Companies set up shop in Taiwan

TAIWAN: Five 500MW projects off Taiwan's north-west coast, including what could be the world's first utility-scale floating site, are just the latest ambitious proposals for the country as it prepares to launch its offshore wind sector.

Emerging offshore… Taiwan’s targets of 3GW of offshore wind and 1.2GW onshore by 2025 will be hard to meet (pic: Swancor)
Emerging offshore… Taiwan’s targets of 3GW of offshore wind and 1.2GW onshore by 2025 will be hard to meet (pic: Swancor)

Eolfi Greater China has been developing the 2.5GW portfolio, including the floating W1N site, which is due to be commissioned in 2022.

Few details have been confirmed about the other projects, but sites off Taiwan’s north-west coast have been selected and environmental assessments are being carried out.

Spain-based Cobra Concesiones has partnered with Eolfi in Taiwan and is now the majority shareholder in Eolfi Greater China, a subsidiary of the French developer, which has been active in Taiwan since 2012.

Eolfi is developing the Groix & Belle-Île floating project off the Brittany coast in north-west France, while Cobra is building the Kincardine floating project off Scotland’s north-east coast in the UK.

The joint venture is one of several positive signs for the Taiwanese offshore market. In the past few years, manufacturers and developers have opened offices, large projects have been proposed, and ambitious targets set. Analysts are taking note.

Make Consulting upgraded Taiwan’s outlook for 2020-2026 by 128% in a report in November, while two months earlier, Germany-based consultancy wind:research had named the country as one of the world’s top emerging or new markets.

Potential hurdles

But there are concerns about projects’ bankability, grid reliability and regulatory uncertainty in the country.

In November, the wind-energy committee of commercial lobbying group the European Chamber of Commerce Taiwan (ECCT) published a position paper for 2018. It highlighted the need for long-term visibility over requirements and tariffs, health and safety standards, local content rules, a market regulator to handle approvals and resolve disputes, and an incentive for developers to repower projects.

Also, as the majority of proposed projects are all situated off Taiwan’s north-west coast, adequate grid and harbour infrastructure is crucial, according to the committee.

John Eastwood, a partner at Eiger Law, which helped set up the committee, added that Taiwan’s supply chain is currently not developed enough, and that its technical expertise lagged behind that of more mature markets.

Power purchase agreements (PPAs) with state-owned energy company Taipower — the country’s sole power distributor — are another cause for concern. They are "not popular with any of the companies trying to enter the market", largely because current PPAs do not adequately address curtailment, explained Eastwood, and the agreements assume that 100% of generated power will be sold to Taipower.

Despite a lot of preparatory work being carried out over the past 18 months, Eastwood does not expect much offshore capacity to be added this year, although results should be visible by 2020.

Open for business

Siemens Gamesa and Ørsted have opened offices in Taiwan with the stated aim of helping launch the country’s offshore sector. German turbine maker Enercon also opened a branch in Taipei last year, focusing on the onshore market.

Northland Power and Singaporean partner Yushan Energy are developing 1.2GW spread across two sites off Taiwan’s coast by 2024.

Danish investment fund manager Copenhagen Infrastructure Partners acquired three projects — for a total up to 1.5GW — in the north-westerly Taiwan Strait.

Meanwhile, monopile specialist Sif and Taiwanese firm Century Wind Power have signed a letter of intent to supply foundations and potentially work together to produce monopiles and transition pieces.

And the renewables arm of international marine and engineering consultancy LOC Group has signed a memorandum of understanding with the CR Classification Society, the Taiwan Institute of Economic Research, the Taiwan Electric Research and Testing Centre, and the Electronics Testing Centre, to further develop offshore wind farms in Taiwan.

These proposals and collaborative projects are underpinned by the government setting a target of at least 3GW offshore wind and 1.2GW onshore by 2025 to help meet its renewable energy target of 20%. The country currently has just 8MW of installed offshore capacity and 682MW onshore. It sourced just 6.5% of its electricity from renewables in 2016.

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