Basic direction of measures in the industrial, transport, and commercial/residential sectors
(1) Approach to measures
As a first step toward the resolution of the global-warming issue, it is essential for Japan to take the lead by immediately implementing appropriate measures. The government should take policy measures that are effective in practical terms, without limiting itself to conventional administrative tools and ideas.
The issue of global warming is an environmental issue as well as an economic and energy issue, because greenhouse gases are largely a result of industrial activity and the consumption of energy by people in their daily lives. Their release is also closely linked to transport/traffic policy and housing/construction policy. Therefore, any countermeasures must cover a broad range of policy areas in the industrial, transport, and commercial/residential sectors, and coordinated and systematic linkages among the various measures must be maintained.
(2) Energy consumption and CO2 emission trends
Energy consumption and CO2 emissions have increased almost consistently since the latter half of the 1980s along with expanding economic activity. The rate of increase fell early in the 1990s upon the collapse of Japan's bubble economy, but the amounts of energy consumption and CO2 emissions have both risen again in recent years. The figures have increased only slightly or not at all in the industrial sector, but they have increased greatly in the transport and commercial/residential sectors because of changes in the lifestyles of the Japanese people as they seek more convenience and comfort. The increase rates are expected to slacken off in the future, but Japan's total energy consumption by 2010 is still projected to be 31 percent higher than the 1990 level, while CO2 emissions are projected to be 21 percent higher. (These figures and other projections presented below were calculated using the socioeconomic Framework such as economic growth rates, population trends, progress in introducing nonfossil energy and promoting energy conservation--presented in Japan's second report to the United Nations Framework Convention on Climate Change.) The projections in the following statements are obtained in the same method.
Industrial sector
In the industrial sector, great progress has been made in energy conservation since the first oil crisis of 1973-74. Compared internationally, the efforts by Japanese industry at energy conservation have produced world-leading results in terms of, for example, the rate of introduction of blast furnace electricity generators in the steel industry; the rate of introduction of the ion exchange membrane method in the soda industry; the rate of introduction of high-temperature, high-pressure recycling boilers in the paper manufacturing industry; dissemination rates of high-efficiency firing kilns in the cement industry; and heat conversion efficiency of thermal power plants in the electric power industry.
Since FY1990, the amount of energy consumed per unit of output has risen slightly in line with more small-lot, large-variety production, higher value added to products, and other responses to market needs. Energy consumption in the industrial sector has grown 5% (with no growth in CO2 emissions). While this has only returned it to the level at the time of the first oil crisis, energy consumption in the industrial sector in 2010 is expected to be 16% above the 1990 level, with CO2 emission 5% higher than in 1990, unless special measures are implemented.
Transport sector
The transport sector is one for which major increases in energy consumption and CO2 emissions are predicted. Since the first oil crisis, in line with increased demand for freight transport, energy consumption has increased consistently except when the freight sector shrank slightly at the time of the second oil crisis of 1979-80. In FY1995 consumption was approximately double the level at the time of the first oil crisis. The increase was particularly pronounced in tourism (2.5 times) because of the greater emphasis on convenience and comfort in people's lives.
Energy consumption and CO2 emissions in the transport sector both grew by as much as 16% from FY1990 to FY1995. This was primarily caused by increased gas consumption by private cars and trucks. The factors behind this phenomenon included an overall increase in transport demand, greater vehicle numbers, a greater amount being transported as a result of changes in transport distribution rates, worsened fuel efficiency due to traffic jams, a trend toward larger vehicles, and decreases in the average number of passengers per vehicle and truck loading rates.
If special measures are not taken, energy consumption and CO2 emissions in the transport sector are both expected to increase significantly--40% over 1990 levels by the year 2010.
Commercial/residential sector
The greater emphasis on convenience and comfort has led to a consistent and significant rise in energy consumption in the commercial/residential sector. Moreover, while improvements in energy-to-output ratios since the first oil crisis have kept them virtually level, in recent years they have again tended to rise. As a result, the commercial/residential sector as a whole is consuming around twice as much energy as at the time of the first oil crisis. Energy consumption rose 19% between FY1990 and FY1995, and CO2 emissions rose 16%, both major increases.
A major portion of the increases in energy consumption and CO2 emissions in this sector is due not to the increased number of households but to more energy consumed per household. Factors behind this include the growing number of electrical appliances in use as a result of the emphasis on personal appliances, as well as the fact that while energy efficiency has improved in the case of appliances with the same functions, the larger size of products, the increased number of product functions, and the greater number of products consuming electricity while not in active use have pushed up energy consumption per appliance.
Increased energy consumption and CO2 emissions in the commercial/residential sector are also strongly linked to larger homes. In terms of utilization, energy increases for lighting and electrical appliances have been particularly large due to such factors as the greater use of office appliances and increased emphasis on information functions (added memory and remote control functions, for example) as technology development proceeds.
If special measures are not taken, energy consumption in the commercial/residential sector is expected to increase by a disturbing 54% over the 1990 level by the year 2010, and CO2 emissions will also increase, by 38%. The major factor behind the CO2 release will be the overall increase in energy consumption, as was the case in the transport sector.
(3) Basic direction of measures in each sector
Taking into consideration the expected future increase in energy demand and the concomitant increased CO2 emission levels, the Joint Conference discussed the following measures proposed by the government. While the discussion was subject to time constraints, the conference considered that the direction of the measures as a whole was basically appropriate.
The basic supply-side measures are the introduction of 19.1 million kiloliters of new forms of energy (around three times the current level), which will help decrease CO2 emissions by the year 2010 (around 3% of total primary energy supply), and 70.5 million kilowatts of extra nuclear power (the equivalent of around 20 new nuclear power plants), based on the current "Oil-Alternative Energy Supply Targets" (September 1994 Cabinet Decision). To implement these measures, it will be vital not only to ensure nuclear energy's safety but also to gain the support of the public.
On the demand side, the following kinds of efforts will have to be strengthened toward energy conservation and lower CO2 emission levels.
Industrial sector
The industrial sector has already reached some of the top levels in the world in terms of energy efficiency thanks to industry's ongoing conservation efforts. While there are limits to what else can be done, industry's CO2 emissions still make up 40% of the total. Industry will therefore need to pursue economically and technically feasible measures to the fullest extent possible. The government should ensure the thorough execution of these efforts by strengthening measures based on the Law Concerning the Rational Use of Energy, which stipulates necessary steps for comprehensively advancing the rational use of energy.
Voluntary efforts by every industrial sector will be specifically encouraged. Particularly important will be the "voluntary action plans" that many members of Keidanren (Japan Federation of Economic Organizations) have adopted, as well as the follow-up steps they take. It will therefore be vital that regular reviews of progress are conducted publicly with regard to the efforts being made by the respective business circles.
At the same time, the Energy Conservation Law and any necessary incentive measures, as well as other means should be used to enhance further energy conservation in plants that use a large amount of energy, to promote energy conservation in medium-sized factories, to promote the accelerated development and introduction of innovative energy conservation technologies, and to promote extensive fuel conversion.
Through measures like these, it should be possible to hold the energy consumption level in 2010 to around the 1995 level and cut the CO2 emission level 7% below the 1990 level through improvements in the amounts of CO2 released per unit of energy on the supply side.
Transport sector
Strong measures need to be taken to change the transport sector's tendency toward large increases in energy consumption. As most consumption is by vehicles, and as the majority of CO2 emissions are produced by vehicles, gas consumption efficiency needs to be improved particularly for vehicles.
In regard to fuel efficiency, under the Energy Consumption Law, the Top Runners Approach is applied in the establishment of standards, and strict observance of them is required. For example, for new gasoline-fueled passenger motor vehicles, fuel efficiency by FY2010 has to be more than 20% greater than FY1995 levels.
Enhanced economic incentives, including tax breaks, should be considered as means to popularize and promote vehicles with better mileage, while accelerated technological development, popularization, and promotion of "clean energy," as well as low-pollution vehicles, should be encouraged. Improvement of basic energy efficiency for trains, ships, and planes is another target (7% for trains, 3% for ships, and 7% for planes).
Actual fuel efficiency can also be improved through the following kind of measures: the promotion of transport by rail and coastal shipping; the development of ports and harbors to reduce land transport distances for international container freight; improved loading rates for trucks; promotion of greater trailer use and larger trailer bodies; greater distribution efficiency through improving access to information; development of public transport bodies and promotion of their utilization; active promotion of traffic measures (measures for traffic demand management, promotion of an intelligent transport system, and traffic substitution utilizing information communications); and steady development of roads to alleviate traffic jams. Civilian efforts will also be encouraged, including commuting by foot or bicycle for short distances formerly covered by car, turning off idling engines while cars are stopped, and encouraging "eco-driving" (driving in an environmentally friendly manner).
Through these efforts, it should be possible to hold the transport sector's energy consumption level in 2010 to much the same level as in 1990. Unlike the industrial and commercial/residential sectors, however, there will be virtually no reduction in CO2 emissions per unit of energy on the supply side. The emission levels, which have already increased 16% between FY1990 and FY1995, are projected to expand by 17% over the 1990 level by 2010.
The Top Runners Approach stipulates values based on the standards of the commercialized products with the best energy efficiency in each of various product categories. Where technically or economically feasible, even higher standards apply.
Commercial/residential sector
Strong measures are also needed to reverse the tendency of the commercial/residential sector toward large increases in energy consumption. It will be vital to improve the energy efficiency of each appliance and the heat insulation efficiency of housing and architectural structures, as well as to reform lifestyles, with each individual taking care to use appliances appropriately, thus achieving significant degrees of energy conservation and reduction in CO2 emissions.
Specifically, in regard to consumer products, under the Energy Conservation Law, the Top Runners Approach is applied to energy conservation (mandating energy efficiency 8%-30% higher than current standards), and steady observance of these levels is required. Moreover, significant improvement needs to be made in energy consumption efficiency through, for example, promotion of the research and development of energy-conserving appliance technology. Other measures will also be taken to enhance energy conservation levels under the Energy Conservation Law to improve the energy conservation functions of housing and architectural structures, looking toward a major reduction in energy consumption for air conditioning. (The aims is about 20% energy saving in housing compared to current standards, and around 10% in the case of other buildings.)
In terms of lifestyles, citizens will be encouraged to work toward energy conservation and reduced CO2 emissions by keeping air conditioning at appropriate levels (28 degrees centigrade or higher for cooling and 20 degrees centigrade or lower for heating) and regularly switching off unnecessary lights and electrical appliances. Efforts in this regard will be promoted through the appropriate provision of information, education, and public relations, and also strengthened product labeling on energy efficiency.
Through these measures, it should be possible to restrain energy consumption in 2010 to a level 11% greater than the 1995 level, with CO2 emissions in 2010 kept to the 1990 level through decreases in CO2 emissions per output on the supply side.
Effect of measures
If the above measures produce the expected results on both the energy supply and demand sides (in the industrial, transport, and commercial/residential sectors), CO2 emissions from energy consumption will drop by 2010 to virtually the same level as in 1990. To achieve this, energy demand has to be kept to around current levels, which will be no easy matter. As was noted at the outset, in order to halt global warming, greenhouse gases need to be cut significantly in the long run. Given this situation, we can hardly be content with the above measures, but must instead engage in even greater efforts on a continual basis toward further greenhouse gas reductions--for example, development of innovative technologies that go beyond currently conceivable measures, the realization of greenhouse gas reduction measures aside from supply-side CO2 cuts, and the enhancement of energy conservation efforts at all levels of society.
Configuration of measures
(4) Policy structure
Sets of measures for the prevention of global warming, which center on the above-mentioned measures for the restraint of energy demand, can be categorized as follows:
(i) Efforts to conserve energy and reduce CO2 emissions through voluntary steps taken by companies and people's reevaluation of their own lifestyles, based on the appropriate provision of information.
Promotion of energy conservation in terms of production facilities through voluntary business efforts; promotion of energy conservation in terms of everyday life through the appropriate provision of information and public relations.
(ii) Incentives for energy conservation and CO2 emission reductions through greater equipment efficiency.
Promotion of the development and introduction of energy-saving plants, equipment, and technologies, as well as more efficient energy management, through tax and subsidy incentives.
(iii) Incentives for energy and CO2 reductions through indirect measures, such as the development of infrastructure.
Improvement of infrastructure and institutional aspects that will lead to reductions in energy consumption and CO2 emissions.
(iv) Obligatory energy conservation
Creation of a legal environment that will encourage the maximum rationalization of energy utilization through, for example, the introduction of factories with equipment with the maximum energy efficiency that can be foreseen both economically and technically. Require cars and commercial/residential appliances to meet the energy efficiency standard of the most efficient models among them or, where economically and technically possible, an even higher standard.
In terms of lifestyle, emphasis will be placed first on voluntary efforts by citizens to conserve energy. Follow-up studies of the results will be conducted, and where the situation does not improve, new measures including regulations will have to be considered to achieve the desired results.
The Joint Conference considers it necessary to develop all of the approaches from (i) to (iv) to the fullest extent possible.
View on economic modalities
Economic modalities entail offering economic incentives using the market mechanism in order to encourage the various economic entities to take actions appropriate for environmental conservation. Economic modalities contributing to CO2 emission reductions would include supplementary economic measures, such as subsidies, loans, and tax breaks, as well as measures relating to economic burdens, such as a carbon tax and emission rights trading. Other possible methods would include the use of donations, such as the collection of donations from car owners. Economic modalities need to be considered comprehensively in terms of such factors as their effect in reducing CO2 emissions and their impact on the lifestyles and consumption activities of citizens and on public finances.
With regard to a carbon tax, the conference debated such aspects as its expected efficiency and the impact it would have on the economy. While it would perhaps be inadvisable to introduce a carbon tax at this point in time, continued consideration will be needed on the pros and cons of this concept in line with the changing situation.
(5) Support for regional efforts
Local governments are important players in terms of actions against global warming, and more action on their part is expected. Local governments seem to be actively addressing the global-warming issue through efficient waste-fueled electricity generation, distribution to schools of environment-related texts, and support for environment-related actions by local citizens, as well as international cooperation. Given the importance of measures in the transport and commercial/residential sectors, however, the role to be played by local governments, whose administration directly affects community residents, is likely to grow larger still. The national government should provide the necessary support for efforts by local governments to address global warming at the community level.
In terms of civilian efforts to address environmental issues, activities initiated by private groups, such as environmental nongovernmental organizations (NGOs) and volunteer groups, are also playing an important role. The sound development of these activities toward the prevention of global warming is hoped for, and support should be given to them where necessary.
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