The 4th Nuclear Plant and the Energy Market in Taiwan

4. Outlooks

  • Develop cleaner energies:

a) Liquefied Natural Gas (LNG)

Taiwan started importing Liquefied Natural Gas in 1990 and since then imports have been multiplied by 5. Its main use if for electricity generation (75%). The technology is not as carbon efficient as nuclear, is more expensive and poses the problem of reliable sources of supply as Taiwan had problems importing from Indonesia a couple of years ago. However, this is maybe the only available alternative to replace nuclear that wouldn’t significantly threaten the diversification of supply, and as such DPP is promoting it as part of its Nuclear-Free Island Policy, while Taipower itself is making efforts to increase the capacity.

b) Renewable Energy

KMT has passed a law in the early 2000’s that seeks to boost the use of clean energy like wind and hydropower. The share of those energy should rise to around xx% by 20xx

  • Liberation of the Energy Market

As of 2005, the Energy market has been liberalized in Taiwan, which means that Taipower is not the only energy generator anymore  -actually, there are now 8 other companies (or IPPs) generating about ¼ of the total energy in Taiwan. It is not clear to me what this is supposed to achieve and whether those companies can induce some healthy competition on the market.

IPP Taiwan Power

  • Phasing out of Nuclear?

Unlike what many people could think, as per Taipower’s sustainability reports in 2011 and 2012, the company wants to reduce the country’s dependency to nuclear and move the overall part of nuclear generation capacity from 8% of the total to 4% in 2025. Phasing out is not officially mentioned, but if its share constantly declines, why not think about a phase out?

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  • Taipower Risk Paradigm

as a summary, I add this document taken from the 2012 sustainability report that shows the risks Taipower see are most likely to occur and how important they are. I feel that this reflects my own findings when I checked the data, ie:

  • failure to reflect rising fuel costs on the end-price to customers
  • delays in the construction of new facility, especially Longmen

are the main problems the company will face.

But you can note that risks linked to employees injuries and protests are rather high as well, I don’t know to which facts this is pointing out, if it is the same low wage problem common in Taiwan or something else. Statistics otherwise show that over the last few years, the numbers of accidents in service has been higher that Taipower’s self imposed targets. My assumption is that some specific works like repairing lines after typhoons, working on nuclear facilities, etc. are highly dangerous and thus require special care from the management.

2012 Strategic Risks

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5 thoughts on “The 4th Nuclear Plant and the Energy Market in Taiwan

  1. taipeir

    Nice work! Some bits still remain unclear to me (services and oil usage?) but overall we can see it’s industry that’s the key to reducing energy use, although there’s plenty of room in residential and transport to gain efficiency.

    Reply
    1. blf_taipei Post author

      Hi taipeir, thanks for your comment! Services refers to Taipower customers who are businesses by opposition to individuals and manufaturing facilities, if I understand correctly.
      For your question on oil usage, not too sure exactly what you mean?

      All in all industry is sure an important part of the equation, and that raises questions for which I have no answer: which are the most energy demanding industries in Taiwan and how much do they contribute to the national income? Can we get a top 10 of Taipower biggest customers, for example? Also, could there be separate tariffs in electricity prices for industries and individuals?

      I have just read today an interesting poll in Tianxia Magazine stating that people seem ready to carry the consequences of their ideas and accept if necessary power cuts, then only price hikes. They would also seemingly prefer having current nuclear plants run longer rather than open the 4th nuclear plant in Longmen. http://english.cw.com.tw/article.do?action=show&id=14755

      Reply
  2. mie

    In my opinion, people should devote at least as much time to opposing coal power as they do to opposing nuclear power. Coal smoke is killing heaps of people here and causing health problems to much larger part of the people; it’s not just theoretical, like the problems with nuclear power plants.
    Taiwan even has the largest coal plant in the world, which is also the world’s largest emitter of carbon dioxide, but nobody seems to care: http://en.wikipedia.org/wiki/Taichung_Power_Plant

    Reply
    1. blf_taipei Post author

      When I looked at the documents it also became clear to me that the fantastic economic development of Taiwan comes at a cost, and that is the carbon footprint. This is why I would be in favor of degrowth and rationing of power both for individual and companies. Do you think Taiwanese people would accept that?

      Reply
  3. John Lysfjord

    Great analysis. For a next step you say “raise electricity costs and to strongly discourage polluting industries. ” How about doing both at the same time by introducing a carbon tax, like Korea have done?

    Reply

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