Taiwan, China

Taiwan, China, enacted the “Climate Change Response Act” (the Act) in 2023, which legislates reaching an economy-wide net-zero GHG emission target by 2050. The Act amends the 2015 “GHG Reduction and Management Act”, which stipulates that the Taiwanese Environmental Protection Administration (TEPA) will implement a domestic cap-and-trade scheme. 

Mandatory emissions reporting for entities with annual emissions above 25,000 tCO₂e from certain sectors has been in place since 2014. The “2018 Regulations Governing GHG Offset Program Management” allows enterprises to acquire carbon offset credits. 

In August 2023, Taiwan upgraded the TEPA to a Ministry of Environment (MoE), which in turn established a new Climate Change Administration (CCA) to lead – in consultation with other relevant central competent authorities – on climate policy design and implementation, including the carbon fee and ETS.

The  Act requires the government to develop  the carbon fee and ETS regulations. In August 2024, the MoE published three carbon fee regulations, aiming to reduce 37 million tCO₂e by 2030. The fee of TWD 300 (USD 9.34) per tCO₂e will be levied on power and manufacturing industries that emit more than 25,000 tCO₂e per year. Covered entities subject to the carbon fee will be required to calculate and pay their carbon fees based on their total 2025 GHG emissions by May 2026. Preferential fees will be available for covered entities upon meeting certain criteria, including application for self-determined emission reduction plans. 

Under carbon fee regulations the use of emission reduction credits from domestic voluntary reduction projects and offset projects is allowed for compliance purposes, up to a limit of 10% of the entity's total chargeable emissions. Facilities in sectors at a low risk of carbon leakage are also permitted to use international reduction credits for up to 5% of their covered emissions. The MoE is to approve the standards for recognizable international offset credits.

In October 2024, the Minister of Environment announced that Taiwan will transfer from the carbon fee to an ETS within four years. In January 2025, the Vice Prime Minister further declared that the government is aiming to accelerate the transition to an ETS, which could be implemented as early as 2026.