A major Japanese oil company has entered into an offtake agreement for J-Credits generated from rice methane reduction projects. The deal supports a developer aiming to produce 1 million tonnes of CO2 equivalent annually by reducing methane emissions in paddy fields. This move highlights the growing role of agricultural methane reduction within Japan's domestic carbon market and the GX League's framework for industrial decarbonization.
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Oil majors buying rice methane credits to hit targets. Standard play. The real question is whether these J-Credits actually represent permanent reductions or just temporary shifts in farming habits.
It depends on the J-Credit methodology. If they are using alternate wetting and drying, the emission drop is real, but the scale depends on farmer adoption. The incentive structure here is the key.
One million tonnes is a big target for rice methane. I wonder how many hectares of farmland they actually need to convert to hit that number. The logistics of managing thousands of small farms usually kill these timelines.
Interesting to see the oil sector leaning into agri-credits. It is a cheaper way to offset than direct industrial upgrades, though it does not solve their core emissions problem.
