GWEC Advises Against Unilateral Feed-in-Tariff Changes in Taiwan

The Global Wind Energy Council (GWEC) has called on the government of Taiwan to rethink proposed changes to the Feed-in-Tariff (FiT) for offshore wind projects.

As reported earlier, Taiwan's Ministry of Economic Affairs proposed a 12.71% reduction in Feed-in-Tariffs (FiTs) for offshore wind projects that sign their Power Purchase Agreements (PPAs) in 2019 as compared to those that sign their PPAs with Taipower in 2018.

GWEC is advising the Taiwanese government to seek consensus in order to ensure that the large amounts of direct investment that companies plan can go ahead, and that the expected creation of around 20,000 jobs takes place.

“Taiwan has been widely recognised for quickly establishing its offshore industry and attracting promises of investment from a number of world-class companies in the sector,” said Ben Backwell, GWEC’s CEO.

“The government must now avoid introducing damaging and unhelpful changes to contracts to ensure that these promises materialise into long-term investments that will create tens of thousands of skilled jobs and provide clean, competitive power for Taiwan’s economy.”

Taiwan has awarded contracts for a number of major offshore wind projects under both an initial FiT scheme and later under an auction programme. GWEC points out that the highly competitive prices that companies bid in the June 2018 auction round were based on assumptions that they would be able to build up a local supply chain and economies of scale, and this requires them to be able to build the first round of FiT projects.

“Looking at the last auction prices should not lead Taiwan’s government to retrospectively change the terms for the first round of projects, which it’s worth remembering – haven’t been built yet,” said Backwell.

“It took Europe over 20 years to bring prices down to their present ultra-competitive level. If Taiwan allows developers to build the projects they have been awarded and invest in the supply chain and skills, it can create its market in less than half the time and become an economic hub for offshore wind in Asia.”