Estimation of Taiwan’s CO2 Emissions Related to Fossil Fuel Combustion – A Sectoral Approach

In terms of annual carbon dioxide (CO2) emissions, Taiwan emitted 293.66 million metric tons of CO2 in 2007 and the volume was down to 279.14 million metric tons in 2009. However, from 2007 to 2009, Taiwan’s CO2 emission ranking rose from the 22nd to the 21st largest emitter in the world. International comparisons of total CO2 emissions are shown in Table 1. After the Kyoto Protocol entered into force in 2005, the Taiwanese government convened its second National Energy Conference.3 The Taiwan Environmental Protection Administration (EPA), designated as the leading government agency in greenhouse gas policy, submitted its Greenhouse Gas Reduction Bill to the legislature in 2006. Unfortunately, the Greenhouse Gas Reduction Bill was not passed.


Introduction
In terms of annual carbon dioxide (CO 2 ) emissions, Taiwan emitted 293.66 million metric tons of CO 2 in 2007 and the volume was down to 279.14 million metric tons in 2009.However, from 2007 to 2009, Taiwan's CO 2 emission ranking rose from the 22nd to the 21 st largest emitter in the world.International comparisons of total CO 2 emissions are shown in Table 1.After the Kyoto Protocol entered into force in 2005, the Taiwanese government convened its second National Energy Conference. 3 The Taiwan Environmental Protection Administration (EPA), designated as the leading government agency in greenhouse gas policy, submitted its Greenhouse Gas Reduction Bill to the legislature in 2006.Unfortunately, the Greenhouse Gas Reduction Bill was not passed.
After President Ma Ying-jeou took office in 2008, he announced his target of stabilizing Taiwan's GHG emissions at 2008 levels by 2020.Furthermore, the Committee of Carbon Reduction of the Executive Yuan has proposed a national target for reducing carbon dioxide in fuel emissions, dropping to 2005 levels by 2020 and to 2000 levels by 2025.The EPA resubmitted the Greenhouse Gas Reduction Bill to the legislature in 2008.It is still being considered, but if it passes, the bill would authorize the EPA to regulate GHGs with a capand-trade scheme and sectoral emission performance standards.That is, the government of Taiwan is considering setting up a carbon trading exchange.
Accordingly, the understanding of the historical allocation of the carbon dioxide emission across sectors and industries becomes very important.This information will allow the government to evaluate the potential trading volume of a future domestic carbon market.To get a grip on the issue of potential trading volume, we start from estimating Taiwan's CO 2 emission levels.Since the largest source of CO 2 emissions is from the oxidation of carbon  4 IPCC makes sectoral emissions estimates based on fuel consumption.In Taiwan's recent inventories of greenhouse gas emissions, estimates of CO 2 emissions carried out by the Bureau of Energy were calculated in accordance with IPCC methodology.However, the estimation breaks down the CO 2 emissions by sector (energy sector, industrial sector, transportation sector, agricultural sector, service sector, and residential sector).
Attempting to delineate the CO 2 emissions of Taiwan, we further estimate Taiwan's fossil fuel CO 2 emissions by subsector/industry.

Research Methodology
In this section, the methodology for estimating CO 2 emissions from energy is discussed.Following the IPCC Guidelines for National Greenhouse Gas Inventories, 5 we estimate 2005-2010 CO 2 emissions based on fuel consumption data by sub-sectoral activity.Individual subsector's fuel consumption data were obtained from the Energy Balance Sheet compiled by the Bureau of Energy. 6Table 2 gives a list of subsectors and industries included in the sample.
Therefore, CO 2 emissions from fuel combustion by fuel type j for each subsector (industry) i in year t is calculated as follows:7 5 The IPCC Guidelines were first accepted in 1994 and published in 1995.UNFCCC COP3 held in 1997 in Kyoto reaffirmed that the Revised 1996 IPCC Guidelines for National Greenhouse Gas Inventories should be used as "methodologies for estimating anthropogenic emissions by sources and removals by sinks of greenhouse gases" in calculation of legally-binding targets during the first commitment period.http://www.ipccnggip.iges.or.jp/public/gl/invs1.html.

Table 2. Subsectors or Industries included in the sample
That is, using IPCC methodology as the basis, the estimation process can be divided into six steps that lead to figures for CO 2 emissions from fuel combustion.
1) Obtain the amount of each fuel consumed by each sub-sector.
Since heating value data provided by the Bureau of Energy are in 10 � kilocalories, we multiply the consumption by 0.04184 to give the amounts of all fuels in terajoules (TJ).Carbon content represents the total amount of carbon that could be emitted if 100 percent were released to the atmosphere.To estimate the carbon content in tons of carbon, we multiply fuel consumption in TJ by the appropriate carbon emission factors (more precisely, the specific carbon content, t C/TJ).This calculation should be done for all fuel types in each sector.The carbon emission factors for each fuel type are shown in Table 3.
3) Estimate the amount of carbon stored in products.After estimating the total carbon contained in the fuels, the next step is to estimate the amount of carbon from those fuels which are used for non-energy purposes.Some of the fuel supplied to an economy is used as a raw material (or feedstock) for the manufacture of products or in a non-energy use (e.g., bitumen for road construction, lubricants).Therefore, in some cases, the carbon from the fuels is oxidized quickly to CO 2 , while in other cases the carbon is stored in the product, sometimes for as long as centuries.The amounts of stored carbon should be deducted from the calculation for total carbon emissions.

Fuel
Carbon The amount of the carbon stored is obtained by multiplying the carbon content and fraction of carbon stored.Table 4 represents the fraction of carbon stored for different types of fuel.Since in Taiwan, lubricants and bitumen are used as raw materials and in non-energy consumption, the Bureau of Energy gives the figures of these two fuel types as 1.0.Naphtha and LPG are used as raw materials in the industry of Petrochemical Materials; consequently, the Bureau of Energy gives the figures of these two fuel types in Petrochemical Materials as 1.0, while in other industries as 0.
4) Account for carbon oxidized during combustion.When energy is consumed, not all of the carbon in the fuel oxidizes to CO 2 .Incomplete oxidation occurs due to inefficiencies in the combustion process that leave some of the carbon unburned or partly oxidized as soot or ash.The Intergovernmental Panel on Climate Change (IPCC) guidelines for calculating emissions inventories require that an oxidation factor be applied to the carbon content to account for the small portion of the fuel that is not oxidized into CO 2 .Table 5 shows the fraction of carbon oxidized.For example, for all oil and oil products, the oxidation factor used is 0.99 (i.e., 99 percent of the carbon in the fuel is eventually oxidized, while 1 percent remains un-oxidized).Since the ratio of the molecular weight of CO 2 (m.w.44) to the molecular weight of carbon (m.w.12) is 44/12, i.e., one ton of carbon is equal to 44/12 tons of CO 2 , all final estimates are multiplied by 44/12 to convert net carbon emissions from energy consumption to total CO 2 emissions.6) Estimate CO 2 emissions from electricity consumption.In estimating CO 2 emissions, the Bureau of Energy in Taiwan provides a supplemental method which accounts for all fossil fuel combusted and all electricity consumption.That is, to estimate the CO 2 emissions in a given subsector, the emissions from fossil fuel combustion may be added to the emissions from electricity consumption.Following the approach of the Bureau of Energy, we first sum up electricity consumption from both the energy sector and the non-energy sector, and then distribute the total emissions in kWh across "end-use subsectors," according to the ratio of each sub-sector's electricity consumption to total electricity consumption.

Estimation Results
The purpose of this paper is to investigate CO 2 emissions from fossil fuels combustion across Taiwan's 57 subsectors (or industries).The estimates of CO 2 emissions and the related results are presented in the following section.

Level of Total CO 2 Emissions
Figure 1 shows that between 2005 and 2007, Taiwan's carbon dioxide emissions rose from approximately 250.3 million metric tons to 261.1 million metric tons and the corresponding per capita value rose from 10.99 metric tons to 11.37 metric tons.Thereafter, CO 2 emissions from fossil fuels combustion in 2008 and 2009 show a trend of decrease.Three main reasons contribute to this negative growth.The first may be the economic recession caused by the global financial crisis.The second is that energy consumption went down after the prices of oil and electricity were rationalized.The third is that the government is vigorously conducting related policies and measures on energy saving and carbon reduction.However, the total CO 2 emissions rose again in 2010 from 238.1 million metric tons to 252.9 million metric tons and CO 2 emissions per capita rose from 10.3 metric tons to 10.92 metric tons.

CO 2 Emissions by Subsector
After further estimating CO 2 emissions from fuel combustion for each subsector, we obtain some important points on the industrial, transport, and energy sectors which need to be addressed.

Transport Sector
The transport sector, the second largest emitting sector, contributes 14.1% of the total CO 2 emissions in Taiwan.CO 2 emissions from the transport sector are shown in Table 8.In the transport sector, road transport is responsible for a significant share of the CO 2 emissions as shown in Figure 4.
Unit: metric tons The fact that road activity generates the most CO 2 emissions means that road vehicles, including motorcycles, passenger cars and trucks, account for approximately 94% of all transport-related CO 2 emissions.This percentage is much higher than that of EU 27, which can be seen from Figure 5.

Energy Sector
The energy sector, the fifth largest CO 2 emitter, accounts for 11.0% of total CO 2 emissions.From 2005 to 2010, the petroleum refineries industry accounted for the major share (35% on average) of total CO 2 emissions in the energy sector, followed by electricity plants and blast furnaces.CO 2 emissions from the energy sector are presented in Table 9.The distribution of CO 2 emissions related to the energy sector is shown as Figure 6.
Unit: metric tons

10 High-Emitting Subsectors in Taiwan
The residential sector in Taiwan is the largest contributor to CO 2 emissions.As discussed earlier, road transport is responsible for a significant share of the CO 2 emissions in the transport sector.It also is ranked second in fossil fuel CO 2 emissions among 57 sub-sectors.Electrical and electronic machinery industry is ranked third.
The top 10 high-emitting subsectors in Taiwan are presented in Table 10 and the time trend of the 10 high-emitting subsectors in Taiwan is shown in Figure 7.
Unit: metric tons

Conclusion and Future Research Direction
This paper is part of an ongoing research project designed to investigate the potential size of Taiwan's carbon market.When tackling this big issue on the size of the carbon market, we first use IPCC's sectoral approach to estimate CO 2 emissions from fuel combustion and examine the sectoral and subsectoral distribution of CO 2 emissions in Taiwan.Utilizing the Energy Balance Sheet compiled by the Bureau of Energy, this analysis is based on the fuel consumed in each subsector and the electricity used in the subsector.With the results obtained in this paper, we are planning to examine the demand and supply structure of Taiwan's carbon market by projecting CO 2 emission data to year 2012 and 2013.Since the cap (emission rights) is given, the quantity of demand for emission rights and the quantity of supply for emission rights could thus be identified.

5 )
Convert emissions of carbon to the full molecular weight of CO 2 .

Figure 1 .
Figure 1.2005-2010 CO 2 Emissions and Emissions per Capita in Taiwan

Table 1 .
Total Carbon Dioxide Emissions from the Consumption of Energy when fossil fuels are burned, Estimate total carbon content in fuels.

Table 5 .
Oxidation Factors as given in the 1996 IPCC Guidelines

Table 6 and
Figure 2 show that the industrial sector dominated fossil fuel CO 2 emissions from 2005 to 2010.