The World Bank's "State and Trends of Carbon Market 2011" report, published in June 2011, pointed out that most Annex I and non-Annex I countries of the Kyoto Protocol have implemented greenhouse gas emission reduction measures. The EU will launch the third phase of its carbon emissions trading program (2013-2020) starting in 2013, while Japan, South Korea, and mainland China have also begun planning to establish carbon emissions trading markets. Under the Kyoto Protocol carbon emissions trading mechanism, the international carbon emissions trading market will experience a supply exceeding demand from 2008 to 2012. I. Status of Carbon Emissions Trading in Major Countries (I) Annex I Countries of the Kyoto Protocol 1. EU: Plans to enter the third phase of its carbon emissions trading program starting in 2013. To gradually implement the polluter-pays principle, it is expected that the proportion of emissions allocated through auction will increase significantly from 3% in Phase 2 (2008-2012) to over 50%. The EU also decided to include aircraft entering and leaving Europe in the EU Emissions Trading System (EUETS) starting in 2012, but this was strongly opposed by the Air Transport Association of America, the Civil Aviation Administration of China, and others, who threatened retaliatory action. 2. United States: Although the United States is an Annex I country to the Kyoto Protocol, the protocol has not been ratified by Congress, and the federal government is unwilling to assume emission reduction responsibilities. Therefore, it has not actively promoted a carbon emissions trading system. However, some state governments (such as California) and private institutions (such as the Chicago Mercantile Exchange) have begun to establish relevant mechanisms. 3. Japan: In March 2010, Japan proposed the "Basic Act on Global Warming Countermeasures," setting a target of reducing greenhouse gas emissions by 25% by 2020 compared to 1990 levels. It also planned to introduce cap-and-trade and emissions trading systems. However, strong opposition from industry prevented the draft from being passed. 4. Australia: In February 2011, Australia introduced a carbon emissions credit system and planned to implement a "Carbon Price Mechanism" starting in July 2012, gradually introducing an emissions trading system. (II) Countries Not Annex I to the Kyoto Protocol 1. Mainland China: In March 2011, China announced its "12th Five-Year Plan," setting a target of reducing carbon intensity (CO2/GDP) by 40-45% by 2015 compared to 2005 levels. It anticipated introducing a carbon emissions trading system in 2015. 2. India: Since 2008, India has been promoting eight major energy conservation and carbon reduction plans, including solar photovoltaic, energy conservation, and sustainable homes. In 2011, it proposed a 20-25% reduction target for carbon intensity by 2020 compared to 2005 levels. However, there are currently no plans for a carbon emissions trading mechanism.
3. Brazil: In December 2009, Brazil passed the National Climate Change Policy, setting a target of reducing greenhouse gas emissions by 36.1-38.9% from the baseline (Business as Usual) by 2020, and planning to establish a carbon emissions trading market.
4. South Korea: In 2010, South Korea passed the Framework Act on Low Carbon, Green Growth, authorizing administrative agencies to promote cap-and-trade and emissions trading systems, and planned to implement related systems starting in 2015.
II. Future Trends in the International Carbon Emissions Trading Market
The World Bank estimates that between 2008 and 2012, the international carbon emissions trading market will have a supply of approximately 300 million tons of Clean Development Mechanism (CERs), while the carbon emission demand of Kyoto Protocol signatories will only be 130 million tons, indicating an overall oversupply in the international carbon emissions trading market.
Although Taiwan is not a signatory to the Kyoto Protocol and is not directly bound by it, in order to fulfill its responsibility as a member of the global community, the government approved the "National Energy Conservation and Carbon Reduction Plan" in May 2010, setting targets to return carbon dioxide emissions to 2005 levels by 2020 and to 2000 levels by 2025. To achieve these emission reduction targets, the Environmental Protection Administration of the Executive Yuan has drafted the "Greenhouse Gas Reduction Act" (draft) as a legal basis for promoting cap-and-trade regulations and emissions trading in the future. Before the legislation is passed, in accordance with the spirit of the draft law, the Ministry of Economic Affairs has already promoted voluntary emission reduction agreements and offsetting projects to encourage emission sources to reduce emissions early, laying the foundation for the future establishment of a domestic carbon emissions trading market.
Source: Independence Evening Post (October 8, 2011)
