During past 150 years the use of fossil fuels has made mankind a dominating factor in the greenhouse effects, which causes CO2 concentration in the atmosphere increasing from 27 ppm to 250 ppm. This situation calls for immediate and prudent policy tools to effectively cut down the GHG emissions at the same time allowing the potential of economic development to be proceeded. It is then the main purpose of this paper to examine energy consumption by applying factor decomposition method to the end use behavior of energy demand and CO2 emission in Taiwan. The findings regarding the linkage between energy use, economic output and CO2 emission are then be modeled by an integrated MODM model, in which fuzzy theory is adopted to handle the uncertainties of the CO2 emission constraints. Policy simulations regarding energy conservation technologies as well as efficiency potentials in energy use are conducted and the effectiveness of possible policy tools are valuated.