By mandating that large residential buildings disclose their energy use, Tokyo is getting tenants and owners to collaborate on prioritizing energy efficiency upgrades.

Large residential buildings included in Tokyo’s Cap-and-Trade Program must report their energy use, and efforts to reduce consumption, under the city’s mandatory Tenant Rating and Disclosure Program. Each tenant receives an evaluation and a grade, which is disclosed on the city’s website. While Tokyo already works with owners to reduce energy use, tenant engagement is essential to accelerate the uptake of energy efficiency upgrades. The program not only increases awareness and transparency, but also incentivizes owners and tenants to collaborate by making tenants responsible parties. In addition, the city supports the disclosure program by providing important information on how to improve energy performance, as well as pilot projects for retrofits and environmental performance attached to leases.

17% potential decrease in energy use in residential buildings by 2020

Cities100 – 2016

The city also encourages the participation of medium and small tenant buildings with a Carbon Certification Program, which rewards well-performing buildings, and releases energy performance to tenants and potential tenants. Through the new initiatives, Tokyo aims to reduce building energy use in all tenant buildings by approximately one-sixth by 2020.

The challenge

Split incentives are one of the most important barriers to energy efficiency upgrades in tenant-managed buildings, as tenants receive the benefit of lower energy consumption while owners often have to pay for the initial investment. With mandatory disclosure of energy use for tenant buildings, Tokyo forces renters and owners to collaborate transparently and encourages all actors involved to improve energy performance.


Economic When implemented, energy-saving measures will reduce the energy expenditure of each tenant building – benefitting both unit renters and building owners.

Environmental The program also aims to increase tenants’ awareness of climate issues such as resource scarcity, water use, and waste management.

Social Increasing tenant and owner collaboration has positive effects on their preparedness and resilience to crises such as extreme weather events.

About Tokyo

Tokyo is the capital of Japan and one of its 47 prefectures. The Greater Tokyo Area is the most populous metropolitan area in the world. Tokyo ranked first in the Global Economic Power Index and fourth in the Global Cities Index. The city is considered an alpha+ world city – and in 2014, Tokyo was ranked first in the “Best overall experience” category of TripAdvisor’s World City Survey. Tokyo was ranked as the 11th most expensive city for expatriates and in 2015, Tokyo was named the Most Liveable City in the world by the magazine Monocle. The Michelin Guide has awarded Tokyo by far the most Michelin stars of any city in the world. Tokyo ranked first in the world in the Safe Cities Index.

Global Goals addressed