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Energy

Marubeni enters Taiwan renewable energy market via acquisition

Trading house invests over $100m in Chenya Energy with 270,000 kW output

Taiwan's Chenya Energy is building an offshore solar farm with an output capacity of 180,000 kW. 

TOKYO -- Marubeni will purchase a Taiwanese renewable energy company that is developing one of the world's largest offshore solar farms, seeing an opportunity in a market trying to wean itself off nuclear power.

The Japanese trading house will spend more than 10 billion yen (or over $100 million) for a 100% stake in Chenya Energy as well as its power generation facilities with a total capacity of 270,000 kW.

This marks Marubeni's first investment in renewable energy plants on the island. With Western rivals also entering Taiwan, the trader hopes to carve out a share of the market by getting involved in projects from the development stage.

Chenya Energy, located in Hsinchu City, handles everything from investment to construction to operation of solar farms. Its floating solar project in Changhua County is scheduled go operational by the end of the year with an output of 180,000 kW. Other ground and rooftop generators have a combined capacity of 90,000 kW.

Marubeni hopes to raise the ratio of renewable energy in its power-generation capacity to 20% from the current 10% by 2023. With South Korea also planning a large-scale offshore solar farm, the company hopes to build expertise and enter other Asian markets as well.

Promising to shut down all nuclear power plants by 2025, Taiwan's ruling Democratic Progressive Party is pushing for the construction of renewable energy plants. Taiwan had a power generation capacity of 5.82 million kW  from renewable sources in 2018, up 20% from 2017 and double the amount a decade ago. The government aims to raise the number to 27.42 million kW by 2025, or five times the 2018 total.

Taiwan's first commercial offshore wind farm, Formosa 1, with about 130,000 kW of output, began operating at the end of last year. A large-scale offshore wind farm generating about 380,000 kW is expected to start operation in 2021, and another with an output of about 900,000 kW in 2022.

Trading house Mitsui & Co. and JERA, a joint venture between utilities Tokyo Electric Power Co. Holdings and Chubu Electric Power have invested in Taiwan wind power plants. Danish energy company Orsted and Australian investment company Macquarie Capital also have stakes in Taiwanese renewal energy businesses.

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