TAIPEI, Taiwan - The Bureau of Energy, Ministry of Economic Affairs (MOEA) this week is expected to determine this year’s offshore wind power purchasing rates; furthermore, this year as the Bureau of Energy drafts the electrical fees, due to last year’s corrections from NT$5.5 to NT$5.1 along with the threshold being set at 3,600 hours of power generation, there was actually an approximately 20% decrease, which had a major impact on local industry chains.
Currently, the Danish offshore wind power company, Orsted A/S (Orsted Ltd) offshore has also announced their controversial decision to suspend operations amid complaints that the decrease in the purchasing rate has been too excessive. The headquarters also an sent an official letter of notification to Taiwanese manufacturers stating that the contractual agreement had ceased and that negotiations would be held concerning the unfinished parts of the construction.
MOEA Minister Mr. Jong-Chin Shen pointed out that Orsted A/S has only temporarily suspended the contract and did not terminated it, and after the new purchasing prices are determined, they will continue operations. However, in actuality, when an overseas company calls for a shutdown, the victims are not limited to merely the front line of developers.
According to Industrial Development Bureau (IDB) statistics, to date a total of fourteen Taiwanese manufacturers have joined the underwater supply chain, and fifteen companies have joined the wind turbine supply chain with an initial investment amount of NT$20.9 billion.
The wind power industry supply chains can be divided into three parts: the equipment manufacturing industry, the integrated services industry, and the wind power industry. In addition, in accordance with the locations of wind turbine installations, they can also be divided into land-based turbines installed on land and offshore wind turbines installed at sea.
Of these types, for offshore wind power the local industrial chain involves a wide variety of industries including fan assembly, underwater structures, wind farm development and operation and maintenance, and finance.
From the standpoint of Taiwan, offshore wind power is a completely new technology; however, foreign countries already have over twenty-five years of comprehensive experience and industry chains. Furthermore, their experience could be of considerable assistance in upgrading the capabilities of Taiwan’s industries. Once foreign investors shout for a halt, in addition to the flow of funds, technological transfers will also cease.
(TR/ Phil Sweeney)
