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Taiwan

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Policy for Promoting Renewable Energy

in Taiwan經濟部能源局

Bureau of Energy

Policy for Promoting Renewable Energy &

Current Status in Taiwan

March 2013

Bureau of Energy

Ministry of Economic Affairs, Taiwan

Taiwan




Bureau of Energy

Outline

• Renewable Energy targets under the “New Energy Policy Framework”

• Current Development of Renewables

• Renewable Energy Development Act

• Million Solar Rooftop PVs project

• Thousand Wind Turbines Project

• Off-Shore Wind Power Demonstration Program

• Concluding Remarks

Taiwan




Bureau of Energy

RE targets under the “New Energy Policy Framework”

Due to the geographical environment and natural resource limitations, The renewable energy with matured technology and low power generation costswill have priority in government development policy. Moreover, the authorities will encourage the industry players to consolidate their R&D and manufacturing capabilities. Thus, Taiwan can be one of the Green Power Supplying countries.

I. Target Expansion and Overall Development Strategy

II. Target of the Promotion of Renewable Energy

According to the “Renewable Energy Development Act”, the target of renewable energy installation shall increase up to 6,500~10,000 MW for 20 years. To correspond with the upcoming goals for GHG reduction, energy diversification, and renewable energy expansion, the renewable energy installation target is revised to reach 9,952MW by 2025, and 12,502MW

by 2030. In other words, more aggressive targets are set for developing

renewable energy in Taiwan.

Taiwan




Bureau of Energy

Energy Source 2012 2015 2020 2025 2030

On-shore Wind 621 866 1,200 1,200 1,200

Off-shore Wind 0 15 600 1,800 3,000

Hydro Power 2,060 2,052 2,112 2,502 2,502

Solar PV 201 492 1,020 2,500 3,100

Geothermal 0 4 66 150 200

Biogas 9 29 29 31 31

Waste to Energy 792 848 925 1,369 1,369

Ocean Energy 0 1 30 200 600

H2&Fuel Cells 0 7 60 200 500

Total 3,683 4,314 6,042 9,952 12,502

Percentage ofinstalled capacity

7.7% 10.0% 10.6% 14.8% 16.1%

Aggressive Installation capacity Targets (MW)

To prompt the solar PV and off-shore wind power, Taiwan also approved the “Million Solar Rooftop PVs” and “Thousand Wind Turbines” promotion projects. The goals will be to reach the installing of 3,100 MW of PV systems and 1,000 wind turbines ( including 450 on-shore and 600 off-shore wind turbines) by 2030.

Taiwan




Bureau of Energy

Current Development of Renewables (1/3)

� Conventional Hydropower

• Total hydro power capacity of 2,081.3 MW, of which the Public utilities

(Taipower) accounted for 98% of large hydro power plants (2,042.2 MW),

privately owned 39.1 MW only

� Wind Power

• Total wind power capacity of 621.1 MW, 314 wind turbines being erected.

Tao-Yuan: 30 MW Chuntung, Penhu: 4.8 MW

Taiwan




Bureau of Energy

� PV: 206.4 MWp installed

• Bureau of Energy, MOEA funds many ongoing deployment programs：

Solar City, Solar Top, Solar Campus, Emergency Systems in Remote Areas

or Isolated Islands, Demo Farms, Solar Communities, Bidding Procedure of

Solar Power Equipment, etc.

• Completed prior to RES Act: 11 MW

• Commissioned after RES Act: 185 MW

• Installed by Taiwan Power Company: 10.4 MW

BIPV demonstration system The Main Stadium of The World Games 2009 Kaohsiung: 1 MW

206.4 MWp


Taiwan




Bureau of Energy

� Biomass power: 801.1 MW

• Municipal Solid Waste Incineration: 624.4 MW (25 plants)

• Biogas: 9.1 MW (4 landfills)

• Waste from Industries and Agriculture: 167.5 MW

• Annual Generation: 4.7 TWh

� Solar Water Heaters

• 226 million m2 of heat collectors installed, effective households penetration

rate3.63% (around 300 thousand households)

• Ranked No. 5 globally for installed density (land area based)

• Annual Energy Production: 153 million litres oil equivalent

� Biofuels

• Biodiesel: Mandatory B1 since July 2008, B2 on June 2010

• Bioethanol: E3 Gasohol Programme in Taipei and Kaohsiung Cities

• Annual Consumption: 100 thousand kilolitres of biodiesel, over 4 thousand

kilolitres of bioethanol.


Taiwan




Bureau of Energy

The 23 Provisions of the Renewable Energy Development

Renewable Energy Development Act in Taiwan

Promulgated on July 8, 2009

FeedFeed--in in

TariffTariff

RatesRates

FundFund

EstablishmentEstablishment

DevelopmentDevelopment

Target Target

LandLand--useuse

LimitationsLimitations

DemonstrationDemonstration

GrantsGrants

Grid ConnectionGrid Connection

AndAnd

PowerPower

PurchasingPurchasing

ObligationsObligations

Renewable Renewable

Energy Energy

DevelopmentDevelopment

ActAct

Taiwan




Bureau of Energy An Overview of the Act

Solar water heating, biomass, and other renewable t hermal technologies

Grants for Thermal Utilization

Target Increase of renewable energy power capacity by 6.5 GW to 10 GW

Tariff Payment Duration 20 years

Targeted Technologies

Solar energy, biomass energy, geothermal energy, oc ean power, wind power, hydropower, waste to energy, excluding non-r iver-stream based hydro power and direct incinerating technologies

Power Purchase Mandatory grid connection and power-purchasing obli gations

Tariff Setting Method

1. The Tariff Committee with 17~21 members is consi sted of related Ministries, scholars and experts, and other groups.

2. Tariffs are reviewed and adjusted by the Committ ee annually.3. The Committee decides tariffs for different rene wables categories.

Financing Scheme

1.Financed by Renewable Energy Fund with revenues c ollected from power generators using fossil fuels and nuclear ene rgy

2.The government allocating extra funding from the national budget3.Other funding sources including the Petroleum Fun d and agricultural

development funds

Supplementary Measures

1. Capital grants and Demonstration grants2. Exemptions of import tax, various licensing and land-use

requirements 3. Dispute mediation mechanism

Taiwan




Bureau of Energy

․․․․Budget Source

Power utilities and operators of self-usage power generation

equipments that reach a certain level of capacity shall pay,

according to the non-renewable energy portion in ones’

total power generation, a certain amount annually to the Fund

․․․․Usage

Subsidies to renewable electricity price, renewable energy

equipment and renewable energy demonstration, and the

promotion of application

Renewable Energy Development Fund

Taiwan




Bureau of Energy

Mechanism of RE Development Fund

Fund

Subsidies to

renewable

electricity price

Purchase of elec.

Subsidies to the expense of

purchasing of renewable

energy equipment

Flow of Elec.

Flow of Fund

TaipowerPower users

Added

Traditional

electricity

Renewable

electricity

Installer of

renewable

energy power

generation equipment

Payment

Payment

Payment

Indepen-

dent Power

Producers,

IPPs

Generating

electricity

using non-

renewablesInstallers of self-usage

power generation

equipment that reaches a

certain level of capacity

Fund

Subsidies to

renewable

electricity price

Purchase of elec.

Subsidies to the expense of

purchasing of renewable

energy equipment

Flow of Elec.

Flow of Fund

Flow of Elec.

Flow of Fund

TaipowerPower users

Added

Traditional

electricity

Renewable

electricity

Installer of

renewable

energy power

generation equipment

Payment

Payment

Payment

Indepen-

dent Power

Producers,

IPPs

Generating

electricity

using non-

renewablesInstallers of self-usage

power generation

equipment that reaches a

certain level of capacity

Income based on expected expenses to balance revenue and expenditure

Taiwan




Bureau of Energy

Mechanism of Feed-in tariffs

• Tariffs and formula should be reviewed annually by referring to

technical advancement, cost variation, goal achievement status,

etc. � no degression system in place

• Tariffs shall not be lower than the average cost for fossil-fired

power of domestic power utilities.

• Current, only Solar PV tariff rates are set on date when generating

equipment installations are completed. Other technologies have

tariff rates set on the Power Purchasing Agreement (PPA) signing

date.�� applied for 20 years

• BOE announces PV capacity quota every year. PV systems > 30 kW are subject to a bidding procedure to decide tariffs.

Developers proposing higher discount rates get the priority to get

the quota.

Taiwan




Bureau of Energy

8.5007

9.7379

9.6600

8.5007

16.5652

8.5007

19.1814

9.0545 (with LVRT)

25.3662

20.6124

21.8393

24.5386

26.0110

28.9555

period 1

2013 Tariff Rates (US¢/kWh)

19.3855

20.6124

23.8024

25.2748

28.2193

period 2

8.0352

9.7379

9.3086

8.0352

16.5652

8.0352

19.1814

9.1128 (with LVRT)

25.3662

23.8024

25.2748

28.2193

29.4462

32.6362

period 1

2012 Tariff Rates (US¢/kWh)

23.3117

24.7838

27.4831

28.7100

31.9000

period 2 period 2period 1

5.79%----Others

0.00%----RDF

3.77%--With biogas eqip.

5.79%--No biogas eqip.Biomass

0.00%----Geothermal

5.79%--Stream-Type Hydropower

0.00%--Offshore

-0.64%≧≧≧≧ 10

0.00%≧≧≧≧ 1 ~ < 10Onshore

Wind Power

-16.84%-13.40%≧≧≧≧1Ground type

-16.83%-13.59%≧≧≧≧ 500

-13.39%-13.04%≧≧≧≧ 100 ~ < 500

-11.97%-11.67%≧≧≧≧ 10 ~ < 100

-11.54%-11.28%≧≧≧≧1 ~ <10

Roof typePV

VariationCapacity (kW)

TypeItem

• Applied for 20 years to electricity from renewables (except PV) whose owner signs PPA with

power utility from 1 Jan. 2013 to 31 Dec. 2013

FIT for Renewables (2013)

* Exchange rate: USD 1 = NTD 29

Taiwan




Bureau of EnergyFIT Variations in Recent Years

2.3302

2.8240

2.6995

anaerobic digestion

4.8039

2.3302

5.5626

2.6427 (with LVRT)

7.3562

6.9027

7.3297

8.1836

8.5394

9.4645

period 1

2012 Tariff Rates (NTD/kWh)

2.3302

without anaerobic digestion

6.7604

7.1873

7.9701

8.3259

9.2510

period 2RES Type Differentia-

tionBrackets (kW)


2011 Tariff Rates

(NTD/kWh)


period 1 period 2

Solar PV

Roof Mounted

1~<1011.1883*

(equivalent to 14.6030 without receiving

capital grants)10.3185 8.3971 8.1836

10~<10012.9722

9.1799 7.5432 7.3297

100~<500 8.8241 7.1162 6.9027

≧≧≧≧50011.1190

7.9701 6.3334 5.9776

Ground Single Bracket 7.3297 5.9776 5.6218

WindOn-shore

1~<10 7.2714 7.3562 7.3562

≧≧≧≧10** 2.3834 2.6574 2.6258 (with LVRT)

Off-shore - 4.1982 5.5626 5.5626

Stream Hydro -- Single

Bracket 2.0615 2.1821 2.4652

Geother-mal -- Single

Bracket 5.1838 4.8039 4.8039

Biomass -- Single Bracket 2.0615 2.1821

anaerobic digestion

without anaerobic digestion

2.8014 2.4652

Waste -- Single Bracket 2.0879 2.6875 2.8240

Others -- Single Bracket 2.0615 2.1821 2.4652

* 1 kW~10 kW Solar PV Installations in 2010 were qualified for 50k NTD/KW Capital Grant, which was terminated in 2011.

** Tariffs for those without LVRT installed are NTD 2.6138/ kWh in 2011, NTD 2.5971/kWh in 2012 and NTD 2.5924/kWh in 2013.

Taiwan




Bureau of Energy

14

Million Solar Rooftop PVs project (1/2)

I. Solar Energy Potential

Goal : 3,100 MW developed by 2030

A. Roof-top (3,000 MW)

B. Ground (100 MW)Constrained by agricultural regulations (EPA released in 2008.12), considering

contaminated soil a 60% building coverage rate, the installed capacity could reach

100MW.

14

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Year

Acc

umul

ated

Cap

acity

(M

W)

2000 203020252020201520112008

2011,70 MW，followed by annual increase by 5 MW/yr

2016,100 MW，followed by annual increase of 10 MW/yr

2021,200 MW installed，followed by annual increase of 50 MW/yr；Polluted agricultural land open for new installations

Target Achieved

� The Feed-in Tariff as a strategy to achieve annual targets for roof-top and ground installations

II. Strategy－－－－First slow then fast/ incentivizing roof-tops prior to ground installations

Taiwan




Bureau of Energy

• Encouraging participation from local governments

� Except for FIT, some local governments (e.g. Kaohsiung City) granting extra capital

subsidies

� Encouraging public buildings and constructions equipped with PV

� BOE considering the provision of subsidies to local governments to encouraging

proposals for promotion programs

� BOE assisting local governments on Solar Roof-top Program and Solar Community

Program to facilitate public participation

• Establishment of PV-ESCO mechanism

� Encouraging banks to participate in project financing and to provide soft loans to PV-

ESCO players

� Capacity of projects required to participate in bidding process considered to be raised

from 10 kW to 30 kW to encourage PV-ESCO

Million Solar Rooftop PVs project (2/2)

Taiwan




Bureau of Energy

Thousand Wind Turbines Project

A. On-shore ：：：：Potential ~ 9,000 MW1,200 MW installed by 2020

B. Off-shore ：：：：Potential ~ 48,000 MW3,000 MW installed by 2030

I. Wind Power Generation Potentials

II. Strategy －－－－Develop on- shore prior to off-shore wind farms

A. On-shore ：：：：develop areas with higher power generating potentia ls prior to 2015, then develop areas with less potenti al thereafter.Develop 564 MW in the initial phase,and complete another 270 MW by 2015,which amounts to a total of 800 MW；for areas with less potential, develop 400 MW following the years after 2015. 1,200 MW on-shore windinstalled capacity will be reached by 2020.

B. Off-shore ：：：：develop among the shallow areas prior 2020 then dev elopin deep water off-shore areas.• Establish the first off-shore wind farm by 2015, and reach 600 MW installed

capacity on shallow off-shore areas (approximately 120 turbines) by 2020.• Develop large wind-farms in areas possessing economic scalability between

2021-2030 (reaching 2,400 MW, which is approximately 480 wind turbines in 10 years)

Taiwan




Bureau of Energy

12海浬經濟海域

海浬經濟海域

海浬經濟海域

海浬經濟海域

台海中線

台海中線

台海中線

台海中線

� Water deep 5-20 m (shallow sea)�About 177,920 hectare�About 9 GW in potential

• 1.2 GW exploitable (13% development)

� Water deep 20-50 m (deep sea)�About 654,700 hectare�About 48 GW in potential

• 6.2 GW developable (13% development)

� Water deep 50-100 m (deeper sea)�About 1,195,400 hectare�About 90 GW in potential

• 9 GW developable (10% development)※ The wind power device of 3 MW is estimated by 4Dx10D wind farm within the boundary of

12 nm territorial sea (D: the diameter of the blade 100 m).

1.The development potential of offshore wind power is estimated more than 15 GW with the market incentive and large scale development opportunity.

Offshore Wind Potential

Source: Green Energy & Environment Research Lab./ITRI (Apr. 2011)

Off-Shore Wind Power Demonstration Program

Taiwan




Bureau of Energy

�� Incentive amountThe incentives include “demonstration incentive” and “development incentive”.

(1)Demonstration incentive :• The upper limit: shall not exceed 50% of the total cost of demonstration

device set up.• To avoid double rewards, the subsidy of this part m ust be returned by

receiving lower FIT until the subsidy is totally re turned.

(2)Development incentive:

• The limit is NT$ 250 million. This part of subsidy is in full reward and won’t be returned. However the technical and c ost information shall be put into public as future reference for th e review of FIT.

Taiwan




Bureau of Energy

�� Demonstration wind farm: in the ocean of 5 m isobat hs or deeper, with total capacity above 100 MW but not exceeding 200 MW.

�� Demonstration devices: 2 offshore wind power system s of single capacityabove 3 MW

�� Complete 1 offshore meteorological observation towe r and the application of ecological environmental investigation; complete basic, structural,parallel construction test, business operation, and maintenance.

Demonstration wind farm: depth ≧≧≧≧ 5 m；；；；total scale ≧≧≧≧ 100 MW and ≦≦≦≦200 MW

Demonstration devices

2 devices ≧≧≧≧ 3 MW

Offshore meteorological observation tower: depth ≧≧≧≧ 10 m；；；；height ≧≧≧≧ 75 m

ecological investigation and

environmental evaluation

Taiwan




Bureau of Energy

Concluding Remarks

• The promulgation of Renewable Energy Development Act and related regulations has paved the way for a sustainable long-

term development of renewables in Taiwan.

• Various kinds of incentives have been issued to encourage the

investment in renewables in Taiwan.

• The development of renewable energy is expected to be

prosperous in Taiwan.

• Taiwan’s government will devote itself for the continuous

growth of renewable energy.

Taiwan




Bureau of Energy

Thank you for your attention

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