Taiwan is not a party to the Paris Agreement, but Taiwan has voluntarily published its NDCs including the commitment to achieve emissions reduction targets which aims for a 20 percent greenhouse gas reduction by 2030 and a 50 percent reduction by 2050 compared with 2005 levels.

Greenhouse Gas Reduction and Management Act (2015.07.01 Enacted)

• The long-term national GHG emission reduction goal aims for a 50 percent reduction by 2050 compared with 2005 levels.
• Regulatory goals will be set in stages on a 5-year basis.

National Climate Change Action Guideline ("Action Guideline," announced 2017.02.23 under the Act)

• The First Stage of the GHG reduction plan aims for a 2 percent, compared with 2005 level, greenhouse gas reduction by 2020, to gradually achieve the above long-term Taiwan national GHG emission reduction goal.

GHG Reduction Action Plan ("Action Plan", announced 2018.3.22)

• 6 central industry competent authorities under the national government (in charge of the energy, manufacturing, transportation, residential and commercial, and agriculture sectors) are required to co-operate in order to achieve Taiwan’s GHG emission reduction goal.

Article 5 of Greenhouse Gas Reduction and Management Act includes: 

• To ensure the nation's energy security, the government shall prepare and implement mid-to-long-term strategies for gradually reducing dependence on fossil fuels with a mid-to-long-term aim of renewable energy policies, and the gradual realization of a nuclear-free homeland.
• Under the principle of equality and social welfare promotion, the government shall gradually implement taxation on the importation of fossil fuels based on carbon dioxide equivalent.

Please refer to our response below in question "What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in the electricity production sector?" regarding the energy policy transition from the use of fossil fuels to renewable energy.

1. Greenhouse Gas Reduction and Management Act
2. National Climate Change Action Guideline ("Action Guideline")
3. GHG Reduction Action Plan ("Action Plan")
4. Rules on the establishment of the Office of Energy and Carbon Reduction under the Administrative Yuan
5. Carbon Footprint Management Directions

Articles 3, 8, 18, 19, 21, 28, 29 of the Greenhouse Gas Reduction and Management Act include a maximum permitted amount of GHG emissions, and an establishment of GHG cap-and-trade scheme including allocation, auction, allowance sale, trade, and facilitation of international emission reduction cooperation mechanism. The above Act also authorizes the competent authority to draft and enact detailed rules to further implement the trading scheme.

Energy Tax

• Under the White Paper of Energy Transition, the Taiwan government is planning to implement an “Energy Tax,” but has not yet passed any legislation so far.

CO2 Tax

• The Ministry of Finance and the Environmental  Protection Administration is still considering a proposal on initiating regulations providing the CO2 tax. The details of such legislation have not yet been announced.

The environmental impact on carbon capture and storage (CCS) is still under evaluation by the Taiwan environmental authority. Currently, there’s a draft amendment to the existing regulation to require the developer to conduct Environmental Impact Assessments (EIA) before implementing any carbon capture and storage as development activities

Renewable Energy Development Act provides several  incentives in relation to the renewable energy power sectors, such as:

• FiT scheme offered to qualified renewable energy generators under which the renewable energy to be acquired by the state-owned power distributor, Taiwan Power Corporation under a long-term PPA. 
• it is required that electricity transmission and distribution enterprises must give priority to operators of renewable energy power generation facilities (including solar power, land and offshore wind power and geothermal energy generation, etc.) to connect to the grid, dispatch renewable energy and adopt a feed-in tariff policy. 
• In addition, if criteria are met, machinery, equipment, tools and components used in renewable energy power generation equipment can be exempted from customs duty. Renewable energy power generation and utilization system-related facilities are exempted from application for miscellaneous licenses in accordance with provisions under the Building Act. 
• For building-integrated solar power generation equipment, there are subsidies and rewards of purchase and demonstration granted by the government. 
• There are certain subsidies provided for solar water heaters products such as a heat utilization of renewable energy.

• Enactment of legislation and rules such as  Greenery of Site, Soil Water Content, Energy Conservation Design of Buildings, Green Building Materials;
• Giving building bulk ratio bonus to those who adopt green building design; 
• Promulgating regulations to prevent the excess of central air conditioners and to improve the value of energy-saving of building envelope. 
• Promoting the certificates of green building and the construction of ecological, energy-saving, waste reducing and healthy green buildings.

• Upgrading mass/public transportation system to reduce the use of personal transportation, such as  adding more buses routs in order to provide a wider variety of transportation services and setting up preferential measures for ticket purchases, including a more convenient way to deposit the electronic card are two examples of raising up people’s willingness to use public transportation; 
• Building the railway electrification system;
• Promoting electricity vehicles which can replace those powered by gasoline and diesel’ and
• Moreover, to improve the energy efficiency of vehicles and reduce GHG emissions, a certain subsidy is provided to phase out aged vehicles with funds provided by the government.

• Promulgating regulations for promoting energy-saving and efficiency for cement, steel, paper, petrochemical, electronics and textile industries, including request those industries to make a record of energy usage and upload relevant data to the website for the review of the authority. 
• Through initiations taken by industry-wise associations, such as the Chinese National Federal of Industry and other 11 Federal of Industry, including steel, petrochemical, cement, papermaking and man-made fibers industries, to participate in the promotion of GHG emissions reduction by using energy-efficient processes and equipment and developing low-carbon technologies. 
• Implementing energy efficiency measures through initiatives adopted in the industrial parks run by the government, such as integration of energy resources, so that the excess energy of each factory can become reusable for neighboring factories, and therefore it can reach the goal of energy and resources recycle as well as improve the efficiency of energy efficiency.

• Implementing the co-existence of agriculture/aquaculture and electricity, including providing counseling, rewards and subsidies to farmers to install solar panels on the roofs of livestock facilities or agricultural production and marketing facilities to promote solar power generation. 
•  Installing the solar panels several meters above the fish farm by support bracket, to make good use of agriculture/aquaculture resources and develop solar power generation.
• Promoting biogas power generation of the stock farms through providing subsidy and incentive. 
• For the purpose of GHG emissions reduction in agriculture, the government encourages the use of special agricultural processes such as drip irrigation which lowers down the need for farm machinery and provides a subsidy to farmers who adopts organic farming.
   

In order to reduce the pollution and GHG emissions during the process of electricity generation, electricity generation through renewable energy such as water power, wind power, solar power and biogas, is highly promoted by the government. Renewable Energy Development Act provides incentives and rewards to the electricity generation of renewable energy. Please refer to our response to Q No. 7.

In addition, the Renewable Energy Development Act requires electricity “heavy users” whose chartered capacity on electricity consumption exceeds a certain amount to either:

1. Install renewable energy power generation with certain capacity;
2. Purchase a certain amount of electricity generated from renewable energy and a certificate; or
3. If the user fails to take the aforesaid actions, the user shall pay the monetary substitution.

Under the above legislation, the Bureau of Energy has promulgated “Regulations Governing Installation of Renewable Energy Power Facilities by Electricity Users with Chartered Capacity Above Certain Volume” (“Heavy Users Regulation”) which became effective January 1, 2021. Under the Heavy Users Regulation, heavy users mean an electricity user who enters into an electricity consumption contract with Taiwan Power Corporation for a chartered capacity of 5,000 KW or more. The green power obligation of a heavy user is 10 percent of such user’s average chartered capacity in the previous year. A heavy user shall fulfill its green power obligation by one or more of the following: (1) installing renewable energy facilities, (2) purchasing renewable energy power and certificates; or (3) installing energy storage facilities, and shall fulfillment its green power obligation within 5 years of being notified by the MOEA that it has met the threshold of the high electricity user. If a heavy user fails to fulfill its green power obligation, the monetary substitution it has to pay is the not fulfilled obligation capacity multiplied by 2,500 kWh/KW and multiplied by NT$4.

1. In response to the international trend toward green finance, The Executive Yuan, the highest administrative arm of Taiwan government, approved the Green Finance Action Plan in 2017. Key measures are as follows:
2. Encouraging banks in Taiwan to extend credit to startups in such important fields as green technology.
3. Encouraging banks to voluntarily adopt international Equator Principles, which dictate that impacts to society, the environment and other areas be considered in credit risk assessment and decision-making.
4. Relaxing rules and regulations governing lending and raising capital; for example, allowing branches of foreign banks in Taiwan to issue New Taiwan dollar-denominated bonds and other such financial instruments for offshore wind power and other renewable energy providers to obtain credit from domestic and foreign banks.
5. Utilizing corporate governance assessment mechanisms to induce listed companies to issue green bonds.
6. Encouraging the insurance industry to invest capital in green energy companies.
7. Deregulating rules and regulations governing indirect investment in green energy by insurers.
8. Promoting various channels for investment in public works and green energy projects by private equity funds, venture capitalists and venture fund management firms.

In 2020, the Financial Supervisory Commission launched the Green Finance Action Plan 2.0, declaring that the above measures will be taken continuously and a new aspect, prudent supervision, is added in the advocacy. The newly added prudent supervision is aiming to drive the financial industry to examine its risks and capabilities in response to climate change so as to cultivate resilience and get ahead of the game.

1. Lawsuit between Formosa Plastics Corp’s (FPC) sixth naphtha cracker complex and Yunlin County Government (the Local government) toward air pollution control fees.

According to the law, FPC had set a continuous and automatic monitoring system. During the replacement of old pipelines with new ones in 2010, FPC did not report to the Local Government in advance in accordance with the law and was found out by the Local Government and imposed administratively. FPC was dissatisfied with the punishment and filed an administrative lawsuit in 2013 however lost the case in 2014.

After that, the Local Government believed that the data calculated by FPC during the violation period couldn’t be used as the basis for the calculation of air pollution control fees. Therefore, it calculated the fee based on the coefficient announced by the Environmental Protection Agency and disgorgement FPC with about 900 million in 2016. FPC again filed a suit against the decision. In 2018, the court determined that even if the connection facility was replaced, it would not affect the correctness and legality of the monitoring data. Therefore, there was no error in the monitoring data transmitted to the Local Government and the calculation method of air pollution control fee adopted by the Local Government was illegal.

2. Lawsuit between Formosa Plastics Corp’s (FPC) sixth naphtha cracker complex and Yunlin County Government (the Government) toward the extension of operating permits. 

Before the operating permits for bituminous coal and petroleum coke were about to expire, FPC applied for the extension of the permits to the Local Government.  Although the Local Government had granted the extension, it shortened the permit period from five years to one and a half years along with the 2% reduction to the use of bituminous coal. FPC, as a result, filed a lawsuit against the Local Government. 

The court made the decision in favor of the Local Government based on the reason that according to the local pollution control regulations,  the pollution level of the particulate matter (“PM”) in Yunlin County should be reduced from the third level of prevention zone to the second, and the PM pollution emitted by FPC not only polluted the air quality but also could cause harm to the health of the local resident.  Therefore even the operating permits were able to be granted, usage of bituminous coal should be gradually reduced. The court hence upheld the Local Government's decision.  

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