The international community has paid greater attention to climate change since 2007, with the issue of carbon emissions getting the most attention as the media introduces topics such as carbon reduction and green technologies. However, the fact that two different international carbon trading mechanisms are in use, and that the participants in the two systems differ can cause confusion.
A carbon trading mechanism was first initiated by the 1997 Kyoto Protocol, which took effect in 2005. Article 17 of the protocol states that the parties included in Annex B may sell extra emission allowances to other parties whose emissions exceed their allowances. “Parties included in Annex B” refers to the advanced industrialized countries listed in appendix 1 of the UN Framework Convention on Climate Change and a few countries that are in the process of transforming into market economies.
There is also the Voluntary Carbon Standard (VCS) stipulated by the International Emissions Trading Association, which ensures that verified voluntary emissions reduction can be used for credit in carbon offsets or trading.
Since Taiwan is not party to the Kyoto Protocol, it is only able to participate in the second carbon trading mechanism. It can enter the international carbon market through industry or non-governmental organizations. The government’s only way to deal with this is to build a verification system for greenhouse gas emissions reductions as soon as possible so it can boost economic incentives for industry to reduce carbon and save energy.
As for proposed domestic legislation, such as the greenhouse gas reduction bill and the energy tax bill, Taiwan’s situation is similar to that of the US and Australia. The legislature is relatively conservative and leans toward economic concerns. It appears to have little motive to declare its stance clearly before the UN Climate Change Conference in Copenhagen.
Before a more concrete post-Kyoto consensus is reached through international negotiations, the legislature does not want to set a specific goal or schedule for Taiwan’s own carbon reduction to maintain flexibility.
Take the US for example. The Senate Committee on Environment and Public Works passed the American Clean Energy and Security Act by an 11-1 vote on Nov. 5. The act had been blocked by all seven Republican members, who protested that the economic cost analysis was insufficient. The committee passed the act after the Republicans decided not to vote. So US legislation on carbon reduction is already in dire straits.
The Senate is likely to vote on the draft bill after the mid-term elections next November. If the Democrats fail to maintain their Senate majority, the possibility of passing the draft would decline drastically.
In Taiwan, the government’s carbon reduction policy remains unclear and communication between the government and the private sector is insufficient, not to mention that Taiwan’s carbon emissions now are included in China’s.
If Taiwan wants to gain space for independent climate diplomacy in the international community or create bargaining chips in the carbon market, it should formulate an ideal for its industry that would reduce carbon and save energy.
Taiwan should adjust its economic structure to win both international support and opportunities to cooperate with others on the carbon market.
Tsai Yu-tai is an assistant professor in the Institute of Strategic Studies and International Affairs at National Chung Cheng University. Husky Tan is a doctoral student in the Department of Diplomacy at National Chengchi University.
TRANSLATED BY EDDY CHANG
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