Aiming to Generate Approximately 1 Million Tons of Carbon Credits Over 10 Years by Tapping into the Potential of 25,000 Hectares of Rice Paddies
Tokyo, Japan – Green Carbon Inc. (CEO: Jun Okita; hereinafter “Green Carbon”), a company specializing in the creation and sale of nature-based carbon credits, is pleased to announce its comprehensive business alliance with Mitsubishi UFJ Trust and Banking Corporation (President: Hiroshi Kubota; hereinafter “MUTB”).
As the first project under this alliance, a pilot demonstration has been launched in the province of Nueva Vizcaya, Luzon Island, the Philippines. This project aims to generate carbon credits utilizing the methodology of the Joint Crediting Mechanism (JCM*) for “Methane Emission Reductions by Water Management in Rice Paddies.” This initiative marks a first for a Japanese trust bank.
The project introduces Alternate Wetting and Drying (AWD**), an intermittent irrigation method, to reduce methane emissions from targeted rice paddies in Nueva Vizcaya. The pilot demonstration, which began in January 2025, is expected to expand to approximately 25,000 hectares—the entire irrigated rice paddy area of the province—within the next three years. This expansion is projected to generate a total of approximately 1 million tons of carbon credits over the next 10 years
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◆Background of the Comprehensive Business Alliance
Green Carbon is dedicated to creating nature-based carbon credits, with a primary focus on Southeast Asia. The company is developing a wide range of projects in areas including forest conservation, rice paddies, mangrove reforestation, reduction of methane emissions from cattle, and biochar. By developing carbon credit projects tailored to the natural resources of each region and leveraging satellite data for site selection and monitoring, Green Carbon ensures efficient and highly transparent project operations.
In the Philippines, the agricultural sector is a significant source of greenhouse gas (GHG) emissions, totaling approximately 54 million tons annually (*3). Emissions from rice paddies contribute around 13 million tons (about 25% of agricultural emissions *4), making reduction efforts a priority. In response, Green Carbon initiated a project in FY2023, in partnership with local research institutions, to reduce methane gas emissions from rice paddies by utilizing Alternate Wetting and Drying (AWD) techniques.
The project is located in the province of Nueva Vizcaya, a region well-suited for rice cultivation. Benefiting from abundant water resources, moderate elevation, and a stable climate, the province produces approximately 2.9 million tons of rice annually from over 64,000 hectares of paddies. Its productivity is notably high, with a yield of 4.45 tons per hectare, surpassing the national average of 4.11 tons (5). This project is being implemented in collaboration with Nueva Vizcaya State University (6). It aims to balance sustainable agricultural development with a reduced environmental impact by measuring and analyzing methane emissions to validate the project’s effectiveness.
Through this joint demonstration with Green Carbon, MUTB aims to support its clients’ decarbonization initiatives and contribute to the decarbonization of Japan by creating and expanding a portfolio of high-quality, high-volume carbon credits.
〇Photo of the MOU signing ceremony with the Province of Nueva Vizcaya.
○Nueva Vizcaya Province, Northern Philippines (Image: Google Earth).
◆Future Outlook
Through this project, Green Carbon aims to accelerate the adoption of AWD in the Philippines and expand agricultural practices that contribute to decarbonization. Including projects already underway in Bulacan and Batangas, we are developing similar projects in seven provinces across the Philippines and are planning a phased rollout to approximately 1 million hectares of rice paddies nationwide by 2030. Furthermore, leveraging the approval of the rice paddy methodology under the Japan-Philippines Joint Crediting Mechanism (JCM), we will promote the development of methodologies in other partner countries and lead project development in Southeast Asian nations. In Japan, we are advancing J-Credit creation projects from “livestock manure management” and “biochar.” Internationally, we plan to pursue nature-based credit creation projects, starting with our biochar business. Additionally, we plan to collaborate on unique product designs from MUTB, such as movable property trusts.
◆Utilization of JCM Credits
In early February 2025, a landmark methodology for reducing methane emissions from rice paddies—the world’s first of its kind—was approved under the Joint Crediting Mechanism (JCM) (*2) between Japan and the Philippines. Registering projects under this methodology allows for the promotion of agricultural practices that reduce environmental impact and improve productivity in the Philippines, while simultaneously contributing to Japan’s national GHG emission reduction targets.
In Japan, demand for JCM credits is expected to grow significantly following the decision to allow their use in the GX-Emissions Trading System (GX-ETS) (*7) to cover corporate emissions that exceed allowances. Furthermore, trading these credits on the TSE Carbon Credit Market is under consideration, which is anticipated to improve market liquidity. In this context, Green Carbon aims to contribute to the decarbonization of both the Philippines and Japan while ensuring the economic viability of its projects.
○News article from the Provincial Government of Nueva Vizcaya
※1：Alternate Wetting and Drying (AWD)
Alternate Wetting and Drying (AWD) is a method that involves repeatedly flooding and naturally drying paddy fields every few days, using the water level as a guide. Compared to continuous flooding, AWD can reduce water usage, contributing to water resource conservation.
※2：Joint Crediting Mechanism (JCM)
The Joint Crediting Mechanism (JCM) is a system where Japan contributes to greenhouse gas emission reductions in partner countries through the spread of its superior decarbonization technologies, and those reductions are then utilized to achieve the emission reduction targets of both countries. The Philippines commenced the JCM with Japan in January 2017, making project implementation between the two countries possible.
※3：Annual GHG emissions in the Philippine agricultural sector: approximately 54 million tons
Reference: Philippine Department of Environment and Natural Resources (2023)
※4：GHG emissions from rice paddies in the Philippines: approximately 13 million tons
Reference: Journal of Food, Agriculture and Environment (2016)
※5：Nueva Vizcaya Province paddy field area and rice production volume
Reference: Philrice Ricelytics (2024)
※6：Nueva Vizcaya State University
Nueva Vizcaya State University, established in 1916, is a public university in the Philippines particularly focused on research and dissemination of sustainable agricultural technologies. Its main campus is in Bayombong, Nueva Vizcaya, and its College of Agricultural Sciences offers specialized education in tropical crop cultivation techniques and livestock management. The university also contributes to the dissemination of the latest agricultural technologies and the development of regional agriculture through cooperative programs with local farmers.
URL：https://www.nvsu.edu.ph/
※7：GX-ETS Scheme
Japan’s first nationwide emission trading system. This mechanism obliges companies to reduce greenhouse gas emissions, requiring those that fail to meet their targets to purchase emission allowances from other companies. As of FY2024, 747 companies are participating, with full-scale operation targeted from FY2026.
◆ Green Carbon, Inc.
Representative ：Jun Okita, CEO
Location ：2-3-2 Kojimachi, Chiyoda-ku, Tokyo, Hanzomon PREX North 9F WeWork
Establishment ：December 2019
Business ：Carbon credit creation and sales business, agriculture-related business, environment-related business, other related businesses and ESG consulting business
URL ： https://green-carbon.co.jp/
◆About Green Carbon, Inc. Business
Green Carbon operates with the vision of “Saving the Earth with the Power of Life,” providing comprehensive support from carbon credit creation, registration, to sales. Additionally, we are involved in agriculture-related businesses, research and development, ESG consulting, among others. Our main focus is on generation carbon credits through methane gas reduction in rice paddies, where we have obtained certification for J-Credits, the first and largest in Japan (approximately 6,220 tons), and plan to expand to around 50,000 hectares in the fiscal year 2024. We also offer a service called “Agreen” that integrates credit registration, application, and sales into one platform, simplifying procedures such as application registration and document preparation, thus reducing the workload for credit creators.
◆Mitsubishi UFJ Trust and Banking Corporation
Representative:President: Hiroshi Kubota
Location: 1-4-5 Marunouchi, Chiyoda-ku, Tokyo
Established: March 10, 1927
Business Activities: Financial and banking services URL:https://www.tr.mufg.jp/