Mitsubishi Research Institute Inc. 1 MRI ’ s climate activities Kenichiro Yamaguchi Senior Staff Researcher, MRI New Delhi, October, 2002

Mitsubishi Research Institute Inc. 2 What is MRI? A Japanese private think tank established in 1970, with a wide variety of activities Has 14 years ’ experience on climate-related research, since 1988 Toronto conference Has the largest research staff among the Japanese think tanks Has worked closely with both the Japanese government and industry on this issue Is involved in the internal discussions within Keidanren, and has wide network in Japanese business Able to introduce suitable contacts to foreign counterparts

Mitsubishi Research Institute Inc. 3 MRI ’ s recent climate-related activities Activities to explore and forecast the “ carbon-constrained world ” Carbon Offset Initiative JEMS (Japan Emissions Management Simulation) Cooperation with UNIDO Strategic consulting on corporate climate policy

Mitsubishi Research Institute Inc. 4 MRI Carbon Offset Initiative Find and evaluate commercially viable projects that result in emission reduction Explore opportunities to expand businesses related to credit trading Eventually set up a pilot system to assess, trade and verify credits from such projects through “ learning-by- doing ” process

Mitsubishi Research Institute Inc. 5 Outline of COI Information / analysisProject identification  Decision making support  In-depth feasibility study  Implementation support  Business development consulting Analysis of business opportunities

Mitsubishi Research Institute Inc. 6 Project Identification HFC 、 PFC 、 SF 6 N2ON2O Methane Carbon sinks Credit Transfer Carbon emission reduction Efficiency improvement Fuel switching Renewables host country organizations host country government ＭＲＩ Expertise in climate issues Contact Consulting experience E C Clients

Mitsubishi Research Institute Inc. 7 UNIDO-MRI cooperation New initiative to push the climate agenda forward Identifying projects in the ASEAN area Cooperating with the Japanese private sector in implementing the projects Utilizing international and Japanese funding opportunities Developing JI/CDM assessment methodologies Workshop in Tokyo (June, 2002)

Mitsubishi Research Institute Inc. 8 Why reduction in Japan is difficult (Even though every country says the same thing … )

Mitsubishi Research Institute Inc. 9 Japan ’ s emission profile Has to decrease emissions by 6% So far it has increased by about 7% Without measures, it will increase by another 10% Decrease in mainly due to recession Data from the government of Japan

Mitsubishi Research Institute Inc. 10 Japan ’ s unique situation (Even though every country is unique … ) Already energy-efficient Already afforested (>60%) Few non-CO2 measures (waste, pasture, aluminum) EU ’ s closer links with Eastern Europe Australia … a great deal under Kyoto Canada … very tough, but will it ratify? GHG Emissions 1999 Data from the governments

Mitsubishi Research Institute Inc. 11 Reason 1: Kyoto looks easy on paper Data from International Energy Outlook 2001

Mitsubishi Research Institute Inc. 12 … but would it really be easy? Implication of Marrakech Eligibility to participate in Kyoto Mechanisms will be scrutinized … Scrutiny on source inventory Submission on sinks inventory National systems Assigned amount Casts doubt on the availability of AAU/ERUs from FSU

Mitsubishi Research Institute Inc. 13 Debt (CF) Scheme of projects Japanese government Host government Debt Bank Investor Project company loan EB Registry CDM DOE (CDM) equity register return account finance return (MOU ) verification validation document data approval request for CER issuance CER Equity (CF) Equity SPC Exim export credit ERU

Mitsubishi Research Institute Inc. 14 Current activities Identification of projects Eastern Europe, Asia, Latin America Formulation of scheme Pre-payment of CER/ERU finance and risk coverage Organizing a financing scheme Expressing the needs of private sector