Shan Wu, editor
Seth Godin once said, "For over a century, we've been fortunate to extract almost free energy from the earth, using cheap fuel to build the world. However, as we enjoy energy and create beautiful things, we waste precious resources, ultimately creating chaos in the world."
As global atmospheric carbon dioxide concentrations exceeded 415 ppm by the end of 2021, rising over 25% in just 50 years due to human activities, it's evident that climate change impacts everything around us. Greenhouse gases, mainly from coal, combustion, livestock, and cement, contribute to climate change, the greenhouse effect, net-zero initiatives, and carbon reduction efforts. In the face of these challenges, Taiwan has embarked on the journey of calculating carbon fees starting in 2024, aligning itself with the global shift towards carbon pricing.
Market Forces and Challenges:
Market-driven economies respond to market forces, with tax revenues and
payments being the two most direct purchasing powers. Consumers tend to buy
discounted items to avoid expensive ones, making international decision
coordination on climate issues challenging. Implementing a carbon tax may
burden citizens economically and reduce domestic industries' competitiveness
against non-taxed foreign counterparts — a phenomenon known
as carbon leakage.
Carbon Border Adjustment Mechanism:
To address carbon leakage without relying on multilateral agreements, a
Carbon Border Adjustment Mechanism has been proposed. Under this plan,
countries imposing carbon taxes will place import tariffs on foreign products
from regions without carbon taxes. This approach ensures that both domestic and
foreign goods share the same carbon tax burden, motivating global industries to
reduce carbon emissions to meet market demands.
Carbon Pricing Strategies:
Carbon pricing, whether through fees, taxes, cap-and-trade, or carbon
offsetting, aims to incorporate health and environmental costs from the start. These
mechanisms create economic incentives for industries to make wise choices in
consumption and carbon emissions. By imposing additional financial costs on
carbon emissions, industries can continue operations during the transition to
low-carbon operations, fostering a faster and more innovative carbon reduction
transformation.
Cap-and-Trade System:
The "cap-and-trade" system provides an alternative to direct
carbon taxes. Companies are assigned carbon emission limits, with permits
issued accordingly. Companies exceeding their quotas face fines, while unused
quotas can be traded among companies. This system reflects the true value of
carbon, encouraging companies to shift production methods if cheaper and more
environmentally friendly alternatives are available. Famous adopters on this
conduct can be seen in California from the USA and the European Union.
In the global shift towards a future where carbon emissions carry a price, Taiwan, deeply integrated into the international supply chain, has seen proactive initiatives from its industries. Companies are investing in energy-saving equipment and process improvements to reduce carbon emissions, adapting to the inevitability of a world where carbon has a tangible price. This journey towards sustainability aligns with Taiwan's commitment to environmental responsibility and resilience in a carbon-priced world.
Recommended
TMTS 2024 exhibitors for [Low-Carbon Production] Solutions:
DA SHIANG: https://www.tmts.tw/en/exhibitors/1622
PASCAL: https://www.tmts.tw/en/exhibitors/1038
FINDOLOGY: https://www.tmts.tw/en/exhibitors/2094
SOLPOWER: https://www.tmts.tw/en/exhibitors/115
AXILE: https://www.tmts.tw/en/exhibitors/875
GREEN ECO: https://www.tmts.tw/en/exhibitors/285
HABOR: https://www.tmts.tw/en/exhibitors/130
MAOHONG
POWER: https://www.tmts.tw/en/exhibitors/2229
For more exhibitors, please visit exhibitors list: https://www.tmts.tw/en/search
Source: “The Carbon
Almanac: It's Not Too Late” by Seth Godin
