Taiwan needs to raise its power reserves to cope with its booming manufacturing sector, its economic affairs ministry said. But recent setbacks to Taipei's efforts to increase power generation from non-coal sources mean the government may have to fill the energy shortfall through coal-fired generation.
Taiwan's power reserves are around 15pc of its installed capacity, which is lower than Singapore's 30pc and below the average of 20pc in many other countries, economic affairs minister Wang Mei-hua said. Taiwan has been rapidly expanding its semiconductor chip manufacturing sector to cope with global shortages. Ensuring adequate and stable electricity supplies is critical in sustaining the island's economy, she said.
But Taiwan's efforts to reduce its reliance on coal-fired generation have been met with multiple setbacks. Public dissent over a government-backed LNG project near an algae reef has gathered momentum amid environmental concerns and raising nuclear capacity has been ruled out by the government. Taiwan's worst drought in 56 years pushed hydropower output in 2020 to its lowest in at least six years, and there are no signs that the dry weather will abate any time soon.
Taiwan may need to rely on thermal coal to meet its energy shortfalls if the LNG project falls through, the ministry said.
But there are obstacles to overcome if Taiwan is to raise its coal-fired output. Taiwanese state-owned utility Taipower is facing uncertainty over whether it can keep four of its 10 coal-fired units in Taichung operational for reserve capacity following a challenge by the local government. It is uncertain if Taiwan's central government will push for Taipower's Taichung coal-fired units to raise output or allocate the tasks to other regions.
Taichung is one of the most polluted cities in Taiwan because it hosts one of the world's largest coal-fired power plants, putting pressure on mayor Lu Shiow-yen to push Taipower to cut back on coal-fired generation. Taiwan's parliament in January passed a resolution to decommission the 5.5GW Taichung coal-fired power plant by 2035.
