December 16, 2018

Moea Defends Renewable Energy Plan After Control Yuan Pans Feed-in Tariff

The Ministry of Economic Affairs (MOEA) yesterday defended its renewable energy policy roadmap after the Control Yuan issued corrective measures on Friday.

The Control Yuan in a report pointed to several shortcomings in the ministry’s renewable energy development plan, saying they could hamper the nation’s long-term progress.

Critics have said that the plan was hastily put together to meet President Tsai Ing-wen’s (蔡英文) policy goal of generating 20 percent of the nation’s electricity from alternative energy sources by 2025.

The feed-in tariff (FIT) of NT$5.8498 per kilowatt-hour does not take into account the falling levelized cost of electricity generated by offshore wind farms, made possible by technological advances and economies of scale, the Control Yuan said.

Minister of Economic Affairs Shen Jong-chin (沈榮津) told a news conference in Taipei that the FIT is about NT$0.1 higher than the UK’s NT$5.7246, albeit significantly lower than Japan’s NT$9.8316.

It is also NT$3.3 higher from the NT$2.5 that was determined in an auction, he said, adding that the discrepancy was intentional and would save the nation about NT$400 billion (US$12.95 billion) in wind power purchases.

“Taiwan’s wind power FIT is within the average range of prices seen abroad,” Shen said.

The plan adheres to the law and there are no compliance issues as the Control Yuan has claimed, he added.

Regarding foreign offshore wind developers criticizing a decision to cut the FIT by 12.7 percent, Shen said that the ministry would continue to review supporting evidence presented by the firms, adding that a public hearing would be held at the end of this month.

The ministry’s tight timeline requiring seven offshore wind developers to complete 16 projects in seven years overlooks the challenges the nation faces in developing a local offshore wind energy supply chain, the Control Yuan said.

The challenges include the cultivation of talent, overcoming steep learning curves and addressing project financing risks, it said.

The burden of the government’s green energy ambitions is made heavier by the ministry’s decision to apply the FIT scheme to a majority 69.7 percent of the planned 5.5 gigawatts of wind power capacity, leaving only 30.3 percent capacity to auctions, the report said, urging the ministry to improve its policy roadmap.

The selection and assessment committees overseeing the wind projects are mostly occupied by government officials aiming to meet the government’s 2025 energy goal and they have overlooked the aspects that determine the success of wind projects, it said.

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