Taiwan's manufacturing sector reduced greenhouse gas emissions by 6.62% in 2022, surpassing the national average. While progress has been made, further reductions require significant investments and stricter regulations.
According to the Climate Change Administration, Taiwan's manufacturing sector achieved a 6.62% reduction in greenhouse gas emissions in 2022, exceeding the national average reduction of 4.07%. While other sectors such as energy, residential, and agriculture also saw reductions, the transportation sector unexpectedly increased emissions by 2.39%, despite the growing adoption of electric vehicles and scooters.
Within Taiwan's manufacturing sector in 2022, the chemical industry was the primary contributor to greenhouse gas emissions, accounting for 25.25%. The electronics industry followed at 21.38%, with metal processing at 19.42%. While the electronics industry's emissions increased by 19.02% from 2016, the metal processing and chemical industries achieved reductions of 9.3% and 9.86%, respectively.
Data from Taiwan's Ministry of Economic Affairs revealed that the country's nine energy-intensive industries collectively reduced their greenhouse gas emissions by 17.89 million metric tons of CO2e from 2006 to 2023. The petrochemical industry led this reduction, achieving a decrease of 11.28 million metric tons. It was followed by the steel industry with a 3.3 million metric ton reduction, and the electronics industry with a 1.4 million metric ton reduction.
The pace of voluntary greenhouse gas reductions across various industries has slowed, largely due to increasing technological barriers and higher costs. In response, regions like the European Union have introduced stricter regulations, including carbon taxes and fees, to mandate further emissions reductions. These measures aim to compel industries to adopt more sustainable practices and enhance their efforts to minimize their carbon footprint.
Taiwan has introduced a carbon fee system with an initial rate of NT$300-500 (approx. US$9.30-15.50) per ton, with plans for increases every two years, targeting NT$1,200-1,800 per ton by 2030. However, industry associations have voiced concerns and requested preferential rates.
The government has assured that the carbon fee will only apply to large emitters and will have minimal impact on consumer prices. Additionally, businesses can offset carbon fees paid in Taiwan against the European Union's Carbon Border Adjustment Mechanism (CBAM). While the EU's CBAM is expected to be implemented in 2026, Taiwan is still developing its own system, which will focus on reporting the carbon emissions intensity of high-carbon leakage products. The government is currently evaluating various aspects of this system, including reporting methods, entities, regulations, and international policies.
Of the 75 countries and regions worldwide that have implemented carbon pricing, only the EU's CBAM will officially take effect in 2026. The UK is expected to follow suit in 2027, while other countries are still in the discussion phase.
Taiwan's forthcoming implementation of its CBAM-like policy will initially focus on carbon intensity reporting for high-carbon leakage products. The Environmental Ministry is currently assessing related measures, including reporting methods, target entities, relevant regulations, and international policy actions.
