Check out how offshore wind in Taiwan has developed

Taiwan is an island that highly relies on import energy to sustain the power supply of the country.

Nuclear power was one of the solutions to be pursued to resolve the high dependency of the country to fossil-fired power but the government has been facing the public opinion to adjust the energy policy after the Fukushima incident.

Since the faith of the public towards nuclear power has been shattered, renewable energy has now become the new hope of the country towards the new low-carbon and less-import-dependency energy portfolio for next decades.

Among the renewables, wind and solar energy are considered to be the first-tier resources to be utilized on the island and offshore wind is regarded as one of the most attractive ones to be developed since the potential capacity is estimated to be at least 6-10GW in the Taiwan Strait and it is successfully operating in Europe.

The attractive potential of offshore wind has given the island a good opportunity to increase the portion of renewable energy in power supply and also to develop the local supply chain by growing it along with on-going offshore wind farm developments, which is expected to bring positive effect on both the economy and the environment.

To do so, the government mandated to realize 600MW offshore wind installation by 2020, and some 3000MW offshore wind energy by 2025.

Thus, having the first offshore wind farm has become the prior mission of the country to carry the plan forward.

In terms of the policy, the Renewable Energy Act (REA) which was promulgated in 2009 supports offshore wind development by providing the developers with a 20-year off-taking PPA mechanism together with the feed-in-tariff (FiT).

For 2013, the FiT is set at the level of NTD 5.5626/kWh (approximately USD 18.8 cents/kWh) and the government aims to remain at this level before large-scale deployment to spur the future development.

Apart from the implementation of the REA, the government has also announced a Government Grant Scheme (The Incentive Program of Offshore Wind Power Demonstration System) for demonstration projects by awarding two winners to speed up the deployment of the first offshore wind farm in Taiwan.

The two winners will be granted with a USD 8 million subsidy for the development costs of the 2-turbine pilot project and a 100-200MW demonstration wind farm and an interest free financing for up-to about USD 5,300/kW (NTD 159,000/kW) for the CAPEX of the 2-turbine pilot.

By providing the financial supports, the government targets to have the first 2-turbine pilot installed before the end of 2015 and the 100-200MW demonstration wind farm by the end of 2020, and at the same time bring synergy to local supply chains to pursue the business opportunity for up to NTD 500 billion (USD 16.7 billion) by 2025.

To date, the government pledges to develop more renewable energy via promoting the plan of “Thousand Wind Turbine Promotion Program” with the implementation of the Government Grant Scheme.

Towards the development of the offshore wind installation and other renewable energy, not only the public but also other potential stakeholders are looking forward to seeing the new chapter open.

To realize the target for installed capacity and business opportunity, how the government establish supporting measures and enhance the coordination among the related government agencies to remove the regulatory obstacles would then be crucial for renewable energy development on top of those incentive policies have been implemented.