Recent Developments ofthe Joint Crediting Mechanism (JCM)
Webinar on the Joint Crediting Mechanism (JCM) Implementation for Sri Lanka- Contribution to GHG Emission Reductions in Sri Lanka through the JCM –16 February, 2024

Ministry of the Environment, Japan

GHG emissions and target in Japan❑ Long-term goal: Net zero emissions by 2050 compared to 2013
❑ Mid-term target: 46% emission reduction by 2030 compared to 2013
❑GHG emissions in 2021: 1.122 billion ton of CO2 eq. (20.3% decline compared to FY2013)❑JCM target: cumulative GHG emission reduction for 100 mil tons of CO2 eq. by 2030

2Basic Concept of the JCM◼ Facilitate diffusion of leading decarbonizing technologies and infrastructure, etc., through investment byJapanese entities, thereby contributing to GHG emission reductions or removals and sustainable development inpartner countries.
◼ Contribute to the achievement of both countries’ NDCs while ensuring the avoidance of double counting
through corresponding adjustments.
◼ Implement the JCM consistent with the guidance on cooperative approaches, referred to in Article 6, paragraph
2 of the Paris Agreement.

UNFCCC, Article 6 of the Paris Agreement
Reporting and Corresponding Adjustments

JAPANJCM

PartnerCountry

Leading decarbonizing technologies, etc.,
and implementation of mitigation actions

Operation and management by
the Joint Committee which consists ofrepresentatives from the both sides

Used to achieve
Japan’s NDC

JCM Credits

JCM Projects
MRV*

GHG emission
reductions/removals*measurement, reporting and verification

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JCM progress
28 JCM Partner countries (Up to 30 partner countries by 2025)

More than 250 Projects Formulation

101 Approved Methodologies

Approx. 20 million-tCO2 cumulative emission reductions by 2030

Alignment with Article 6.2 guidance (Authorization, Corresponding Adjustment
and Sustainable Development etc)4Scheme of the JCM
Flow of the JCM
1st Joint CommitteeJapan

between Japan and Sri Lanka
organized on 13 Oct 2023

ProjectParticipants

Joint Committee
Submit PIN/PDD• Implementation &monitoring ofprojects(Secretariat)• Confirmation of noobjection to PIN• Registration of projects• Issuance of credits

Confirmation of no objection
Submission of Proposed
Methodology
Approval of Proposed
Methodology

Partner Country
Submit PDD/monitoring report

Submission of PIN＊

Inform results ofvalidation /verification

Third partyentities• Validation of projects• Verification of amountof GHG emissions
reduction or removal＜Terminology＞• PIN (Project Idea Note): A document used to explain the outline of the project to thepartner country and confirm whether there is an objection.
• PDD (Project Design Document): A document that includes monitoring methods andestimated emission reductions. Required for project registration.

Development of PDD*
Validation
Registration
Monitoring
Verification

Issuance of credits

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JCM Partner Countries (28 countries)

Mongolia
Jan. 8, 201（Ulaanbaatar）

Ethiopia
BangladeshMar. 19, 2013 (Dhaka) May. 27, 2013 (Addis Ababa)KenyaJun. 12, 2013 (Nairobi)

Maldives
Jun. 29, 2013 (Okinawa)

Viet Nam
Jul. 2, 2013 (Hanoi)

Lao PDR
Aug. 7, 2013 (Vientiane)

Indonesia
Aug. 26, 2013 (Jakarta)

Costa Rica
Dec. 9, 2013 (Tokyo)

Palau
Jan. 13, 2014 (Ngerulmud)

Cambodia
Apr. 11, 2014 (Phnom Penh)

MexicoJul. 25, 2014 (Mexico City)

Saudi Arabia
May. 13, 2015

Chile
May. 26, 2015 (Santiago)

Myanmar
Sep. 16, 2015 (Nay Pyi Taw)

ThailandNov. 19, 2015 (Tokyo)

Philippines
Jan. 12, 2017 (Manila)

SenegalAug. 25, 2022 (Dakar)

TunisiaAug. 26, 2022 (Tunis)

Azerbaijan
Sept. 5, 2022 (Baku)

Moldova
Sept. 6, 2022 (Chisinau)

Georgia
Sept. 13, 2022 (Tbilisi)

Sri Lanka
Oct. 10, 2022 (Colombo)

Uzbekistan
Oct. 25, 2022 (Tashkent)*photograph provided by Ministry ofEcology and Natural Resources of theRep of Kazakhstan

Papua New Guinea
Nov. 18, 2022 (Sharm-el-Sheikh)

United Arab Emirates
Apr. 16, 2023 (Sapporo)

Kyrgyz Republic
July. 6, 2023 (Bishkek)

Republic of Kazakhstan*October 30, 2023 (Astana)6

Projects supported by the JCM financing programmes
Renewable Energy

Solar power, FARMLAND Co.,
Ltd., Chile

Floating Solar PV,TSB Co.,
Ltd.,Thailand

Hydro Power Plant, Toyo
Energy Farm Co., Ltd.,
Indonesia

Biomass Co-Generation
System, Fuji-Foods Coporation,
ThailandEnergy efficiency [Consumer sector]

High-efficiency refrigerator,
Mayekawa MFG, Indonesia

Energy saving atconvenience stores,
Panasonic, Indonesia

Energy efficiency [Urban sector]

LED street lighting systemwith wireless network control,
MinebeaMitsumi, Cambodia

Amorphous transformers inpower distribution, Hitachi
Materials, Vietnam

Binary Power Generation Projectat Geothermal Power Plant, MHI,
Ltd., Philippines

Energy efficiency [Industrial sector]

Optimization in petroleum
refining plant, Yokogawa
Electric Corp. Indonesia

High-efficiency airconditioning system,
Hitachi, Daikin, Vietnam

Waste

Power Generation with
Methane Gas Recovery
System, NTTDATA, Mexico

Waste to Energy Plant,
JFE engineering, Myanmar

Energy-saving of mobile
communications basetransceiver stations,KDDI Corp. Indonesia

Transport

CNG-Diesel Hybrid
Public Bus, Hokusan
Co., Ltd., Indonesia

7Activities related to the JCM by Government of Japan

Capacity building

Project development• Article 6
Implementation
partnership• Seminars/workshops• Secretariat work for
the JCM• Partnership for Market
Implementation Facility[World Bank]• City-to-city cooperation• Training for TPEs

• JCM Global Match (bizmatching website)• Consultation withproject
developers/consultants• City-to-city cooperation• JCM Feasibility Study

Project
implementation• JCM Model Projects• Japan Fund for the JCM[ADB]• F-gas Recovery andDestruction ModelProject• Financial support for
projects [UNIDO]• JCM Demonstration
Projects

Monitoring/evaluation• Support for MRV(development ofmethodology and project
design document,validation andverification by TPEs)• Secretariat of the Joint
Committee• Support forestablishment of aregistry

Outreach activities through Carbon Markets Express (website)8

Overview of Japan’s support for the JCM partner countries
Ministry

ProgrammeType of support

Ministry of theEnvironment

Finance Programme for JCM ModelProjects*

Subsidy

Finance Programme for F-gas Recovery
and Destruction Model Projects*

Subsidy

Japan Fund for the JCM (JF JCM)
- managed by ADB

Grant

JCM support programme by UNIDO*

Grant for projects,
technical cooperation

Project development/capacity
building/MRV support

Technical cooperation

JCM Feasibility Study

Technical cooperation

JCM Demonstration Programme

Government-commissioned
project

Field studies for JCM REDD+

Government-commissioned
project

Ministry ofEconomy, Tradeand Industry

Forestry Agency* These programmes can support projects implemented by government-owned companies but not those implemented
by the government itself.

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Finance programme for JCM Model Projects by MOEJ
Budget for projects starting from FY
2023 is approx. 15 billion JPY(approx. USD 109 million) in total(1 USD = 137
108 JPY)
by FY2025

Governmentof Japan

Finance part of an investment cost
(up to half)∗ Includes collaboration with projects supported
by JICA and other governmental-affiliatedfinancial institute.

Conduct MRV and expected to deliver
JCM credits issued

International consortiums(which include Japanese entities)⚫ Scope of the financing: facilities, equipment, vehicles, etc. which reduce CO2 from fossil fuelcombustion as well as construction cost for installing those facilities, etc.
⚫ Eligible Projects: starting installation after financing is awarded and finishing installation within
three years.

10Finance programme JCM F-gas Recoveryand Destruction Model Project by MOEJ
【Budget for FY2023】
61 million JPY (approx. 0.45million USD)
(1 USD = 137 JPY)

Governmentof Japan

Finance part of the cost in flat-rate(up to 40 million JPY/year)

Conduct MRV to estimate GHG emission reductions.
At least half or ratio of financial support to project cost(larger ratio will be applied) of JCM credits issued areexpected to be delivered to the government of Japan

International consortiums (which include Japanese entities)
Manufacturers ofequipment whichuses F-gas

Users ofequipment whichuses F-gas

Entities for recovery andtransportation of used F-gas(recycling or scrap entities)

Entities for destruction of usedF-gas (may use existing
facility for destruction)

Purpose

Project Period

To recover and destroy F-gas (GHG except for energyrelated CO2, etc) from used equipment instead of releasing
to air, and reduce emissions

Three years in maximum(Ex. 1st year for scheme, 2nd year for facilities, 3rd yearfor recovery/destruction)

Scope of Financing

Eligible Projects• Establish scheme for recovery and destruction• Install facilities/equipment for recovery/destruction• Implementation of recovery, transportation, destruction
and monitoring• After financing is awarded, start implementation ofrecovery/destruction within three years• Aim for the registration as JCM project and issuancecredits

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ADB Trust Fund: Japan Fund for Joint Crediting Mechanism (JFJCM)

BudgetCumulative contribution from 2014: JPY 14 billion (approx. USD 100 million)※Budget for 2023: JPY 0.2 billion (approx. USD 1.5 million)

Overview

To provide financial incentives for the adoption of expensive but leading decarbonizing
technologies/methane emission reduction technologies in projects financed by AsianDevelopment Bank (ADB)

PurposeTo develop ADB projects with sustainable and decarbonizing transition perspective byintroducing advanced decarbonizing technologies as well as to acquire JCM credits

JCM creditsADB
MOEJContribution

1 Ordinary Capital Resources are from:(1) Paid-in capital provided byshareholders, (2) Funds borrowed from
capital markets and private placements,(3) Accumulated retained income(reserves). OCR loans are provided tomiddle-income countries at a quasimarket rate.
2 Asian Development Fund offers
concessional loan and grant to lowincome countries.

MRVJFJCM(Trust Fund)Grant

ADB source（OCR1/ADF2)

Loan/Grant etc.
Co-financing

Co-Financing partners(Other financialinstitutions and funds)

GHG
reduction

Additional costs toinstall leading
decarbonizing
technologies/methane emission reduction
technologies

Project(selected from ADB
project pipeline)

Loan/Grant etc.

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JCM Financing Programme by MOEJ (FY2013～2023) as of Feb 202413

Thank you for your kind attention