Policies for Transitioning to a Green Economy: Experiences from Taiwan
POLICY DIALOGUE ON A TRANSITION TO A GREEN ECONOMY FOR SOUTHEAST ASIA, 6th – 7th March 2015, Ho Chi Minh City, Vietnam
Daigee ShawResearch Fellow, Institute of Economics, Academia Sinica
President, Taiwan Association of Environmental and Resource EconomistsMarch 6, 2015
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Contents
•Taiwan experiences in greening the economy• A brief introduction to Taiwan • A success story: solid waste reduction and recycling• A failure story: pricing of water, petro and electricity
• The (draft) Green Economy Policy Framework for Taiwan
• Sustainable transition to a green economy – Why and How?• Definition and Four Key Aspects of Green Economy in the (draft) Green Economy
Policy Framework for Taiwan• Basic Principles, Vision and Objective of the (draft) Green Economy Policy
Framework for Taiwan• The Structure of the (draft) Green Economy Policy Framework for Taiwan• Some important policy recommendations
Taiwan experiences in greening the economy• A brief introduction to Taiwan • A success story: solid waste reduction and recycling• A failure story: pricing of water, petro and electricity
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Energy > 98%Mineral > 80%Food > 70%
A Brief Introduction to Taiwan
Geographical Feature
Population: 23 millionsSquare measure : 36,000 km² Population density: 624 person/km²
Energy Imported
Resource conservation and recycling are important to Taiwan’s sustainable development
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Economic growth has become more modest since the late 1990s
US
Dol
lar
0
5000
10000
15000
20000
25000
-4
-2
0
2
4
6
8
10
12
14
162013 GDP per capita, 20,952
2013 GDP Growth Rate, 2.09
GDP per capita & GDP Growth Rate
Source: DGBAS, Executive Yuan, R.O.C.
%
The Economy
6
The contribution of the industrial sector to GDP reached a peak of 44.8% in 1986
IndustryStructure
Source: DGBAS, Executive Yuan, R.O.C.
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
Agriculture; 1.33%
Industry; 35.56%
Services; 60.58%
GDP Composition by Sector
7
Industrial sector & non-energy use accounts for primary energy consumption
Source: Energy Statistical Annual Reports, Bureau of Energy, Ministry of Economic Affairs, R.O.C.
Total Domestic Energy Consumption (by Sector)
EnergyStructure
Energy Sector Own Use
Services
Industrial
Residential
Transportation
Non-energy use
Agriculture
(energy products used as raw materials, i.e., petroleum derivatives)
8Source: Yearbook of Industrial Production Statistics the Republic of China; AREMOS Taiwan Economic Statistical Databank System
19811983
19851987
19891991
19931995
19971999
20012003
20052007
20092011
20130
5
10
15
20
25
30
35
40
45
Basic Metal
Non-metallic Mineral Products
Chemical Products
Chemical Material
Petroleum & Coal Products
Pulp Paper & Paper Products
e.g., steel
e.g., cement
e.g., petrochemicals
e.g., dye
Year
Pollution-intensive industries
Pollution-intensive Industries’ Share of Taiwan’s Manufacturing Output
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Low tax burden rate might make the nation difficult for sustainable development in the long run
Taiwan
Austria
Belgium
Canad
a
Denmark
France
German
y
GreeccIta
ly
Ice la
nd
South
Korea
Norway
Singa
poreSp
ain
Sweden
Switz
erland
U.S.10
15
20
25
30
35
40
45
50
12.8
28.330.8
26
47.1
28.3
23.2 23
30.933.3
20.2
32.6
13.7
21.1
34
21.118.9
Source: Ministry of Finance , R.O.C.
FiscalSustainability
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Zero population growth will occur between 2019 to 2026
population projectionPopulation(m
illion)
Popu
latio
n gr
owth
ra
te(t
hous
andt
h)
Population growth rateActual population
High projection
Medium projection
Low projection
1981 1991 2001 2011 2021 2031 2041 2051 2061(year)
TFR=Total fertility rate
High (TFR=1.4 person)
Medium(TFR=1.1 person)
Low (TFR=0.8 person)
zero
2019~2026Population peak23.5~23.6 million people
Source: National Development Council, R.O.C
PopulationProjection
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Life expectancy rising, while risk for chronic diseases and population of disabled elderly increase
According to the 2013 National Well-being Indicators in Taiwan• Life expectancy at birth: 79.5 years ( Japan 82.7;
South Korea 81.1 )• Self-reported health: 79.5% respondents regard their
health condition as good /very good
HealthStatus
Source: 2013 National Well-being Indicators, Directorate General of Budget, Accounting and Statistics (DGBAS), Executive Yuan, R.O.C.
Taiwan experiences in greening the economy• A brief introduction to Taiwan • A success story: solid waste reduction and recycling• A failure story: pricing of water, petro and electricity
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MSW Quantity and Disposal Rate
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
0
50
100
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
60.17
76.97
99.99
5.88
55.01
0.863
1.143
0.387
Recycling rate including recyclable waste, food waste and bulky item
Rate of properly processed waste
Disposal per capita per day
Rat
e of
was
te p
rope
rly
proc
esse
d an
d re
cycl
ing
rate
(%
)
Am
ount
of
was
te d
ispo
sal p
er c
apit
a pe
r da
y (k
g/da
y/ca
)
Review of MSW Management
200220001987 1991 2001 2005~61997 2004
Ext Producer Responsibility Introduced in the law
Large Incinerators
Four-in-One Recycling
Program
Per-Bag Trash Fee in Taipei
Food Waste Recycling
Reducing at Source
Zero-Waste Policy
Mandatory G
arbage Sorting /Recycling
Sustainable Material
Managem
ent
2011
1984
1990 2004
Dumping Sanitary Landfills
IncinerationResource Recycling Resource Circulating
1997
Restriction on Plastic Bags and Disposable Tableware
Waste reduction
Restriction on ExcessivePackaging
Restriction on mercury-containingbatteries
Banned Mercury Thermometers
Toxicity MinimizationWaste Minimization
Establish resource recycling systems
Resource recycling management fund
Payment
Resource recycling fee rate review
committee
Resource recycling
management fund committee
Auditing and certification
group supervisor committee
Managing duty and budget
Subsidy
Auditing and certification
group
Manufacturers, importers, and sellers of objects or containers
Recycling responsibility
Resource recycling plant (treatment industry)
Recycling and clearance (recycling industry)
Local government Community and
school Private groups Retail sales
Recycling system
Extended Producer Responsibility Program since 1987
Mandatory Recycling Category
Containers
iron, aluminum, glass, paper, plastic and pesticide containers
E-waste Light bulbs
BatteriesVehicles
automobiles, motorcycles, tires and car batteries
electronic products and household appliances
dry cell, button cell battery
Food Waste Recycling
70% for pig feed after thermal treatment
30% composting at private or public facilities
Animal feedPlant compost
Trash
Mandatory Garbage Sorting/RecyclingSeparating garbage into 3 categories
Keep trash off the ground
– A warning will be issued for the first non-compliance. A penalty of
NT$1,200 -6,000 will be imposed on the second violation.
Per-Bag Trash Collection Fee
“Pay-by-Household Water Usage Trash Collection Policy” is implemented in other districts: NT$4/ton of household water consumed.
• Per-Bag Trash Collection Fee
in several cities– Taipei, New Taipei, Taichung
– Pay as you throw
– Per-Bag trash collection fee (NT$ 0.36/L)
– Waste volume 67%down, recycling
volume 48%up
Cradle to Cradle• Redesign products for
complete recycling, technically or biologically
• Redesign, a crucial factor for achieving zero waste and complete resource recycling
Taiwan experiences in greening the economy• A brief introduction to Taiwan • A success story: solid waste reduction and recycling• A failure story: pricing of water, petro and electricity
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Water Bill and Consumption
• Annual water bill trend
• Water bill and water consumption (per person per day) (2006)
NTD/cubic meter
NTD/cubic meter
liter
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080
2
4
6
8
10 10.62 10.66 10.71 10.73 10.73 10.77 10.72 10.77 10.8 10.84
50 100 150 200 250 300 350 400 4500
20
40
60
80
100
120
140
160
180
200
61.6 55.6
30
89.799.5
181.7
10.84
65
19.38.24
UK Netherland
Singapore
Germany French
Denmark
Taiwan
Tokyo
US Seoul
Petrol Price and Consumption• Annual petrol price trend
• high-grade petrol price (March, 2015)
NTD/L
2007/3/1
4
2007/5/3
0
2007/8/1
5
2007/10/3
1
2008/1/1
6
2008/4/2
2008/6/1
8
2008/9/3
2008/11/1
9
2009/2/4
2009/4/2
2
2009/7/8
2009/9/2
3
2009/12/9
2010/2/2
4
2010/5/1
2
2010/7/2
8
2010/10/1
3
2010/12/2
9
2011/3/1
6
2011/6/1
2011/8/1
7
2011/11/2
2012/1/1
8
2012/4/4
2012/6/2
0
2012/9/5
2012/11/2
1
2013/2/6
2013/4/2
4
2013/7/1
0
2013/9/2
5
2013/12/1
1
2014/2/2
6
2014/5/1
4
2014/7/3
0
2014/10/1
5
2014/12/3
10
5
10
15
20
25
30
35
40
95
NTD/L
kloe
Taiwan Japan South Korea
Singapore US Canada Germany Italy Spain UK Franch0.00
2.00
4.00
6.00
8.00
10.00
12.00
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
1.83 1.72 2.18
13.24
2.56 2.98
1.36 1.07 1.39 1.10 1.23 2.56
Price Before tax Cons. Per cap
Electricity Bill and Consumption
• Annual electricity bill trend
• Electricity bill compare, 2013
NTD/kWh
NTD/kWh
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
2.57 2.58 2.54 2.53 2.53 2.59 2.63 2.70 2.91 2.95 2.94 2.97 3.12
1.89 1.85 1.83 1.82 1.82 1.88 1.93 2.12
2.46 2.46 2.45 2.62 2.80
Light ball Electricity
year
Watt
Taiw
anChina
Mexico
Malaysi
a
South Korea US
Norway
Israe
lChile
Hungary
Singa
pore
Turke
y
Fran
ce
Poland
Finlan
d
Switz
erlan
d
Swed
enCzec
h
Luxe
mbourg
Greece UK
Japan
Netherl
ands
Philippines
Belgium
Austria
Portuga
l
Irelan
dSp
ain Italy
German
y
Denmark
0
2
4
6
8
10
12
14
0
500
1000
1500
2000
2500
3000
Household Industry annual cons. per cap
The (draft) Green Economy Policy Framework for Taiwan• Sustainable transition to a green economy – Why and How? • Definition and Four Key Aspects of Green Economy in the (draft) Green Economy Policy Framework for
Taiwan• Basic Principles, Vision and Objective of the (draft) Green Economy Policy Framework for Taiwan• The Structure of the (draft) Green Economy Policy Framework for Taiwan• Some important policy recommendations
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Definition and Four Key Aspects of “Green Economy”
Respect planetary boundaries
Society that lives within the
self perpetuating limits of its environment
(Coomer, 1979)
Requires the conservation
and enhancement of
the resources base (Bruntland,
1987)
Inter-generational equity, justice and
externality
Concern of future
generations (Bruntland,
1987)
Desire to ensure lasting and
secure livelihoods
(Barbier, 2013)
Intra-generational equity
Elimination of poverty and deprivation (Bruntland,
1987)
Enhance the equity of income
distribution
Revive the middle-class
Improve human well-beings and life quality sustainably
Seeks alternative
indicators to measure human welfare in place
of GDP
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Basic Principles of The (draft) Green Economy Policy Framework for Taiwan1. Development must go beyond GDP2. Give priority to creating an environment that enables the transition to
a green economy3. Propose policies that address underlying issues, not short-term
strategies aimed at surface-level problems4. Emphasize inclusive, democratic, participatory, accountable,
transparent, and stable governance5. Attach importance to the limits of its environment and natural
resources and planetary boundaries and the internalization of externalities
6. Advance the greening of all industries7. Create more decent jobs and rebuild the middle class8. Take account of economic efficiency, social equity, and protection of
the disadvantaged during the transition process
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Vision and Objective
• Vision• Toward a green economy that recognizing the limits of
environmental resources, enhancing intergenerational and intragenerational equity, improving prosperity and happiness of the people.
• Objective• To lay a solid foundation for the transition to a green
economy through integrated policies addressing underlying issues.
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Sectoral policies
Urban areas and buildings
Transportation
Agriculture
Environmental protection
Tourism
Forestry
Ocean and
fishery
Energy
Manufactures
Man-made capital
Natural capital
Human capital
Macro-policies
Water resources
Institutional capital
Social capital
The Structure of the (draft) Green Economy Policy Framework for Taiwan
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Green fiscal reform, including eliminating environmental-unfriendly subsidies in terms of macroeconomic policy instruments, i.e., exchange rate and interest rate
Establish an institution for promoting and protecting the rights of future generations, such as electing or appointing representatives of future generations in the congress and various institutions
Enhance intergenerational justice through healthy national finance, and a system of exchange rate, tax rate and interest rate that does not bias against future generations
Some important policy recommendations
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Some important policy recommendations
Establish a sustainability assessment system for policies and public projects
Require businesses to be responsible for the protection of environmental quality and labors’ welfare
Establish systems of payment for ecosystem services (PES)
Extend producers’ responsibility from cradle to cradle
Apply total quantity control in various fields, such as water, land, energy, infrastructure, etc.
Thank you for your attention !
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