Saudi Arabia has become the thirteenth nation to sign up to Japan’s Joint Crediting Mechanism (JCM), a bilateral carbon offset mechanism that allows Japan to earn carbon credits in return for funding or exporting clean technology.
Under the deal, signed on May 13 but announced by Japan on Monday, both countries pledged to promote investment and deployment of technology that can cut greenhouse gas emissions in Saudi Arabia.
In return for funding, Japan will be able to count part of the emission reductions towards its own future climate target, which looks set to be a 26% cut in GHG emissions from 2013 levels by 2030.
But like with the other JCM agreements, the deal will not immediately create a tradable offset market.
“The JCM starts its operation as the non-tradable credit type mechanism. Both sides continue consultation for the transition to the tradable credit type mechanism and reach a conclusion of such consultation at the earliest possible timing, taking account of implementation of the JCM,” the agreement said.
Last month a government-appointed expert committee said it expected the JCM to cut emissions by 50-100 million tonnes of CO2e between now and 2030.
Japan launched the mechanism in 2010 after growing impatient with the CDM, which it saw as overly bureaucratic and unpredictable.
But despite having signed agreements with 12 other countries, including big emitters such as Indonesia and Mexico, only four projects have been approved so far under the controversial scheme, with a total capacity to cut less than 500 tonnes of CO2e annually.
By Stian Reklev – email@example.com