Taipei, April 26 (CNA) The price of voluntary carbon credits is likely to rise if the Science Based Targets Initiative (SBTi) recognizes the use of carbon credits to offset companies’ carbon emissions, an executive of the Taiwan Carbon Solution Exchange (TCX) said Friday.
At a sustainability seminar, Joshua Tien (田建中), CEO of TCX, explained the role of the TCX and told the audience that with the recent policy change proposed by the SBTi, the demand for carbon credits will undoubtedly increase.
When asked after his speech what the consequences could be, he said: “It will become more difficult to buy international carbon credits, which will increase their price.”
The SBTi is a United Nations-approved climate certification organization that develops standards for companies to set and meet science-based emissions reduction targets to help limit global warming.
Tien said the SBTi has long been recognized as the initiative with the “strictest” criteria for meeting emissions targets, requiring companies to reduce emissions from their own operations and not recognizing offsetting emissions with purchased carbon credits.
However, in mid-April the SBTi proposed the inclusion of voluntary carbon credits as a legitimate tool to offset a company’s ‘Scope 3 emissions’, the emissions generated indirectly by the company’s value chain activities and considered most difficult to reduce be considered, Tien said.
“This came as a relief to many manufacturers, as it was a much more demanding task for them, compared to the services sector, to reduce emissions from manufacturing activities,” said the TCX director.
Some of Taiwan’s largest companies, including Taiwan Semiconductor Manufacturing Co. (TSMC), have joined the initiative. At least 94 Taiwanese listed companies had made commitments to the SBTi as of September 2023, according to an ESG report by a local consultancy firm.
Asked whether the revision of the SBTi criteria has been confirmed, Tien said the organization will announce the “basic rules, thresholds and guardrails” for the use of carbon credits in July.
While he suggested the price of carbon credits could be raised, he was reluctant to guess how big an impact the SBTi move could have on the prices of those credits.
The TCX, which was officially launched in August 2023 and began trading carbon credits in December, is Taiwan’s only certified exchange that brokers the purchase of international voluntary carbon credits by domestic companies.
