG)

Tadashi Otsuka Professor, School of Law, Waseda University (Chairman, Expert Committee for Follow-Up to the Voluntary Action Plan on the Environment, Global Environment Committee, Central Environment Council)

Takeo Kikkawa Professor, Graduate School of Commerce and Management, Hitotsubashi University (Chair, Electronics, Electrical Equipment, and Industrial Machinery WG; Chair, Chemicals and Nonferrous Metals WG)

Taketo Sakuma Vice President, Kochi University of Technology (Chair, Iron and Steel WG)) Hidetoshi Nakagami President, Jukankyo Research Institute (Chair, Paper, Flat Glass, and Cement WG; Chair, Distribution and Services WG) Ryuji Matsuhashi Professor, Department of Electrical Engineering and Information Systems, Graduate School of Engineering, University of Tokyo

(Chair, Automobiles, Auto Parts and Auto Body WG) Kenji Yamaji Director-General, Research Institute of Innovative Technology for the Earth (Chair, Natural Resources and Energy WG)

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○ In 1997, Japan had improved efficiency levels by more than 30% as a result of energy-saving efforts since the oil crises, thus achieving the world’s highest efficiency levels.

○ Targets set under the Voluntary Action Plan by the 34 Keidanren member industries from the industrial and energy conversion sectors represented, on average, a ratio of 0.90 (-10%) to actual energy intensity and CO2 intensity levels in 1997 (=1.0). In comparison, actual values in the target year were, on average, 0.83 (-17%) against 1997 levels, thereby indicating industrial efforts to overachieve targets which had been set at even more stringent levels compared to the world’s highest efficiency levels.

Validity of action plan targets

Source: Comprehensive Energy Statistics, Annual Report on National Accounts

Energy efficiency

Energy consumption

CO2 emission intensity

CO2 emissions

Federation of Electric Power Companies of Japan

0.96

0.96

[0.91] 1.05

(1.04)

1.05

(1.04)

Petroleum Association of Japan

[0.95] 0.92

0.92

0.92

(0.92)

0.92

(0.92)

The Japan Gas Association 0.21 0.21 [0.20] 0.21

(0.19)

[0.20] 0.21

(0.19)

Japan Iron and Steel Federation

0.84

[0.85] 0.84

0.85

(0.84)

0.85

(0.84)

Japan Chemical Industry Association

[0.93] 0.90

0.90

0.92

(0.87)

0.92

(0.87)

Japan Paper Association [0.84] 0.79

0.79

0.83

(0.81)

0.83

(0.81)

4 Electrical & Electronics Associations

0.71

0.71

[0.83] 0.86

(0.76)

0.86

(0.76) Japan Automobile Manufacturers Association / Japan Auto-Body Industries Association

0.66

0.66

0.72

(0.67)

[0.84] 0.72

(0.67) Average for 34 Keidanren member industrial and energy-conversion sectors

[0.90] 0.83

1.0

1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

(tonne of oil equivalent/trillion yen)

Efficiency improved by

33%

Upper row:[Target level] Middle row: Actual performance, without credits Lower row: (actual performance, credits reflected)

Primary energy consumption per real GDP in Japan

8

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9

○ Playing a central role in industrial efforts to cope with climate change, the Voluntary Action Plan on the Environment has proved to be a highly effective approach. Some of its accomplishments include the following:

1. Many industries established challenging targets, which were achieved through constant energy-saving efforts and guidance in Government-led follow-ups, best practices were shared among industries and a steadily increasing number of industries formulated action plans .

2. Investment was made not only in measures with short payback periods but also in middle- to long-term strategies for enhanced competitiveness.

3. The world’s highest energy efficiency levels were maintained through persistent technological development and introduction

○ If Japan is to continually employ voluntary approaches in the middle to long-term as a central policy instrument for climate change, Keidanren must continue its undertakings and take the initiative in setting up post-2020 targets.

○ The proposals made in this report should be harnessed to the fullest extent possible in order to further the effectiveness of the subsequent Commitment to a Low Carbon Society.

<Institutional flexibility> ○ Providing clear data on the assumptions made in determining a target can ensure flexibility in reconsidering action plans in follow-ups in

correspondence to changes occurring in the business environment, such as economic downturns and industrial structural reforms. <Increased coverage> ○ It is essential to increase coverage, both in terms of expanding the number of participating industries, especially in the business/commercial sector,

and engaging more member companies of each participating industrial organization. <Promotion of data accessibility> ○ Further disclosure of historical data on business activity, energy consumption and energy intensity by industry and analysis conducted on historical

trends will enable multidimensional evaluation of the policy. <Formulation of guidelines for data collection and disclosure> ○ Formulating and announcing guidelines which outline industry-oriented methods for data collection/disclosure and guidance on procedures/case

examples concerning the implementation of such guidelines can ensure the fostering of international and social confidence in the program and promote knowledge-sharing among industries.

<Establishment of research hubs and enhancement of international outreach> ○ Establishing research hubs where academic analysis and evaluation of the Voluntary Action Plan on the Environment and Commitment for a Low

Carbon Society can be conducted on a constant basis by overseas researchers and universities can facilitate multidimensional analysis and evaluation.

Proposals for Commitment to a Low Carbon Society

Comprehensive evaluation of the Voluntary Action Plan

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excerpts from the Annual Report on the Environment, the Sound Material-Cycle Society and the Biodiversity in Japan (2014) (adopted by Cabinet decision on June 6, 2014)

○ “The Status of Progress in Implementing the Kyoto Protocol Target Achievement Plan,” compiled by the Global Warming Prevention Headquarters based on the outcome of deliberations by the Comprehensive Review Committee states that the Voluntary Action Plan “has been sufficiently successful.“

○ The Plan has similarly gained high acclaim in other Government documents including the environment white paper (Annual Report on the Environment, the Sound Material-Cycle Society and the Biodiversity in Japan.)

Japan’s business community, led by Keidanren, has proactively addressed global warming issues by formulating the Voluntary Action Plan on the Environment in 1997. Consequently, the Voluntary Action Plan has thus far produced sufficiently high results, including the following: [1] The Voluntary Action Plan was effective on the whole, as many industries set up challenging targets, which were achieved through consistent energy-saving efforts and Government-led follow-ups, best practices were shared among different industries and a steadily increasing number of industries formulated action plans. [2] Investment was made not only in measures with short payback periods but also in middle- to long-term strategies for enhanced competitiveness. [3] The world’s highest energy efficiency levels were maintained through persistent technological development and introduction.

Evaluation of the Voluntary Action Plan in Government documents

excerpts from The Status of Progress in Implementing the Kyoto Protocol Target Achievement Plan (complied by the Global Warming Prevention Headquarters on July 1, 2014)

Despite significant changes in Japan’s energy context in both domestic and international terms after the Great East Japan Earthquake and the accident at TEPCO’s Fukushima Daiichi Nuclear Power Plant in March 2011, Japan was able to achieve its target of reducing emissions by 6% by the first commitment period under the Kyoto Protocol, because all circles and levels of the Japanese public have made maximum efforts to address global warming. These include the sufficient success achieved by the Voluntary Action Plan on the Environment, which has played a central role in implementing global warming countermeasures in the business community, thus maintaining the world’s highest energy efficiency levels, the tireless efforts to implement energy-saving measures, such as enhancing the efficiency of equipment in accordance with Top Runner standards, and the consistent implementation of emissions control of HFCs, PFCs, SF6 and forest sink measures, etc.

10

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Voluntary Action Plan on the Environment (-fiscal 2012)

Commitment to a Low Carbon Society (-fiscal 2020)

Participant industries

114 industries 90 industries *as of end of June 2014. Urging of non-participant industries to formulate plans to be continued.

Coverage ratio * Based on actual CO2 emissions of energy origin in fiscal 2012

50% of total emissions in Japan 80% of emissions from industrial and energy conversion sectors

50% of total emission in Japan 80% of emissions from industrial and energy conversion sectors

Substance of plans Industry-specific emission reduction targets (average of fiscal 2008-2012 levels)

[Commitment] 1) Industry-specific emission reduction targets (as of 2020) + [Reduction potential] 2) Development and diffusion of low-carbon products (contribution to emission reductions in transport and business/commercial sectors) 3) International contribution through technology transfer, etc. (transfer of energy-saving technologies and know-how to developing countries by utilizing bilateral offset mechanisms, etc.) 4) Development of innovative technologies (commercialization in 2030-2050)

Commitment to a Low Carbon Society

○ In December 2009, Keidanren determined the basic principles for the Commitment to a Low Carbon Society, which would succeed the Voluntary Action Plan. Embracing 36 industries which had already formulated action plans, the Keidanren Commitment to a Low Carbon Society was announced in January 2013.

○ The Commitment to a Low Carbon Society not only comprises emission reduction targets for domestic corporate activities but also contributions to reductions in other sectors through the diffusion of low-carbon products and international contribution through technology transfer.

○ The Commitment to a Low Carbon Society covers 80% of CO2 emissions from the industrial and energy conversion sectors, amounting to a ratio comparable to coverage by the Voluntary Action Plan, excluding the Federation of Electric Power Companies of Japan (FEPC), which is currently unable to set targets based on projections of a future energy mix

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○ The 9 major industries have pledged emission reduction targets for 2020 as provided in the table below. ○ The Commitment to a Low Carbon Society comprises 4 pillars: 1) emission reduction targets; 2) development

and diffusion of low-carbon products; 3) contribution at the international level through technology transfer, etc.; and 4) development of innovative technologies

Baseline year Target indicator Reduction target level in 2020 [Commitment]

Federation of Electric Power Companies of Japan

- (absolute value)

- (CO2 intensity)

- (0.33kg-CO2/kWh

prior to Great East Japan Earthquake) Japan Iron and Steel

Federation 2005 CO2 emission reductions from BAU -5 Mil t-CO2

Japan Chemical Industry Association 2005 CO2 emission reductions from BAU -1.5 Mil t-CO2

Japan Paper Association 2005 CO2 emission reductions from BAU -1.39 Mil t-CO2

4 Electrical and Electronics Associations 2012 energy intensity more than -7.73% (*)

Japan Cement Association 2010 energy savings from BAU -56 thousand kl

Japan Automobile Manufacturers Association 1990 CO2 emissions -28%

Petroleum Association of Japan 2010 energy savings -0.53 Mil kl

The Japan Gas Association 1990 CO2 intensity energy intensity

-89% -85%

• Average annual energy intensity improvement rate of 1% until 2020

(Reference) Emission reduction targets pledged by major 9 industries under the Commitment to a Low Carbon Society

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Emissions coverage under the Voluntary Action Plan and the Commitment to a Low Carbon Society

as of June 30, 2014

○ The Voluntary Action Plan covered over 80% of CO2 emissions from the industrial and energy conversion sectors. The Commitment to a Low Carbon Society covers a comparable ratio of CO2 emissions from the industrial and energy conversion sectors, excluding the Federation of Electric Power Companies of Japan (FEPC), which is currently unable to set targets based on projections of a future energy mix.

○ In the business/commercial sector, 20% of CO2 emissions were covered by the Voluntary Action Plan, whereas only 10 % is covered by the Commitment to a Low Carbon Society.

○ The Voluntary Action Plan covered 51% of total CO2 emissions of energy origin, while the Commitment to a Low Carbon Society covers 45%.

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Business / commercial sector (27,237)

Voluntary Action Plan 5,743 (21%)

Commitment to a Low Carbon Society 2,981 (11%)

Industrial and energy conversion sectors (50,535)

Voluntary Action Plan 42,307 (84%)

Commitment to a Low Carbon Society 38,135 (75%)

based on FY 2012 emissions data (10,000t-CO2)

Transportation sector (22,634)

Voluntary Action Plan 13,723 (61%)

Commitment to a Low Carbon Society 13,473 (60%)

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2014 7/11-12: MEF @ Paris

7/14-15: Petersberg Climate Dialogues @ Berlin

9/23: 2014 Climate Summit (one day before UN General Assembly session) @ NY

10/8: First ICEF meeting 10/27-31: IPCC plenary (AR5 Synthesis Report) @ Copenhagen

(In autumn: end of European Commission’s term of office, US midterm elections)

12/1-12: COP20 (finalization of what should be included in national draft commitments* and discussion on draft text for 2015 agreement) @ Lima

2015 May: preparation of draft text for 2015 agreement 6/4 - 5: G7 Summit meeting

11/30-12/11: COP21 (deadline for negotiations on post-2012 framework) @ Paris

* Each country shall be urged to present voluntary draft commitments to all countries sufficiently in advance of COP21. Countries that have completed their drafts are urged to submit them by the first quarter of 2015.

Major events up to 2015

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Keidanren’s voluntary approaches beyond 2020 ○ On July 7, 2014, Keidanren published “Contributing to Global Efforts against Global Warming: Further Challenges for

the Japanese Business Community.” Keidanren having decided that a Voluntary Action Plan-based approach would be taken in determining industry-specific targets for 2030, the Chairman of Keidanren has urged the chairs of each industrial organization to set up individual targets.

3. Further enhancement of efforts International negotiations on climate change issues call for global agreement on a post-2020 international framework that will apply to all nations by the COP21 meeting to be held in December 2015. Hence, global warming countermeasures beyond 2020 are likely to be deliberated domestically as well. Given these circumstances, Keidanren will seek the further enhancement of efforts based on the Commitment to a Low Carbon Society (Phase II of the Keidanren Commitment to a Low Carbon Society) in order to further enhance its contribution to global-scale long-term measures against global warming. In light of emissions from domestic business operations, reduction targets shall be established for 2030 in addition to those for 2020 and efforts shall be enhanced to the extent possible in the fields of cooperation among actors, international contribution, and development of innovative technologies. Furthermore, in order to ensure the effectiveness, transparency and credibility of the Commitment to a Low Carbon Society, Keidanren shall continually encourage the implementation of the PDCA cycle. It will become increasingly important to consider various factors, such as structural changes in society and industry and advancements made in technological innovation, acknowledging that 2030 targets for domestic business operations are efforts over the long-term, explicitly identifying the conditions assumed in setting up the targets, and ensuring transparency. Keidanren will also lucidly communicate information to both domestic and international audiences on cooperation among actors, international contribution, and technological contributions to global warming countermeasures, including the development of innovative technologies.

4. Setting the context for promoting the Commitment to a Low Carbon Society Keidanren has continually requested that the Government set the policy context for promoting the Commitment to a Low Carbon Society, and as it approaches Phase II, it will renew its proposals as provided below.[…] (3) Incorporate the Commitment to a Low Carbon Society into Government-wide global warming policies (such as the Action Plan for Global Warming Countermeasures, etc.), as the pillar of industrial measures.[…]

excerpts from “Contributing to Global Efforts against Global Warming: Further Challenges for the Japanese Business Community” (announced by Keidanren on July 7, 2014)

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