The ECCT hosted a Premium Event lunch with Ministry of Environment (MOENV) Minister Peng Chi-Ming (彭啓明). In his presentation, Minister Peng provided an update on the MOENV's policies and plans to advance Taiwan's progress towards a circular and net zero economy, including the introduction of carbon fees, highlighting the importance of collaboration between government, industry and communities to achieve a greener and more resilient economy.

Minister Peng opened by saying that the MOENV's job was difficult given that it has to balance competing demands on several fronts. For example, companies demand speeding up the Environmental Impact Assessment (EIA) process but some green projects are opposed by environmentalists or other parties. Before the MOENV was upgraded from the former EPA, its role was that of an investigator and issuer of punishments for violations. Minister Peng hopes to shift the focus of the MOENV to one of an integrator and supporter of industry in the transition to net zero.

The MOENV's mission is aligned with the administration's "Project of Hope: 2050 Net-zero Transition and Green Growth", which outlines five pathways to net zero: 1) a second energy transition; 2) dual transformation of the digital and green industries; 3) net zero sustainable green living; 4) robust support for the net zero transformation and 5) to ensure a "just transition" to a net zero society that leaves no one behind. Peng noted some of the challenges in these pathways, including problems in solar and wind energy development, a lack of consensus on nuclear energy and carbon fees. For instance, he noted that many large corporations view Taiwan's proposed carbon fees as too low, while some small companies see them as so high as to pose an existential threat to their livelihoods.

Peng said that he believes the establishment of the "National Climate Change Response Committee" has great potential to serve as a sounding board for policies from a broad spectrum of stakeholders, the best of which have a good chance of being implemented given that it is a "top down" body, with members in senior positions, that report directly to the president. Peng serves as the chief secretary of the committee and said that while official committee meetings with the president only happen on a quarterly basis, he is expected to provide progress updates on a monthly basis, which requires much more frequent meetings on various issues in the seven key areas: net zero pathway, sustainable green lifestyle, green finance, just transition, green energy & carbon reduction technology, green & digital twin transformation and sustainable homeland & adaptive resilience.

The NDC is revising its interim targets for cutting greenhouse gas emissions (including a target for an approximate 24% reduction in emissions from 2005 levels by 2030) and has identified six areas for carbon reduction, including: deep energy conservation, decarbonization and hydrogen combustion, emerging energy (such as geothermal and small hydropower), hydrogen energy (ammonia) supply chain, energy storage, carbon capture, resource recycling, transportation (electrification, mass transportation improvement, sustainable aviation fuel), and carbon reduction actions of public enterprises.  

According to statistics cited by Minister Peng, the number of green jobs in Taiwan is growing rapidly. Eight years ago, there were only about 1,000 companies involved in environmental activities but currently around 3,600 companies have vacancies for about 22,000 green-collar jobs, which have expanded beyond areas such as sanitation and manufacturing, to major industries such as information and communications, semiconductors and finance.

Carbon pricing will become a new driver of green growth in Taiwan, a key pathway to net zero and is one of the main focuses of the MOENV. Minister Peng reported that NT$10 billion has been secured to establish the "Green Growth Fund" to drive domestic net zero related emerging industries and accelerate carbon reduction while also enhancing resilience and creating job opportunities. The ministry also wants to secure long-term investments from financial institutions to invest in energy-saving measures, net zero initiatives, and resource recycling industries across various sectors to accelerate the transition to net zero emissions and environmental sustainability.

Entities that will be subject to carbon fees initially include power and gas supply industries, as well as manufacturing industries, with annual emissions of 25,000 metric tons of CO2e or more. It is estimated that around 500 entities (from 281 companies) will be subject to carbon fees. The carbon fees will take effect on 1 January 2025 with payment for 2025 emissions to be made by May 2026. The standard carbon fee rate has been set at NT$300 (US$9.34) but preferential rates have been set at NT$50 (rate A) and NT$100 (rate B) for certain industries. Fees will be used for: Implementation (emission source inspections, emission reduction implementation, platform account management, carbon footprint management, international affairs, and a just transition); Reduction (subsidies and incentives for emission reduction efforts and research and development activities); Adaptation (coordination, formulation, and promotion of climate change adaptation initiatives; Education (climate change and GHGs reduction education and outreach initiatives) and other costs related to climate change. Minister Peng praised the EU's Emissions Trading System and said that he hoped Taiwan could transition from carbon fees to a similar system within a few years.

To address extreme climate change and sustainable development, each of Taiwan's ministries will appoint a deputy head as the 'Sustainability Officer' to align with the private sector's efforts. This will not increase the budget or staffing. The role of the Sustainability Officer will be clearly defined, focusing on actions the government needs to take before achieving net zero emissions by 2050. It will also ensure alignment with the private sector and connect with global efforts. Given that government departments collectively have large budgets, if they follow through on making green procurement decisions, it could have substantial benefits for providers of green products and services and help to speed up the transition to net zero.

On the topic of the circular economy, the MOENV is working on new legislation that it hopes to finalise and send to the legislature in 2025. The three strategies to achieve a circular economy are green designs for waste reduction at source, resource recycling and reuse, and better balance and management of treatment capacity. To achieve the circularity objectives will require a well-functioning circular network and innovative technologies and systems. The minister said that he appreciated concepts already employed in Europe, such as lighting and furniture as a service business models, which encourages optimal efficiency of resources and minimal waste. He said that he would welcome input from Europe on circular economy concepts and technologies as well as innovative ways to treat waste.