Industrial sector accounts for more than 50% of total emission, which is comparable higher than the global average. Hence, this task set up to make major energy-intensive companies committed to net-zero target by 2022 with a concrete strategic plan by 2023, especially for state-owned enterprises (SoE). Owing to the pressure from civil society, Ministry of Economic Affairs ask SoEs should make those commitment. Hence this project put more focus on policy packages recommendation to ensure the net-zero pledge can be fulfill. Therefore, the activities of this task includes policy report publication, press conference on the net-zero commitment of companies and the regional implication to decarbonize SoE such as CPC corporation （中油）.
Last year, Taiwan’s National Development Council published the “Taiwan’s Pathway to Net-zero Emissions by 2050” and “12 Key Strategies” to respond the trends of 2050 net-zero goals that have been committed by many economies in the world. Based on the targets and strategies, Taiwan’s
Industrial Development Bureau also proposed “Net-zero Transition Pathway of Industrial Sector by 2030” to further explain its short- and medium-term plans to drive industrial decarbonization.
It is true that the Taiwanese government has made some progress regarding climate policy planning, but it is not sufficient to ensure that Taiwan meets the climate pledges. The biggest problem may be that the “12 Key Strategies” do not have a coherent action plan to decarbonize industrial sector nor innovative policy tools to encourage hard-to-abate industries to adopt low-carbon technologies — despite they produce around 40% of the country’s emissions. Instead of an ambitious industrial plan,
measures to cut emissions in industries are scattered across 12 strategies on hydrogen, energy efficiency, carbon capture and other areas. In view of this, Taiwan Climate Action Network (TCAN) advocates that Taiwan’s net-zero strategies should be “12+1,” i.e. the Industrial Development Bureau
should come up with an integrated industrial decarbonization plan based on the existing 12 key strategies. Moreover, relevant policy instruments should be innovated, and the policy process needs to be more inclusive and transparent. To provide comprehensive suggestions and call for more stakeholders’ participation, TCAN published the policy brief: “Key Policy Mixes for a Net-Zero Industry in Taiwan”.
In this policy report, TCAN pointed out many areas that should be improved in current industrial policy, furthermore, we introduced three policy tools that play crucial roles to decarbonize hard-to-abate industries as well. In chapter 2, we reviewed critical international research and experience, examined Taiwanese government’s documents related to the measures of industrial GHG reduction, and then provided key recommendations for the authority, including the establishment of
interim targets (milestones), strengthening of climate laws and regulations, and supporting mechanism for industrial net-zero transition. In chapter 3, we highlight three policy tools that can accelerate GHG reduction in industrial sector, including demand-side mechanism: “green public procurement (low carbon procurement) for public construction projects,” supply-side mechanism: “carbon contracts for difference (CCfD)” and information-based tool: “tracking major enterprises’/ products’ climate
performance (climate disclosure improvement).” Here we not only presented the policy rationale but also emphasized the implications for Taiwan.
A comprehensive industrial net-zero policy covers a variety of fields, and this policy brief just dealt with some topics. To develop an effective and inclusive industrial low-carbon transition strategy, it is necessary to invite more stakeholders to participate policy planning, implementation, and
evaluation. Therefore, in the policy brief, TCAN also suggest that the authorities shall establish a unified long-term communication mechanism during the policy process by adhering to three principles: “disclosures of policy progress,” “civil society engagement,” and “concrete response to the opinions of stakeholders,” otherwise, it will be difficult to have people’s support toward to Net-zero target.
Another focus on this task is the commitment of the companies. As for the monitoring the net-zero pledge, this task held two press conference to examine the progress. According to the latest survey, TCAN find out that only 7% of Listed Companies Have Committed to 2050 net-zero Emissions, other key finding are :
• Only 7% (118) of Taiwanese listed companies have committed to net-zero by 2050, which slightly increased from 3% last year.
• Although 18% (334) of listed companies have interim targets for GHG reduction, they do not make pledges to get to net-zero emission.
• 75% (1300+) of listed companies have not set GHG reduction targets nor mentioned any future plan to reduce GHG emissions.
• In Taiwan, there are 293 hard-to-abate companies with annual emissions more than 25 kilotons of CO2e, but merely 8% (24) of them have committed to reach net-zero target by mid-century.
The Taiwanese government has already committed to reach net-zero emissions by 2050 since 2021. Earlier this year, the amendment of “Climate Change Response Act” was finished; relevant policies and “12 Key Strategies for net-zero transition” are also being implemented by the government entities at all levels. To track climate progress of Taiwanese corporates, the Green Citizens’ Action Alliance(GCAA) collected and analyzed Taiwanese listed companies’ latest public disclosure of climate-related information on the reporting system of governmental website,however, the findings showed that most companies do not on the track of 1.5°C climate goal as they have not set GHG reduction
targets and/or concrete strategies; some of them even have not finished GHG accounting. GCAA also investigated the listed companies that are required to report their GHG emissions (scope1 and 2) to the
authority,and found that around 40% (32) of them do not have any GHG reduction target. It seems that Taiwanese government needs to develop more effective and comprehensive climate policies to push those unprepared companies to take further climate action, otherwise they may slow down the overall net-zero timeline, and then Taiwan will fail to achieve 2050 climate pledges.
In view of this, TCAN made four requests to call on Taiwanese authority and listed companies to act:
- Taiwan’s net-zero strategies should be “12+1,” i.e., Ministry of Economic Affairs should come up with a comprehensive industrial decarbonization plan based on the existing 12 key strategies, since current strategies do not have a coherent action plan to decarbonize industrial sector nor innovative policy tools to encourage hard-to-abate industries to accelerate adoption of low-carbon technologies. Therefore, relevant ministry (Ministry of Environment, Ministry of Economic Affairs, and Financial Supervisory Commission at least) should strengthen and integrate various policy tools and explain how to implement them to guide industrial net-zero transformation.
- The Financial Supervisory Commission should revise the requirements regarding corporate climate-related information disclosure based on the recommendations from United Nations’ Integrity Matter report. Moreover, FSC should supervise the quality of sustainability reporting
so that the stakeholders can access accurate corporate climate-related information. - The authority should establish an appropriate monitoring mechanism (e.g., EU’s “Corporate Sustainability Due Diligence Directive”) to make sure that companies’ climate transition progress aligns with 2050 net-zero timeline.
- Large carbon emitters should further develop corporate climate transition plans, not just remaining 2050 net-zero commitment and/or short-term unambitious climate target. Besides, when the Ministry of Environment charge specific companies carbon fees with preferential rate in the future, the government officials should consider the corporates’ climate transition plans to ensure their business strategies and corporate governance are consistent with net-zero pathway.
