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Taiwan's renewables push hit by big tech's appetite for power

'Not in my backyard' sentiment and struggle to ditch nuclear make 20% goal hard

Taiwanese President Tsai Ing-wen makes speech at the opening ceremony of 2020 Energy Taiwan. (Photo courtesy of Energy Taiwan)

TAIPEI -- Taiwanese President Tsai Ing-wen's push to have the island generate 20% of its electricity from renewables by 2025 is running into difficulties.

Wind, solar and hydro generation accounted for just 5.2% of the island's power production in the first three quarters of 2020, underscoring the difficult task of reaching the target announced by Tsai soon after taking office in 2016.

Tsai faces other headwinds. Localities and environmentalists are pushing back on an array of projects, and the U.S.-China trade war is creating even more demand for electricity as factories bolt back to Taiwan from China.

As many as 10,000 new factories are expected to register by the end of 2020, the highest number ever.

Taiwan is also caught between large tech companies like Apple, Microsoft and Google that have committed to carbon-neutral supply chains on one side and "not in my backyard" sentiment on the other.

In July, Taiwan Semiconductor Manufacturing Co., the world's largest contract chip producer, got on board with the wishes of Silicon Valley, signing a 20-year deal with Orsted to build a wind farm off Taiwan's west coast -- described by the company as the largest green energy deal in history.

While polls show strong public support for green energy, some solar and wind projects face negative local sentiment.

This month, a court ordered the halt to construction of a solar energy farm that overlaps with wetlands, saying it fails to protect indigenous people's rights. The ruling derailed what was to be Taiwan's largest solar energy project, on a 2.26 sq. km site in the southern county of Taitung.

"Taiwan has a lot of potential to reach its goal," said Milan Chen, a fellow at Risk Society and Policy Research Center, an environmental think tank. "But it is very unlikely we will reach the goal in time."

Some of that potential includes a shallow seabed and year-round average wind speeds of over 25 km per hour in the Taiwan Strait -- some of the best conditions in Asia for offshore windmills.

Taiwan is working with international companies, including Danish power producer Orsted and German wind farm developer WPD, to construct 14 wind farms by 2025. They are slated to generate 6.9 gigawatts, and Taiwan is eyeing a further 10 gigawatts by 2035.

The reality in 2019, however, was that Taiwan imported 98% of its energy, mostly in the form of oil and coal.

This explains why some environmentalists are up in arms. Last month, green groups called on the environment minister to resign, citing air pollution in the country's central and southern areas, where many fossil fuel power plants are located.

The nuclear storage site on Lanyu Island off Taiwan's southeast coast is seen in this 2015 photo.   © AFP/Jiji

Tsai is putting on a brave face. Last month, the president told a local energy forum that renewables had grown "leaps and bounds" in the past four years and described Taiwan as a renewable energy "hot spot" tipped to generate 1 trillion New Taiwan dollars (US$35 billion) in investments and 20,000 jobs by 2025.

But the oil and coal imports are also a national security concern, observers say, and the issue is becoming more pressing as China -- which claims Taiwan as part of its sovereign territory and forbids formal recognition of it on the international stage -- ratchets up military threats against the island.

Taiwan is also pinned down on the nuclear front. Japan's Fukushima meltdowns in 2011 reignited anti-nuclear protests in Taiwan, but in 2018 a referendum rejected Tsai's commitment to decommission reactors that produce 6.3% of Taiwan's energy. The decommissioning is to take place by 2025.

"It is really difficult to phase out nuclear and achieve renewable targets at the same time," Chen told Nikkei Asia. "If you look at other countries, they don't really tackle the two together."

Some observers believe the Tsai administration fears carbon-neutral policies could spark a new push for nuclear power as a way to reach these goals.

"At one point [carbon neutrality] was a forbidden term when we talked about climate policy, but in the last few months we have seen some windows of opportunity to make it a reality," said Chao Chia-Wei, chair of the Taiwan Environment and Planning Association.

Meanwhile, demand for electricity and land has soared. Government-backed loans and rent concessions have played a role, as have the return of all those factories. And the island's hydropower production dipped this year.

Given these trends, renewables as a percentage of all energy sources are set to slightly drop this year, according to Chao.

But when reports surfaced of a planned wind farm off the coast of the northeastern city of Keelung, a major fishing port, the mayor immediately took a stand. "Don't even think about it," he said. "I'm against it."

Ground-level solar farms are also having the welcome mat pulled out from under them. Environmental groups warn that they pose risks to ecosystems and agriculture.

Greenpeace has called on the government to carry out thorough ecological and societal assessments and to alternatively incentivize rooftop solar cells.

"The Taiwanese government needs to develop more feasible and eco-friendly policies to facilitate renewable energy development if it really wants to achieve its goal," Alynne Tsai, Greenpeace East Asia campaign specialist, told Nikkei Asia.

There are also calls for Taiwan to find an alternative route to go green.

Sun-han Hung, a lawmaker and member of Tsai's Democratic Progressive Party, this month called for a new climate change law based on a 2050 net-zero carbon target, arguing the approach could include carbon pricing and tactics to reduce greenhouse gas emissions.

"A climate change law will be the key for both our national development and diplomacy," Hung said, explaining that a target more in line with international norms could boost Taiwan's legitimacy on the world stage. "This law will create greater space for Taiwan internationally and set Taiwan's important position in climate diplomacy."

By way of comparison, Taiwan's neighbors Japan and South Korea have pledged to go carbon neutral by 2050, while China is shooting for 2060.

On Tuesday, Japanese Environment Minister Shinjiro Koizumi proposed increasing renewable power sources to more than 40% of the nation's energy mix by fiscal 2030, about twice the government's current goal.

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