Taiwan to introduce carbon fee scheme on Jan. 1, 2025: MOENV

Taipei, Oct. 23 (CNA) Taiwan will implement a long-delayed carbon fee program on Jan. 1, 2025, that will assess a rate of up to NT$300 (US$9.31) per metric ton of carbon emissions from Taiwan's biggest carbon-emitters, the Ministry of Environment (MOENV) said Wednesday.

The rate, recommended by a government review committee earlier this month, will initially apply only to companies emitting over 25,000 metric tons annually, according to the ministry.

In addition to the basic rate, preferential rates of NT$50/tCO2 and NT$100/tCO2 were also recommended for companies that meet defined emissions reduction targets, the MOENV said in a statement.

According to the ministry, 2025 will be a trial year where large emitters will report 2024 emissions without paying carbon fees. Those fees will be collected starting in 2026 based on 2025 emissions.

The ministry has said around 500 emitters are expected to meet the 25,000-metric ton threshold for paying a carbon fee.

At a meeting in July, the committee reviewed estimates showing that a carbon fee of NT$300 per metric ton would lead to a 0.12 percentage point drop in gross domestic product (GDP), while a NT$500 fee would cause a 0.2 percentage point fall.

Every 0.1 percentage point drop in GDP is equivalent to around NT$23.5 billion, based on Taiwan's 2023 GDP, according to the ministry.

The Executive Yuan originally aimed to pass legislation and begin collecting carbon fees in 2023, but due to delays in the then-Environmental Protection Administration's (EPA) preparations, the timeline was pushed to 2024.

However, following the EPA's rebranding and upgrade to the Ministry of Environment in August 2023, the collection of carbon fees was further delayed and is now expected to start in 2025.

The delays were criticized by environmental groups, which also generally felt that the carbon fee rate and preferential rates were too low to influence the behavior of major carbon emitters.

Greenpeace Taiwan, for instance, argued that companies might treat them as manageable operating costs or pass the burden onto consumers, rather than investing in emission reductions.

The organization also warned that the global community could interpret what it described as Taiwan's "passive" carbon rate regulations as a sign of insufficient commitment to reducing carbon emissions.