Green finance for mitigating greenhouse gases and promoting renewable energy development: Case study in Taiwan

Wen-Tien Tsai; Wen-Tien Tsai

doi:10.3934/GF.2024010

Green Finance

2024, Volume 6, Issue 2: 249-264. doi: 10.3934/GF.2024010

Previous Article Next Article

Case report Special Issues

Green finance for mitigating greenhouse gases and promoting renewable energy development: Case study in Taiwan

Wen-Tien Tsai ^,

Graduate Institute of Bioresources, National Pingtung University of Science and Technology, Pingtung, Taiwan

Received: 31 January 2024 Revised: 27 March 2024 Accepted: 17 April 2024 Published: 14 May 2024
JEL Codes: E52, G38, Q28, Q48, Q54

In recent years, the tools of green finance have evolved to foster green economic growth like renewable energy and climate change mitigation. Taking a case study of Taiwan not yet reviewed in the literature, the present study aimed to conduct a preliminary analysis for exploring the amazing growth in renewable energy over the past fifteen years (2010–2023) in connection with the achievements of green finance promotion over the past five years (2018–2022). The updated database was accessed on the websites of Taiwan's competent authorities. This work was divided into the following main parts: Taiwan's carbon neutrality policy and sustainable development goals (SDGs) relevant to green finance, the regulatory promotion for green finance action plans in Taiwan, and the status of green finance measures and achievements in Taiwan. The findings supported the idea that the implications of green policies for unlocking green finance and green investment significantly enhanced a positive influence on green energy industry development in Taiwan. In this regard, it showed the amazing growth of renewable energy generation, particularly in solar photovoltaics (PV) power and offshore wind power, since 2010. These findings were similar to those in Asian countries like China and Japan. Responding to Taiwan's SDGs policy by 2030 and the net-zero emissions in 2050, aspects relevant to climate change mitigation and adaptation were investigated in order to focus on the use of green finance tools.
- green finance,
- sustainable development goals,
- carbon neutrality policy,
- renewable energy development,
- regulatory promotion
Citation: Wen-Tien Tsai. Green finance for mitigating greenhouse gases and promoting renewable energy development: Case study in Taiwan[J]. Green Finance, 2024, 6(2): 249-264. doi: 10.3934/GF.2024010

Related Papers:

Abstract

In recent years, the tools of green finance have evolved to foster green economic growth like renewable energy and climate change mitigation. Taking a case study of Taiwan not yet reviewed in the literature, the present study aimed to conduct a preliminary analysis for exploring the amazing growth in renewable energy over the past fifteen years (2010–2023) in connection with the achievements of green finance promotion over the past five years (2018–2022). The updated database was accessed on the websites of Taiwan's competent authorities. This work was divided into the following main parts: Taiwan's carbon neutrality policy and sustainable development goals (SDGs) relevant to green finance, the regulatory promotion for green finance action plans in Taiwan, and the status of green finance measures and achievements in Taiwan. The findings supported the idea that the implications of green policies for unlocking green finance and green investment significantly enhanced a positive influence on green energy industry development in Taiwan. In this regard, it showed the amazing growth of renewable energy generation, particularly in solar photovoltaics (PV) power and offshore wind power, since 2010. These findings were similar to those in Asian countries like China and Japan. Responding to Taiwan's SDGs policy by 2030 and the net-zero emissions in 2050, aspects relevant to climate change mitigation and adaptation were investigated in order to focus on the use of green finance tools.

References

[1]	Ahmed D, Hua HX, Bhutta US (2024) Innovation through green finance: A thematic review. Curr Opinion Env Sust 66: 101402. https://doi.org/10.1016/j.cosust.2023.101402 doi: 10.1016/j.cosust.2023.101402
[2]	Akomea-Frimpong I, Adeabah D, Ofosu D, et al. (2022) A review of studies on green finance of banks, research gaps and future directions. J Sustain Financ Inv 12: 1241–1264. https://doi.org/10.1080/20430795.2020.1870202 doi: 10.1080/20430795.2020.1870202
[3]	Berrou R, Dessertine P, Migliorelli M (2019) An overview of green finance, In: Migliorelli M, Dessertine P (eds.), The Rise of Green Finance in Europe, Cham (Switzerland): Palgrave Macmillan, 3–29. https://doi.org/10.1007/978-3-030-22510-0_1
[4]	Bhatnagar S, Sharma D (2022a) Evolution of green finance and its enablers: A bibliometric analysis. Renew Sustain Energy Rev 162: 112405. https://doi.org/10.1016/j.rser.2022.112405 doi: 10.1016/j.rser.2022.112405
[5]	Bhatnagar S, Sharma D (2022b) Green financing in India: identifying future scope for innovation in financial system. Int J Green Econ 15: 185–212. https://doi.org/10.1504/IJGE.2021.120875 doi: 10.1504/IJGE.2021.120875
[6]	Bhattacharyya R (2022) Green finance for energy transition, climate action and sustainable development: overview of concepts, applications, implementation and challenges. Green Financ 4: 1–35. http://doi.org/10.3934/GF.2022001 doi: 10.3934/GF.2022001
[7]	Chiu WH, Lin WC, Liang CJ (2021) The role of green finance in community renewable energy projects of main region and Taiwan. Lex localis 19: 503–519. https://doi.org/10.4335/19.3.503-519(2021) doi: 10.4335/19.3.503-519(2021)
[8]	Debrah C, Darko A, Chan APC (2023) A bibliometric-qualitative literature review of green finance gap and future research directions. Climate Dev 15: 432–455. https://doi.org/10.1080/17565529.2022.2095331 doi: 10.1080/17565529.2022.2095331
[9]	Dhayal KS, Giri AK, Kumar A, et al. (2023) Can green finance facilitate Industry 5.0 transition to achieve sustainability? A systematic review with future research directions. Environ Sci Pollut Res 30: 102158–102180. https://doi.org/10.1007/s11356-023-29539-w doi: 10.1007/s11356-023-29539-w
[10]	Erdoğan S, Yıldırım S, Yıldırım DC, et al. (2020) The effects of innovation on sectoral carbon emissions: Evidence from G20 countries. J Environ Manag 267: 110637. https://doi.org/10.1016/j.jenvman.2020.110637 doi: 10.1016/j.jenvman.2020.110637
[11]	Financial Supervisory Commission (FSC) (2018) Green Finance Action Plan. Taipei (Taiwan): FSC
[12]	Financial Supervisory Commission (FSC) (2020) Green Finance Action Plan 2.0. Taipei (Taiwan): FSC
[13]	Financial Supervisory Commission (FSC) (2022a) Green Finance Action Plan 3.0. Taipei (Taiwan): FSC
[14]	Financial Supervisory Commission (FSC) (2022b) Important Measures and Achievements of Green Finance Action Plan 2.0. Taipei (Taiwan): FSC
[15]	Gilchrist D, Yu J, Zhong R (2021) The limits of green finance: A survey of literature in the context of green bonds and green loans. Sustainability 13: 478. https://doi.org/10.3390/su13020478 doi: 10.3390/su13020478
[16]	Global Change Data Lab (GCDL) (2024) Our World in Data. Available from: https://ourworldindata.org/ghg-emissions-by-sector.
[17]	Intergovernmental Panel on Climate Change (IPCC) (2006) 2006 IPCC Guidelines for National Greenhouse Gas Inventories. Available from: https://www.ipcc-nggip.iges.or.jp/public/2006gl/.
[18]	Khan HHA, Ahmad N, Yusof NM, et al. (2024) Green finance and environmental sustainability: a systematic review and future research avenues. Environ Sci Pollut Res 31: 9784–9794. https://doi.org/10.1007/s11356-023-31809-6 doi: 10.1007/s11356-023-31809-6
[19]	Khurshid A, Deng X (2021) Innovation for carbon mitigation: a hoax or road toward green growth? Evidence from newly industrialized economies. Environ Sci Pollut Res 28: 6392–6404. https://doi.org/10.1007/s11356-020-10723-1 doi: 10.1007/s11356-020-10723-1
[20]	Khurshid A, Qayyum S, Calin AC, et al. (2022) The role of pricing strategies, clean technologies, and ecological regulation on the objectives of the UN 2030 Agenda. Environ Sci Pollut Res 29: 31943–31956. https://doi.org/10.1007/s11356-021-18043-8 doi: 10.1007/s11356-021-18043-8
[21]	Khurshid A, Rauf A, Qayyum S, et al. (2023) Green innovation and carbon emissions: the role of carbon pricing and environmental policies in attaining sustainable development targets of carbon mitigation—evidence from Central-Eastern Europe. Environ Dev Sustain 25: 8777–8798. https://doi.org/10.1007/s10668-022-02422-3 doi: 10.1007/s10668-022-02422-3
[22]	Kumar B, Kumar L, Kumar A, et al. (2023) Green finance in circular economy: a literature review. Environ Dev Sustain. https://doi.org/10.1007/s10668-023-03361-3 doi: 10.1007/s10668-023-03361-3
[23]	Kung CC, Lan X, Yang Y, et al. (2022) Effects of green bonds on Taiwan's bioenergy development. Energy 238: 121567. https://doi.org/10.1016/j.energy.2021.121567 doi: 10.1016/j.energy.2021.121567
[24]	Li M, Hamawandy NM, Wahid F, et al. (2021) Renewable energy resources investment and green finance: Evidence from China. Resour Policy 74: 102402. https://doi.org/10.1016/j.resourpol.2021.102402 doi: 10.1016/j.resourpol.2021.102402
[25]	Li Z, Khurshid A, Rauf, A, et al. (2023) Climate change and the UN-2030 agenda: Do mitigation technologies represent a driving factor? New evidence from OECD economies. Clean Technol Environ Policy 25: 195–209. https://doi.org/10.1007/s10098-022-02396-w doi: 10.1007/s10098-022-02396-w
[26]	Liu D, Guo X, Xiao B (2019) What causes growth of global greenhouse gas emissions? Evidence from 40 countries. Sci Total Environ 661: 750–766. https://doi.org/10.1016/j.scitotenv.2019.01.197 doi: 10.1016/j.scitotenv.2019.01.197
[27]	Liu MY, Lin D (2021) A case study of green energy roofs in Taiwan using financial analyses. Int J Financ Bank stud 10: 12–20. http://dx.doi.org/10.20525/ijfbs.v10i3.1288 doi: 10.20525/ijfbs.v10i3.1288
[28]	Liu Y, Zhao X, Dong K, et al. (2023) Assessing the role of green finance in sustainable energy investments by power utilities: Evidence from China. Util Policy 84: 101627. https://doi.org/10.1016/j.jup.2023.101627 doi: 10.1016/j.jup.2023.101627
[29]	Meo MS, Karim MZA (2022) The role of green finance in reducing CO₂ emissions: An empirical analysis. Borsa Istanb Rev 22: 169–178. https://doi.org/10.1016/j.bir.2021.03.002 doi: 10.1016/j.bir.2021.03.002
[30]	Ministry of Economic Affairs (MOEA) (2023) Energy Statistics Handbook (in Chinese). Taipei (Taiwan): MOEA
[31]	Ministry of Economic Affairs (MOEA) (2024) Energy Statistics Database. Available from: http://www.esist.org.tw/database.
[32]	Ministry of Environment (MOE) (2023) National Greenhouse Gases Inventory in Taiwan (in Chinese). Taipei (Taiwan): MOE
[33]	Ministry of Justice (MOJ) 2024 Laws and Regulation Retrieving System. Available from: https://law.moj.gov.tw/Eng/index.aspx.
[34]	Monasterolo I (2020) Climate change and the financial system. Annu Rev Resour Econ 12: 299–322. http://doi.org/10.1146/annurev-resource-110119-031134 doi: 10.1146/annurev-resource-110119-031134
[35]	National Council for Sustainable Development (NCSD) (2022) Taiwan's Sustainable Development Goals (Revisions in Chinese). Taipei (Taiwan): NCSD
[36]	National Development Council (NDC) (2022) Taiwan's Pathway to Net-zero Emissions in 2050. Available from: https://www.ndc.gov.tw/en/.
[37]	Ozili PK (2022) Green finance research around the world: A review of literature. Int J Green Econ 16: 56–75. https://doi.org/10.1504/IJGE.2022.125554 doi: 10.1504/IJGE.2022.125554
[38]	Rahman S, Moral IH, Hassan M, et al. (2022) A systematic review of green finance in the banking industry: perspectives from a developing country. Green Financ 4: 347–363. https://doi.org/10.3934/GF.2022017 doi: 10.3934/GF.2022017
[39]	Rasoulinezhad E, Taghizadeh-Hesary F (2022) Role of green finance in improving energy efficiency and renewable energy development. Energ Effic 15: 14. https://doi.org/10.1007/s12053-022-10021-4 doi: 10.1007/s12053-022-10021-4
[40]	Sun L, Yin J, Bilal AR (2023) Green financing and wind power energy generation: Empirical insights from China. Renew Energy 206: 820–827. https://doi.org/10.1016/j.renene.2023.02.018 doi: 10.1016/j.renene.2023.02.018
[41]	Taiwan Stock Exchange (TWSE) (2024) Statistics on Sustainability Report by the listed companies. Available from: https://cgc.twse.com.tw/front/chPage.
[42]	Taghizadeh-Hesary F, Phoumin, H, Rasoulinezhad E (2023) Assessment of role of green bond in renewable energy resource development in Japan. Resour Policy 80: 103272. https://doi.org/10.1016/j.resourpol.2022.103272 doi: 10.1016/j.resourpol.2022.103272
[43]	Tolliver C, Fujii H, Keeley AR, et al. (2021) Green innovation and finance in Asia. Asian Econ Policy Rev 16: 67–87. https://doi.org/10.1111/aepr.12320 doi: 10.1111/aepr.12320
[44]	Tsai WT (2021) Overview of wind power development over the two past decades (2000–2019) and its role in the Taiwan's energy transition and sustainable development goals. AIMS Energy 9: 342–354. http://doi.org/10.3934/energy.2021018 doi: 10.3934/energy.2021018
[45]	United Nations (UN) (2024) Take action for the sustainable development goals. Available from: https://www.un.org/sustainabledevelopment/sustainable-development-goals.
[46]	United Nations Climate Change (UNCC) (2024a) The Paris Agreement. Available from: https://unfccc.int/process-and-meetings/the-paris-agreement.
[47]	United Nations Climate Change (UNCC) (2024b) The Glasgow Climate Pact. Available from: https://unfccc.int/process-and-meetings/the-paris-agreement/the-glasgow-climate-pact.
[48]	Wang X, Khurshid A, Qayyum S, et al. (2022) The role of green innovations, environmental policies and carbon taxes in achieving the sustainable development goals of carbon neutrality. Environ Sci Pollut Res 29: 8393–8407. https://doi.org/10.1007/s11356-021-16208-z doi: 10.1007/s11356-021-16208-z
[49]	Zakari A, Oryani B, Alvarado R, et al. (2023) Assessing the impact of green energy and finance on environmental performance in China and Japan. Econ Change Restruct 56: 1185–1199. https://doi.org/10.1007/s10644-022-09469-2 doi: 10.1007/s10644-022-09469-2
[50]	Zhou F, Endendijk T, Botzen WJW (2023) A review of the financial sector impacts of risks associated with climate change. Annu Rev Resour Econ 15: 233–256. http://dx.doi.org/10.1146/annurev-resource-101822-105702 doi: 10.1146/annurev-resource-101822-105702

Reader Comments

Your name:*

Email:*
© 2024 the Author(s), licensee AIMS Press. This is an open access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0)