Taiwan thinks big on renewable energy despite naysayers
Taiwan has ambitious plans to increase the percentage of renewable energy in its energy mix and reach net-zero emissions by 20501, but is facing familiar hurdles when it comes to hitting its targets.
The government has had to delay some of its renewable energy targets due to COVID-19 disruptions, and some industry watchers have cast doubt on whether the government can deliver on its promises2.
Although Taiwan is one of the global leaders in the manufacturing of photovoltaic panels used for solar, some claim the island does not have the physical space to install the necessary solar and wind farms to meet its targets, while others claim government bureaucracy will weigh on progress.
Taiwan has ambitious targets
Either way, the clock is ticking. Between now and 2050 the world needs to move from 20% economy-wide electrification to 70%, as entire sectors transition from fossil fuels to renewably generated electricity3.
Taiwan's National Development Council (NDC) plans to reach net-zero carbon emissions by 20504, and has ambitious goals for renewable energy and hydrogen use.
In fact, in December the government revised its target for its nationally determined contribution to carbon emissions reduction, from a previous target of 20% by 2030, to '24% plus or minus 1%' 5.
Furthermore, the island plans to increase offshore wind capacity by 54x and solar capacity by 4x from current levels , to 3.1 GW (gigawatts) and 7.7 GW by 2030, respectively6. By 2050, the NDC aims for installed capacity of 40 GW–55 GW in offshore wind power and 40 GW–80 GW in solar power7. To put the 2050 solar target into context, this would require the construction of 15–30 solar farms the size of China's Golmud solar Park, the world's largest photovoltaic installation8.
Read more about China's electrification initiatives
This momentum is being driven by events globally, with the transformation of electricity grids accelerating. Already, renewables have pushed conventional fossil power stations to the back of the merit order which determines which forms of energy production are “switched on" first – when power is needed, renewable energy is increasingly at the front of the queue9.
At the same time, demand for electricity is growing, driven by recent technological improvements in end-user applications, with many electric solutions now significantly more efficient than their fossil-fuel predecessors.
Taiwan's plans are particularly ambitious because the government, unlike others in Asia, has abandoned nuclear power, and has pledged to decommission the last nuclear reactor by 202510.
With the government under pressure to bring renewable capacity on stream as quickly as possible11, this should create myriad opportunities for companies and investors.
Find out how Singapore launches initiatives to tackle heat mitigation initiatives
Electrification will create huge opportunities
According to the NDC's plans, nearly TWD 900 billion (USD 29.3 billion) will be invested in net-zero projects by 2030, with more than half being invested in electrification-related sectors renewables, power grid infrastructure and energy storage, as well as the electrification of vehicles12.
Taiwan is part of a global trend, as electrification creates huge investment capex. Between now and 2030, with the business case for generating and consuming low-cost, zero-carbon electricity becoming ever clearer, companies around the world are gearing up to deploy USD 24.5 trillion to participate in the electric economy13.
Read on about Asia-Pacific's energy storage race
Vast potential for Taiwan
With Taiwan already the world's second-largest manufacturer of photovoltaic (PV) panels used for solar power generation14, the island has a sound foundation on which to build. And the potential is vast according to GlobalData, solar PV accounted for 13% of Taiwan's total installed power generation capacity in 2021, and this will increase to 37% by 203515.
Developing similar expertise in wind and hydrogen fuel technologies will not be straight-forward. But with the government's bold no-nuclear policy increasing the pressure and urgency across the energy industry, the die has been cast. By attracting investment, nurturing talent, and building on the knowhow that already exists, the island may succeed in turning its targets into a world-leading sustainable energy industry.
1 Taiwan's Pathway to Net-Zero Emissions in 2050. Available here.
2 Taiwan's energy ambitions for 2025 not obtainable. Available here.
3 Electrifying the economy. Available here.
4 Taiwan's Pathway to Net-Zero Emissions in 2050. Available here.
5 Taiwan Details Road Map to Carbon Neutrality. Available here.
6 12 Key Strategies for Taiwan's 2050 Net-Zero Transition (Draft). Available here.
7 Taiwan Details Road Map to Carbon Neutrality. Available here.
8 Top 10: Largest Solar Power Parks. Available here.
9 Electrifying the economy. Available here.
10 Nuclear Power in Taiwan. Available here.
11 Taiwan's energy ambitions for 2025 not obtainable. Available here.
12 Taiwan's Pathway to Net-Zero Emissions in 2050. Available here.
13 Electrifying the economy. Available here.
14 Renewable energy industry in Taiwan - statistics & facts. Available here.
15 Solar PV capacity in Taiwan and major projects. Available here.
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