Since October 2018, GWEC has been actively following and engaging with the industry and government, specifically in regards to the Taiwan offshore wind power Feed in Tariff (FiT).
The Taiwanese government has been extraordinary in planning and supporting the success of Taiwan’s offshore sector in merely two years. Taiwan is by far the most open offshore wind turbines markets in Asia, and has emerged as a great success story of how the right policy framework will create a sustainable and localised industry to benefit the economy while meeting climate goals.
While the sector is gaining traction, challenges still remain. In late 2018, the Taiwanese government proposed the following revisions to the FiT which had the industry concerned: a 12.7% reduction in the FiT rate, from 5.8498NT$/kWh to 5.106NT$/kWh; a cap on the rate of 3,600 full load hours; and the removal of the optional accelerated FiT for the first 10 years, the so-called “ladder tariff”. Combined, these changes would have reduced project revenues by 20-25 per cent, therefore making them commercially unviable.
After two months of intense policy and communications work, along with our members, developers and the wider supply chain, GWEC met up with the Taiwanese government twice to discuss the proposed changes and highlighted how such a dramatic reduction in the tariff, combined with the two new restrictions, would stall the offshore wind farm market.
We welcomed the subsequent MOEA announcement on 30 January 2019 that the new FiT tariff would be: a 5.7% reduction in the FiT rate to 5.5160NT$/kWh; a stepped cap, above 4,200 hours 75% of the rate and above 4,500 hours 50%; and the reintroduction of a revised ladder tariff with a lower rate for the first 10 years and an increased rate for the second 10 years.
As a result, it is estimated that the revenue reduction will be approximately a third of that previously proposed in 2018, and GWEC is thrilled to have played such an active role to help the industry to continue developing offshore wind farm projects in Taiwan to power the energy transition and economic development in the region.
A turning point for the industry was GWEC’s first ever Global Offshore Wind Summit – Taiwan, as both the industry and government clearly showed a positive outlook for the future of offshore wind in the region and increased willingness to work together to make these ambitions a reality. We will be holding the event once again in 2020 on the 21-23 April with an even bigger programme to address all the current challenges and opportunities that remain in Taiwan’s offshore wind market. Find out more about the Global Offshore Wind Summit – Taiwan 2020 here.