Final public consultation on green and transition taxonomy launched

The GTIF is seeking views on the “Do No Significant Harm (DNSH)” criteria, amongst others.

The MAS-convened Green Finance Industry Taskforce (GFIT) has launched its final public consultation on the green and transition taxonomy for Singapore-based financial institutions.

GFIT wishes to seek the public’s view on the detailed thresholds and criteria for the classification of green and transition activities in the agriculture and forestry/land use, industrial, waste and water, information and communications technology, and carbon capture and sequestration sectors.

The task force also wants the public to share their view on the adoption of a “measures-based approach” for the industrial sector. 

“Unlike other sectors, for the industrial sector, there is a lack of certainty around the technological solutions to achieve net zero.  This makes it difficult to determine science-based metrics and thresholds for the ‘amber’ category based on the emissions performance of the activity,” the Monetary Authority of Singapore (MAS) said.

“In lieu of this, a ‘measures-based approach’ is proposed, which requires the production process of the industrial raw materials to adopt a range of emissions reduction measures. For example, in cement manufacturing, the amber category in the taxonomy provides a list of decarbonisation measures or retrofitting plans which should be put in place to support better energy efficiency outcomes,” the MAS added.

Lastly, the GFIT would like to get opinions on the “Do No Significant Harm (DNSH)” criteria, which state that “activities which are making a substantial contribution to climate change mitigation should not be carried out in a manner that would cause significant adverse impact to the other four environmental objectives (EO) under the taxonomy.”

“To illustrate, the construction of a hydropower generation facility may have met the thresholds and criteria to be classified as a green activity under the climate change mitigation EO. The DNSH criteria would additionally require that the construction and operation of the facility not result in a significant adverse impact on the environmental ecosystem within the vicinity of the facility, and the facility owner has to demonstrate that practical measures will be put in place to mitigate any adverse impact,” the MAS said/.

After the three consultations, GFIT will publish the final taxonomy by 1H 2023.