Households to bear 130,000 yen to 765,000 yen burdens from 25% cut+

TOKYO, Nov. 24 Kyodo -
Japanese households will bear financial burdens ranging from about 130,000 yen
to 765,000 yen a year as Tokyo strives to slash its greenhouse gas emissions by
25 percent from 1990 levels by 2020 through domestic efforts, a task force
analyzing the economic impact on Japan of pursuing the goal said Tuesday.

The financial burdens in the form of estimated declines in household disposable
income compare with the previous government's estimate that the 25 percent
emissions-cut target would cost each Japanese household at least 360,000 yen a
year.
Prime Minister Yukio Hatoyama pledged on the world stage in September to reduce
Japan's heat-trapping gas emissions by 25 percent from 1990 levels by 2020,
toughening the previous target of 8 percent unveiled in June by his predecessor
Taro Aso. The new government has since reexamined the economic impact of the
ambitious goal.
Environment Minister Sakihito Ozawa told reporters the task force's new
analysis found that the household financial burden of 360,000 yen calculated by
the Aso government was ''too exaggerated.''
''Since we inherited most of the preconditions used for calculations conducted
by the previous government, results are not so different. However, some newly
compiled data indicate smaller household financial burdens,'' Ozawa said.
The minister said the Hatoyama government will officially release fresh data on
the household financial burden next week after a meeting of the Cabinet
ministers concerned.
The task force, headed by Kazuhiro Ueta, a professor of environmental economics
at Kyoto University's Graduate School of Economics, compiled the new estimates
under various scenarios.
The projected burdens of 130,000 yen to 765,000 yen were calculated on the
basis that Japan achieves its 25 percent emission-cut target by 2020 only
through domestic efforts.
The experts predicted efforts to cut 25 percent greenhouse gas emissions
domestically would push down disposable income of each household by 130,000 yen
to 765,000 yen, compared with the situation in which no measures are taken to
slash such emissions.
Think tanks that comprise the governmental task force came up with the new
figures based on an assumption that the nation's economy expands 1.3 percent a
year.
But they set different preconditions regarding how to use revenues from an
environment tax which would be introduced by the government to implement the 25
percent cut goal.
Their scenarios involved returning revenues to households in a lump sum, using
them for policies aimed at helping the nation achieve the emissions-cut goal,
and allocating tax revenues to repayment of the nation's debts.
Ozawa pointed out that when environment tax revenues are used for policies to
curb global warming, the overall income level of Japanese people will be higher
than in other cases.
The task force also showed that financial burdens on households will be smaller
if Japan tries to meet its goal through both domestic efforts and the purchase
of emissions credits from abroad.
When Tokyo implements 10 percentage points of the 25 percent cut domestically
and the remaining 15 points through credit purchases from overseas, the
predicted decline in households' disposable income will be 30,000 yen to
280,000 yen, according to the experts.
Ozawa said the government will analyze the economic impact again next year
after setting the specifics of its new policies to combat climate change, such
as the environment tax and cap-and-trade emissions trading system.
==Kyodo
2009-11-24 23:22:21