Japan Power Firm Pays to Plant Australian Trees
2/17/00
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Title: Japan power firms pays to plant Australian trees
Source: Reuters
Status: Copyright 2000, contact source for permission to reprint
Date: February 17, 2000
SYDNEY - Tokyo Electric Power Company has signed a "carbon credit"
deal with an Australian state worth possibly A$130 million (US$82
million) which could result in 40,000 hectares (99,000 acres) of new
forest.
The deal, signed in Tokyo between the power firm and State Forests of
New South Wales, will see new forests planted along Australia's east
coast in exchange for carbon credits which offset carbon belched into
the air in Japan.
"It means the world's largest privately owned utility will reduce the
impact of its gas emissions on the world environment by laying down
plantations in NSW," state premier Bob Carr said in a statement
received by Reuters on Wednesday.
Under the deal the Tokyo Electric Power Company (TEPCO) will pay A$30
million for an initial 10,000 hectares of forest to be planted, but
has the option to plant up to 40,000 hectares worth A$130 million,
over 10 years.
Carr said the carbon trade agreement was in line with the Kyoto
Protocol, an agreement signed by 83 nations to cut greenhouse gas
emissions back to 1990 levels by 2010.
Carbon credits are units equal to the carbon dioxide absorbed by
trees, which offsets greenhouse gas emissions.
NSW Minister for Foresty Kim Yeadon said planting of the initial
forests would begin immediately.
"Planted forests are a key driver for economic development,
particularly in rural NSW. It is estimated that every 50 hectares of
forest creates one new job," Yeadon said.
Yeadon said the new forests would help Australia address major
environmental problems such as rising salinity in agricultural lands
and provide renewable energy systems and additional timber resources.
A spokesman for Yeadon told Reuters that under the deal the state
forestry department would manage the new forests, determining what
type of trees and where they would be planted.
"The deal is a management agreement whereby land is bought and trees
are planted on behalf of TEPCO," he said.
State Forests of NSW is also talking with other Japanese
corporations, including Nippon Steel Trading Co Ltd and Oji Paper, as
well as European and U.S. firms, he said.
Australia's futures exchange will set up the first market in carbon
credits in July. Greenhouse gas emissions are already traded in
Chicago.