Bizarro world: Because smokestack industries in former communist countries collapsed in the 1990s, Japan may pay those countries $3.7 billion

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Japan to buy excess Czech emissions allowance

TOKYO/PRAGUE, Sept 23 (Reuters) - Japan has signed an agreement with the Czech Republic to buy surplus allowances for greenhouse gas emissions, helping it achieve its reduction goals under the Kyoto Protocol, the Czech Environment Ministry said on Tuesday.
Japan, the world's fifth-biggest emitter, is seeking emissions credits overseas after lagging behind in its obligation to cut emissions to 1.19 billion tonnes in carbon dioxide equivalent by 2012, or 6 percent below 1990 levels. It emitted 1.340 billion tonnes in the year ended in March 2007.
The deal could be lucrative for the Czech Republic as Tokyo needs to buy 100 million tonnes of credits between 2008 and 2012, worth around $3.7 billion based on current European carbon emission futures prices of 25.2 euros ($36.55) a tonne.
The memorandum of understanding, signed in Prague, is the third such agreement for the Japanese government following the similar accords with Hungary and Ukraine.
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Japan is in talks with countries including Poland and Russia on similar deals.
Former communist countries in Europe are well within their targets to cut emissions by 8 percent compared to 1990 levels, because of the collapse of their smokestack industries and carbon emissions in the 1990s.