Strategies to Achieving a Green
Economy in Taiwan
Chun-hsu Lin, Ph.D.
Research Fellow / Deputy DirectorAugust, 2016

Introduction• Paris agreement leads to a new era of GHG management• Governmental measures encouraged to achieve a greeneconomy• GHG management, Green Trade, Business Models:
perspectives from government and academia2

簡報大綱Outline
1. Status of Taiwan

2. Greenhouse Gas Management forGreen Economy
3. Green Trade for Green Economy
4. Business Models for Green Economy
5. Conclusions

1Status of Taiwan

Taiwan Basics
Taiwan is an export-driven economy,Ranked20th largest economy in the world.

Item

Data of the year 2014

Population

23.43 million

Gross National Product (GNP)

529.5 billion(country comparison to the world: 20)

Per Capita GDP

US$ 40,537

Economic Growth Rate*

3.7%

Total Exports / Imports**

US$ 314 billion / US$ 274 billion

Source :＊IMD World Competitiveness Yearbook 2015＊＊Department of Statistics, Ministry of Finance, "Summary of Exports and Imports forMarch, 2015"

5Carbon Emission & Intensity
Emission

Carbon⼆二emissions
氧碳排放量⼆二intensity
氧碳排放密集度

0.02150.02062560.0211

250

245

2320.0181

209150253

250
249

0.01970.0187

200248

245

0.02

0.02

0.01710.01630.01750.01650.015

150

CO2/元)
排放密集度(kg化化0.025

Emission intensity (kCO2/NT$)(百萬公噸
⼆二氧碳排放量
Carbon emissions(Milliontonnes))

300

0.01
100

109

0.005

50

00
1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

年
Year

Source: Bureau of Energy, MOEA,Taiwan (2014)

6

Taiwan’s CO2 emissions• In 2014, CO2 emissions from fuel combustion: 251 million tonsof CO2e, ranked 31st in 2014, 28th in 2015 in the world.
• Main: energy and industrial sectors,
1.8%

0.4%

1.8%

Energy 10.6%

13.9%

Residential 12.6%
能源工業
運輸
農業

16.1%

Commercial
13.1%
Agricuture 1.1%

服務業
66.0%

CO2 emissions by sector(excluding electricity consumption)

住宅

Transportation
14.2%

Industry 48.3%

CO2 emissions by Sectors(including electricity consumption)

Source: 2013 CO2 emissions from fuel combustion, estimation by Bureau of Energy

7

【範例】

2GHG Management
Approaches

The New Government
since May 20th 2016•

More aggressive in global GHG reduction, fulfilling Paris Agreement•Green Energy as one of the six focused industries for development bythe new government
1. Green Energy
2. Health Care
3. Biological Technology
4. Quality Agriculture
5. Tourism
6. Cultural and Creative Industry

9Low-Carbon Legislations• National Sustainable Energy Agenda• Renewable Energy Development Statue• Energy Management Act• GHG Reduction and Management Act• Energy Tax Bill (draft)• National Climate changes Adaptation Guidelines

10

Greenhouse Gases Reduction andManagement Act
 Taiwan’s commitment to combat climate change Emission target:•80% of emission in 2030 compared to 2005•

50% of emission in 2050 compared to 2005GreenGrowth Most important features:•Target revised every 5 years•

Cap and trade scheme•

GHG management fund

Adaptation

Mitigation
1111

GHG Management Fund
From:

To:
• These funds must be used toreduce carbon emissions at thenational level acts.

Donations• Adapt to climate change.
penalties

Revenuefrom sales
and auction

12

otherGovernme

Transaction

nt budgetfee

Mandatory GHG Reporting• 262 emissions sources reported, covering about 88.8% of industrial and energy
sector emissions, totaling 226.49MT CO2e.

vVoluntary Reporting

2004

VoluntaryReportingand Inventory

Performancestandards rewards

Mandatory Reporting

Dec. 2012
GHG Management
and subjects
announced underthe Air pollution
control acts

Jan. 2013
Air Pollution Control Act

Jan. 2016

Jan. 2014
Reporting of2nd Group

Reportingof 1st Group

Cap-and Trade

GHG
Reduction andManagement
Act Passes

GHG
Reduction andManagement
Act Passed

Promulgate
d Emission
Sources

Reduction
responsibili
ties foremission
sourcesJun. 2015
GHG Reduction and13

Domestic Renewable Energy
Installed2008
2009

2010
2011
2012
2013
2014

10,000kW

05

Solar Power (Private)

1015
Solar Power(TPC)2025

Wind Power (Private)303540Wind Power(TPC)

The total capacities of wind and solar power generated by private companies have increased
faster than before because the authority announced the preferential feed-in-tariffs to which
renewable energy equipment can apply under article 9 of the Renewable Energy Development
14
Statute.
14

【範例】

3Green Trade

Taiwan Green Technology
Competitiveness7th in Asia, and 20th in the World.
(Source: IMD World Competitiveness Yearbook 2015)
Category

Our Achievements

Green Energy•PV production ranked 2nd worldwide (2014).
•LED production ranked 3rd worldwide (2014).

Green ICT• ICT products got the world's first carbon footprint certification, e.g.,
notebook computers, desktop computers, LCD panels, ICs.
•The world's first LEED (Energy and Environmental Design) Gold-Certified
green TFT-LCD plant.

Green Building• Taiwan has the highest density in Green Building worldwide.(4532 greenbuildings in 2014)

Green ConsumerStaple• Bike production ranked 1st worldwide.
• Quality of green Fabric ranked 1st worldwide.

16

Trade Liberalization, Economic Growthand Climate Change■ GDP

Source：World Bank (2012) Trade and Climate Change: An Analytical Review of Key Issues
17Trade Liberalization and Climate Change
Trade Liberalization ↑Climate Change ↑Trade liberalization increases the production,transportation and consumption.

… Traditional Trade
Trade Liberalization ↑Climate Change ↓Trade liberalization boosts the transactions of Low
carbon products and technologies.

… Green Trade
Source：Grossman and Krueger (2012); Copeland and Taylor (2003)

18

Green New Deal vs. Green Trade

GDP = C + I + G + X - M
PrivateConsumption

GrossInvestment

Government
Spending

Exports

Imports※ Taiwan’s total export value (X) takes 60% of GDP, net export value (X-M) takes 10% of GDP.
Taiwan is an export-oriented economy.
19Definition of Green Trade General Definition
The cross-border trades of products,services, resources, and rights, which
support sustainable development ofenvironment and ecology.

 Defined Definition
The trades of green products andservices.
 Type A

The products or services for environmental protection or environmental recovery, such aspollution abatement facilities and services, waste water management, resource recycling ,technology of carbon capture and storage.
 Type B

The products or services that produce less impacts than the traditional products to theenvironment and ecology in their life cycles.
20

Green Trade vs. Traditional Trade The trade is not only determined by price and function, butalso by “green level” of goods
 The comparative advantages of trade is determined byproduction cost plus environmental cost.
 The environmental goods are normally considered as public

goods; so governments are deeply involved in green trade As providing green products and services is part ofenterprise’s social responsibility, the procurement policies ofinternational enterprises change gradually.
 Green trade redefines the national competitiveness andchanges the rules of trading.
21

Statistics of Export of Taiwan’s Green Products
2010-2014
Unit: thousand US$
65,000,000

64469191

63,750,000

62679624
62,500,000

61774872
60758985

61,250,000

60164814
60,000,000

58,750,000

57,500,000
2010

2011

2012

2013

2014

Source: ITC Trade Map Database22• Taiwanese green products go to• China, Honk Kong, the United States, andJapanEXPORT Countries ofTaiwan’s Green Products•

EU28 as a whole is the third largest export
market of Taiwan

Unit: thousand USD
30,000,000

22,500,000

15,000,000

7,500,000

0
China

USA

Germany

Netherlands

Singapore

VietnamThailandCanadaAustraliaTurkey

Indonesia

Source: ITC TradeMap Database
23

ENVIRONMENTAL
PROTECTION EQUIPMENTEXPORT COUNTRIES• United States, China, and Japan. The proportion oftotal environmental protection equipment to thesethree countries was over 50%.
• In addition to these three countries, Germany andcountries in south Asia were our important trade
partners

Source: Sinotech Engineering Consultants, Ltd. (2013), 'Environmental Protection Industry and Water Saving Guidance Project'.

2424

Taiwan Eco-Products Directory
Taiwan Eco-Products Directory is updated quarterly on-line andpublished annually since 2011. It covers the products that feature low
chemical, waste reduction, pollution prevention, anti global warming,
resource saving, and increase bio-diversity for the world. This Englishwritten directory can be served as a reference for green procurement.
In the“2014-2015 Eco-Products Directory “ published in July 2014, 489
eco-products and 4 eco-service from 195 companies are included.

http://apo-ecoproducts.com
Copyright 2013 ITRI 工業技術研究院

2525

How to classify
ISO 14024 - Type I Environmental LabelingISO 14021 - Type II Environmental LabelingISO 14025 - Type III Environmental Declarations
Other Types of Environmental Labels
Product Carbon Footprint Labels and Declarations

26
Copyright 2013 ITRI 工業技術研究院

26

Taiwan Green Classic Awards

Product’s Green

Green SupplyValue

ChainManagement(25 Points)(25 Points)

InnovativeCorporate

Technology andSocial

Green

Responsibilities

Marketing(25 Points)(25 Points)

27
Copyright 2013 ITRI 工業技術研究院

27

Example: Far Eastern New Century
Introduction：
A multi-billion market cap
company with polyester andtextile business, now reinventing
itself in green economy.
Product Characteristics：•Recycled/recyclable polyester
products, such as food-grade
recycled PET resin•Recycled fiber, which is made fromused PET bottles

Far Eastern New Century•The 1st Taiwan Green Classics Award Winner•Far Eastern EcoARK, the world’s 1st building
with exterior walls made entirely by discarded
PET bottles•Football jersey made by recycled fabrics, usedby Nike in the FIFA World Cup for two
consecutive years

28Green Demo house• Launched in 2013
• Modular approach to delivering various green quality products/services.

Smart Green Home

Smart Green Appliances

Green Building Materials

LED Lighting

29

Demo House can be arbitrarily
assembled and dissembled

Assembling parts

30

Design Ⅰ: Home Space

31

Design Ⅱ: Retailing Space32

Design Ⅲ: Office Space33

Green Demo House Road Show2016.3London Eco Build
2015.102014.11
Taipei2014.10Singapore
Taipei2014.12
Taipei2015.3LondonEco Build2015.7
Tsingtao
Energy fairTokyo
2015.9Home & Building
BangkokGreen Building Expo34

Green Demo Site
Off-Grid power system @Liberty State Park, NJ, USA
Opened in July 201635

Introducing

SKYNERGY ™

•

A totally off-grid energy integration system withgreen materials•

Location: Liberty State Park, New Jersey.

•Replacing traditional diesel generator with solar
PV generator for the supply of electricity•

2 X 20 foot container with 5KW of power

Off-Grid Solar PowerSystems

Lithium Battery Pack

Solar Power Bricks

Energy Management
Fuel Cell

Colorful Solar Panel

Energy Info. Control

142975638

Insulation Coating

Rubber Floor

Spray Paint

Designed Lighting
38

4Business Models to Facilitate
Green Tech Deployment

Basic Structure of PartnershipGreenProducts
Providers

GTPO/Platform

Project
Owners/Managers

Local Government/Incentive Provider

Service Providers/Installers

Customers
Monetary flow
Equipment/Service flow

40

Energy Service Company, ESCO
Shared Savings Financing•ESCO bears debt responsibility、
execution risk and credit risk.

Guaranteed Saving Financing••

ESCO bears project performancerisk.
Customer bears responsibility for thedebt on the balance sheet.

41

Design, Build, Finance and Operate, DBFO

Contractor

contract
pay the cost (rent)

Investment ,building

Manufacturers
provide maintenanceand warranty.

Facilities

Government
revenue

Public services
responsible forgovernment

42

Conclusions

43Green growth re-emphasized after Paris
agreement

Low-carbon society is a goal and a reality

Innovative business models are key to thesuccess of green economy, including different
formats of partnership

Public-Private Partnership unavoidable