By Matthew Chye
SINGAPORE (Reuters) - Japan, the world's fifth-biggest carbon dioxide (CO2) emitter, will begin a carbon pricing scheme in stages from April to encourage companies to curb emissions and achieve its goal of carbon neutrality by 2050.
Here is a look at some of the carbon emissions trading systems (ETS) and pricing mechanisms in Asian countries aimed at reducing greenhouse gas emissions and achieving net zero targets.
JAPAN
* The government in December proposed introducing a carbon levy on fossil fuel importers in 2028-29 fiscal year to encourage companies to curb carbon dioxide (CO2) emissions.
* Japan's version of an ETS, set up by a forum for "green transformation" called the "GX League", will begin in the 2023/24 fiscal year on a voluntary basis, followed by full-scale operation from around 2026/27.
* By 2026/27, Japan will set guidelines for the ETS and introduce a mechanism for third-party certification of companies' targets. Official supervision may also be introduced for those abusing the system.
* From around 2033/34, auctions for emission allowances for the power generation sector will begin.
* Details including the price of carbon, the scope of coverage and whether it should be mandatory are being discussed.
* A carbon levy will be introduced from around 2028/29 on fossil fuel importers such as refiners, trading houses and electricity utilities. The initial levy will be set low but will gradually rise.
CHINA
* China launched its ETS in 2021, with a dedicated exchange in Shanghai, covering the power sector - which accounts for around 40% of the country's total emissions. It is expected to expand to other carbon-intensive sectors, including steel and construction, in its next phase.
* China aims to achieve net zero by 2060.
HONG KONG
* The Hong Kong stock exchange in November carried out the first batch of carbon credit trades on its new voluntary carbon market, joining a handful of Asian exchanges in tapping opportunities resulting from governments' push to achieve climate goals.
INDIA
* Parliament in December passed the Energy Conservation (Amendment) Bill 2022 that sought to establish carbon trading.
* In October, green energy companies, such as Adani Green Energy Ltd, and carbon offsetters like EKI Energy Services Ltd, came together to develop a carbon credit market to help achieve energy transition goals.
* India plans a stabilisation fund to keep prices of credits in its planned carbon market above a certain threshold, ensuring they remain attractive for investors and that the market succeeds in cutting emissions, two government sources said.