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Ministry of Economic Affairs Explains Energy Transition Pathway, Forward-Looking Green Energy Infrastructure and Stable Electricity Supply in This Summer2017-06-20

Organization: Bureau of Energy, Ministry of Economic Affairs

Confronting with rapid changes in domestic and international energy and environmental situations, Ministry of Economic Affairs (MOEA) today (16th May) explains the energy transition pathway and the short-term and long-term supporting strategies so as to lead the governments and the public to work together in reaching the 2025 nuclear-free homeland. It is aimed to increase the generation share of renewables and natural-gas to 20% and 50% respectively, and to decrease the coal-fired electricity generation share to 30%.

MOEA stated that in order to build clean energy mix and environment for sustainable energy development, the energy transition will be reached by developing zero carbon renewable energy, expanding the use of natural gas, and progressively decreasing coal-fired power. The detailed roadmap is illustrated as follows:

1. Renewable energy: The expansion in renewables installation will take technology feasibility, cost effectiveness, balanced development by stages, industrial development and acceptable influence from electricity prices fluctuations into account. The renewables pathway, in terms of electricity generation share, will be raised from 4.8% in 2016 to 9% by 2020, and will ultimately reach the goal of 20% by 2025.

2. Natural gas-fired electricity generation: The newly built or expanded natural gas power plants are installed with high efficiency combine-cycle turbines with electrical efficiency level at 62% (existing gas turbines' average efficiency is around 51%). Meanwhile, build new or expand receiving, storage and transmission facilities for liquefied natural gas (LNG) and ensure the construction and operation works can be completed as scheduled. The pathway consists of increasing share to 33% by 2020 from 32.4% in 2016, the ultimate goal is to reach 50% by 2025.

3. Coal-fired generation: To ensure electricity supply stability throughout energy transition process, coal-fired power is perceived as a critical baseload power source, a moderate level of coal-fired power will be preserved in the future energy mix. By replacing the old plants with high efficiency ultra-supercritical power plants with efficiency level of 45% (existing coal-fired plants' average efficiency is around 38%). With flexible dispatch, the coal-fired power's share will decline progressively. With the decommissioning of No.1 and No.2 nuclear power plants, the substituted capacity from the renewables and natural gas-fired generation are unable to catch up, therefore, the coal-fired power's share will be slightly surged to 50% by 2020 from 45% in 2016, while the share will decrease to less than 30% by 2025.

4. Nuclear power: The existing nuclear power plants (No.1, No.2 and No.3) will not be extended and the operation will be ceased comprehensively by 2025 according to the Article 95 of the amended Electricity Act. In addition, the retirement plan shall be proposed 3 years prior to the permanent shut down according to the Nuclear Reactor Facilities Regulation Act. In the meanwhile, the No.4 nuclear power plant was abolished so that the goal of nuclear-free homeland can be achieved by 2025.

In order to accelerate Taiwan's energy transition, MOEA has comprehensively promoted solar PV, wind power and accomplish the amendment of the Electricity Act in the past year, concrete achievements include:

1. Launch Solar PV Two-year Promotion Project: The 1.52GW PV capacity will be installed from July 2016 to June 2018, the total investment value is estimated to be NTD 91.2 billion. Mid- and long-term measures (including site selection and grid connection) will be implemented throughout this 2-year pilot project so that the interim goal of 6.5GW and long term goal of 20GW can be achieved by 2020 and 2025 respectively.

2. Promote offshore wind turbines and wind farms demonstration project: Two demonstrative turbines have been constructed by the end of October in 2016, another four will be constructed by 2017, and 3 demonstrative wind farms will be constructed by 2020. To attain the target of 3GW in the cumulative installed capacity by 2025, the 3-stage promotion strategy in the order of demonstration, potential exploration and zonal development is being adopted.

3. Accomplish the amendment of the Electricity Act: The Act, promulgated on January 26th 2017, serves as the market mechanism and legal basis for energy transition and electricity market reform. The way in which the electricity market operates is reconstructed by granting the priority access to the grid for green power and allowing wheeling and direct supply for renewables energy generation and renewables energy retailing power industries. An environment beneficial for green energy development is therefore established.

4. Accomplished the amendment of Energy Development Guideline: The amendment of the Guideline was approved in April 2017. Four major principles including "Energy Security", "Green Economy", "Environmental Sustainability" and "Social Equity" are set to guide the energy transition policy. A White Paper on Energy Transition will be formulated as a promotion mechanism of the Guideline and will be reviewed every 5 years to accelerate the implementation of energy transition.

As for electricity supply this summer, supply side measures will include continual strengthening in operation and maintenance of existing power plants, and the quality facilities renovation projects will be accomplished as scheduled, in addition, the co-generation system power supply through the increasing power supply mechanism will be promoted. Demand side measures include demand bidding and time-of-use rate so that the peak demand can be curbed.

To accelerate the sound development of green energy environment, MOEA induces resources from private sectors into green energy construction. The government also promotes Green Energy Forward-Looking Infrastructure Plan to fill the investment gap in green energy infrastructure by preparing special budget of NTD24.32 billion. Meanwhile, along with the outcomes achieved last year, the government proactively implemented the measures outlined by the energy transition policy. The goals of energy transition and nuclear-free homeland will be reached under the premise of ensuring stable electricity supply, meanwhile, the outcomes of clean, low carbon and affordable energy along with the economic growth and job opportunities brought by green energy development can be enjoyed by the public so as to realize the vision of sustainable energy development.

Spokesperson for Bureau of Energy, Ministry of Economic Affairs: Deputy Director General, Chun-Li Lee
Phone number: 02-2775-7702
Mobile: 0936-250-838

Newsletter Contact: Director, Su-Chen Weng
Phone number: 02-2775-7710
Mobile: 0910-087-942

Media Contact:
Inspector, Yu-Hsuah Hsia
Phone Number: 02-2775-7705
Mobile: 0910-668-295