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Ørsted Freezes Ongoing Supply Chain Contracts in Taiwan

Ørsted has suspended the execution of contracts with Taiwan Cogeneration Corporation, China Steel Corporation (CSC) and Century Iron and Steel Industrial (CISI) for the developer’s offshore wind projects in Taiwan, Taiwanese media reports.

Illustration; Photo: Ørsted (archive)

OffshoreWIND.biz has contacted Ørsted to confirm this, with the company yet to respond.

The suspended contracts were already ongoing, while for those that were set to commence later, Ørsted will renew price negotiations, according to Taiwanese media.

The move would be in line with Ørsted’s announcement from the beginning of January, when the company said it would pause and revisit its project activities, project timelines, and local supply chain commitments and contracts in Taiwan.

Ørsted’s decision to do so is a result of the changes in the feed-in tariff (FiT) and the company not receiving an establishment permit in time to sign a 2018 power purchase agreement (PPA) with Taipower for the Changhua 1 and 2a projects.

Namely, the deadline for signing the 2018 PPA was extended to 2 January, however, since Taiwan’s Bureau of Energy had not issued the establishment permit for the projects by close of business local time, it was no longer possible for Ørsted and Taipower to sign the agreement for Changhua 1 and 2a.

To remind, Ørsted signed contracts with Taiwan Cogeneration Corporation (TCC) and China Steel Corporation (CSC) in November 2018.

TCC was awarded an engineering, procurement, and construction (EPC) contract for two onshore substations, cable corridors, landfalls and transition joint bays for the first 900MW Greater Changhua projects. A wholly-owned subsidiary of China Steel Corporation (CSC), Sing Da Marine Structure Corporation (SDMS), has been contracted to supply 56 jacket foundations.