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Diverse Measures to Offset Increased Emissions

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On 19 January 2023, the EPA announced the revised Offset Principles for the Increased Greenhouse Gas Emission Caused by Development Activities (審查開發行為溫室氣體排放量增量抵換處理原則). The amendment has added more options of emission sources so that agricultural and transportation sectors with these sources can qualify for offsets, extending emission sources available for offsets and therefore encouraging more enterprises to engage in carbon reduction. It is to provide developers more diverse offset measures and better lower emissions generated by developing activities.

The Offset Principles were first announced by the EPA on 27 March 2020 to strengthen controls on increased emissions from newly installed emission sources. During environmental impact assessments (EIAs), developers with certain developing activities are mandated to offset their increased emissions for ten consecutive years with a minimum of 10% annual offset rate. Criteria of these developing activities include development of an area of 50 acres or more, establishment of factories, fossil-fuel power plants burning non-liquid natural gas (LNG) energy, and cogeneration plants.

So far, there are ten EIA-qualified projects in total in which the developers have promised to conduct offsets: They are the second expansion project of Hsinchu Scientific Park (Paoshan Branch); Ciaotou Branch and the third phase of Tainan Branch of Southern Taiwan Science Park; as well as industrial parks in Jhongpu, Shueisheng, and Sinshih, and Chiayi. All are expected to create an annual demand to offset as high as 820,000 Mt CO2e.

Article 4 of the revised Offset Principles has newly added sources of increased emissions qualified for offset. For the agricultural sector, it includes replacement of coal- or oil-burning equipment with biomass energy as fuels, replacement of antiquated fishing lamps with LED lamps on fishing vessels, replacement of old farming machineries with electric ones, and replacement of existing oxygen-adding equipment with high-efficiency, energy-conserving types. For the transportation sector, it includes using electric or hybrid vehicles in place of old ones. Once a developing activity is approved by the EIA, its developer has to submit to the EPA an offset proposal, which has to be evaluated and approved first before being implemented accordingly.

If a developer carries out reduction measures via its affiliated company that is not part of the development sector, the EPA noted that it will be qualified to offset 1.2-time the amount of reduction actually resulted from these measures. Besides motivating different companies to join force in reduction, this is also to encourage developers to put in the capital or technologies to cut down emissions from sources other than their own developing activities.

Moreover, the Scrap Vehicle Platform website launched last year serves as a platform to generate offset credits by purchasing electric motorcycles to replace old ones. It has so far matched over 24,000 offset requests. This year the mechanism has been expanded to incorporate other vehicle types like cars and pickup trucks. As a result, it encourages major developers to invest more in order to purchase more offset credits generated by the general public, thus creating joint reduction efforts between corporations and citizens, and at the same time lessens the government’s financial burden.

Excerpt from Major Environmental Policies, January 2023

Ministry of Environment