Posted on 17 Oct 2024
Taiwan is preparing its own version of the Carbon Border Adjustment Mechanism (CBAM) to protect local industries from the impact of importing carbon-intensive products, Mysteel Global learned from a report by Taipei media outlet CNA on October 14.
Taiwan's Environment Minister, Peng Qiming, stated that details of the mechanism will not be finalized until mid-2025. The Ministry of Environment is collaborating with the ministries of economy and finance to shape the policy. Taiwan has also been in discussions with the EU and Japanese regulators to ensure that its carbon levy aligns with international standards.
As a highly export-oriented economy, implementing a carbon fee would benefit Taiwan's local industries in the long run by encouraging efforts to reduce carbon emissions, Peng emphasized.
He also noted that many enterprises, as seen in their ESG reports, have shown more ambitious carbon reduction goals than the government's current plans. For instance, some companies aim to cut emissions by 40% by 2030, surpassing the national target of approximately 24%.
The push for the mechanism follows a recommendation made by a government review committee on October 7 to set a basic carbon fee of TWD 300 ($9.3) per tonne of carbon emissions. The committee also proposed preferential rates of TWD 50/tCO2 and TWD 100/tCO2 for companies that meet specified emissions reduction targets.
Starting in 2026, the carbon fees will only apply to companies emitting more than 25,000 tonnes of carbon annually, according to the Ministry.
The EU's CBAM, which serves as a model, is currently applied to imports of certain carbon-intensive goods and precursors at high risk of carbon leakage, such as cement, iron and steel, aluminium, fertilizers, electricity, and hydrogen.
Source:Mysteel Global
