[Event Review] 2022 Fubon Globalization Forum (Part One): Accelerating Net-Zero Transition: Academia Sinica's Technology Proposal and International Transformation Strategy

: 13 January 2023; Hits: 16198

[Event Review] 2022 Fubon Globalization Forum (Part One): Accelerating Net-Zero Transition: Academia Sinica's Technology Proposal and International Transformation Strategy

Author / Chien-Ming Hsu, Predoctoral Fellow, RSPRC
Co-author / Mu-Xing Lin, Postdoctoral Fellow, RSPRC & Jui-Ning Chang, Research Assistant, RSPRC
Proofread / Che-Chun Chen, Project Executive, RSPRC

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In addition to the pandemic and wars, the impact of extreme weather is also being increasingly felt, and thus countries need to adopt more effective net-zero transition strategies. The Seventh (Annual) Fubon Globalization Seminar was hosted by the National Taiwan University (NTU), the Risk Society and Policy Research Center (RSPRC; hereinafter referred to as NTU RSPRC), Fubon Financial Holding Co., Ltd., and the Fubon Cultural & Educational Foundation, and co-organized by the Center for Sustainability Science of the Academia Sinica. In the context of the developments toward the target of net-zero emissions by 2050, the theme of the seminar was "Net-Zero 2.0X Transition Acceleration—Toward a People-Oriented and Just Transition." In the morning session, experts from Taiwan and abroad discussed how the process of net-zero transition could be accelerated through net-zero technology and international experience. In the afternoon session, in the area of "just transition," the NTU RSPRC, which completed the first survey across Taiwan on the awareness of a just transition in Taiwan's high-carbon and high-power-consumption industries, presented the industry's viewpoints and concerns, and Japanese and Korean scholars and central and local governments shared their experiences and responses.

The morning session was opened by Kuei-Tien Chou, Director of the NTU RSPRC, and Daniel Tsai, Chairman of Fubon Group, was the guest speaker. Director Chou said that the international community is currently affected by both climate disasters and geopolitics. On the one hand, the international layout of enterprises is affected; on the other hand, enterprises face the issue of the transition of the high-power-consumption industry. He believes that under the developments of energy technology and net-zero emissions, Taiwan should think about the future development in 2040, 2050, and 2060, reposition itself, and consider how a just pathway of transition that takes into account the lives of those affected can be established. Chairman Tsai pointed out that the year 2022 marked the seventh time that the Fubon Globalization Seminar was being held, "but we are not talking about economic globalization, but common global problems, the battle for the survival of all mankind." He further shared his thoughts on a just transition under COP27, as well as Fubon's experience as the first financial enterprise in Taiwan to commit to restricting its investment in coal-fired power plants to less than 50%, and Fubon's participation in RE100, green power procurement, and climate financing. He highlighted the need to assist enterprises in their financing endeavors for green transition, through capital utilization and by actively steering clients toward and assisting them in the process. He also expressed his hope from the industry perspective that the government will propose a comprehensive net-zero emissions pathway and process, and that this seminar, with the theme of a people-oriented and just transition, will draw greater attention from leaders of industry, government, and academia.

Figure 1 Kuei-Tien Chou, Director of RSPRC, NTU

Figure 2 Daniel Tsai, Chairman of Fubon Group

The first session keynote speech of this seminar was moderated by Faa-Jeng Lin, Director of the National Applied Research Laboratories, and delivered by James C. Liao, President of Academia Sinica. The content of the lecture was based on the key points in the "Proposal for the Policy of Research and Development of Net-Zero Technology in Taiwan" released by Academia Sinica. President Liao began by emphasizing that Taiwan cannot reach the net-zero emissions goal by 2050 with existing technology and therefore needs to develop new technology. The most crucial technology is zero-carbon energy. He explained with actual figures that the energy consumption entailed in net zero from the source is much smaller than that of carbon emission and capture, and the carbon content of products such as cement and ethylene, which are reused after carbon capture, is also much smaller than the total carbon emission in Taiwan. Therefore, zero-carbon electricity should be vigorously developed.

Figure 3 Faa-Jeng Lin, President of National Applied Research Laboratories

In terms of which zero-carbon power technologies to develop, he believes that, in addition to developing technologies that affect fewer vulnerable people and reduce a greater amount of carbon emissions, we should also consider those with high feasibility. In addition to considering technical feasibility, the NTU RSPRC will make forward-looking deployments with respect to the social aspect and study the problems that technology may bring and issues related to industrial transformation. Academia Sinica's proposed net-zero technology strategy can be divided into "pressing ahead as fast as possible," "expanding promotion," "continuous promotion," and "close tracking." The theme of President Liao's report today focused on high-efficiency photovoltaics (PV), methane pyrolysis, geothermal energy, ocean energy, and biomass carbon sink, which belong to the strategy of "pressing ahead as fast as possible." From the perspective of self-generated energy, high-efficiency PV faces difficulty in achieving low cost despite the ease of realizing high efficiency, but Taiwan also has the technical strength to meet the challenge. Meanwhile, with respect to self-generated green energy, we cannot give up geothermal and ocean energies, both of which already have experimental sites. With respect to imports, President Liao emphasized the use of methane pyrolysis power generation technology to produce green power. From a theoretical point of view, methane pyrolysis can be used directly, and so its economic benefits are greater. Moreover, the by-products can be handled easily and can be used as a stable base load; Academia Sinica already has a demonstration unit. With respect to power use efficiency, he pointed out that direct use of green power is the most effective carbon-reducing approach, followed by battery storage and discharge, and then water electrolysis for hydrogen production, hydrogen burning, or fuel cell power generation.

Figure 4 James C. Liao, President of Academia Sinica

Finally, President Liao stated that Academia Sinica's policy proposal also mentioned the importance of expanding the promotion of social and economic measures, and that various net-zero technologies represent the key to the transition to net-zero emissions, which entails universal support for research and development of carbon reduction technologies, support for reasonable carbon taxes and fees, and reasonable power prices.

After a technical presentation by President Liao, a panel discussion was held on the theme of "International Net-Zero Experience and Strategies," moderated by Yi-Hua Li, Chairman of PricewaterhouseCoopers Sustainability Services Company Ltd., with Wen-Sheng Tseng, Deputy Minister of the Ministry of Economic Affairs, participating (who participated in the panel discussion with a pre-recorded video and was represented by Ming-Chih Chuang, Executive Secretary of the Committee of Research and Development of the Ministry of Economic Affairs, who attended the panel discussion on his behalf). The panelists included Jules Chuang, Co-chair of European Chamber of Commerce Taiwan, Alain Chouan, Head of the Economic Department of French Office in Taipei, and Sun-Jin Yun, Professor of Environmental Studies at the Graduate School of Environmental Studies at Seoul National University.

Figure 5 Wen-Sheng Tseng, Deputy Minister of the Ministry of Economic Affairs

Figure 6 Ming-Chih Chuang, Executive Secretary of Ministry of Economic Affairs

In the pre-recorded video, Deputy Minister Tseng presented the government's achievements and plans in the net-zero area. He began by pointing out that the direction of this year's COP27 is "Delivering Together," which requires a problem-based approach to finding practical solutions and turning them into action plans. This process cannot be accomplished by a single technology or approach, or a single business, government, or organization's initiative; it requires joint efforts from all. One of the major problems with Taiwan's net-zero transition is that around 90% of the carbon emissions can be attributed to the energy sector, with the power sector and non-power sector accounting for 56% and 35%, respectively. Therefore, creating a zero-carbon energy system is a priority. Deputy Minister Tseng went on to share several major directions. The first one was renewable energy, with the growth of PV and wind power as the main force/mainstay in Taiwan. The former's installation capacity has exceeded 3 GW, namely 7.3 times that of 2016, while the latter will accelerate its growth in the next three years. Small hydropower, geothermal energy, and ocean energy represent the key development efforts. We hope to develop geothermal energy by accelerating exploration and simplifying the administrative process, and to develop ocean energy with offshore wind power and marine projects. As we still need to maintain a certain level of inertia by 2050, we will continue to have natural gas units in operation and will achieve net-zero goals through carbon-free fuels and carbon capture.

The second direction was Taiwan's green energy import substitution and export expansion. Deputy Minister Tseng pointed out that nearly 10% of Taiwan's GDP is spent on imported energy, which translates into NT$ 2 trillion. All countries are developing renewable energy, and Taiwan needs to find a "mine" in its own territory to be more competitive on the one hand, and find a possible opportunity for national development on the other. The focus of development is "wind, solar, heat, ocean, and hydrogen, storage, and sink." In addition to the aforementioned wind power, PV, geothermal energy, and ocean energy, the question of whether hydrogen energy can replace natural gas and be used in chemical batteries, as well as that of hydrogen storage, has received a lot of attention. "Storage" refers to energy storage, which helps to regulate thermal power generation and improve grid efficiency, while "sink" refers to the next key development direction, namely carbon sink. The government has also asked government enterprises such as Taipower, CPC Corporation Taiwan, and China Steel Corporation to set an example and work together to promote carbon reduction. Finally, Deputy Minister Tseng specifically mentioned that energy use should gradually switch to electricity and that new power generation equipment will be a vital industry orientation for Taiwan. Effective layout of the energy industry and grid regulation services are the core tasks of Taiwan's energy transition. However, the solution requires not only science and technology but also laws and regulations, financial support, and consensus of the people. Communication will continue. We need to accelerate the related work.

After the presentation by Deputy Minister Tseng, Jules Chuang, Co-Chair of the European Chamber of Commerce Taiwan, shared his experience as a market participant. He began by pointing out that countries in the EU, such as Sweden, Germany, France, Denmark, and Hungary, have their own net-zero targets; while EU countries have the support of EU organizations, Taiwan as an island country has to face many challenges on its own. Second, there are two points worth noting in the EU's Fit for 55 package. First, through the carbon tariff that will come into effect soon, the EU hopes to gradually retire the large internal carbon emitters, while the carbon tariff will allow enterprises within the EU and beyond to compete on a level playing field without the problem of carbon leakage. Second, with respect to carbon emissions trading, the EU is considering raising the target, so that sources of carbon emissions that cannot currently be attributed can be included in the system. Extending Deputy Minister Tseng's arguments, Mr. Chuang pointed out that, to move toward net-zero emissions, in addition to shifts in technology and energy type, more dialogue and communication are needed on the legal and consensus fronts, and ultimately more capital market support is required.

Figure 7 Jules Chuang, Co-chair of the European Chamber of Commerce Taiwan

The third speaker was Alain CHOUAN, Head of the Economic Department of the French Office in Taipei. He pointed out that France adopted the current National Low Carbon Strategy (NLCS) because of its need to reduce carbon emissions in response to the global temperature rise. In 2015, France passed a law on energy transition and green energy growth, and then set carbon reduction targets for 2030, starting with a 40% reduction in carbon emissions based on the 1990 level, and then achieving carbon neutrality by 2050 and reducing the carbon footprint of the French people in transportation and in the import and export of products. In this process, the views of enterprises, NGOs, third parties, experts, and public stakeholders are being sought extensively and on a large scale. Moreover, professional organizations have provided governance recommendations, which form the outline of policy recommendations and management. Furthermore, the national policy has been reviewed and adjusted every five years.

Figure 8 Alain Chouan, Director of the Economic Department of the French Office in Taipei

France switched from coal to nuclear power in the 1970s and currently has 56 nuclear power plants, with 70% of its energy coming from nuclear power. However, there are more new energy options available now. While energy production can reach 1,423 TWh across Taiwan, the demand reached 2,550 TWh in 2020, which implies that 45% of the energy depends on imports. The future carbon emissions target is to reduce from the 442 MTCO_2eq in 2017 to 301 MTCO_2eq by 2030, and to reach an irreducible level of approximately 80 MTCO_2eqsub> by 2050, before achieving carbon neutrality through other means. To achieve this goal, NLCS has also developed a carbon budget with a cap on carbon emissions set for every five years through to 2033, and then each industry and gas emitter will have its own reduction target in the next three phases of the carbon budget.

To achieve carbon neutrality, NLCS requires a completely decarbonized energy system for energy production and a reduction in energy consumption in all industrial activities, which entails not only improving energy efficiency and reducing energy use by 40% but also developing an industrial transition featuring sobriety and sufficiency. Non-energy sectors such as agriculture and industrial processes should also significantly reduce emissions, as well as develop carbon sinks and CCUS. France's per capita carbon footprint will need to be reduced from the current 11 tons to around 2 tons by 2050. He stressed that action to reduce carbon emissions is imperative, but not just with respect to reduction of emission amount. Instead, enterprises and individuals also need to change their behavior and reduce consumption. To convince all parties to take action, education, regulations, incentives, and sanctions are needed and adequate information should be provided to the public.

The fourth speaker was Sun-Jin Yun, Professor of Environmental Studies at the Graduate School of Environmental Studies at Seoul National University. She drew on her previous experience as co-chair of South Korea's 2050 Carbon Neutrality Committee to talk about how the South Korean government intends to achieve its net-zero policy goals. She began by drawing on the IPCC data to emphasize the importance of reaching initial targets by 2030. South Korea set carbon reduction targets in 2009 and 2019, respectively, and then declared a 2050 carbon neutrality target in 2022 under the Moon Jae-in administration. The country created the Carbon Emission Committee in May 2021. However, data showed that, in 2020, South Korea's actual emissions increased rather than decreased, exceeding the original target by about 100 million tons. Thus, the gap between the target and actual action needs to be filled.

Nevertheless, the carbon neutrality target set in 2020 was proposed after considerable discussion between ministries and commissions under the Executive Yuan (Taiwan) and the public. Some local governments had already announced their carbon neutrality targets before the central government did. The central government announced its carbon neutrality promotion strategy and the establishment of the Carbon Neutrality Committee in late 2020, and established carbon neutrality and green energy as law. Subsequently, in 2021, the emission reduction targets and the milestones for 2030 were readjusted. As the organization directly under the Prime Minister and the main entity, the Carbon Neutrality Committee needs to continuously communicate with the public, and such communication is characterized by the inclusion of a substantial number of citizens. It invites South Koreans over 15 years of age (19 is the age of adulthood in South Korea) to participate proportionately to gender and region and is the largest committee in the Moon Jae-in era, with 95 members, including 18 ministers.

Figure 9 Sun-Jin Yun, Professor at Gratuate School of Environmental Studies, Seoul National University

The primary source of carbon emissions in South Korea is energy, followed by the industrial sector, such as steel and semiconductor industries, and the third source is transportation, all of which are quite difficult to adjust. In the beginning, the committee proposed three scenarios, which were soon criticized by both industry and citizens, and two scenarios were formed after a series of controversies and resignations of members. The proportion of nuclear energy in both scenarios is rather limited. Today's new government wants to maintain the same carbon reduction targets but wants to restart nuclear power, which is a major challenge for South Korea, a country with no nuclear waste storage site. With respect to politics, there are multiple goals beyond the numbers that need to be achieved. The question today is not whether carbon neutrality is possible, but how to achieve the goal.

After the panelists' presentations, moderator Chairman Yi-Hua Li asked Executive Secretary Ming-Chih Chuang and Professor Sun-Jin Yun about the EU carbon tariff. Executive Secretary Ming-Chih Chuang said that the carbon tariff has a significant impact on export-oriented Taiwan, and it is thus necessary to understand the degree of domestic manufacturers' grasp of relevant information and to consider carbon leakage and national competitiveness when formulating policies. Professor Sun-Jin Yun said that export-oriented South Korean industries were also affected, and that improving the power grid and increasing energy efficiency and the amount of renewable energy are important countermeasures. The moderator then asked whether France's net-zero policy was affected by the war and the pandemic. Alain Chouan, Head of the Economic Department of French Office in Taipei, said that the war between Russia and Ukraine did not have a strong impact on France's energy supply but that it was important to note how the unusual climate affected the movement of people. On the issue of stakeholder participation, Mr. Jules Chuang said that communication should not be subjectively timed and that it is important to put oneself in the shoes of others, because there may be a backlash if communication is not in place.

Figure 10 Eliza Li, Leader of Sustainability and Climate Change Service, PwC Taiwan

In response to an online question, Professor Sun-Jin Yun said that, although the goals of energy policy may be overturned in the election, the public can monitor and ask their representatives to promote the implementation of these goals because both private enterprises and the government need the support of the public. Mr. Alain Chouan said that nuclear energy is a sensitive issue in both Taiwan and France, and the future pathway remains uncertain. With many challenges ahead in the future, moderator Yi-Hua Li concluded with the phrase "Inclusion, Integration, and Prosperity," which requires the cooperation of all parties in order to achieve a people-oriented net-zero transition.

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