There is growing concern that increasing accumulation of certain gases in the atmosphere is leading to undesirable changes in the global climate, such as the greenhouse effect. This has resulted in proposals to set physical targets for reducing emissions of gases which cause the global warming. In June 1992, the Framework Convention on Climate Change was signed in Rio de Janeiro by more than 150 countries in order to promote international cooperation for achieving such reductions. In December 1997, the Third Member’s Meeting of the Convention on Climate Change declared the passage of the Kyoto Protocol to regulate greenhouse gases mitigation (GHG) for the industrial countries from Annex I regions. In February 2005, after 55% of the countries from Annex I regions signed agreement on GHG-mitigation the Kyoto Protocol was enacted automatically.
International trade plays a critical part in Taiwan’s economic growth. Therefore, Taiwan must pay close attention to the issue of global environmental changes. The Taiwan government may initiate in the foreseeable future relevant policy actions to fulfill its global obligation to reduce GHG. In 1990 the total CO2 emission in Taiwan reached the level of 112 million tones and among them 39 million tones were contributed by power generation. In 2003 the emission level from power generation was further increased to 98.9 million tons, which occupied at least one third of the total emissions of Taiwan. With this background in mind, it is important to understand the simulated impact of domestic measures to reduce greenhouse gas emissions on Taiwan’s economy.
The main purpose of this project is to establish an integrated electric model (incorporating bottom-up and top-down modeling techniques) simulating the environmental, energy, and economic systems of Taiwan and to formulate strategies for mitigating GHG emissions for Taipower. In order to achieve this objective, a CGE model coupled with a power expansion model will be cons