Isramart : Taiwan Demands China Steel Cut Emissions, Buy Credits

Isramart news:
Taiwan is forcing some of its largest companies including China Steel Corp. to cut emissions in return for permission to expand on the island, where greenhouse-gas output per capita is almost three times the world average.

The biggest polluters must either slash gas discharges, invest in emissions-reduction projects or buy carbon credits in global markets. Taiwan will set up an offshore company to help them get the credits, Stephen Shen, head of the Environmental Protection Administration, said in an interview in Taipei.

Taiwan’s government is negotiating with companies while pushing them to compete with European and Japanese buyers in the $120 billion global carbon market. The policy is a stopgap until permanent emission limits are set under the Greenhouse Gas Reduction Act being debated in the legislature.

“For heavy industries, such as electricity, steel and petrochemical, costs will rise,” said Peter Tzeng, an analyst at Polaris Securities Co. in Taipei. “Producers of alternative energy, including wind and solar, will benefit” because they may attract investment to offset emissions by heavy industry.

Reducing companywide emissions by an amount equal to half of what a new plant would produce may become a benchmark in government approval of large industrial projects, Shen said. That policy may be applied to the NT$280 billion ($8.7 billion) plan to expand energy and chemical production in the Mailiao township by Formosa Plastics Group, parent of the island’s only publicly traded refiner, he said.

The government´s proposed offshore company, most likely in Japan, will help Taiwanese companies accrue carbon credits certified by the United Nations in a “cost-effective way,” Shen said, without elaborating.