Revised Japanese ‘SHK’ greenhouse gas reporting system to come into effect in April 2024
In an effort to accurately account for emissions, the Act on Promotion of Global Warming Countermeasures states that Japanese companies are required to report their greenhouse gas emissions using the Greenhouse Gas Emissions Accounting, Reporting and Disclosure System – also known as the “SHK system” (taking the first letter of the Japanese word for Accounting, Reporting, and Disclosure). Under this reporting system, specified business operators and large greenhouse gas emitters must report their “unadjusted greenhouse gas emissions” (actual emissions) as well as their “adjusted greenhouse gas emissions,” which take into account domestic emission reductions.
Following a year-long review in 2022, MoE’s subcommittee recommended a series of revisions to the system. Based on these, the Cabinet Order of Enforcement for the Revised Global Warming Countermeasures Act was passed in September 2023. The Revised Cabinet Order of Enforcement for the SHK system, reflecting these amendments, is planned to come into effect in April 2024.
The proposed amendments include:
- Specified emitters will be required to report greenhouse gas emissions generated by waste or waste-derived fuel. This amendment follows the “Revised Energy Conservation Act” in April 2023, which defined CO2 emissions generated from waste as fuel and waste-derived fuel as one of the energy sources of CO2.
- Emission reductions through the purchase of certificates will be capped by the amount of power supplied by third parties.
- Gas and heat supply providers must also disclose their adjusted emissions in the same way as electricity providers.
- Specific coefficients per provider will be used to calculate CO2 emissions using city gas and heat supply.
MoE will accept public comments between October 11th and November 9th for the above proposed amendments. They will then publish the summary of submitted comments and their replies.
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