Taiwan Advances Low-Carbon Hydrogen Certification Bill for Global Standards

The Ministry of Economic Affairs in Taiwan has unveiled a draft bill aimed at establishing guidelines for certifying low-carbon hydrogen sources. This initiative is designed to align with international standards and enhance a renewable-friendly supply chain. The move reflects Taiwan’s commitment to reducing carbon emissions and promoting sustainable energy practices.

In a significant development at the UN Climate Change Conference (COP28) in 2023, representatives from 37 countries pledged to create national low-carbon hydrogen certification mechanisms based on mutual recognition. Taiwan’s draft guidelines, completed in May 2023 by the Bureau of Standards, Metrology and Inspection, will complement the existing Taiwan Renewable Energy Certificate (T-REC) system.

Key Features of the Draft Guidelines

According to the Ministry, the draft guidelines encompass essential technical aspects, including certificate issuance formats, information disclosure requirements, cancellation procedures, and carbon emissions inventory boundaries. These regulations aim to standardize hydrogen certification processes, making them compatible with European Union voluntary certification schemes. A memorandum of understanding has been signed with a technical support team from the EU’s Association of Issuing Bodies to ensure conformity.

Assistant Researcher Hsu Chia-wen from the Taiwan Institute of Economic Research emphasized the importance of these guidelines, stating that low-carbon hydrogen can significantly contribute to decarbonizing energy-intensive industries. The certification mechanisms will provide a clear identifier for clean hydrogen, encouraging companies to adopt this environmentally friendly energy source.

An anonymous expert from the institute noted that market demand for low-carbon hydrogen is primarily driven by economic incentives and compliance requirements. Well-established certification mechanisms will enhance international clean hydrogen markets, enabling the environmental value of low-carbon hydrogen to be verified and traded effectively.

Implications for Industry and Sustainability

Once implemented, the new guidelines will transform hydrogen from merely an industrial raw material into a product valued for its verifiable environmental attributes. Companies will need to supply comprehensive data on greenhouse gas emissions associated with hydrogen production, including the sources of electricity, energy consumption during production, and emissions from raw materials and transportation.

Taiwan’s T-REC system focuses on electricity sources and renewable energy usage. The new low-carbon hydrogen certification system is intended to work in conjunction with T-REC, assessing the carbon intensity and life-cycle emissions of hydrogen and hydrogen-based fuels. This integrated approach will ensure that the environmental benefits of renewable electricity are disclosed only once, creating a more transparent system for consumers and businesses alike.

For companies utilizing hydrogen, these certification mechanisms will be vital for international sustainability initiatives and supply chain disclosures. Sustainability frameworks, such as the RE100 initiative, the Carbon Disclosure Project, and the European Sustainability Reporting Standards, mandate that companies disclose their energy sources and contributions to decarbonization.

Companies lacking credible certification for their hydrogen energy sources may find themselves at a competitive disadvantage. They could face higher tariffs on exports to the EU under its carbon border adjustment mechanism, which underscores the urgency for Taiwan to develop its low-carbon hydrogen certification process.

Taiwan plans a progressive approach to implementing its low-carbon hydrogen certification mechanism, initially focusing on domestic power and fuel usage, as well as emissions during production processes. The incorporation of imported raw materials and overseas transport emissions will be addressed in later stages, aiming to alleviate pressures on domestic industries.

Through these efforts, Taiwan seeks to position itself as a leader in the low-carbon hydrogen market, fostering sustainable practices that align with global trends and contribute to a greener future.