Japan approves 2 green projects for carbon offsets

TOKYO Oct 31 (Reuters) - Japan has approved two reafforestation projects in China and Moldova to provide Japanese fund suppliers U.N. carbon offsets to help them reduce greenhouse gas emissions.

It was the first projects against deforestation the Japanese government had approved among those registered or to be registered under the Kyoto Protocol's Clean Development Mechanism, a Ministry of Agriculture official said on Friday.

Voluntary emission cuts by private companies including the usage of U.N. carbon offsets is key for Japan to meet its Kyoto commitments to cut greenhouse gas emissions by 6 percent in 2008-2012 from 1990 levels.

But as of 2006 its emissions were 6 percent above 1990 levels. Tokyo is expected to admit that the world's fifth biggest polluter's emissions last year further exceeded 1990 levels due to a low operation rate of nuclear plants.

The two projects have been financed by a carbon fund launched by the World Bank in 2003 aimed at supporting long-term green projects. Out of the $50.3 million fund in the pool, eight private entities from Japan provided a total of $24.0 million.

The Japan Iron and Steel Federation, to which Nippon Steel Corp (5401.T) and rivals belong, and seven companies said in a joint statement on Friday that their investment in the two projects through the World Bank fund is expected to provide a total of around 510,000 tonnes of carbon offsets by 2017.

A broad tree planting project in Moldova has not been registered to the United Nations, but a green project in southern China along river Zhujiang was registered in November, 2006.

The seven companies are Suntory, Idemitsu Kosan Co (5019.T), Okinawa Electric Power Co (9511.T), Tokyo Electric Power Co (9501.T), Japan Petroleum Exploration Co (1662.T), Sumitomo Chemical Co (4005.T) and Sumitomo Joint Electric Power Co. (Reporting by Risa Maeda; editing by James Jukwey)