As demand for energy storage systems and EVs rises, the battery industry continues to grow. Like many other countries, Taiwan is trying to localize battery production while facing costs, production, and other challenges.
According to estimates from research firm InfoLink, Taiwan's battery energy storage capacity will achieve 20GWh in 2030 with a market value of NT$200 billion (US$6.2 billion). The rise of the segment came from the government's support. The Taiwanese government plans to invest over NT$76 billion in renewable energies to improve power grid resilience.
China, Japan, and South Korea have been fostering their lithium battery industries through policies. The three countries also hold most of the world's battery capacity and technologies. However, governments worldwide have been localizing battery production due to increasing demand and geopolitics.
Taiwan has seen multiple energy storage projects recently. Taiwan Cement's 100MW E-dReg energy storage system has been completed and integrated into the country's power grid. Tatung Company is expected to finish a 100MV energy storage system by the end of 2023. J&V Energy Technology and HD Renewable Technology are also constructing energy storage plants.
Most energy storage plants use battery cells from China, South Korea, and other countries. Big Taiwanese battery makers like Taiwan Cement, Formosa Smart Energy, and Foxconn are still constructing their production plants. In addition, most Taiwan-based battery manufacturers have limited production capacity. Their products are more expensive compared to large international players.
Safety is another factor that companies will consider when purchasing batteries for energy storage systems. Sources said China and South Korea-based battery companies have already established their reputations, and their products will consequently see higher adoption rates. However, some companies have started using Taiwan-made batteries due to national security concerns. Industry sources indicated that the adoption of locally-made batteries will grow as more production facilities in Taiwan are commissioned.
