Taiwan moved one step closer to net-zero emissions on Friday as it inaugurated its first carbon market exchange. The exchange is a place where carbon emissions are traded for credits that can be used internationally. About 27 companies attended the opening ceremony, including TSMC, Hon Hai and China Steel. The first batch of transactions totaled more than US$800,000, with a financial holding making the biggest purchase.
The Taiwan Carbon Solution Exchange is inaugurated, bringing Taiwan in to the era of carbon trading. The historic event was attended by Minister of Economic Affairs Wang Mei-hua, Financial Supervisory Commission Division Director Huang Tien-mu, National Development Council Minister Kung Ming-hsin and Taiwan Carbon Solution Exchange Chair Sherman Lin.
Sherman Lin
Taiwan Carbon Solution Exchange
Carbon pricing has become the most effective tool that can lead to carbon reduction. Establishing a trading platform like this can bring in market mechanisms that can create incentives for enterprises to reduce their carbon emissions.
The carbon trading platform is a compilation of suppliers and developers looking to sell carbon emissions. A list of sellers is compiled and inspected, before the carbon credits associated with them gets put up for sale on the platform. Then, Taiwanese businesses can purchase the credits, which allow them generate a certain amount of carbon emissions, while getting their products to be considered carbon neutral. The first sellers of carbon credits on Taiwan’s platform originated from seven countries, including Vietnam, India and Kenya, with between 50,000 and 100,000 tons of carbon for sale at a rate of US$5 to US$15 per ton. The first transactions on the platform totaled US$800,000, and the biggest buyer was a finance holding company.
Kung Ming-hsin
National Development Council
I think this is a historic moment. These transactions are much more lively than we can imagine. The Taiwan Carbon Solution Exchange has many cooperative relationships with exchanges in other countries, including the London Stock Exchange, the Tokyo Stock Exchange and the Singapore Exchange.
Lee Chang-ken
Cathay Financial Holding president
Our financial holding and all its subsidiaries mobilized people to support this. Actually, we have operations in more than 10 countries. Of course, we have some carbon credits from abroad that we can put to use locally here. So of course we will be very active on this exchange.
Several companies rushed to make transactions on the opening day, including China Steel Corporation and TSMC. Big names in finance were also present, such as E.Sun Financial Holding, Cathay Financial Holding, Mega Holdings and CTBC Financial Holding, all of which engaged in trading. E.Sun purchased 5,000 tons of carbon, to offset its own emissions in financial products and services. Hua Nan Commercial Bank said it had also made a purchase of a similar amount to other companies in the finance sector. China Steel purchased 500 tons as well, and says it will evaluate whether to purchase more in the future.
Sherman Lin
Taiwan Carbon Solution Exchange
The finance industry can play the role in green finance. Through investment and financing, it can bring attention to important issues like this.
The carbon trading platform is hoped to push companies toward treating carbon emissions as a commodity and set up Taiwan on the road of reaching net-zero emissions by 2050.
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